Five New Rules To Follow When Purchasing A Home In This Current Red-hot Market

 The COVID-19 pandemic played a large part in the current strong housing market. Bidding wars have been predominant for the past year and a half. Now that the interest rates are starting to rise, the competition is getting even stronger. Here are five new rules to follow when buying a home in 2022.

1. Lock in a mortgage before you start your search

In the past, homebuyers would find a home and then get pre-approved. This is not the case in 2022 because of the strong demand. This fast-paced market makes it essential to get pre-approved before you start the homes search process.

“You should be pre-approved by a lender and knowledgeable about your finances before you even begin your home search,” says Beverly Burris, an agent with William Means Real Estate in Charleston, SC. “With houses going under contract as quickly as they are right now, often within days or sometimes hours of going to market, there is no sense in going to see a property before speaking to a lender and learning what you can afford.”

2. Shop for homes priced below what you can afford

Once you get pre-approved you then know how much you can afford. Homebuyers in the past have purchased a home on the high end of their mortgage approval and that resulted in a recession. Today, homebuyers are encouraged to purchase a home below the top of their price range.

“These days, houses are selling for more than their list price and, as a buyer, you’re more than likely going to end up in a bidding war,” Lori Ozley, a manager with Birmingham HomeBuyers explains. “If you look at properties that are under your budget, you’ll have room to submit a competitive offer that goes above the asking price.”

3. If you love a property, act fast

Purchasing a home is a big deal so most homebuyers want to think on it before they make the big leap. Today's market does not afford homebuyers this luxury.

“If you are interested in a property, you must act quickly or you risk losing out to another offer. When you really like a property, you should sit down with your real estate agent, go through the comp research, and work on putting together an offer the very same day,” says Bill Samuel, the agent and investor behind Blue Ladder Development.

4. Put your big number out there from the start

When it comes to purchasing property, negotiations have always been part of the process. This is not the case today in this hot market. Homebuyers need to put their best offer forward at first.

“Be prepared to make your best and final offer from the beginning,” advises Jodi Dougherty, a luxury broker at Downtown Realty Company in Chicago. “Since sellers often receive multiple full-price offers, you may not get an opportunity to counteroffer if you come in too low.”

5. It will probably take multiple tries before you succeed

Don't give up, there are tons of other homebuyers looking at the same homes in the same market. It might take more than once to put your best foot forward and have your offer accepted.

‘You can almost plan on having several offers not go through before one is accepted,” explains Brian Chinn, leader of the Brian Chinn Team at Newberry Real Estate in Tyler, TX. “While that isn’t always the case, it happens more often than not in this market.”

If you are interested in purchasing a new home, contact a Realtor who can help you through the process. “It’s easy to get frustrated,” Chinn adds, “but having patience is key.”

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Tips On Improving Your Indoor Air Quality

 When it comes to the air in your home, it has become more important now than ever in this day in age. The COVID-19 pandemic kept the country indoors and in their homes a lot within the past couple of years. In the past, air pollution has been focused on the outdoor air quality but with the past stay-in-door orders, this has also brought our home's air quality into the equation.

Our indoor air quality can affect our health and our well-being. Bad indoor air quality leads to colds, the flu, asthma allergies, impaired sleep and concentration, sluggish productivity, mood disorders and health problems.

Professionals in the industry report that more than half of the homes in the country do not have correct ventilation which leads to poor indoor quality. Surprisingly, indoor air pollutants can be found in your home's paint, furniture, carpets and cleaning products.

“Understanding the sources and, more importantly, controlling the causes behind common indoor pollutants can help to protect the health of your family, and one of your most important investments — your home,” says Scott Rasmussen, president of Quality Edge.

Below are some tips on how you can improve your indoor environment at home to help with indoor air quality.

Proper Ventilation Is Crucial for Clean Air

While your home does need to be weatherproofed, it still needs to be able to breathe. Proper ventilation is imperative for this and helps alleviate those indoor pollutants.

“Inadequate ventilation can increase indoor pollutant levels by not bringing in enough outdoor air to dilute emissions from indoor sources, and by not carrying indoor air pollutants out,” Rasmussen says. He adds that proper ventilation is crucial for clean air.

Your attic is one of the first places you should start. A home's attic needs continuous ventilation. An attic with no airflow causes mold, growth, mildew and rot. Make sure the ventilation at the eave edge can bring fresh air in through the roof exhaust vents.

If this is a concern for you and your home, you might want to consider investing in a high-performance roof ventilation system. This kind of system will do its job well but is architectural pleasing to the eye and will not stand out and ruin your home's curb appeal.

Extend the Life of Your Home

A new roof with an adequate roof ventilation system will help do this. As a homeowner, you will be able to avoid costly repairs due to mold, rotten wood or odor buildup with this system.

Another way to extend the life of your home is to add vented soffit products that will not only help with the health of your home but will add to your home's curb appeal. These products do this by elevating the look of your house's exterior.

“Replacing your soffit also presents a great opportunity to update your home’s trim colors,” Rasmussen says.

Prevent Leaks

A home's exterior siding can prevent water leaks. These leaks will seep into your home's interior causing moisture damage and mold. Professionals suggest a moisture-wicking siding should be used on a new home or added to a remodel.

If you cannot afford to replace your current siding, then a regular maintenance check-up is suggested. Look for cracks that can be scaled up to help prevent any water leaks.

Other Steps to Take

There are many simple things you can do to your existing home that will help with air quality. Make sure to clean and dust regularly which will minimize indoor air pollutants. Also regularly check your HVAC system and replace their filters several times a year.

Remember the quality of the air in your home does not only affect those that live in the house but extends the health and life of the home itself. “High temperature and humidity levels in your attic spaces due to inadequate ventilation can increase your energy costs, reduce the effectiveness of your home’s insulation, cause premature aging of your home’s building materials and void your home’s roof warranty,” Rasmussen says.

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Tips To Follow When Purchasing a Home in the Current Market

While today's housing market is not in the buyer's favor, people are still purchasing homes. Most potential buyers will need a mortgage and there are many steps to this process. When deciding if this step is right for you, take into consideration the following things regarding the process.

Now may still be a good time to buy a home

This is a personal decision, there is no right or wrong time to purchase a home in general. Whether a buyer's market or a seller's market you should take the leap when it makes the best sense in your life. Ann Thomspon, with Bank of America, says that consumers will always want to purchase a home and need to purchase a home.

Especially with the changes we have seen in the last year due to COVID-19, our home has become our live, work and play space. People have placed a greater emphasis on the value of a home.

“A second bedroom that can be used as a home office, or an outdoor space, are now more desired, prompting many people to move or buy for the first time,” says Rick Rudman, CEO at Curbio, a home renovation technology company.

Get pre-approved ASAP

The first step before even looking at listings is to see how much home you can afford. Pre-approval is the first step to let you know what you can afford and to prove to others that you are financially able.

In the current seller's market, a buyer needs to prove to agents and sellers that they are serious. “These days, in some markets, you need a pre-approval just to start looking at homes,” says Ann Thompson, retail sales executive of the West with Bank of America.

Prepare for bidding wars ahead of time

A seller's market means bidding wars are inevitable. The record-low mortgage rates coupled with low inventory is causing a panic among buyers. Sellers are entertaining multiple offers, many receiving multiple all-cash offers.

“Potential buyers now should prepare themselves by discussing, with their real estate agent, how much a home is worth beforehand, so that they can go into a bidding war with the strongest offer tactics, while also knowing when to back away if the price escalates,” says Thompson.

Understand appraisal gaps

With bidding wars comes bids over the asking price. These high bids cause appraisal gaps. An appraisal gap is a disparity between the offer you put on a property and what the property is deemed to be worth by a lender.  Even if you are approved for $350,000 and you offer $350,000 on a $300,000 listing price that doesn't mean the lender will give you the full $350,000 on the home. If the appraisal comes in at $300,000, you will have to come up with the $50,000 out of pocket.

“In this market, we are seeing a lot of appraisal gaps being written into contracts. Please be sure to understand how that works before agreeing to it,” says Shanon Schinkel, branch manager and mortgage lender at HomeTown. “Also, check with your lender before agreeing to it. Using that money for an appraisal gap can change your ability to qualify.”

Keep track of changing rates and terms

Today's mortgage rates are beginning to rise and the historical low rates we have seen in the last year will be a thing of the past. Schinkel reports that over the last six weeks, the rates have crept up. You will want to keep track of where the rates are and where they will be going during your home buying process. Shop around for rates and terms for the best deal.

Research down payment assistance programs

This market is hard for buyers but especially challenging for new home buyers. Down payment assistant programs can help. There are programs offered through government organizations and private agencies. You will want to research all of these avenues to see if you are eligible.

“There is a shortage of houses in many markets. This is creating bidding wars, offers over asking, and appraisal gaps—houses are going quickly,” says Schinkel. “But there are still many great opportunities if you’re patient and have a great real estate agent and lender.”

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Spring A Great Time To Sell A Home

Photo by Andre Furtado from Pexels

 

Spring brings new flowers, animals, and warm sun. Many say that spring is the time for changes. The housing market also sees a rise in home sales during this time. Here are five reasons why springtime is the best time to sell.

1. There's high demand from homebuyers.

Showingtime, an app that tracks showings on homes, reported that buyer showings are up 51.5% from this time last year. The housing market is hot and buyer demand is strong.

“As anticipated, demand for real estate remains elevated and continues to be affected by low levels of inventory…On average, each home is getting 50 percent or more requests this year compared to January of last year. As we head into the busy season, it’s likely we’ll push into even more extreme territory until the supply starts catching up with demand,” says Daniil Cherkasskiy, Chief Analytics Officer at ShowingTime.

2. There aren't enough houses for sale.

Inventory is on a record low, and buyers are high on demand. “Nationally, the inventory of homes for sale in February decreased by 48.6% over the past year, a higher rate of decline compared to the 42.6% drop in January. This amounted to 496,000 fewer homes for sale compared to February of last year,” reported Realtor.com.

According to the National Association of Realtors (NAR) "sales are skyrocketing" and the existing inventory is "continuing to drop dramatically". The average house is only staying on the market for only 21 days.

3. You have a lot of leverage in today's market.

Low inventory and tons of buyers make this a seller's market. The seller currently has the upper hand in the market and can negotiate the best deals. NAR reports that bidding wars have increased on average by 3.7 offers per house.

4. It's a great way to use your home equity.

CoreLogic reported that the average homeowner gained $17,000 in equity over the past year, and that number continues to grow as home values appreciate, in the third quarter of 2020. During this market, homeowners will find that they have a lot of equity in their homes. Equity is a type of forced savings that grow during your time as a homeowner and can be put toward bigger goals like buying your next dream home.

“As homeowners gain equity in their homes, they are more likely to consider using that equity to purchase a larger or more attractive home – the wealth effect of rising equity. In today’s housing market, fast-rising demand against the limited supply of homes for sale has resulted in continued house price appreciation,” says Mark Fleming, Chief Economist at First American.

5. It's a chance to find a home that meets your needs.

The COVID-19 pandemic has changed the way homeowners see and live in their homes. The stay-at-home orders meant spending a lot of time at home. This extra time at home caused homeowners to re-evaluate the top desires they want in a home.

The home office, outdoor spaces and flex rooms became a must in the 2021 home search. With so many people working from home, or virtual schooling flex rooms and home offices are in high demand.

If you are in the market to sell your home, contact your local Realtor. A Realtor will not only help you navigate the market, getting you the best price and deal for your home, but will also take most of the pressure off of you from this fast pace market.

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CoreLogic Predicts A Drop in Home Price in 2021

CoreLogic, a company that provides consumer, financial and property data analytics and services to business and government, forecast a downturn in home prices in 2021. Even though COVID-19 has not affected the current housing market, the company suggests a dip this summer because of the negative impact the coronavirus has had on the economy as a whole.  

June 2020 saw a rise in home prices annually 4.9% and 1% month-over-month. According to CoreLogic’s Home Price Index, June 2020 saw the highest growth rate for the month of June since 2013. Part of this growth stemmed from the respective year-ago price growth rate of 3.6%. The Home Price Index has been on the up ever since bottoming out in March 2011.

Their prediction for June 2021 is a decrease by 1% in home prices. CoreLogic feels their prediction is relatively strong because of the housing market’s reliability on entertainment, tourism and hospitality. They forecast Las Vegas to have an 11.3% drop in home prices by June 2021.

“Home price appreciation continues at a solid pace reflecting fundamental strength in demand drivers and limited for-sale inventory,” Frank Martell, president and CEO of CoreLogic, said in a press release. “As we move forward, we expect these price increases to moderate over the next twelve months. Given the economic outlook, housing remains a bright spot for the foreseeable future.”

So far, this has the housing market has not seen a dip in prices. The record-low mortgage rates and buyer demand has fueled the current market. Surprisingly, homes are very affordable even though there has been a steady price growth.

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St. Tammany Parish's Future Looks Bright Even Among the Pandemic

St. Tammany Parish Development District hired Chris Masingill in May 2018 to be the CEO of St. Tammany Corp. St. Tammany Corp. was developed to create partnerships and opportunities to help the parish prosper. The company is the lead economic development organization in St. Tammany Parish.    

When Masingill began his position as CEO, St. Tammany was on an uphill path with a great local economy, many prospects and partnerships in the works that could bring the parish additional jobs and the parish’s performance was well above standards. Today, the parish’s prosperity has taken a hit by the stay-at-home orders and social distancing guidelines the novel coronavirus has brought on.

Masingill is being proactive and has a plan in place to hopefully return to pre-pandemic levels of prosperity and keep on a positive track for the future. Masingill is focusing on what can be done in the future to best ensure the parish remains a place of choice to work, live and play for decades to come.

St. Tammany’s unemployment rate dramatically rose in 2020 because of COVID-19. During the height of COVID-19, 50,000 St. Tammany residents sought unemployment benefits. Many of the parish’s industry sectors were hit very hard. Those that were hit the hardest were hospitality, tourism and restaurants. The Ceo explains that the parish’s revenue has been reduced but some of it is slowly returning. The parish might not see as much motel/hotel sales tax nowadays but taxes from grocery stores and hardware stores have spiked.

Masingill reports that there are some companies that are busier than ever because of the change in spending habits due to the novel coronavirus. In St. Tammany, the logistics, transportation, warehousing and distribution sectors have boomed. The parish has thrived in this industry because of its geographic positioning and the talented workforce it has living among it. Masingill believes this shift is because the global supply chain has changed. “Even with the vaccine coming online and the economy getting energy behind it, there’s little doubt that some things about the way we do business have fundamentally changed forever,” he relays.

People are currently hiring and job postings for the month of November 2020 were at 7,000 unique postings. St. Tammany residents are still spending money and there is a rebound in consumer confidence but the recovery will be slow. We should understand that there will be ups and downs to the long-term recovery. “There is no quick fix. We’re talking several more months, and some people predict several years, before we see the same level of economic activity we saw in 2019,” Masingill states.

St. Tammany is very lucky that it is home of some of the most educated people in the area. It is reported that 40% of the residence in St. Tammany hold a college degree. Masingill wants to focus on keeping its residence local to work and not go out of the parish for employment.

It is in the perfect location and the parish has access to things people want. The parish is in the top 10% of the most populous counties/parishes in the United States. Masingill continues to keep the area in the top 10% and believes that quality of life is just as important as sustainable growth, job creation and business development. “You want a nimble and resilient community. If you have that, you can rebound that much more quickly when things like a pandemic happens, when a hurricane happens.”

Overall Masingill feels that balance will be the success of St. Tammany’s robust economy. “There’s a balance. (You have to be in the middle.) That’s the sustainable and smart approach. We want our kids and grandkids to either stay here or have a place to come back to where they can reap the benefits and enjoyment of a place where they can have access to the things they want. That’s educational opportunities, job growth and expansion, a place to enjoy all the things our community has to offer,” says Masingill.

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