Area Real Estate News & Market Trends

You’ll find our blog to be a wealth of information, covering everything from local market statistics and home values to community happenings. That’s because we care about the community and want to help you find your place in it. Please reach out if you have any questions at all. We’d love to talk with you!

March 16, 2022

Will Ukraine War Impact Fla. Real Estate?

Will Ukraine War Impact Fla. Real Estate?

 

On the one hand, Fla. is the No. 1 state for Russian RE investing – 29% of all U.S. purchases. On the other, Russian buyers make up only 0.8% of all foreign purchases.

NAPLES, Fla. – Over the past six years, Russian buyers of U.S. real estate have preferred the sunny coasts of Florida over property in any other state in the nation. Wealthy Russians have reportedly bought so many luxury condo properties in the north Miami city of Sunny Isles Beach that some have termed it “Little Moscow.”

“They love to be here, and they like to spend their money and enjoy their life,” Lana Bell, a South Florida real estate agent told NewsNation.com.

But it’s not just the wealthy Russian elites seeking Florida sunshine.

Across the state from Warm Mineral Springs in North Port all the way up to small town of Steinhatchee near the Panhandle, Russians and Eastern Europeans have established communities, according to population data from the U.S. Census Bureau’s American Community Survey.

Over the past six years, 29% of Russian real estate transactions in the United States occurred in Florida, the most in the nation, according to a report from the National Association of Realtors® (NAR).

But even as countries across the world impose sanctions on Russia for invading and waging a brutal war against its neighbor Ukraine, the impact to U.S. home or property prices is not expected to be meaningful, even without any Russian purchases of Florida real estate.

“Russia has little direct impact on the U.S. real estate market as it accounted for less than 1% (0.8%) of all foreign buyers who purchased U.S. residential property from April 2015 through March 2021, according to data from NAR’s survey of foreign buyer transactions of its members,” covering about 5,000 respondents, the report said. Any effect from the loss of Russian purchases would tend to be at the high end, as the NAR’s report notes that Russian buyers buy more luxury properties than the average Florida buyer.

Still, with the transition of the pandemic to a different phase, the loss of Russian buyers could be offset by the resumption of purchases by people from other countries, as well as within the U.S.

Craig Cerreta, the managing broker for Premier Sotheby’s International Realty’s Sarasota office, said the pandemic caused a near shutdown of foreign buyers, but that the segment has been bouncing back in recent months.

During the COVID pandemic, real estate prices have drastically increased in Florida as migration brought new residents to the state, with people retiring early or enjoying the ability to work remotely.

Tight supply

Historically, Cerreta said, Canadians, followed by residents of the United Kingdom, have accounted for the majority of international real estate transactions in the Sarasota market.

“There is no question that they (Russian purchasers) are small” locally, he said. “But they are typically high-end buyers.”

The NAR data says that the average Russian real estate transaction was about $650,000. The average for all international buyers was about $480,000.

But, with the demand seen for Florida properties, combined with historically low number of properties for sale, any loss of Russian purchases are being more than made up from demand from other buyers, Cerreta said.

Cerreta recently sold a home he owned in the Sarasota area. During the open house, more than 170 people viewed the residence and 21 people made an offer. Three of the offers came from people in California, something that surprised the longtime real estate agent, as Californians have historically not been a large market for the west coast of Florida.

Any loss of demand from Russian buyers for luxury properties or other property types won’t be felt in the Sarasota market, he said.

In February, 72% of all real estate sales in the Sarasota market closed at or above the list price compared to 43% at or above list price in February 2021, Cerreta said. “There’s not enough inventory to meet demand,” he said of the Sarasota market.

Sergei Sokolov, a Realtor with Sarasota’s Michael Saunders & Co., was born in Ukraine but moved to the United States when he was 5 years old. The now-47-year-old real estate professional, fluent in Russian and Ukrainian, said Russian speakers often want a Realtor who speaks their language.

The first house he sold in Sarasota in 2004 was to a Russian speaker, and he does about three or four transactions a year. Sokolov specializes in entry level homes typically in the $350,000 to $400,000 price range, with the majority of his Russian-speaking buyers already living in the U.S. or Canada and unlikely to be impacted by the Russian-Ukrainian war.

“I don’t expect there to be much of an impact on my business,” he said. “There’s just a lot more demand than there is supply.”

Varied buyers

The next closest U.S. state for Russian buyers was Georgia with 16% of all Russian purchases of U.S. real estate, roughly 13 percentage points behind Florida. New York (13%), California (8%) and Illinois (5%) rounded out the top five states for total transactions from Russian buyers.

The NAR report said that even in Florida, purchases of real estate made by Russians accounted for just 0.2% of the Sunshine State’s real estate transactions from July 2020 to June 2021. Those numbers may be skewed as the pandemic caused many governments to restrict travel to other countries.

A 2020 profile on international residential transactions in Florida conducted by the NAR with Florida Realtors, the largest trade organization in the state, concluded that foreign buyers accounted for $15.6 billion in real estate transactions from August 2019 to July 2020 – about 11% of the state’s sales. The total transaction volume for Florida real estate in that time period was $137 billion dollars.

However in that report that largely accounted for sales just prior to the pandemic, Russia did not rank among the top 15 counties for any Florida metro besides Miami. The Miami metro market, the largest in Florida, had just 2% of home sales go to Russian buyers.

The largest group of foreign buyers by transaction volume came from Latin America and the Caribbean with about 37% of the total value of homes purchased by international citizens.

Canadian buyers had the most transactions at 21% followed by Brazil (7%), Argentina (6%), Venezuela (5%), Columbia (5%) and the United Kingdom (5%).

The metro area of Miami-Fort Lauderdale-West Palm Beach had the lion’s share of foreign buyers with 47.3% of all purchases. The Tampa-St. Petersburg-Clearwater metro accounted for 11%; Orlando-Kissimmee-Sanford had 9.7%, North Port-Sarasota-Bradenton had 6.9% and Cape Coral-Fort Myers came in at 4.7%.

Larger economic issues

While Russians account for a tiny fraction of all real estate purchases in Florida, the real impact of the conflict may be felt at the gas pump as international buyers cut ties with Russian energy. President Joe Biden announced a ban on Russian oil earlier this week.

Chris Jones, president of Florida Economic Advisors and a University of South Florida faculty member at USF in the economics department, agreed with the real estate experts that the reduction in demand from Russian buyers for U.S. real estate won’t shift home prices in Florida.

However, the impact of rising gas prices could be dangerous for the U.S. economy, he said.

He anticipates that gas prices will increase at least another 50 cents before the end of May, with peak price per gallon of gasoline surpassing $5 per gallon this year. As people pay more at the pump, they have less money to spend on goods and services that drive the economy, which he believes will lead to a decrease in the nation’s economic output.

He said he fears that the American economy could be headed toward “stagflation” because of the rising gas prices. Stagflation happens when an economy has rising inflation at the same time as slowing economic output.

“We’re already halfway there,” he said, pointing to rising inflation.

Rising gas prices will also have an impact by raising prices on nearly all goods and services which could then cause fewer people to be able to afford to purchase residential property.

Less demand, caused largely by rising gas prices, would then impact Florida’s real estate market.

 

 

© 2022 Journal Media Group

Source: https://www.floridarealtors.org/news-media/news-articles/2022/03/will-ukraine-war-impact-fla-real-estate?utm_campaign=3-16-2022+Florida+Realtors+News&utm_source=iPost&utm_medium=email

Posted in Market Updates
Feb. 27, 2022

How Russia’s Invasion of Ukraine Is Already Rippling Through the U.S. Housing Market

Russia’s deadly invasion of Ukraine has set much of the world on edge, with many fearing this could become the largest conflict since World War II. Russian airstrikes battering Ukrainian cities and bases have already roiled financial markets around the globe, rippling through the U.S. housing market.

Mortgage interest rates, which had been expected to keep inching up, instead retreated slightly, according to the latest Freddie Mac data. The stock and cryptocurrency markets, where many buyers pull money from to purchase property, tumbled. And ultimately, the already accelerated rate of inflation is expected to rise even further—hurting renters, buyers, and even builders who will continue to grapple with fast-rising construction costs.

“It’s all bad for the economy and housing. … It’s just a matter of how bad,” says Mark Zandi, chief economist at Moody’s Analytics. “There’s a number of different ways in which Russia’s actions will hurt housing.”

By just after 1:30 p.m. ET on Thursday, the S&P 500 was down more than 12.5% year to date, recovering a bit from the morning. Nearly half of that loss came in just the past five days as tensions escalated along the Ukrainian border. Stocks began rebounding Thursday afternoon after President Joe Biden announced more sanctions against Russia.

While that’s a substantial loss, it’s not a meltdown like what happened in the 2000s, when the markets lost more than 50% of their value.

“Investors tend to overreact to bad news and then settle down,” says Robert Dietz, chief economist of the National Association of Home Builders.

This may have a larger impact on the luxury real estate market, where wealthier buyers often cash out stocks or cryptocurrency to purchase multimillion-dollar homes or second or third abodes. However, the uncertainty may also make buyers in all price ranges hesitant to pull the trigger on large purchases such as real estate.

For now, the uncertainty in the stock market amid fears of a full-blown war in Europe is helping to keep mortgage rates in check.

Many investors moved into the bond market, which includes mortgage bonds, as they are generally considered safer, less volatile investments. Bond prices rose as a result. And when prices go up, mortgage rates typically fall.

Rates averaged 3.89% in the week ending Feb. 24, according to Freddie Mac. Instead of cracking 4%, rates dipped slightly from 3.92% in the previous week.

“We’d expected rising rates,” says Realtor.com Chief Economist Danielle Hale. Now “they’re more likely to steady, slip even.”

And if buyers aren’t worried that they have to purchase a home now before mortgage rates go up any further, it could relieve some of the urgency in the market. This could lessen demand in the short term, resulting in reduced competition among buyers.

“That would affect the market at all price points,” says Hale.

However, the jury is out on whether rates will stay lower. Moody’s Zandi believes they may rise as a result of the turmoil and ensuing inflation.

Another potential fallout for Americans is rising oil and gas prices, as Russia is the second-largest oil producer on Earth. While that is expected to affect prices at the pump and home heating costs, it’s also likely to make goods more expensive. That’s because food, products, and building supplies often require oil in their production. Then they need to be transported around the nation, or even the world, to wind up on store shelves.

“If oil prices go up, that raises costs throughout the economy,” says Hale. “It means more inflation.”

This could potentially lead to job losses, warns Zandi, if Americans pull back on their spending. He’s not expecting another recession, but he’s not ruling one out either.

There are also likely to be more global supply chain disruptions.

“That’s a real problem for homebuilders,” says Zandi. “They can’t build to meet demand because they can’t get the building materials and appliances and the things they need to complete homes.”

Inflation and supply chain problems are expected to lead to higher construction costs. Prices for building materials are already up 22% year over year, says Dietz. Lumber is up 40% in the past 13 months, while a popular kind of particle board used in construction rose about 60% over the same period. Those costs will be passed along to new homebuyers.

“We will continue to see that low double-digit growth in new homes prices as we move through 2022,” says Dietz. “It’s going to be a tough year for housing affordability.”

 

Source: https://www.realtor.com/news/trends/russias-invasion-of-ukraine-is-already-rippling-through-the-u-s-housing-market/?identityID=57addc8a838a2e411101ace0&MID=2022_0225_Weekly_NL&RID=4138076702&cid=eml_promo_Marketing_NonPRSL_WeeklyNL_cons.14196102_2022_0225_Weekly_NL-blog3russiaukraineconflict-blogs_trends

Feb. 25, 2022

Buying a Home in Another State? Here Are a Few Tips to Make the Process as Easy as Stress-Free as Possible

Posted in Home Buyer Tips, Moving
Feb. 24, 2022

Many First-Time Home Buyers Are Overlooking a Competitive Edge in 2022

Buying a house was challenging for many buyers in 2021, but especially for first-time buyers. Competition and prices were high, and inventory was low, and while some predictions suggest things will loosen up a bit in 2022, buyers will still need to have an aggressive strategy heading into the new year.

According to this REALTOR Magazine article, first-time buyers are optimistic about their chances in 2022, and many are changing their strategies to increase their odds of success.
The most notable changes in strategy were:

  • Making an offer within 48 hours of seeing a home
  • Offering above asking price
  • Being willing to compete in bidding wars
  • Going over their budget
  • Making offers on houses without even seeing them first

Making offers quickly, being willing to go above asking and compete in bidding wars are all advisable strategies in this market.

Going over budget on the other hand…well, that depends. If “going over budget” means still within their comfortable financial means, sure! If not, it’s a recipe for future struggle and financial trouble.

And making offers on houses without seeing them in person first isn’t the worst thing to do given technology, but it isn’t ideal.

What wasn’t on the list, and would likely make the biggest impact for first-time buyers, was to choose and work with a great real estate agent. Working with a trusted buyers’ agent can enhance any of the above strategies, if not make them unnecessary. Their awareness of the market, perspective, advice, connections, and negotiation skills can often give first-time buyers an edge, yet many first-time buyers don’t put a lot of emphasis on choosing and working with one.

So, if you’re a first-time buyer looking to edge out competition in 2022, by all means be prepared to do everything on the list other buyers are planning on. But, to truly tip the scales in your favor, make sure you’re teaming up with a buyers’ agent you connect well with and trust.

Posted in Home Buyer Tips
Feb. 23, 2022

A Guide to Buying Your First Home in 2022

Ready to buy your first home in 2022? The C.A.R.E. Team specializes in helping first-time home buyers like you find their dream property in Tyler TX and Sarasota FL areas.

Before you start searching for homes online, it's important to take the first step to house shopping: Getting pre-approved for a mortgage.

Your pre-approval will tell you what you can afford and what your monthly payment will be, so it's important to determine this before you start searching for your new home.

Pre-approval is good for about 30-90 days, so once you're ready, take these first 3 steps to get it done.

  1.  Contact me, and I’ll send over a list of lenders I know and trust.
  2.  Look over the list, check out online reviews, and ask friends and family for referrals.
  3.  Email 2-3 lenders you like or let me introduce you over email.

Once you've got your pre-approval letter in hand, it's time to start the search!

Before we hop into the home search, I like to advise my clients to create a "Needs" list and a "Wants" list. This will help us to really focus on the things that are most important in your future home.

Needs are the non-negotiable features; the features you simply must have in your next home. Wants are the ones you’d like to have, but you can add or change down the road. Remember, you can’t change the lot or the location so make sure you love both.

Once you've established what you're looking for, I will set you up on a search so you can receive an email the second a home that fits your criteria goes live. If you have any questions about a property, send me the information and I will find out for you. Send me listings you like and I can get more information and set up showings on your behalf.

After touring houses and choosing the one you love, it's time to make an offer. To do this, you'll need your pre-approval letter or proof of funds. You'll also need to make an escrow deposit of at least 1-2% of the purchase price. This will go towards your closing costs at closing.

Have more questions about buying a home or what happens after making an offer? Reach out to me today!

Posted in Home Buyer Tips
Feb. 22, 2022

Could There Be A Return to Normal; The State of Real Estate in 2022

Last year was one for the real estate history books. The pandemic helped usher in a buying frenzy that caused home prices to soar nationwide by a record 19.9% between August 2020 and August 2021.

However, there were signs in the fourth quarter that the red-hot housing market was beginning to simmer down. In the month of October, only 60.3% of sales involved a bidding war—down from a high of 74.5% in April.2 While this trend could be attributed to seasonality, it could also be a signal that the real estate run-up may have passed its peak.

 

So what’s ahead for the U.S. housing market in 2022? Here’s where industry experts predict the market is headed in the coming year.

 

 

MORTGAGE RATES WILL CREEP UP

 

Most economists expect to see mortgage rates gradually rise this year after hitting record lows in late 2020 and early 2021.3 

 

Freddie Mac forecasts the 30-year fixed-rate mortgage will average 3.5% in 2022, up from around 3% in 2021.4

 

The Mortgage Bankers Association predicts that rates will tick up to 4% by the end of the year. "Mortgage lenders and borrowers should expect rising mortgage rates over the next year, as stronger economic growth pushes Treasury yields higher," said Mike Fratantoni, chief economist for the Mortgage Bankers Association at their 2001 Annual Convention & Expo in October.5

 

However, it’s important to keep in mind that even a 4% mortgage rate is low when compared to historical standards. According to industry trade blog The Mortgage Reports, “Between 1971 and December 2020, 30-year mortgage rates averaged 7.89%.”6

 

What does it mean for you? Low mortgage rates can reduce your monthly payment and make homeownership more affordable. Fortunately, there’s still time to lock in a historically-low rate. Whether you’re hoping to purchase a new home or refinance an existing mortgage, act soon before rates go up any further. We’d be happy to connect you with a trusted lending professional in our network.

 

 

THE MARKET WILL BECOME MORE BALANCED

 

In 2021, we experienced one of the most competitive real estate markets ever. Fears about the virus and a shift to remote work triggered a huge uptick in demand. At the same time, many existing homeowners delayed their plans to sell, and supply and labor shortages hindered new construction. 

 

This led to an extreme market imbalance that benefitted sellers and frustrated buyers. According to George Ratiu, director of economic research at Realtor.com, “Prices and sellers reached for the moon [last] year. It looks like we are now about to move back to earth.”7

 

Data from Realtor.com released in November showed that listing price reductions had more than doubled since February 2021. And the average days on market (an indicator of how long it takes a home to sell) has been slowly creeping up since June.7

 

What’s causing this change in market dynamics? The real estate market typically slows down in the fall and winter. But economists also suspect a fundamental shift in supply and demand.

 

At the National Association of Realtors’ annual conference last November, the group’s chief economist, Lawrence Yun, told attendees that he expects increased supply to come from an uptick in new construction—which is already underway—and an end to the mortgage forbearance program. “With more housing inventory to hit the market, the intense multiple offers will start to ease,” he said.8

 

Demand is also predicted to wane slightly in the coming year. Rising mortgage rates and record-high prices have made homeownership unaffordable for a growing number of Americans. And in a recent Reuters poll, nearly 80% of property analysts said they expect housing affordability to worsen over the next several years.9

 

What does it mean for you? If you struggled to buy a home last year, there may be some relief on the horizon. Increased supply and softening demand could make it easier to finally secure the home of your dreams. If you’re a seller, it’s still a great time to cash out your big equity gains! And with more inventory on the market, you’ll have an easier time finding your next home. Reach out for a free consultation so we can discuss your specific needs and goals.

 

 

HOME PRICES LIKELY TO KEEP CLIMBING, BUT AT A SLOWER PACE

 

Nationally, home prices rose an estimated 16.8% in 2021.8 But the average rate of appreciation is expected to slow down in 2022.

 

Danielle Hale, chief economist at Realtor.com, told Yahoo! News, “Home asking prices have decelerated in the second half of 2021, with median listing price growth slipping from a peak of 17.2% in April to just 8.6% in October.”10

 

But experts disagree about how much more property values can continue to climb this year. Goldman Sachs predicts that home prices will rise by 13.5%, while Fannie Mae and Freddie Mac are forecasting a 7.9% and 7% rate of appreciation, respectively.2

 

However, not all analysts are as bullish. The National Association of Realtors predicts a 2.8% rate of appreciation for existing homes and 4.4% for new homes, while the Mortgage Bankers Association expects the average home price to decrease by 2.5% by the end of the year.10,2

 

According to Hale, “With prices near all-time highs and mortgage rates expected to rise, we expect this slowdown in prices to continue.”10

 

What does it mean for you? If you’re a buyer who has been waiting on the sidelines for home prices to drop, you may be out of luck. Even if home prices dip slightly (and most economists expect them to rise) any savings are likely to be offset by higher mortgage rates. The good news is that decreased competition means more choice and less likelihood of a bidding war. We can help you get the most for your money in today’s market.

 

 

RENTS WILL CONTINUE TO RISE

 

Along with home, gasoline, and used vehicle prices, rent prices rose dramatically last year. According to CoreLogic, in September, rents for single-family homes were up 10.2% nationally year over year.11 And economists at Realtor.com expect them to climb another 7.1% in 2022.12

 

“Homes are expensive now...but for most people, the comparison that is most important is how that cost of homeownership is going to compare to the cost of renting,” Zillow Senior Economist Jeff Tucker told CNBC in November.13

 

Tucker also pointed out that rent is less predictable than a mortgage—and more likely to go up along with inflation.13

 

Real assets, like real estate, are often used as a hedge against inflation. That’s because property values typically rise with inflation.14 And when a homeowner takes out a mortgage, they lock in a set housing payment for the next 30 years. 

 

In contrast, renters are at the mercy of the market—and they don’t gain any of the benefits of homeownership, like tax deductions, equity, or appreciation.

 

George Ratiu of Realtor.com told CNBC that he advises buyers to consider their budget and time frame. If they plan to stay in the home for at least three to five years, he believes it often makes sense to buy.13

 

Fortunately, it’s shaping up to be a better year for buyers. “I think 2022 has the promise of providing less competition, a lot more homes to choose from, and, as a result, a lot more approachable prices,” Ratiu said.13

 

What does it mean for you? Both property and rent prices are expected to continue rising. But when you purchase a home with a fixed-rate mortgage, you can rest assured knowing that your monthly mortgage payment will never go up. Whether you’re a first-time homebuyer or a real estate investor, we can help you make the most of today’s real estate market. 

 

 

WE’RE HERE TO GUIDE YOU

 

While national real estate numbers and predictions can provide a “big picture” outlook for the year, real estate is local. And as local market experts, we can guide you through the ins and outs of our market and the local issues that are likely to drive home values in your particular neighborhood. 

 

If you’re considering buying or selling a home in 2022, contact us now to schedule a free consultation. We’ll work with you to develop an action plan to meet your real estate goals this year.

 

 

Sources:

Fortune -
https://fortune.com/2021/11/04/us-home-prices-real-estate-forecast-2022-outlook/

Fortune -
https://fortune.com/2021/11/29/housing-market-real-estate-predictions-2022-forecast/

Freddie Mac -
http://www.freddiemac.com/pmms/pmms30.html

Freddie Mac - https://freddiemac.gcs-web.com/news-releases/news-release-details/freddie-mac-strong-housing-market-will-continue-even-rates-and

Mortgage Bankers Association -
https://www.mba.org/2021-press-releases/october/mba-annual-forecast-purchase-originations-to-increase-9-percent-to-record-173-trillion-in-2022

The Mortgage Reports -
https://themortgagereports.com/61853/30-year-mortgage-rates-chart

Realtor.com -
https://www.realtor.com/news/trends/has-housing-market-peaked/

National Association of Realtors -
https://www.nar.realtor/newsroom/nars-yun-says-housing-market-doing-well-may-normalize-in-2022

Reuters -
https://www.reuters.com/world/us/rise-us-house-prices-halve-next-year-affordability-worsen-2021-12-07/

Yahoo! News -
https://www.yahoo.com/now/where-home-prices-headed-2022-130012748.html

CNBC -
https://www.cnbc.com/2021/11/16/inflation-rent-for-single-family-homes-surged-10percent-in-september.html

Realtor.com -
https://www.realtor.com/news/trends/what-to-expect-in-2022-housing-market/

CNBC -
https://www.cnbc.com/2021/11/23/rising-inflation-hot-housing-market-what-you-need-to-know-about-buying-a-home.html

Money -
https://money.com/inflation-2021-stocks-bitcoin-gold-reits-commodities/

Posted in Market Updates
Feb. 21, 2022

2022 Housing Market Predictions

Though not predictable, you can always rely on the real estate market to change. Here are some predictions for the housing market in 2022.

2022 housing market predictions

  • 2022 will fall just short of record-breaking

"Zillow’s forecast calls for 11% home value growth in 2022. That’s down from a projected 19.5% in 2021, a record year-end pace of home value appreciation, but would rank among the strongest years Zillow has tracked. Existing home sales are predicted to total 6.35 million, compared to an estimated 6.12 million this year. That would be the highest number of home sales in any year since 2006." Zillow (https://www.zillow.com/research/zillow-2022-housing-predictions-30394/)

  • Mortgage rates may rise, but inventory may rise as well

"The market is likely to cool compared to 2021, but it will still be active... It may still be a seller’s market in many areas, but there’s likely to be more opportunities and wiggle room for homebuyers. A ‘priced out’ buyer should be able to find many more options. Experts also reinforce that 2022’s housing market is not at all likely to crash — the conditions we’re seeing are nothing like those that led up to the crisis of 2008.” Andrina Valdes (https://finance.yahoo.com/news/where-home-prices-headed-2022-200001201.html)

  • **Rents are expected to outpace home price growth over the next year **

**"**Nationwide, rent growth went from minimal to double-digit pace in 2021 as the U.S. made substantial progress against the pandemic. With the rental vacancy rate continuing near its historic lows during the pandemic, in which just 5.7% to 6.8% of rental housing units are vacant at any point in time compared to 7% or more, historically, renters are also contending with limited supply and excess demand that leads to upward pressure on rents. In 2022, we expect this trend will continue and fuel rent growth. At a national level, we forecast rent growth of 7.1% in the next 12 months, somewhat ahead of home price growth as rents continue to rebound from slower growth earlier in the pandemic." Realtor.com (https://www.realtor.com/research/2022-national-housing-forecast/)

Curious what your home would sell for in the current market? Click here, or give me a call or an email for a free home value estimate.

Posted in Market Updates
Feb. 21, 2022

Settling Into a New Community

Settling Into a New Community

A happy father and son walking the city street settling into a new community.

Moving to a new house creates a long “to do” list and no small amount of stress. If the house is in a new community, it’s just as important to get acquainted with the area and its people as it is to turn on the utilities.  Here are some tips for settling into a new community.

Change your address

Two weeks before your new address becomes official, submit a change of address request to the US Postal Service at www.usps.com. This request, which requires a $1 processing fee, will be good for a year. Then begin updating your address with each vendor with whom you do business. Start with financial accounts. (One way you can obtain peace of mind that sensitive information isn’t mailed to an old address is by arranging for paperless statements via email.) Make sure to include family and friends.

Though the timing is not quite as critical, most states have a deadline for updating your driver’s license. Provide the state motor vehicles agency with the new address for registration of your cars.

Stop and start utilities

Contact the utility companies — electricity, gas, water, sewerage, trash collection, telephone, security monitoring, and the Internet — that service your new community and schedule an end to service at your former home effective the date you close. Be sure to inform these providers of your new address as well and schedule service to start effective the day you move in.

Update your voter’s registration

Your local post office or county government offices will have a card to complete, sign and mail in to register to vote in your new political jurisdiction.

Introduce yourself in the neighborhood

Take the initiative to meet your neighbors as you settle into a new community. As an icebreaker, ask for recommendations for good local restaurants, the nearest home improvement store, grocery stores, doctors, dentists, babysitters or playgroups for the kids. If new neighbors bring over cookies or a meal, accept it graciously and strike up a conversation. If neighbors are slower to warm up, host a small gathering to introduce your family to the neighborhood. Ask if the neighborhood has a private group Facebook page. You can also join Next Door, another private group site where local residents share all kinds of information about what is happening nearby,  from book clubs and social events to shopping tips and service recommendations.

Get to know the broader new community

As you’re settling into a new community, take a walk or a bike ride through areas that interest you. If you’re religious, visit churches or synagogues and join one. Shop and dine at locally owned establishments. Drop-in at your nearest library. Get to know your letter carrier. Ask questions. Who knows? The nice man behind the deli counter may know the perfect person to tune your piano.  For information on community events, also consider subscribing to your local newspaper or dropping by the town visitors center.

Related – I’m Moving: How Do I Find the Best Schools for My Kids?

While you get settled, if you are looking to buy or sell real estate in the greater East Texas or South West Florida areas, visit my homepage to filter and search properties and/or obtain a free instant home valuation. 

Source: https://www.houseopedia.com/settling-new-community?id=b917&fbclid=IwAR1j4_6Vlx7n5PNxpxaLoC_E6POYCnBDKPg8eH3B1cZVPvVTbpUyzUBVEoA

 

Posted in Home Buyer Tips, Moving
Feb. 20, 2022

Planning To Buy a Home This Summer? Here’s What You Need To Know...

Feb. 19, 2022

Could Rising Home Prices Effect Your Net Worth?

Learn how to determine your current net worth and how an investment in real estate can help improve your bottom line.

Your net worth

Among its many impacts, COVID-19 has had a pronounced effect on the housing market. Low home inventory and high buyer demand have driven home prices to an all-time high.1 This has given an unexpected financial boost to many homeowners during a challenging time. However, for some renters, rising home prices are making dreams of homeownership feel further out of reach.

 

If you’re a homeowner, it’s important for you to understand how your home’s value contributes to your overall net worth. If you’re a renter, now is the time for you to figure out how homeownership fits into your short-term goals and your long-term financial future. An investment in real estate can help you grow your net worth, build wealth over time, and gain a foothold in the housing market to keep pace with rising prices.

What is net worth?

Net worth is the net balance of your total assets minus your total liabilities. Or, basically, it is what you own minus what you owe.2

Assets include the cash you have on hand in your checking and savings accounts, investment account balances, salable items like jewelry or a car and, of course, your home and any other real estate you own. 

Liabilities include your total debt obligations like car loans, credit card debt, the amount you owe on your mortgage, and student loans. In addition, liabilities would include any other payment obligations you have, like outstanding bills and taxes.

How do I calculate my net worth?

To calculate your net worth, you’ll want to add up all of your assets and all of your liabilities. Then subtract your total liabilities from your total assets. The balance represents your current net worth. 

Total Assets – Total Liabilities = Net Worth

Keep in mind that your net worth is a snapshot of your financial position at a single point in time. Your assets and liabilities will fluctuate over both the short term and long term. For example, if you take out a loan to buy a car, you decrease your liability with each payment. Of course, the value of your asset (the car) will depreciate over time, as well. An asset that is invested in stocks or bonds can be even less predictable, as it’s subject to daily fluctuations in the market.

 

As a homeowner, you enjoy significant stability through your monthly real estate investment, also known as your home mortgage payment. While the actual value of your home can fluctuate depending on market conditions, your mortgage payment will decrease your liability each month. And unlike a vehicle purchase, the value of your home is likely to appreciate over time, which can help to grow your net worth. Right now, your asset may be worth significantly more than it was this time last year.3

 

If you’re a homeowner, contact us for an estimate of your home’s market value so that you can factor it into your net worth calculation. If you’re not a current homeowner, let’s talk about how homes in our area have appreciated over the last several years. That way, you can get an idea of how a home purchase could positively affect your net worth.

 

How can real estate increase my net worth?

 

When you put your real estate dollars to work, it’s possible to grow your net worth, generate cash flow, and even fund your retirement. We can help you realize the possibilities and maximize the return on your investment.

 

Property Appreciation

 

Generally, property appreciates in one of two ways: either through changes to the overall market or through value-added modifications to the property itself.

 

Rising prices

 

This type of property appreciation is the one that many homeowners are enjoying right now. Buyer demand is at an all-time high due to a combination of record-low interest rates and limited housing inventory.4 At other times, rising home prices have been attributed to different factors. Certain local conditions—like a new commercial development, influx of jobs, or infrastructure project—can encourage rapid growth in a community or region and a corresponding rise in home values. Historically, home prices have been shown to experience an upward trend punctuated by intermittent booms and corrections.5

 

Strategic home improvements

 

Well-planned and executed home improvements can also impact a home’s value and increase homeowner equity at the same time. The type of home improvement should be appropriate for the home and in tune with the desires of local buyers.

 

For example, a tasteful exterior remodel that is in keeping with the preferences of local home buyers is likely to add significant value to a home, while remodeling the home to look like the Taj Mahal or a favorite theme park attraction will not. A modern kitchen remodel tends to add value, while a kitchen remodel that is overly expensive or personalized may not provide an adequate return on investment.

 

Investment Property

 

You may be used to thinking of investments primarily in terms of stocks and bonds. However, the purchase of a real estate investment property offers the opportunity to increase your net worth both upon purchase and year after year through appreciation. In addition, rental payments can have a positive impact on your monthly income and cash flow. If you currently have significant equity in your home, let's talk about how you could put that equity to work by funding the purchase of an investment property.

 

Long-term or traditional rental

 

A long-term rental property is one that is leased for an extended period and typically used as a primary residence by the renter. This type of real estate investment offers you the opportunity to generate consistent cash flow while building equity and appreciation.6 

 

As an owner, you don’t usually have to worry about paying the utility bills or furnishing the property—both of which are typically covered by the tenant. Add to this the fact that traditional tenants translate into less time and effort spent on day-to-day property management, and long-term rentals are an attractive option for many investors.

 

Short-term or vacation rental 

 

Short-term rentals are often referred to as vacation rentals because they are primarily geared towards recreational travelers. And as more people start to feel comfortable traveling again, the short-term rental market is poised to become a more popular option than ever. In 2020 alone, in the thick of widespread travel bans, the short-term rental platform Airbnb’s market share of the hospitality industry reached as high as 41 percent.6

 

Investing in a short-term rental offers many benefits. If you purchase an investment property in a top tourist destination, you can expect steady demand from travelers while taking advantage of any non-rented periods to enjoy the home yourself. You can also adjust your rental price around peak demand to maximize your cash flow while building equity and long-term appreciation. 

To reap these benefits, however, you’ll need to understand the local laws and regulations on short-term rentals. We can help you identify suitable markets with investment potential.

 

WE’RE HERE TO HELP

 

Ready to calculate your personal net worth? Contact us for an easy-to-use worksheet and to find out your home’s current value. And if you want to learn more about growing your net worth through real estate, we can schedule a free consultation to answer your questions and explore your options. Whether you’re hoping to maximize the value of your current home or invest in a new property, we’re here to help you achieve your real estate goals.

 

The above references an opinion and is for informational purposes only.  It is not intended to be financial advice. Consult the appropriate professionals for advice regarding your individual needs.

 

 

Sources: 

 

National Association of Realtors -
https://www.nar.realtor/newsroom/housing-market-reaches-record-high-home-price-and-gains-in-march

Forbes -
https://www.forbes.com/advisor/investing/what-is-net-worth/

The Washington Post -
https://www.washingtonpost.com/business/on-small-business/your-net-worth-is-americas-secret-economic-weapon/2020/08/20/70df5b92-e2d4-11ea-82d8-5e55d47e90ca_story.html

Bloomberg -
https://www.bloomberg.com/news/articles/2021-04-09/home-prices-soar-in-frenzied-u-s-market-drained-of-supply

Federal Reserve Economic Data -
https://fred.stlouisfed.org/series/MSPUS

Propmodo -
https://www.propmodo.com/what-the-growing-short-term-rental-market-means-for-multifamily-real-estate/