You Can Afford to Buy and Haven't...Are You Crazy?

This may be the best buyer’s market that we’ll see in our lifetimes. There are lots of legitimate reasons why a person should be taking advantage of this market if they are able.

Obviously, if a person doesn’t have the down payment or credit score, they won’t be able to seize this opportunity. If a person is concerned about losing their job, that would be a valid reason for not buying now. If you are planning on relocating in the next year or two, maybe now isn’t the time to buy.

On the other hand, if a person doesn’t own a home, has good credit and job stability, they should seriously consider capitalizing on this unique combination of opportunities. A qualified real estate professional can explain all of the reasons and even suggest some very interesting financing alternatives.

Top Ten Reasons to Buy a Home NOW

1. Interest rates incredibly low – the rates are hovering at near historic lows. Interest rates play a huge part in the cost of housing together with the price and shouldn’t be overlooked. The average mortgage interest rates for the past four decades were: 1970’s 8.9%; 1980’s 12.7%; 1990’s 8.1%; 2000’s 6.3%. Most experts agree that they’re going to rise this year.

2. Lower Prices - Recent price adjustments have made good values that haven’t been available in some situations for years. Current buyers are able to take advantage of the discounted prices.

3. Selection is good – In a seller’s market, buyers sometimes have to accept a home that may not meet their needs completely because of short supply. Inventories in most markets and certain price ranges are higher which allow buyers better choices.

4. Negotiate financing concessions – FHA, VA, and Conventional allow the seller to contribute towards financing concessions for the buyer. The money can be used for buyer’s closing costs, pre-paid items or interest rate buy down.

5. Costs for FHA loan going up – Currently, a seller can pay up to 6% of the sales price in financing concessions but the number will be reduced to 3% later this year; the date has not been announced yet. The annual MIP for FHA loans will also probably be going up this year which will increase the monthly payment. Buyers who get in now will pay the lower fees.

6. Interest and property tax deduction – the U.S. is one of the few countries in the world that allow an interest and property tax deduction for homeowner/taxpayers.

7. Source of funds with deductible interest - a homeowner can borrow up to $100,000 above their acquisition debt and deduct the interest regardless of what purpose the money is used. This is a great opportunity to consolidate debt at a lower interest rate and be able to make the interest deductible that otherwise may not have been.

8. Capital gain exclusion – the U.S. allows qualified homeowners to make a profit on their home without having to pay tax on the gain.

9. Borrowing against equity is non-taxable event – taking money out of the equity in your home does not require recognizing capital gains income.

10. The combination of reasons to buy a home may never be stronger than now.

Interest rates are going up; it is just a matter of when. Inventories are starting to be absorbed by current demand. New home construction is down considerably which could lead to higher prices due to not enough annual housing units to keep up with the population. Prices have started to climb in some markets; others will surely follow.

A basic rule of investing is to buy low and sell high. There will be some buyers who take advantage of the current opportunities and will look back and remark how fortunate they were to act when they did. There will be others who look back on these conditions and say "We should have bought then." Hindsight is always 20/20. Evaluating the present and acting takes equally clear vision. The help of a trusted professional can make the difference.

Should I Consider A Home Auction?

If you've had a "For Sale" sign in front of your house for months, you want something to happen and you want it to happen yesterday. Why not consider an auction? I know. When we think of auctions, we tend to think of auctions strictly for distressed properties. However, this is not true any longer. Selling premium homes via auction has become somewhat commonplace in Los Angeles, Miami, and New York. Now the trend has gained momentum in the Baltimore and surrounding areas.
The idea makes good marketing sense for sellers who missed the real estate boom over the last few years. What are some seller benefits?
It significantly lowers your commission as seller
You have a quicker sale ( 5 weeks from signing agreement to auction date)
Maximum buyer participation
Maximizes dollars
No contingencies
Buyer pays ALL transfer taxes and recordation fees.
These are just a few benefits.

Now suppose you are the buyer? What benefits to you?
Auctions are fun
Open, fair bidding process
Simple and transparent (Since you receive all information needed prior to auction; thus no surprises)
Buyers buy at their price
The decision to bid is reinforced by the immediately preceding bid
6% buyers premium is financeable.

So, auctions are good. Auctions can maximize the value of a property because of the competitive bidding process.
Buyers are eager to bid for a chance at a bargain. This is the only time you can go and buy something at your price.

If you want any more information on the process involved or a list of homes in the area that are offered through auctions, contact me.

Buyer Representation

Buying a home is no small matter. Besides being the largest financial transaction you may ever undertake, it's probably also the most complex. There are so many good reasons to work with a qualified real estate professional-especially a trained professional who has earned the Accredited Buyer's Representative (ABR) designation, representing best in-class buyer services.
When you look for an ABR before you look for a home, you'll be served, not sold. Your interests become their interest. And you'll be working with someone who has gone the extra mile by completing specialized training in delivering the best in buyer-representation services. Plus a REALTOR who has an ABR Designation also has an established track record, with proven experience in representing the concerns of home buyers.
I am designated as an Realtor and an ABR. I also specialize with helping first-time home buyers. So, if you have any questions about today's market, or want to find out if you qualify in buying a home, I will be glad to assist.