Real Estate Tidbits

February 2012: This Month in Real Estate and How to Improve Your Credit Score When Buying a Home

Is Now a Good Time to Buy a Home?

I am asked this question quite a bit... and the answer is simple. No, it's not a good time to buy a home... it's a GREAT time to buy a home. Many think that because of everything going on in the economy and with all the uncertainty in the real estate market, that they should sit on the sidelines and wait. I say "wait for what?".

Think about it... here we are in January of 2012 and...

1) We currently are experiencing the lowest home prices we've seen in a decade.
2) Interest rates are at historic lows.
3) With all the forelcosures, short sales and even "regular" sales currently available, there's LOTS to choose from. Small homes, big homes, old homes, new homes, inexpensive homes, and even more inexpensive homes.

I'm not sure how it could be any better.

Yes, it's very possible home prices could drop even more in the next year or two. But, if you plan to live in your home for a few years or more, then so what? Even if prices drop a bit more, you'll still have the tax advantages of owning your own home. You'll still have the pride of owning your own home - you can paint it whatever color you want, you can remodel, change or improve whatever you want... it's YOUR home. And, of course, you're not paying rent... your payments are working for YOU... not some landlord.

Not convinced? Call me and let's discuss your situation. I'm at (916) 241-8000 or (530) 677-1332.

January 2012: This Month in Real Estate and Benefits of Selling in Winter

A Quick and Simple Explanation of the Mortgage Process

November 2011: This Month in Real Estate & 3 Secrets to Home Ownership

What is "PITI"?

What is PITI?

PITI is the acronym used to indicate what is included in a mortgage payment.  It means "Principal, Interest, Taxes, and Insurance", all paid as part of that monthly payment. If you have an "impounded" loan (also known as an impound account), then your monthly payment to the lender includes all of these and may even include mortgage insurance, too.

If your payment just includes PI (principal and interest only), then you'd pay for your insurance and property taxes separately, outside of your monthly mortgage payment.

What is a "contingency"?

What is a "contingency" as it relates to real estate?

A contingency is a provision or condition in a real estate contract that specifies the contract could be cancelled if that contingency/condition is not met or does not occur.

For example, if a contract has a contingency that requires that the buyer be able to obtain a mortgage loan at 4.5% or lower, but rates increase above that percentage, then the buyer has the option of cancelling the contract based on that contingency not being met.

Another contingency that is often in real estate contracts is the requirement that the buyer be able to obtain a satisfactory home inspection.  If the results of an inspection are not acceptable to the buyer, then they are likely able to cancel that contract. 

Octobert 2011: This Month in Real Estate & One of the Most Important Things a Buyer Wants When Looking to Buy a Home

Buying a Short Sale Property

Buyers: Think You Need 20% Down? Think Again.

Many would-be home buyers think they need to put 20% down when buying a home... and this keeps many of those buyers out of the market.  Programs are available that allow buyers to purchase with very little money out of pocket... check out this short video and give me a call to discuss the possibilities.

Is It Still a Good Time to Buy Real Estate? Here are 3 Reasons the Answer is YES!

With all that's been going on in the the stock market, the real estate market, and in the global and nationwide economies, many wonder if now is a good time to buy or invest in real estate.  While that's certainly a fair question, think about the positives of buying in today's historically-low real estate market.

1. Prices are LOW:  Home prices are down by 50% or more in many areas, especially here in the Sacramento area.  El Dorado and Placer county values have dropped significantly, too, within the past five years.  Think of it this way:  Homes are ON SALE... up to 50% OFF and MORE!
2. Interest Rates are LOW:  Interest rates are the lowest we've seen them in decades.  They can't get much lower.  Those buyers who wait for lower real estate prices, may possibly pay less in price but, when interest rates go up, that savings on price may be lost by the interest rate increase.
3. LOTS of homes to choose from:  We're seeing available home inventories at some of the highest levels in many years.  There are LOTS of choices... regular sales (those with equity), short sales (those where the current owners owe more than the homes are worth), and REOs/foreclosures (those owned by the banks following a foreclosure).

So... as you can see, now may be the BEST TIME to buy.  Remember... the greatest opportunities are often had within the worst of times.  Those who succeed greatly often do it when others run for the hills. 

Call me and we can discuss the potential opportunties available for you.

August 2011: This Month in Real Estate

April 2011: This Month in Real Estate

March 2011: This Month in Real Estate

February 2011: This Month in Real Estate

Many Buyers Think Foreclosures are Hard to Buy... Think Again!

It's true... many of the buyers I talk to try to avoid foreclosures because they think the buying process for foreclosures is more complex and takes longer than traditional sales.  As a Realtor who has sold literally hundreds of foreclosures in the past few years, I can honestly say that, in many respects, foreclosures are much easier to buy than a home sold by an actual homeowner.

Many people get confused between foreclosures - also called bank-owned or REO (real estate owned) properties - and short sales.  Short sales are those properties where the homeowner owes more on the mortgage than the property is worth and the sellers are trying to get their mortgage holder to agree to take less than the outstandning mortgage... those sales (short sales) can indeed take much longer than a traditional sales... often many months.

Foreclosures, on the other hand, are bank-owned properties that the bank wants to sell, mitigate their loss, and get the property off their books. Those properties, contrary to popular belief, are actually very easy to buy. 

And while there are some typical restrictions to buying foreclosures, like often they're sold AS-IS, and there's little negotiation after the escrow process has begun, the process overall is much like a traditional sale. Even the time lines are consistent with a traditional sale... often 30 - 45 days to close a transaction.

In addition, many people think all foreclosures are dumps or in poor condition. While that's true for some properties, many are very nice homes where the previous owners fell on hard times, but took great care of the property.  I've sold many, many foreclosures that were absolutely gorgeous.  So, just because it's a "foreclosure," don't automatically think it's in bad shape. 

So... if you're in the market to buy, either to live in or for investment, certainly don't pass up looking at the foreclosures that are for sale.  They make up a large portion of the available properties on the market... check 'em out.

Also read:

Who's Buying Distressed Properties
Foreclosure Properties Often Get Multiple Offers

Home Buyers See the Amazing Benefits of Buying in Today's Market

Yes, it's true... every time you watch the news, there's another story about how bad the real estate market is and how much worse it's supposed to get.  Of course, negative news is what the media is all about.

While much of the news in real estate has been "less than positive" over the past few years, many savvy buyers see "opportunity" where others see "doom and gloom."

Napolean Hill, author of the classic book Think and Grow Rich said it best: "Out of every adversity comes the seed of equal or greater benefit."  And that includes the current real estate market.

The current market boasts three main "seeds of equal or greater benefit" to those buyers open to seeing them:

1. SUPER-LOW HOME PRICES:  We haven't seen prices this low in many years.  And with many sellers and banks (who are selling foreclosures) willing to negotiate on price, buyers are getting homes for up to 50% or more below their peak prices just a few years ago. Homes and other real estate are really "on sale."
2. SUPER-LOW INTEREST RATES:  Recently, we've seen interest rates hit historically-low levels.  Rates under 5% are still available (as of this writing) with buyers financing with 15-year mortgages sometimes getting rates in the 3's.
3. PLENTY OF INVENTORY TO CHOOSE FROM:  While inventories are lower now than they were a couple years ago, there's still lots to choose from.  With foreclosures, short sales, and traditional sales... there are many options for buyers looking to buy to live in or for investment.

If you're considering buying for the first time, looking to sell your current home and buy another, or if you're looking to take adavantage of the investment opportunities currently available, then give us a call.  Let's discuss the possibilities.

Also check out:  Why Should Buyers Buy During the Current Recession?

 

First Time Home Buyers

Who's Buying Distressed Properties

Buying a Short Sale Property

Why Should Buyers Buy During the Current Recession?

This is a topic I discuss regularly with would-be buyers and investors: Why would anyone buy real estate in today's tough times and down real estate market?  The answer is very simple: It's truly one of the BEST TIMES to buy or invest in real estate?  Puzzled?  Read on...

Have you ever heard that great fortunes are made during tough times?  Sure you have. Some of the richest and most successful people TAKE ACTION during times of uncertainty?  Why?  Because others don't, and... opportunities abound.

One of my favorite sayings is "Successful people do what others are afraid to do." Think about it... isn't it true?  In the real estate market, we can define "successful" people as those to see opportunities that are available during the current recession and move on those opportunities. Does that mean those who don't take advantage of the opportunities are "not" successful?  No, of course not.  It just means that those who do may very well come out ahead of those who don't.

During today's challenging economy and down real estate market, there are three primary reasons those considering buying real estate should "jump in":

1. Prices are the lowest we've seen in MANY years. Yes, this is a biggie... prices are low. Think of it this way: REAL ESTATE IS ON SALE... UP TO HALF OFF OR MORE!!! If you saw a sign in the mall that said that, wouldn't it catch your attention? Sure it would. Homes and investment property prices are the lowest they have been in a long time. Why wouldn't someone buy now? Some would say that values could drop even further and they'd prefer to wait until they can get an even better bargain. That logic does make sense... to a degree... but how long will they wait?  What if they wait too long and the market starts heading back up? Then they missed the boat.  By the way... the only way to truly know when the real estate market has "bottomed out"... is when it starts heading up again; and then all the best opportunities may be gone. Think about it.
2. Interest rates are at, or near, historically-low levels.  Even if property values drop a bit more, interest rates will go up, making now a truly amazing time to buy.
3. Lots of inventory from which to choose.  There are plenty of choices out there... from foreclosures, short sales, and even "regular" sellers - those who have equity.

So, as you can see, it truly is a great time to buy. In fact, this may be the best opportunity we'll see in many years to get a great deal on real estate.

And, remember... even if prices drop a bit more, we may not see interest rates this low for many more years, so any money saved in waiting a bit longer for prices to drop may be offset by the soon-to-be higher interest rates.

Of course, if you're not sure what your best move is in today's market, give me a call.  We can discuss your specific situation and how you can take advantage of the opportunities currently available.

July 2010: This Month in Real Estate

It's Offer Time... Time to Get Nervous... And Yes, It's OK

While anything having to do with buying or selling real estate can be nerve-racking, it seems like buyers and sellers get the most nervous at around the time when an offer is being made... either when it's a buyer making an offer to purchase, or when it's a seller considering an offer that has just been made on their property.  Of course, when people get nervous and their anxiety levels rise, they tend to make poor decisions... or worse yet, they get "decision constipation" and can't make any decisions at all.

One thing that both buyers and sellers must remember is that this nervousness is normal and certainly OK.  It's just the body telling you that this is a big deal... and it is. But it's not beyond your capacity to handle it.

Getting scared, nervous, and anxious is perfectly normal.  And the term "buyer's remorse" (which is nothing more than anxiety) applies to sellers, too, and is very common.  In fact, I'd say that if there were no nervous feelings at all... then that would be strange. 

The bottom line is this... accept nervousness and higher anxiety levels as normal when offers are being made or considered.  The best thing buyers and sellers can do is to work closely with their Realtor to evaluate all options and make good decisions.  Realtors work with nervous buyers and sellers all the time and understand the anxiety associated with this business.  Talk to your Realtor, discuss your concerns and hesitations, and make the best decisions you can.

Why Many Buyers Avoid Short Sale Purchases

Are you surprised that many buyers avoid short sales?  It's true. Why?  Read on...

As you may know, a short sale occurs when a homeowner, who owes more on their home than it's currently worth, decides to sell.  They attempt to get their lender(s) to accept less on the property than the outstanding loan balance(s).  For the lender(s) to consider accepting less than is owed on the property, quite a bit of "stuff" must happen.  Going into detail on all that "stuff" is beyond the scope of this blog post (see related links below to learn more), but believe me, it can take many weeks... and sometimes many months.

So, if it takes from many weeks to many months to successfully complete a short sale, then why would a buyer want to take that long to buy a home when a non-short sale home could take much less time (usually only from 30-45 days)?  The answer is why many buyers would prefer to avoid them all together... it just takes too long.  

In addition, there's no guarantee that the lender(s) will even agree to accept less than is owed and complete the short sale.  It's not uncommon for many weeks or months to go by, all the while the buyer is anxiously waiting (and getting very frustrated), and then the lender(s) decline the short sale request.  The buyer is then back to square one and has nothing to show for it.

Please keep in mind... I am not saying that a buyer can't successfully buy a short sale.  Quite the contrary... they certainly can.  However, the buyer must be very patient... and risk a complete rejection of the request from the seller's lender(s).  Usually, a buyer is willing to wait only when they have found THE house... the house of their dreams... and nothing else will do.

When a buyer first starts working with a Realtor, they must talk in depth with that Realtor about their wants and needs.... AND the time frame in which they want to buy.  If they are wanting to buy fairly quickly, then maybe short sales should be avoided. 

Many buyers would rather focus, at least initially, on the regular sales and foreclosures that are for sale.  Usually, those are much easier to buy and close much quicker.

Again, talk to your Realtor about the best approach for you.

Related posts:

What is a Short Sale?

Buying a Short Sale Home

June 2010: This Month in Real Estate