Tag Archives: Dream Home

Looking for Your Dream Home? Know What You Want vs. What You Need

 

Looking for Your Dream Home? Know What You Want vs. What You Need | MyKCM

In this day and age of being able to shop for anything anywhere, it is really important to know what you’re looking for when you start your home search.

If you’ve been thinking about buying a home of your own for some time now, you’ve probably come up with a list of things that you’d LOVE to have in your new home. Many new homebuyers fantasize about the amenities that they see on television or Pinterest, and start looking at the countless homes listed for sale through rose-colored glasses.

Do you really need that farmhouse sink in the kitchen to be happy with your home choice? Would a two-car garage be a convenience or a necessity? Could the ‘man cave’ of your dreams be a future renovation project instead of a make-or-break right now?

The first step in your home buying process should be getting pre-approved for your mortgage. This allows you to know your budget before you fall in love with a home that is way outside of it.

The next step is to list all the features of a home that you would like, and to qualify them as follows:

  • ‘Must-Haves’ – if this property does not have these items, then it shouldn’t even be considered (ex: distance from work or family, number of bedrooms/bathrooms).
  • ‘Should-Haves’ – if the property hits all of the ‘must-haves’ and some of the ‘should-haves,’ it stays in contention but does not need to have all of these features.
  • ‘Absolute-Wish List’ – if we find a property in our budget that has all of the ‘must-haves,’ most of the ‘should-haves,’ and ANY of these, it’s the winner!

Bottom Line

Having this list fleshed out before starting your search will save you time and frustration, while also letting your agent know what features are most important to you before starting to show you houses in your desired area.

Number of Buyers Putting Down Less Than 10% Hits 7-Year High

 

Number of Buyers Putting Down Less Than 10% Hits 7-Year High | MyKCM

According to Black Knight Financial Service’s Mortgage Monitor Report, 1.5 million Americans have purchased a home with down payments under than 10% over the last 12 months. This is great news for buyers as this marks a 7-year high.

Many mortgage programs offered by agencies like Freddie Mac and Fannie Mae allow buyers to put down as low as 3% to purchase their dream homes. The strength of the housing market has aided buyers who used low-down-payment programs to buy. As a recent CNBC article points out,

“Defaults on recent low down payment loans, so far, are slow, but that is as much a factor of the good credit quality as it is the strength of the housing market. Home prices are rising incredibly fast, meaning those borrowers are gaining equity in their homes quickly.”

Low down payments aren’t just great for first-time homebuyers. These programs have allowed homeowners who want to capitalize on the equity they have in their homes to use the profit from their sale to pay off high-interest credit cards, fund education or even start a business.

According to a new Census Report, the Annual Survey of Entrepreneurs, home equity was used to start 7.3% of all businesses in the United States, which equates to over 284,000! The industries that saw the most growth from home equity are accommodation & food services, manufacturing and, retail trade.

Bottom Line

Gone are the days of ‘20% down or no mortgage.’ What could you build with the equity in your house? Let’s get together today to evaluate your ability to achieve your dreams today!

More Boomerang Buyers Are about to Enter the Market

 

More Boomerang Buyers Are about to Enter the Market | MyKCM

We previously informed you about a study conducted by TransUnion titled, “The Bubble, the Burst and Now – What Happened to the Consumer?” The study revealed that 1.5 million homeowners who were negatively impacted by the housing crisis could re-enter the housing market between 2016-2019.

Recently, HousingWire analyzed data from the US Bankruptcy Courts and revealed that 6 million Americans will have their bankruptcies disappear off their credit reports over the next five years and that this could “possibly send a flood of more homebuyers into the housing market.

The chart below shows the total number of bankruptcies filed by year in the US over the last 10 years. The light blue bars represent over 3.3 million people who have already waited the 7 years necessary for their reports to no longer include their bankruptcies.

More Boomerang Buyers Are about to Enter the Market | MyKCM

 

How would this “send a flood of more homebuyers into the housing market”?

As the article mentioned, in 2010 the number of chapter 7 bankruptcies increased to nearly 1.14 million. Now, 7 years later, they will begin to fade from credit histories, enabling prospective buyers to become homeowners again once their credit scores improve.

As we can see from both reports, the homeownership rate has the opportunity to increase drastically over the next few years with all of these boomerang buyers returning to the market.

Bottom Line

If your family was negatively impacted by the housing bust, here is the light at the end of the tunnel! You may be able to purchase your dream home faster than you think!

Sellers: Your Home is an Oasis in an Inventory Desert

 

Sellers: Your Home is an Oasis in an Inventory Desert | MyKCM

First-time homebuyers are flocking to the real estate market by the thousands to find their dream homes in order to make their dreams of homeownership a reality. Unfortunately for many, the inventory of starter and trade-up homes in the US has struggled to keep up with demand!

According to the National Association of Realtors (NAR), the inventory of homes for sale dropped 7.1% year-over-year to a 4.3-month supply and is down for the 25th consecutive month.

Some homeowners may be hesitant to list their homes for sale because they are worried that they will also have a problem finding a home to buy and move in to. This is a legitimate concern; no one wants to sell their home quickly and not have anywhere to live.

But there is good news! If you are thinking of moving up to a luxury or premium home, there is more inventory available in these markets and you may even get a great deal on a home that has been on the market for a while.

If you are the owner of a starter home and you are looking to move into a trade-up home, or if you are just looking to relocate to a new area in a home of the same size, there is still hope!

In many markets, homeowners are building contingency plans into their contracts. This means that the homeowner builds in extra time before they close in order to find their dream home and they are upfront about the contingency with any buyers who come to see the house.

Your home is an oasis to buyers who are searching for homes in today’s market. The right buyers will sympathize and wait for you and your family to find your next home.

Bottom Line

Don’t let the fear of not finding a home to move in to stop you from moving on with your life. Let’s get together to discuss ways to set expectations with potential buyers from the start.

Housing Inventory Hits 30-Year Low

 

Housing Inventory Hits 30-Year Low

Spring is traditionally the busiest season for real estate. Buyers, experiencing cabin fever all winter, emerge like flowers through the snow in search of their dream home. Homeowners, in preparation for the increased demand, are enticed to list their house for sale and move on to the home that will better fit their needs.

New data from CoreLogic shows that even though buyers came out in force, as predicted, homeowners did not make the jump to list their home in the second quarter of this year. Frank Nothaft, Chief Economist for CoreLogic had this to say,

“The growth in sales is slowing down, and this is not due to lack of affordability, but rather a lack of inventory. As of Q2 2017, the unsold inventory as a share of all households is 1.9 percent, which is the lowest Q2 reading in over 30 years.”

CoreLogic’s President & CEO, Frank Martell added,

“Home prices are marching ever higher, up almost 50 percent since the trough in March 2011.

While low mortgage rates are keeping the market affordable from a monthly payment perspective, affordability will likely become a much bigger challenge in the years ahead until the industry resolves the housing supply challenge.”

Overall inventory across the United States is down for the 25th consecutive month according to the latest report from the National Association of Realtors and now stands at a 4.3-month supply.

Real estate is local.

Market conditions in the starter and trade-up home markets are in line with the median US figures, but conditions in the luxury and premium markets are following an opposite path. Premium homes are staying on the market longer with ample inventory to suggest a buyer’s market.

Bottom Line

Buyers are out in force, and there has never been a better time to move-up to a premium or luxury home. If you are considering selling your starter or trade-up home and moving up this year, let’s get together to discuss the exact conditions in our area.

3 Tips to Succeed in Today’s Real Estate Market

 

3 Tips to Succeed in Today’s Real Estate Market | MyKCM

In today’s highly competitive real estate market, where inventory levels are not keeping up with the constant stream of buyer demand, there are steps you can take to ensure you are most prepared for success when buying a home.

The 3 tips we are going to expand on today come from a recent blog by Trulia entitled, The Skinny on Skinny Inventory. 

1. Be Prepared

“Homebuyers should talk with a lender, real estate agent, and a home inspector BEFORE finding a home to make an offer on.”

Being intentional, pre-approved, and prepared will set you up for the accelerated time tables that come with a highly competitive market. If you are the most prepared buyer interested in a home, if you have already secured financial approval, and if you are ready to move fast, your bid will be that much more attractive to a seller.

2. Think Strategically

“Starter homebuyers don’t have a home to sell and can be flexible on closing dates compared to homebuyers who are also trying to sell at the same time.”

If you are one of the many first-time buyers looking for your dream home, know that being strategic and flexible about closing dates can also help your offer stand out from the rest. But don’t fret if you are a homeowner who will also have to sell your own house first – be upfront about your timeline with your agent and with any offers you make.

3. Seek Out the Ugly Ducklings

“Buyers might consider looking for homes that have been on the market for a while and investigate why. The reasons may be a deal-killer but all it takes is one ugly duckling to turn into a swan.”

Finding a fixer-upper or a home that needs a little love might be your best way to guarantee that you are able to find a home in the neighborhood that you want. The worst house on the best block will go for a steal and offer instant equity once you fix it up!

Bottom Line

In today’s market, full of bidding wars and tough competition, finding ways to stand out from the rest by getting creative will improve your chances of having a home to call your own.

2 Myths Holding Back Home Buyers

 

2 Myths Holding Back Home Buyers | MyKCM

In Realtor.com’s recent article, “Home Buyers’ Top Mortgage Fears: Which One Scares You?” they mention that “46% of potential home buyers fear they won’t qualify for a mortgage to the point that they don’t even try.”

Myth #1: “I Need a 20% Down Payment”

Buyers overestimate the down payment funds needed to qualify for a home loan. According to the First Quarter 2017 Homeownership Program Index (HPI) from Down Payment Resource, saving for a down payment was the barrier that kept 70% of renters from buying.

Rob Chrane, CEO of Down Payment Resource had this to say,

There are many mortgage-ready renters today, but they don’t know it. Often, homebuyers remain sidelined for years due to the down payment.

Many believe that they need at least 20% down to buy their dream home, but programs are available that allow buyers put down as little as 3%. Many renters may actually be able to enter the housing market sooner than they ever imagined with new programs that have emerged allowing less cash out of pocket.

Myth #2: “I Need a 780 FICO® Score or Higher to Buy”

The survey revealed that 59% of Americans either don’t know (54%) or are misinformed (5%) about what FICO® score is necessary to qualify.

Many Americans believe a ‘good’ credit score is 780 or higher.

To help debunk this myth, let’s take a look at Ellie Mae’s latest Origination Insight Report, which focuses on recently closed (approved) loans.

2 Myths Holding Back Home Buyers | MyKCM

As you can see in the chart above, 53.2% of approved mortgages had a credit score of 600-749.

Bottom Line

Whether buying your first home or moving up to your dream home, knowing your options will make the mortgage process easier. Your dream home may already be within your reach.