Blog | Blessings Realty | Colorado Springs and Monument Realtor

4 Reasons Why Fall Is A Great Time to Buy A Home!

September 30, 2018 By Claire Garlick Leave a Comment

Here are four great reasons to consider buying a home today instead of waiting.
1. Prices Will Continue to Rise
CoreLogic’s latest Home Price Insights report reveals that home prices have appreciated by 6.2% over the last 12 months. The same report predicts that prices will continue to increase at a rate of 5.1% over the next year.
Home values will continue to appreciate for years. Waiting no longer makes sense.
2. Mortgage Interest Rates Are Projected to Increase
Freddie Mac’s Primary Mortgage Market Survey shows that interest rates for a 30-year mortgage have already increased by half of a percentage point, to around 4.5% in 2018. Most experts predict that rates will rise over the next 12 months. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison, projecting that rates will increase by half a percentage point to around 5.1% by this time next year.
An increase in rates will impact your monthly mortgage payment. A year from now, your housing expense will increase if a mortgage is necessary to buy your next home.
3. Either Way, You Are Paying a Mortgage
There are some renters who have not yet purchased homes because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.
As an owner, your mortgage payment is a form of ‘forced savings’ that allows you to build equity in your home which you can then tap into later in life. As a renter, you guarantee your landlord is the person building that equity.
Are you ready to put your housing cost to work for you?
4. It’s Time to Move on with Your Life
The ‘cost’ of a home is determined by two major components: the price of the home and the current mortgage rate. It appears that both are on the rise.
But what if they weren’t? Would you wait?
Look at the actual reason you are buying and decide if it is worth waiting. Whether you want to have a great place for your children to grow up, you want your family to be safer, or you just want to have control over renovations, maybe now is the time to buy.
If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings. Give us a call to help you through the process.

The Wave of Millennial Home Buyers Continues to Swell

September 19, 2018 By Claire Garlick Leave a Comment

Many have written about the millennial generation and whether or not they, as a whole, believe in homeownership as a part of attaining their American Dream.

Comparatively speaking, millennials have taken longer to obtain traditional milestones (like getting married, having kids and buying a home) than generations before them, but that does not mean that they do not aspire to still achieve those things.

For older millennials (aged 25-34) who have established themselves in their career and are starting to build their families, homeownership is the next logical choice.
According to the Urban Institute’s State of Millennial Housing, the probability of a millennial becoming a homeowner increases by 17.9% if they are married, and by an additional 6.2% if they have children.

Last year, according to the US Census Bureau, the average age at first marriage was 30 for men and 27 for women, while the National Association of Realtors (NAR) reports that the average first-time homebuyer was 32 years old.

With most of this generation having yet to age into the ‘Responsibility Zone’ (the time in their lives when their responsibilities start to dictate their behaviors), there will be a steady wave of buyers for years to come!

Those who are currently out in the market searching for a home are being met with a strong, highly competitive seller’s market. NAR’s Chief Economist Lawrence Yun recently commented,

“Realtors® throughout the country continue to stress that there’s considerable pent-up demand for buying a home among the millennial households in their market.
Unfortunately, they’re just not making meaningful ground, and continue to be held back by too few choices in their price range, and thereby missing out on homeownership and wealth gains.”

Bottom Line
If you are currently renting and thinking about jumping into the real estate market this year, let’s get together to help you navigate our market.

Have You Outgrown Your Starter Home?

September 14, 2018 By Claire Garlick Leave a Comment

For many Americans, buying their first home is their first taste of achieving part of the American Dream. There is a sense of pride that comes along with owning your own home and building your family’s wealth through your monthly mortgage payment.
It may seem hard to imagine that the first home you purchased (which made your dreams come true) might not be the home that will allow you to achieve the rest of your dreams. The good news is that it’s ok to admit that your home no longer fits your needs!
According to CoreLogic’s latest Home Price Index, prices in the starter home market have appreciated faster than any other category over the last year, at 9.4%. At the same time, inventory in this category has dropped 14.2%.

These two stats are directly related to one another. As inventory has decreased and demand has increased, prices have been driven up.
This is great news if you own a starter home and are looking to move up to a larger home as the equity in your home has risen as prices have gone up. Even better is the fact that there is a large pool of buyers out there searching for your starter home to help them achieve their American Dream!
Bottom Line
If you have outgrown your starter home, contact us and we can go over the market conditions in your area and help you find your next home!

Housing Market: Another Gigantic Difference Between 2008 and 2018

September 11, 2018 By Claire Garlick Leave a Comment

Some are attempting to compare the current housing market to the market leading up to the “boom and bust” that we experienced a decade ago. They look at price appreciation and conclude that we are on a similar trajectory, speeding toward another housing crisis.
However, there is a major difference between the two markets. Last decade, while demand was being artificially created by extremely loose lending standards, a tremendous amount of inventory was coming to the market to satisfy that demand. Below is a graph of the inventory of homes available for sale leading up to the 2008 crash.

A normal market should have approximately 6 months supply of housing inventory. As we can see, that number jumped to over 11 months supply leading up to the housing crisis. When questionable mortgage practices ceased, and demand dried up, there was a glut of inventory on the market which caused prices to drop as there was too much supply and not enough demand.

Today is radically different!
There are those who believe that low mortgage rates have created an artificial demand in the current market. They fear that if mortgage rates continue to rise, some of the current demand will dry up (which is a possibility).
However, if we look at supply again, we can see that the current supply of homes is well below the norm of 6 months.

Bottom Line
We will not have a glut of inventory like we did back in 2008 and home values won’t come tumbling down. Instead, if demand weakens, we will return to a normal market (approximately a 6-month supply) with historic levels of appreciation (3.6% annually).

What Does the Recent Rash of Price Reductions Mean to the Real Estate Market?

August 28, 2018 By Claire Garlick Leave a Comment

Last week, in a new report from Zillow, it was revealed that there has been a rash of price reductions across the country. According to the report:

There are more price cuts now than a year ago in over two-thirds of the nation’s largest metros
About 14% of all listings had a price cut in June
Since the beginning of the year, the share of listings with a price cut increased 1.2%
This is the greatest January-to-June increase ever reported, and more than double the January-to-June increase last year

Senior Economist Aaron Terrazas further explained:

“A rising share of on-market listings are seeing price cuts, though these price cuts are concentrated at the most expensive price-points and primarily in markets that have seen outsized price gains in recent years.”

What this DOESN’T MEAN for the real estate market…

This doesn’t mean home values have depreciated or are about to depreciate.
A seller may put a home worth $300,000 on the market for $325,000 hoping a bidding war will occur and an overanxious buyer will pay more than its actual value. That has happened often over the last few years. If the seller gets no offers and reduces the price to $300,000, it doesn’t mean the home dropped in value. It is still worth $300,000.
Home prices will continue to appreciate over the next 12 months. In this same report, Terrazas remarks:

“It’s far too soon to call this a buyer’s market, home values are still expected to appreciate at double their historic rate over the next 12 months, but the frenetic pace of the housing market over the past few years is starting to return toward a more normal trend.”

What this DOES MEAN for the real estate market…

This does mean that sellers should be more conservative when it comes to the price at which they list their homes – especially sellers in the upper end of each market.
Sellers have been listing their homes at inflated prices hoping a super-hot market will deliver a buyer willing to pay virtually any price to ensure they don’t lose the house. That strategy has worked somewhat successfully over the last two years. However, the time that strategy would have worked may have passed.
Again, quoting Aaron Terrazas in the report:

“The housing market has tilted sharply in favor of sellers over the past two years, but there are very early preliminary signs that the winds may be starting to shift ever-so-slightly.”

Bottom Line
Prices are not depreciating. However, if you want to sell your house quickly and with the least amount of hassles, pricing it correctly from the beginning makes the most sense.

Top 5 Reasons You Shouldn’t FSBO

August 22, 2018 By Claire Garlick Leave a Comment

In today’s market, with home prices rising and a lack of inventory, some homeowners may consider trying to sell their home on their own, known in the industry as a For Sale by Owner (FSBO). There are several reasons why this might not be a good idea for the vast majority of sellers.

Here are the top five reasons:
1. Exposure to Prospective Buyers
According to the 2017 Profile of Home Buyers and Sellers from NAR, last year 95% of buyers search online for a home. That is in comparison to only 15% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?

2. Results Come from the Internet
Where did buyers find the home they actually purchased?

49% on the internet
31% from a Real Estate Agent
7% from a yard sign
1% from newspapers

The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.

3. There Are Too Many People to Negotiate With
Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale by Owner:

The buyer who wants the best deal possible
The buyer’s agent who solely represents the best interest of the buyer
The buyer’s attorney (in some parts of the country)
The home inspection companies, which work for the buyer and will almost always find some problems with the house
The appraiser if there is a question of value

4. FSBOing Has Become More And More Difficult
The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 8% over the last 20+ years.

5. You Net More Money When Using an Agent
Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission.

A study by Collateral Analytics revealed that FSBOs don’t actually save anything, and in some cases, may be costing themselves more, by not listing with an agent. One of the main reasons for the price difference at the time of sale is:

“Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.”

If more buyers see a home, the greater the chances are that there could be a bidding war for the property. The study showed that the difference in price between comparable homes of size and location is currently at an average of 6% this year.

Why would you choose to list on your own and manage the entire transaction when you can hire an agent and not have to pay anything more?

Bottom Line
Before you decide to take on the challenges of selling your house on your own, let’s get together to discuss your needs.