What Do New Home Buyers Want? The Surprising Results

What Do New Home Buyers Want? The Surprising Results

When it comes to new home design, are current floorplans and features meeting or anticipating buyers’ needs? A recent survey of future homebuyers – those who intend to purchase within 10 years – from Florida, Texas, Arizona, North Carolina, South Carolina and Georgia builder Ashton Woods produced some interesting responses that could influence how new home builders approach home design and how buyers respond to them.

While we can review the survey results with a liberal grain of salt, knowing that different buyer segments in different areas may have varying wants and needs – and also knowing that what people say they want prior to buying, and what they end of choosing when factors including budget and practicality are woven in at the time of purchase – the Ashton Woods survey is still useful in examining what may be shifting buyer preferences.

Here are some of the, perhaps surprising, results of the survey.

Buyers are over white kitchens. Or, at least, they don’t top their must-have list. “All-white kitchens are now second choice,” said the Washington Post. “The survey found an overwhelming majority of buyers prefer natural wood cabinets for their kitchen, pushing white cabinets to second place followed by distressed wood cabinets.”

Buyers would trade bedroom space for more living space. Sixty-one percent of those surveyed had this preference!

Bye bye, bonus rooms. Buyers still want bonus space, but they want it to match their lifestyle pursuits, and they’re willing to pay for it. Think hobby rooms personalized for yoga, crafting, or wine tasting. “76 percent of the homeowners surveyed said they would spend extra to incorporate a hobby room in their next house,” said the Washington Post.

Home offices remain a priority across all age groups. Almost 70 percent of those surveyed want a designated space, not just wireless capabilities that allow them to work on the couch or at the kitchen table.

Additionally, “Personalization is a priority. When choosing a builder, 75 percent of those surveyed said they are more likely to select a builder that offers design options, and 67 percent said they are willing to pay more for those options,” said Professional Builder.

Source: Buying Tips

Hey, First-Time Buyer: This Is Where You Should (And Shouldn't) Buy A Home

Hey, First-Time Buyer: This Is Where You Should (And Shouldn't) Buy A Home

If you’re looking for the perfect place to buy your first home, you’re likely overwhelmed with the “what,” “where,” and “when.” Many places across the country have seen growth that has pushed prices far beyond what a typical first-time buyer can handle. But that hasn’t stopped them from getting into the market.

“Buying a home for the first time is an exciting and important milestone for many Americans,” said WalletHub. “Their purchases make up a sizable chunk of the market, too. In 2017, 38% of all U.S. single-family home purchases were made by first-time buyers.”

So where should you be looking if it’s time for you to put an end to rent? WalletHub’s new list of “Best & Worst Cities for First-Time Home Buyers” can help.

“WalletHub compared 300 cities of varying sizes across 27 key indicators of market attractiveness, affordability and quality of life,” they said. “Our data set ranges from cost of living to real-estate taxes to property-crime rate.”

Beyond their overall score based on an affordability rank, a real estate market rank, and a quality of life rank, we’re looking at their top five and further breaking down the pros and cons of living there.

No. 1: Broken Arrow, OK

Pros: “Broken Arrow offers both small-town charm and big-city amenities” since it’s close to Tulsa, said Livability. “Some of Oklahoma’s most scenic natural areas surround the community, making it a top spot for outdoor activities, while its cultural attractions draw people seeking arts and entertainment, especially in downtown’s Rose District. Broken Arrow also includes a thriving business climate, three renowned hospitals, and excellent public and private schools.

Cons: Potential for tornados and earthquakes, the latter attributed to aggressive fracking. High sales tax – Oklahoma’s average tax rate of 8.72 percent is the fifth-highest in the nation, according to the Tax Foundation. It’s 8.417 percent in Broken Arrow.

No. 2: Tampa, FL

Pros: Tampa oozes charm with historic neighborhoods you might not find in other first-time buyer cities. Their overall real estate market rank by WalletHub is No. 4. There is always something to do, with tons of ongoing activities, festivals, and special events. There’s no state income tax and property tax is also incredibly low, at two percent. If you’re a sports fan, you’ll also love the fact that there are four professional sports teams in Tampa.

Cons: “Common complaints include a relatively flat landscape and streets that are lined with a multitude of chain retail plazas,” said Life Storage. “Traffic can also be a nightmare. As the lightning capital, you can expect daily thunderstorms throughout the summer, and you’ll most certainly want a hurricane emergency plan.”

No. 3: Centennial, CO

Pros: Mountains! A lovey downtown! Arts, culture, and recreation! And friendly people to boot.

Cons: “Compared to the rest of the country, Centennial’s cost of living is 35 percent higher than the U.S. average,” said Best Places. And while homes are still more affordable than in many places in the country, the growth of the area continues to push them up. That growth also means more and more people discovering the area, and more traffic on the roads. If you’re looking for a private, serene retreat near the mountains, this isn’t it.

No. 4: Boise, ID

Pros: If you’re looking for open space and beautiful scenery, with great access to recreation (Hello, Greenbelt!), you’ll find it here – despite the ongoing growth.

Cons: Winter weather. Lack of a professional sports team (Get used to rooting for Boise State University!). Slower pace – a “pro” for many, but a fact of life that might be harder to embrace for someone craving the vibrancy of big-city life. And a low real estate market rank of 169 by WalletHub.

No. 5: Grand Rapids, MI

Pros: Access to water. If the idea of being landlocked in some of the other cities on the WalletHub list has you in a panic, Grand Rapids could be a possibility since it’s under an hour from Lake Michigan. Low traffic. The list ranks quality of life at No. 142, but if you love beer, you’re in luck because there are great breweries in town (The city even won USA Today’s Best Beer Town poll.).

Cons: If you don’t love cold weather, don’t even think about it. Winters can be brutal. There’s also a notable lack of walkability unless you’re in downtown.

Source: Buying Tips

Newly Listed: Would You Buy The Brady Bunch House?

Newly Listed: Would You Buy The Brady Bunch House?

The Brady Bunch house hit the MLS last week, sending generations of TV watchers into a tizzy. While there will likely one be one buyer – unless hordes of fans join together to pony up the $1.885 million asking price – hundreds, or more likely thousands, will be making their way to the home just to have a peek.

They probably won’t get in unless they’re legitimate buyers; there will be no open house. But that won’t stop many from making the trek to L.A.’s Studio City to at least snap a pic. And, we can’t say we blame them. The Brady Bunch house is beyond iconic. For many of us, it’s where our childhood dreams and memories live, right there in that orange and avocado green kitchen.

Except that the house bears little resemblance to what we saw on TV from 1969 to 1974 (and in reruns that continue today). It’s not that the current owners, who purchased the home at 11222 Dilling Street in 1973 for $61,000, according to reports, overhauled it; there are still mid-century touches throughout.

“The Brady Bunch house comes with its fair share of preserved ’70s style, according to its real estate listing,” said TIME: Money. “Photos show wood-paneled walls, beamed ceilings and lively wallpaper throughout the split-level home. And, save for a fence, the home’s facade looks nearly identical to its on-air appearances.” Take a look at the current interiors and let us know what you think!

What may come as a disappointed surprise to Brady Bunch fans and prospective buyers is that interiors for the show weren’t even filmed here. No, Mike, Carol and thegang never sat around the dining room table in this house. All interiors were shot at a studio.

Will that matter to buyers? It’s hard to know at this point whether someone will be seduced by the nostalgia factor or by the home itself, which does have its issues:

Size: The home definitely isn’t configured for a blended family with six kids, plus Alice. It only has two bedrooms and three bathrooms in 2,477 square feet, plus a converted garage that is now a recreation room. It is on a 12,500-square-foot lot, though. Hey, just add on!

Price: Some are musing that the home is overpriced by about $500,000. Of course, there’s no guarantee that the house will get its listing price.

“For all the fan attention they draw, famous Hollywood homes don’t always command a premium on the market,” said the Los Angeles Times. “When the ‘American Horror Story’ house, a Gothic Tudor-style home in L.A.’s Arlington Heights area, sold three years ago, it did so after years on the market and roughly $14 million below the $17-million original asking price. But for every horror story, there is a happy ending: Two years ago, a much-publicized Alhambra home featured in the movie ‘Father of the Bride’ sold for the asking price. Last year, a Venice compound made famous on the show ‘Californication’ sold for $14.6 million, setting a record for the area.”

Condition: While listing agent Ernie Carswell from Douglas Elliman described the property as, “a postcard of exactly what homes looked like in the 1970s,” not everyone is going to be keen on living in a time capsule. In fact, much interest in the home has been from developers looking to tear it down and rebuild – something the area is known for. “But the owners will give first consideration to bidders who want to keep the home intact, Carswell said to the L.A. Times. “We’re not going to accept the first big offer from a developer who wants to tear it down. We’re going to wait a few days, in case there are others who want to purchase it as an investment to preserve it.”

Fame: Listing agent Carswell expects the home to generate an “avalanche” of interest – “upwards of 500 calls a day.” And once the home is sold, there’s no guarantee that interest will die down. “The buyers of the Brady house will inherit more than just television history. They’ll also own a major neighborhood tourist attraction,” said Yahoo.

The Brady Bunch house is reportedly the second-most photographed home in the country – The White House is No. 1. Sitting in third: “The San Francisco home used for exterior shots in the TV series Full House and spin-off Fuller House, said CNN. Neighbors have complained about the large number of vehicles – including tour buses – that clog the street, creating chaos, traffic, and dangerous conditions.

“Neighbors reportedly came to a meeting with the San Francisco Municipal Transportation Agency…armed with a timelapse video that showed the congestion on the street, estimating that 1,000 to 1,500 people per day come through the area on busy days,” said CNN. They are now “hoping a new city measure banning commercial vehicles with nine or more seats from the street on which the home is located will curb the number of tourists making their way to the location.”

Source: Buying Tips

Goodbye, Saving. Why Not Crowdfund Your Down Payment Instead?

Goodbye, Saving. Why Not Crowdfund Your Down Payment Instead?

You can crowdfund your medical expenses. You can crowdfund your honeymoon. And now you can crowdfund your down payment. Savings, shmavings.

Seriously, though. For people who are having trouble coming up with a down payment or just need a boost, HomeFundMe is a Godsend. Provided through California mortgage bank CMG Financial, HomeFundMe is helping people realize the dream of homeownership by eliminating what, for many, is the biggest barrier.

The idea of crowdfunding a down payment is not totally new, but cooperation with Fannie Mae and Freddie Mac, which signed off on the program, has smoothed out potential wrinkles for both buyers and donors. “HomeFundMe is approved by Fannie Mae and Freddie Mac as a down payment crowdfunding platform because it allows for a fully transparent and verifiable crowdfunding effort,” said Mortgage Orb.

How it works is:

Buyers first get prequalified, as they would to kick off any homebuying process. This will give them an idea of how much they need for a down payment. “Borrowers typically aim to raise 3 percent of the purchase price, which is the minimum down payment for conventional mortgages bought by Fannie Mae and Freddie Mac,” said Benzinga. “Donors can give as much as $7,500. For contributions of $500 or more, donors must sign a gift letter.” DocuSign can be used to make that process easier.

Crowdfunding works on the power of social networking, as we’ve seen with popular platforms like GoFundMe and Kickstarter, so the program recommends connecting user accounts to Facebook and actively sharing. “Write a summary of your goals and publish updates to share your story,” said HomeFundMe. “Upload images that help others get to know you or even showcase your dream home. You also have the option to film and share an ‘Intro’ video. We recommend adding visual content like images and video to give potential contributors a better idea of who you are and what you are trying to do.” HomeFundMe also assigns each buyer a fundraising coach who can help maximize their social outreach.

Once a HomeFundMe campaign is active, the clock starts ticking. Once buyers receive their first gift, they have 12 months to close on their home and use their funds. Gifts can come from anyone – friends, family, strangers, even Realtors. “HomeFundMe has partnered with wedding registries so couples can ask for down payment assistance rather than flatware and dishes,” said Benzinga. “The site also opens the door to Realtors rebating some of their commission for down payments, a practice that’s normally prohibited. A “variance” from Fannie and Freddie “allows Realtors to divert part of their fee to the buyer’s down payment.”

In addition, HomeFundMe has launched Affinity Portal, “a new program allowing employers to add HomeFundMe to their benefit packages to assist employees in overcoming the down payment obstacle,” said Mortgage Orb. “The HomeFundMe Affinity Portal allows employers to add HomeFundMe to their benefit packages, with the option to elect to match donations in any amount.”

Borrowers taking part in the HomeFundMe program can earn more than their goal amount, and donors can also make their gifts “conditional,” so their funds are returned should the home purchase not occur within the 12 months. Also, there are no fees on contributions and no charges for payment processing; by comparison; GoFundMe charges a 2.9 percent payment processing fee.

Source: Buying Tips

Building Your Home Equity Now

Building Your Home Equity Now

There are three ways to build equity, or ownership, when you buy a home. One is to put money down in a down payment. The second is to pay your lender back, and the third is to take advantage of market upswings.

It’s no secret that market momentum has been helping homeowners for a few years. Sales volume is still climbing, says the National Association of REALTORS®. You can still take advantage of low housing supplies and low interest rates to invest in a home.

One way to build equity is to put more money down on the home you want to buy. Lenders have returned to tried and true models of income to debt ratios and requiring that borrowers put more money down when they purchase a home. The more you put down, the more instant equity you have. Putting more money down also helps lower borrowing costs because it lowers risk for the lender.

As you make your house payments, you build equity slowly because interest payments at the beginning of a loan are much heavier than the money paid toward principal. The longer you own your home, the less you’ll pay in interest and a greater share will go toward ownership, or building equity.

For example, if you borrow $250,000 at 5%, your monthly payment is $1,342.05. The first month you’ll pay $1041.67 in interest, and only $300.39 toward reducing your principal. At that rate, building equity may seem like it takes forever. But only two years later, your interest rate lowers by $30 a month allowing $30 more to go toward reducing what you owe your lender.

You can build equity faster by adding a little more to your payment, which removes hundreds of dollars in interest and allows you to own your home in full much faster.

The other way to build equity is to allow the market to do it for you. Home values historically beat inflation by one to two percentage points, but the last decade has been anything but typical. However, all markets return to the norm, so assuming a normal market is on the way, on the modest side, your home should appreciate approximately one percent annually.

In theory, if you purchased your home for $300,000, your home should gain $3000 in value in one year. Home values are expected to rise about seven percent in 2015, so if you buy a home now, you could still do well.

Market variables from the weather to the Fed can all play a part in how quickly your home builds market equity. But one thing is certain, you can’t build equity unless you’re invested.

Source: Buying Tips

6 Don'ts When Buying Your First Home

6 Don'ts When Buying Your First Home

These are exciting times. You’ve finally outgrown apartment life or living with your parents or sharing a place with waaaaayyyyy too many roommates, and you’re ready to take the leap to homeownership. Now it’s time to prepare. As you embark on this journey, beware of six important don’ts that could potentially derail your purchase.

Don’t think it’s too early to get prequalified

So, you’re just going to go out “looking” at houses, you say? The time when you just expect to drive around a little and maybe visit an open house or two is obviously the time when you’re going to fall in love with a house and want to make a move on it right away. If you’re not already prequalified with a lender, you may not have a chance at it. Competition is fierce across the country thanks to low inventory, and well-maintained, move-in ready homes do not sit if they’re priced right. Talk to a lender now to make sure you can qualify – and learn your max budget – even if you just think you’re casually looking (because that can change in a hurry!).

Don’t wait to the last minute to check credit

As a continuation of the casually looking conversation…you want to check your credit the second you start thinking about buying a home. You never know what’s going to be on there. Even if you’ve never missed a payment and have always done a good job of managing your outstanding debt, there could be errors on your report that you’re unaware of or even something from many years ago that you didn’t realize had been reported to a credit agency. Those little boo-boos, accurate or not, could be hurting your score, and a low score could keep you from getting a mortgage at all. Give yourself time to correct errors or fix blemishes; every tick upward can help you get a better rate and make your home more affordable.

Don’t forget about PMI when calculating your monthly expenses

The idea of putting as little down as possible on your new home is attractive, especially if you’re not a natural saver. Today, that can mean just three percent of your purchase price, depending on the loan. For FHA loans, it’s three and one-half percent. The problem with making the minimum down payment is that you then have to pay Private Mortgage Insurance (PMI).

“PMI is a fee you pay on your mortgage until you owe 80 percent or less of what your home is worth. It’s one reason why so many experts advise homebuyers make a 20 percent down payment; if you do, you avoid the evils of paying PMI,” said Student Loan Hero. “PMI can cost between 0.3 percent and 1.15 percent of your loan annually. Depending on how much you borrow, that can mean thousands of dollars in extra costs until you can cancel your PMI.”

Don’t ignore the closing costs

Many of us micro-focus on the down payment when getting ready to buy our first home, but there is another important expense related to the purchase: The closing costs. Closing costs encompass a wide variety of fees, some or all of which may apply to you depending on where and what you’re buying. They can include everything from the application fee and appraisal to the escrow fee to the home and pest inspection to the recording fees. You’re looking at between two and five percent of your purchase price for closing fees, which can definitely add up. Many first-time buyers fail to factor this in when getting ready to purchase, and you don’t want something that could amount to a few thousand dollars or more to come as an 11th-hour surprise.

Don’t forget to factor in all the monthly expenses

New-home communities often quote a monthly payment that looks quite affordable and that can entice buyers who don’t look more closely. That’s because the payment is based on principal and interest only (Typically, you’ll see a star next to the payment that tells you there’s a disclaimer at the bottom of the page.). If you take a look at the small print, you’ll see that there are also taxes and insurance to factor in. In some cases, there is also a homeowner’s association fee. That monthly payment may not be looking so good anymore.

If you’re buying your first home and coming from an apartment or other rental property, you may not have worked things like a gardener into your monthly budget. You’ll also want to consider that if you’re going up in square footage, there could an increase in your utilities, and you may be taking on payments for things like water and trash that were covered by your rental. It’s best to have a true idea of what your monthly expenses are going to look like when buying your first home so you don’t end up in over your head.

Don’t think you can go it alone

Can you buy a home without an agent? Sure. Is it a good idea? Not usually. It could be that you are looking to buy a home that is for sale by owner. “In the industry, we call these types of sellers unrepresented,” said The Balance. “Beware if you are trying to buy a home directly from an unrepresented seller. Odds are the seller won’t know what she is doing or she might be taking advantage of you; either way, it could be problematic.”

Unless you are a real estate attorney or are otherwise connected to the industry and aware of the laws, contract issues, etc., it’s best for you to have representation, regardless of what type of home you are buying.

Source: Buying Tips

Want To Buy And Renovate A Property Overseas? 9 Things To Consider

Want To Buy And Renovate A Property Overseas? 9 Things To Consider

If you’ve ever seen a movie like under the Tuscan sun, you’ve undoubtedly had your own Italian farmhouse renovation fantasy. But how real is it to think about buying property in a place that requires changing currency and a long plane ride?

“Buying and restoring a fixer-upper in another country…It can be an appealing idea,” said Huffington Post. “Houses in need of some tender loving care can be bought below market value and, when renovated, can resell for a nice profit. This is especially true in countries where labor costs are low. Using local labor and local materials (hardwoods, stone, etc.), you can add a lot of perceived value for not a lot of money.”

But, that doesn’t mean the process is easy. Think: Permit issues, trying to manage a delicate process from halfway around the world, and all the typical issues associated with renovating an older property – magnified by all that international intrigue. Still interested? We’re breaking down the particulars. 

Carefully consider the location

The image above is of a multi-use building next to the Trevi Fountain in Rome. The first floor comprises several shops, a café, and a Gelateria. On the second floor: Apartments. The two remaining floors are empty and in need of major restoration and renovation. Imagine the potential of these apartments, simply for the views alone. And, imagine the undertaking! But mostly, imagine the demand for modern, renovated apartments here, right in the center of town, mere footsteps from one of the city’s most spectacular sights.

“Location, Location, Location. The old adage about location is true,” said Expat Focus. “Picking the right location is as important as the property. Picking the wrong one can be a nightmare. Think carefully about your requirements and if an abandoned property in the middle of nowhere seems remote on viewing, it will be even more so when living there.”

Work with professionals who specialize in renovating older properties

Yes, moving to England for a year to renovate your old farmhouse sounds dreamy. But, let’s be practical. There are few among us who can uproot our lives that way (But, if you do it, please take us with you!). Bucket list aside, there are far more reasons to consider purchasing an overseas property to renovate than because you’re having an Eat Pray Love moment. And whether you’re looking to move into the property some day or renovate it sell for profit, you want to do it right, which is why working with the right people is so important.

“London is filled with period homes, and owning one of these homes has become a hot commodity in the London property market,” said The Resident. “The issue, however, is that while the outside of these homes are timeless and grand, the interiors don’t always match up.” Property management company Huntsmore focuses on renovating these period homes. “Very often we will assess a property and the walls and floors aren’t straight, or the original plaster work is out of shape,” they said. “Many of these period properties have been converted, sometimes very badly, into flats, with no regard for practicality or aesthetics. We see odd pipework boxed in, poor space configuration and many of the original cornicing and fireplaces removed. One of the main issues is that many of the problems associated with renovating a period home are not identified until the works have started and the property has been gutted. We try to identify as many of these possible hurdles as possible in the design phase to avoid delays and keep the project on track.”

Make sure it’s legal

Buying an international property may not be as easy as hopping on a plane, and, in some cases, it might not even be legal. Different places have different requirements, so be sure to check before you go off and purchase an old Victorian on a whim while on vacation halfway around the world. “Non-Bahamians must register any purchase with the Foreign Investments Board, and special permits are required,” said International Living. “Non-Croatians can purchase real estate in this country if they have approval from the Ministry of Foreign Affairs.” You can check International Living for a country-by-country guide.

Get your finances in order

“One of the biggest hurdles to buying real estate in another country can be coming up with the capital required to close on the purchase,” said U.S. News & World Report. “In much of the world, financing isn’t easy to organize. In some places financing is not possible at all for foreign buyers.” Cash is king around the world, and, in some places, it’s not just king, but also emperor.

Know your buyer

You’ll likely have a more limited buyer base in an international market, and knowing precisely who might bite on your home will drive your renovation. Are you in an area that attracts families, or are you mainly looking at retirees seeking retirement far from their current reality?

“Unless you plan to live in the home forever yourself, do your best to imagine who your resale buyer might be from the start, before beginning the restoration work,” said Huffington Post. “If you plan to rent the property, identify your target renter. If your resale buyer will likely be a retiree, you’ll make different choices than if you think you might be reselling to a family with children, for example. The differences have implications for both the work you do and the location you pick.”

Make a friend

Finding a potential goldmine when it comes to any renovation project is often about who you know. Keep your eyes open when traveling, and talk to the people you meet. Sure, there are real estate companies who can help you locate properties for sale, in addition to helping you renovate, but they may not know that the great aunt of the neighbor of the shopkeeper where you bought souvenirs is thinking about selling her incredible old place with the impossible view of the Aegean.

Think about power

Buying an international property can come with a number of particulars you may not previously have thought about, and electricity is a big one. “Unless you want to get embroiled in a lengthy and costly planning application, avoid properties not connected to main electricity,” said Expat Focus. “Despite some estate agents’ claims connection is just a telephone call away, this is not the case most of the time.”

Recycle

If you’re buying abroad, you’re almost certainly buying an older property. That can mean charming period details, but it can also mean outdated function and features. Remember when you’re renovating that you don’t need to ditch all the old to bring in the new. Save what you can and put it back, or use it in a whole new way. Working with tradespeople who are committing to reusing and recycling materials will save you money, aid the environment, and help you create a standout property.

Pay attention to local zoning laws

You can be the most experienced renovator in your state, or country, for that matter, and still feel completely out of your element when you go international. That could mean rules and laws you’re not aware of.

“Check to see if it is a listed (historic or heritage) building,” said Plaza Estates. “If it is, there may be some restrictions on what you can do when renovating.

“Beware of the local planning laws. Depending on the type of renovation you are undertaking, it would be wise to check with the local planning authority. Not all renovations will require planning permission, but it’s prudent to check if you are planning a major renovation.”

Source: Buying Tips

Emerging Trends Threaten Housing

Emerging Trends Threaten Housing

Household growth has increased over the last three years, millennials are stepping up, and home prices have recovered from recession lows. So what is there to worry about? Not much on the surface, but there are some emerging trends that suggest good times won’t continue for much longer in the housing market.

Rising housing costs

According to the latest from Joint Center for Housing Studies at Harvard University State of the Nation’s Housing, the cost of housing has outpaced incomes to the point that almost one-third (38 million) U.S. households are cost burdened, meaning they pay 30 percent or more of their incomes for housing in 2016. Worse, 47 percent of renter households (28.8 million) are cost-burdened, with over half paying more than 50 percent of their incomes for housing.

The price of a typical existing home sold in 2017 was more than four times the median income, compared to just over three in 1987.

Tepid wage growth

While there’s been growth in wages in recent years, it hasn’t kept up with inflation, and certainly hasn’t kept up with housing. The real median income of households in the bottom quartile increased only 3 percent between 1988 and 2016, while the median income for adults aged 25 to 34 rose by just 5 percent.

Meanwhile, the median home price grew 41 percent faster than inflation between 1990 and 2016, the median rent grew 20 percent faster. Adding insult to injury, 2.5 million rental units priced below $800 serving households earning up to $32,000 annually were lost between 1990 and 2016.

Income Inequality

A new report from the National Low Income Housing Coalition attests that there’s not one state, county or metropolitan area in the entire United States where a full-time worker earning the federal minimum wage of $7.25 an hour can afford a modest 2-bedroom apartment. They need three times that amount, or $22.10 to afford a modest two-bedroom rental.

According to real estate analyst John Burns, the problem is the shrinking middle class, which is diminishing demand for median-priced housing. “Among households headed by those under age 65, middle-income households plunged from 57% of American households in 1970 to only 45% today – a decline of 12%. The result has been a 7% increase in the percentage of households who earn more than double the US median income, from 12% in 1970 to 19% in 2016 and a 4% increase in the percentage of households who earn less than 80% of the US median income, from 31% in 1970 to 35% in 2016.”

<p>Senior Households increasing faster than Millennials

Millennials formed an average of 2.1 million net new households annually in 2012–2017, but despite being larger in numbers, they’re forming fewer households than older generations. Over the past 10 years, the number of older households grew by over 7 million, rising from one in five households to one in four. By 2035, one out of every three households will be at least 65 years old. As the oldest homeowners move into care facilities or pass on, there eventually won’t be enough buyers for senior homes because younger household formation hasn’t kept up.

New Housing Still Underperforming

New JCHS analysis projects household growth at a rate of 1.2 million per year between 2017–2027. Single- family construction, however, has remained well below the long-run annual average of 1.1 million units for at least ten years.

Homebuilders are trying to keep up. Single-family starts rose 8.6 percent to 848,900 units while permitting increased in 78 of the 100 largest metros, but because of the higher cost of materials, new homes are priced higher than existing homes. In April 2018, the median price of new homes sold was $312,400, compared to the median existing-home price of $257,900.

And for the first time since 2009, the national rental vacancy rate rose, ticking up from 6.9 percent to 7.2 percent. Most of the increase was concentrated among newer and higher-cost units, which suggests the party could be about to end.

The National Association of REALTORS® reported that housing sales volume has fallen for the last two months. While prices are at a 74-month high, sales volume is 1.4 percent below a year ago.

While it’s early to call a housing recession, the indicators are being felt. Home prices, affordability, household formation, wages, rental, existing and new home performance are all categories to watch going forward.

Source: Buying Tips

10 Places That Will Pay You To Move There

10 Places That Will Pay You To Move There

Close to job. Great schools. Projected growth. They’re all reasons why someone might consider buying a home in a certain area. But here’s one more important reason: Because someone wants to pay you to move there.

That’s right. You could actually make money moving to a new area…if you’re willing to go where the interest is.

“The idea has spread where a strong economy, an aging population and an exodus of younger workers have triggered severe labor shortages – often places with very low unemployment rates and higher-than-average wage growth,” said MSN. “That’s why small towns across America, instead of offering incentives to employers, such as Amazon.com Inc., are giving it to workers – one by one.

We’re talking about places like:

North Platte, Nebraska

The city offers incentives “from student loan help and home buying grants, to gifted parcels of land and even town-wide ceremonies in your honor,” said Inc. “Last year the North Platte chamber of commerce started offering up to $10,000 to anyone who moves there for a job, in the hopes of helping the town of 24,000 fill some of its hundreds of job openings. They’ll even present you a large check during a ceremony in your honor.”

St. Clair County, Michigan

This city has its eye on a student population who they hope will then stick around and pump money into the economy. They recently upped their student-loan scholarships from $10,000 to $15,000.

Grant County, Indiana

Move to Grant County with “advanced training or a college degree” and you could get $5,000 toward a home from the economic development office. You have to stay for at least five years. You could also get a $9,000 scholarship from the chamber of commerce to help repay loans.

Hamilton, Ohio

Or, move to Hamilton, instead. The city’s student loan repayment incentive is $5,000.

Marne, Iowa

You can even get a free piece of land when you move to Marne. “The small town of 120 has a free-lots program that offers any newcomers a free piece of land to build a home on,” said Inc. “The state of Iowa has one of the lowest unemployment rates in the country at 2.8 percent.”

But it’s not just small American cities that are enticing new residents to move there. You can opt to move to Canada, Switzerland, Chile, or even Italy, and get paid to do so.

Candela, Italy

“It pays to live in Candela, Italy. The once-bustling town in Puglia has dropped from more than 8,000 residents in the 1990s to just 2,700 today, so the mayor is offering up to 2,000 euros (about $2,350) to lure people back to the picturesque Medieval village of winding streets and restored palazzos surrounded by hills and forests,” said Moneyish.

To qualify, you must “live inside Candela, rent a house and have a job paying a salary of at least 7,500 euros ($8,800) per year. Singles will receive 800 ($940) euros from the town coffers, couples will get 1,200 euros ($1,400), three-member families will get 1,500 to 1,800 euros ($1,760-$2,100), and families of four to five people will get more than 2,000 euros ($2,350). Candela may also give tax credits on city waste disposal, bills and nurseries in the future.”

Saskatchewan

“If you’ve graduated from a Canadian post-secondary institution and you live in Saskatchewan, you can qualify for a tuition rebate of up to $20,000 under the province’s Graduate Retention Program,” said Slice

Pipestone, Manitoba

In the rural municipality of Pipestone, Manitoba, you can get a grant worth up to $32,000, buy a home with just a $1,000 deposit, and buy a lot for just $10. 

Albinen, Switzerland

Last year, residents of Albinen in southern Switzerland pushed for an incentive program to attract some more folks.”According to the proposal, anyone who decides to move to the village and buy, refurbish or build a home should be paid an incentive: CHF 25,000 per adult and CHF 10,000 per child,” said Swissinfo. “There are conditions though: applicants must be below the age of 45 and commit themselves to living in Albinen for at least ten years. They will also need to invest a minimum of CHF200,000 in the property, with the financing approved by the bank. If someone moves away or sells the property within these ten years, they will have to pay back the money received from the village.”

Chile

Chile fancies itself the future business center of South America, so its efforts are geared toward startups. “In this scenario, Chile will pay a company $50,000 through their program Start-Up Chile,” said Nomadapp. “In order to qualify, the startup must have the potential of becoming global and largely successful. In addition, they will provide you with a one-year work visa and business contacts. The support system is completely in English despite the country being primarily Spanish speaking.”

Source: Buying Tips

Steps To Building Wealth

Steps To Building Wealth

It’s never too late to secure your financial future. At BuildingWealth.org, a public service offered by the Dallas Federal Reserve, you can learn how to reach your life goals by budgeting, saving and investing, building credit and controlling debt.

When you understand the difference between assets and liabilities, you know that owning a home, contributing to a retirement plan, and creating savings are all assets in the making because they increase in value or provide a return. Automobiles, clothing, smartphones and furniture are not assets because they depreciate in value. Liabilities are debts that you owe to credit card companies, mortgage lenders, hospitals, etc.

It doesn’t make sense to go into debt to buy possessions that aren’t assets, unless it serves a necessity like a car that gets you to and from work. That’s why lenders look at your credit history to see how sensibly you spend money and if your finances fall within their income-to-debt guidelines. You don’t want them finding that all your free income goes to eating out and mall shopping. No matter how much money you make, you shouldn’t have more than 42 percent of your income going to pay liabilities and that should include credit card debt, rent, car payments, student loans, etc.

So the first step is creating a budget that enables you to save money. Track your spending and see where money is wasted so you can cut back and create savings. If your company offers a 401K plan, contribute as much as you comfortably can. Give yourself a goal to eat out once a week instead of five times a week. You’ll be surprised at how quickly you’ll build savings.

Owning a home is one of the foundations of wealth. With rare exceptions, the longer you own your home, the more equity, or ownership you’ll have. Equity is created three ways – when your home rises in market value, when you pay down or pay off your liability, and when you make repairs and improvements that raise the value of the home.

Home ownership is like a forced savings account. Until you sell the home, you’re not going to touch the equity you’ve built unless you take on a liability by refinancing your mortgage to make improvements.

To figure out what you need to do to buy a home of your home, you should create a budget and a gameplan and then calculate how long it will take you to save the amount you need. If you want to save $20,000, that will give you a 10 percent downpayment on a $200,000 home. Saving $200 a month, you’ll be able to buy a home in just over eight years, but it’s likely that you’ll save much more per month with as your income increases, your spending habits improve, and your investments start to show returns.

All it takes is time and money.

Source: Buying Tips

Sneaky Ways To Find A Home That's About To Be Listed For Sale

Sneaky Ways To Find A Home That's About To Be Listed For Sale

Coldwell Banker just rolled out some exciting new tech that’s meant to help determine when someone is about to list their home for sale. What may sound Big Brother-y to some is being lauded by others as the Big Data answer to next-level real estate success. Call it the high-tech version of going door-to-door asking if owners are looking to sell their home. Also, call it a great lead source for agents and a potential boon for buyers looking for an “in” after repeatedly getting shut out of homes thanks to ongoing inventory issues.

“In a real estate market facing a severe lack of homes for sale, agents could really use a secret weapon – something to shake up the status quo of the listing and selling game…something to help them compete in a low inventory market,” said RISMedia.

Coldwell Banker’s solution: CBx Seller Leads, which can identify homes that are most likely to be sold before an agent ever becomes involved. “Coldwell Banker has taken it to the next level, expanding the value of big data for real estate by adding proprietary algorithms and machine learning to the data in the original CBx product to fuel the entire CBx Technology Suite and give brokers and agents access to market intelligence they can’t get anywhere else.”

Skeptical? Consider this: “Coldwell Banker piloted CBx Seller Leads in 16 different markets; during the pilot, leads converted at twice the industry average.”

The potential advantage to the agent is undeniable, but we also love the benefit to buyers. Agents who nurture those leads may be able to find a gem for a client without having to fight other buyers in a crowded market where inventory is at a premium. But CBx Seller Leads isn’t the only way to get an early beat on new homes that haven’t yet been listed. Here are some more tips that could help you find that elusive home.

Stalk your preferred neighborhood

Sure, the workmen outside that cute corner Colonial could mean the homeowners are doing some updates to make the house function better for them. Or, it could mean they’re making updates to get the home in better shape so they can list it. You don’t know until you ask. Your real estate agent may recommend leaving this task to them for best results, and, you never know – it could turn out that you end up shaking on an as-is property that gets you into a desired neighborhood, gets you a great deal, and gives you the opportunity to fix it up the way you want to.

Work with a connected REALTOR®

If a listing doesn’t get posted to the MLS or the big listing sites like Trulia and Redfin, how do you find out about pocket listings? The first step is to ask your real estate agent. Tell them that you’re interested in pocket listings and that you’d like to expand your search beyond the homes on the MLS. Encourage them to reach out to other realtors to see if there is a hidden gem on the market. It’s a lot more work than scouring the online listings, but sometimes it can really pay off. In addition to working with an agent, there are also sites getting into the pocket listing game, such as PocketList, which specializes in unlisted homes in the San Francisco Bay Area. Zillow also has a “coming soon” search feature, which allows you to check out homes that have not yet been posted on a listing service.

What you’re looking for in a real estate agent is someone who is going to work hard for you, obviously. But, especially when you’re trying to find a home in a hot market where there aren’t a lot of available homes, working with someone who has a large base of connections in the industry and a great working relationship with other agents is crucial. Those relationships may yield early notice on a new home about to hit the market or pocket listings you’d never know about if it weren’t for your agent.

Look for an unkempt yard

Could be an overwhelmed homeowner, could be the owners are on an extended vacation…or it could be that the home is about to be foreclosed on.

Track “Notices of Default”

Finding a pre-foreclosure property isn’t as easy as driving down the street in your preferred neighborhood, looking for signs on the lawn. There is no complete list that aggregates listings of homes subject to a notice of default, and it can be a process to find these potential buys. A savvy agent who hustles to find properties in default can be a real asset to a buyer, especially if they are able to cultivate a relationship that ends up with a great home and a great deal for their buyer and an “out” for the seller.

“The easiest way to buy a pre-foreclosure home is to help the seller to make up the back payments and then arrange to buy the home directly from the seller,” said The Balance.

Source: Buying Tips

10 Things To Do After Relocating To A New City

10 Things To Do After Relocating To A New City

Free at last! The backbreaking work of moving large furniture from one side of the house to other is finished. No more do packed boxes line the house. It’s a great feelings of accomplishment. Enjoy your reprieve for a night as you’ve earned it. After giving yourself a day of rest it’s time to get back to work!

1. Get Connected to your New Neighborhood: Probably the most anxious part of moving is meeting your new neighbors. It’s essentially a crap shoot as they could be wonderful people that you will eventually trust and perhaps they will become a vital asset once you become settled in. Or possibly they could be the Neighbor from Hell. Regardless going out of your way and introducing yourself to the neighbors will go a long way as we know first impressions last a lifetime.

2. Update your address with the important contacts: Emergency contacts, banks, family members, and collectors must all be made aware of your address change. This can be a bit tedious, but you must make sure everything is in order as you would hate for some meaningless bill go into collections due to sheer negligence.

3. Register your vehicle: Go to dmv.org and get new tags, a license plate, and a registration card. If you don’t and you get pulled over you will be very sorry. You will most likely have to waste a day in court to appeal whichever fine may have been levied on you.

4. Re-register to vote in your new location: Follow http://www.eac.go. It’s important that you do this as states rules and regulations vary when it comes to establishing residency.

5. Find a doctor/dentist: Click here to find a Doctor or Dentist near you. Make sure to do a quick check of ratings as well.

6. Update your insurance: Compare Auto Insurance now! You would be surprised to see how much auto insurance can vary state-to-state, but it certainly make sure you get the best and most advantageous rate.

7. Check your commute to work: Try at least two different routes and time how long it takes you to go each way. As good as Google maps is becoming, it’s still better to be prepared and know multiple ways to get to work in case an unfortunate event were to happen causing you to be late to work during your first week.

8. Get acquainted with your new city! Try new things: Go to new grocery stores. Check out urbanspoon.com and see which restaurants are the best in your area. Look up TripAdvisor and see which attractions are closest to you.

9. Review your moving company: Perhaps it was a pleasant experience perhaps it wasn’t. If you indeed had a bad experience make sure other people don’t make the same mistake that you did.

10. Schools: If you have children make sure to get them registered and set to go for school. Also make sure to check for sports leagues, clubs, or extracurricular activities to get them involved.

Source: Buying Tips