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Buying a Home Early Can Significantly Increase Future Wealth

by Christie Cannon

Buying a Home Early Can Significantly Increase Future Wealth

Buying a Home Early Can Significantly Increase Future Wealth | MyKCM
 

According to an Urban Institute study, homeowners who purchase a house before age 35 are better prepared for retirement at age 60.

The good news is, our younger generations are strong believers in homeownership.

According to a Freddie Mac survey,

“The dream of homeownership is alive and well within “Generation Z,” the demographic cohort following Millennials.

Our survey…finds that Gen Z views homeownership as an important goal. They estimate that they will attain this goal by the time they turn 30 years old, three years younger than the current median homebuying age (33).”

Buying a Home Early Can Significantly Increase Future Wealth | MyKCMIf these aspiring homeowners purchase at an early age, the Urban Institute study shows the impact it can have.

Based on this data, those who purchased their first homes when they were younger than 25 had an average of $10,000 left on their mortgage at age 60. The 50% of buyers who purchased in their mid-20s and early-30s had close to $50,000 left, but traditionally purchased more expensive homes.Buying a Home Early Can Significantly Increase Future Wealth | MyKCMAlthough the vast majority of Gen Zers want to own a home and are somewhat confident in their future, “In terms of financial awareness, 65% of Gen Z respondents report that they are not confident in their knowledge of the mortgage process.”

Bottom Line

As the numbers show, you’re not alone. If you want to buy this year but you’re not sure where to start the process, let’s get together to help you understand the best steps to take from here.

There’s a Long Line of Buyers Waiting for Your House

by Christie Cannon

There’s a Long Line of Buyers Waiting for Your House

There’s a Long Line of Buyers Waiting for Your House | MyKCM
 

If you’re following what’s happening in the housing market right now, you know that many people believe the winter months aren’t a good time to sell a home. As realtor.com Senior Economist George Ratiu recently noted,

“Sellers tend to be more reluctant to list during the colder time of year when the market typically makes a seasonal slowdown.”

However, a recent report by ShowingTime reveals how this year is different. Buyer activity is way up compared to the same time last year. The report explains,

“The nation’s 12.6% growth in home showings compared to 2018 was the most significant jump in buyer traffic during the current four-month streak of year-over-year increases. The West Region saw the greatest growth in activity, with a 23.1% jump – the region’s greatest in the history of the Showing Index.”

The increase has spread across all four regions of the country, as the graph below shows:There’s a Long Line of Buyers Waiting for Your House | MyKCM

Bottom Line

Waiting for the “spring buyers’ market” may be a mistake this year. It seems the purchasers are already out and looking to buy.

3 Benefits to Buying Your Dream Home This Year

by Christie Cannon

3 Benefits to Buying Your Dream Home This Year

3 Benefits to Buying Your Dream Home This Year | MyKCM
 

Outside of a strong economy, low unemployment, and higher wages, there are three more great reasons why you may want to consider buying your dream home this year instead of waiting.

1. Buying a Home is a Great Investment

Several reports indicate that real estate is a good investment, topping other options such as gold, stocks, bonds, and savings. Why? Real estate helps build equity, a form of investing for you and your family. According to CoreLogic’s Equity Report,

“U.S. homeowners with mortgages (roughly 64% of all properties) have seen their equity increase by a total of nearly $457 billion since the third quarter 2018, an increase of 5.1%, year over year.”

This means the average homeowner gained approximately $5,300 in equity over the past year. If you want to start building your equity, put your housing costs to work for you through homeownership this year.

2. Mortgage Interest Rates Are Low

The Primary Mortgage Market Survey from Freddie Mac indicates that interest rates for a 30-year mortgage have fallen since November 2018 when they hit 4.94%. In their latest forecastFreddie Mac expects rates to remain low, leveling out to a yearly average of 3.8% in 2020.

When you purchase a home at a low mortgage rate, it will impact your monthly mortgage payment, giving you the opportunity to buy more house for your money.

3. Investing in Your Family is a Win

There are some renters who haven’t purchased a home yet because they’re uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you’re living rent-free with your parents, you’re paying a mortgage – either yours or that of your landlord.

Today, rental prices continue to increase, and when you’re paying your landlord’s mortgage instead of your own, you’re not the one earning the equity. As an owner, your mortgage payment is a form of ‘forced savings’ you can use later in life to reinvest in your family. You can use it for a variety of opportunities, such as saving for your children’s education, moving up to a bigger home, or starting your own business. As a renter, it can be more challenging to achieve those types of dreams without home equity working for you.

Bottom Line

Buying a home sooner rather than later could lead to substantial savings and long-term financial growth for you and your family. Let’s get together to determine if homeownership is the right choice for you this year.

The 2020 Real Estate Projections That May Surprise You

by Christie Cannon

The 2020 Real Estate Projections That May Surprise You

The 2020 Real Estate Projections That May Surprise You | MyKCM
 

This will be an interesting year for residential real estate. With a presidential election taking place this fall and talk of a possible recession occurring before the end of the year, predicting what will happen in the 2020 U.S. housing market can be challenging. As a result, taking a look at the combined projections from the most trusted entities in the industry when it comes to mortgage rateshome sales, and home prices is incredibly valuable – and they may surprise you.

Mortgage Rates

Projections from the experts at the National Association of Realtors (NAR), the Mortgage Bankers Association (MBA), Fannie Mae, and Freddie Mac all forecast mortgage rates remaining stable throughout 2020:The 2020 Real Estate Projections That May Surprise You | MyKCMSince rates have remained under 5% for the last decade, we may not fully realize the opportunity we have right now.

Here are the average mortgage interest rates over the last several decades:

  • 1970s: 8.86%
  • 1980s: 12.70%
  • 1990s: 8.12%
  • 2000s: 6.29%

Home Sales

Three of the four expert groups noted above also predict an increase in home sales in 2020, and the fourth sees the transaction number remaining stable:The 2020 Real Estate Projections That May Surprise You | MyKCMWith mortgage rates remaining near all-time lows, demand should not be a challenge. The lack of available inventory, however, may moderate the increase in sales.

Home Prices

Below are the projections from six different expert entities that look closely at home values: CoreLogicFannie Mae, Ivy Zelman’s “Z Report”, the National Association of Realtors (NAR), Freddie Mac, and the Mortgage Bankers Association (MBA).The 2020 Real Estate Projections That May Surprise You | MyKCMEach group has home values continuing to improve through 2020, with four of them seeing price appreciation increasing at a greater pace than it did in 2019.

Is a Recession Possible?

In early 2019, a large percentage of economists began predicting a recession may occur in 2020. In addition, a recent survey of potential home purchasers showed that over 50% agreed it would occur this year. The economy, however, remained strong in the fourth quarter, and that has caused many to rethink the possibility.

For example, Goldman Sachs, in their 2020 U.S. Outlook, explained:

“Markets sounded the recession alarm this year, and the average forecaster now sees a 33% chance of recession over the next year. In contrast, our new recession model suggests just a 20% probability. Despite the record age of the expansion, the usual late-cycle problems—inflationary overheating and financial imbalances—do not look threatening.”

Bottom Line

Mortgage rates are projected to remain under 4%, causing sales to increase in 2020. With growing demand and a limited supply of inventory, prices will continue to appreciate, while the threat of an impending recession seems to be softening. It looks like 2020 may be a solid year for the real estate market.

Year-Over-Year Rental Prices on the Rise

by Christie Cannon

Year-Over-Year Rental Prices on the Rise

Year-Over-Year Rental Prices on the Rise | MyKCM
 

Looking ahead, 2020 is projected to be a strong year for homeownership. According to the Freddie Mac Forecast,

“We expect rates to remain low, falling to a yearly average of 3.8% in 2020.”

If you’re currently renting, 2020 may be a great time to think about making a jump into homeownership while mortgage rates are low.

As noted in the National Rent Report,

the national rent index increased by 1.4 percent year-over-year.”

With average rents on the rise, this year-over-year increase may not sound like much, but it can add up – fast. The math on how much extra it will cost you over time surely doesn’t lie.

Here’s an example: On a $1,500 rental payment, an increase of 1.4% adds an additional $21 dollars per month to your payment. When multiplied by the twelve months in a year, it’s a $252 overall annual increase. The price continues to multiply when you rent year after year, as rental prices rise.

History shows how average rental prices have been increasing each year, and there doesn’t seem to be much end in sight. Here’s a look at how rents have grown since 2012 alone:Year-Over-Year Rental Prices on the Rise | MyKCMWhy not lock down your monthly housing expense, and at the same time build additional net worth for you and your family? If you’re thinking about buying a home, consider the financial benefits of what homeownership can do for you, especially while the market conditions are strong and current mortgage rates are low.

Bottom Line

With average rents continuing to rise, now may be a great time to stabilize your monthly payment by becoming a homeowner and locking into a low mortgage rate. Let’s get together to discuss how taking advantage of the current market conditions might work for you.

5,300 Reasons to Be Happy You’re a Homeowner

by Christie Cannon

5,300 Reasons to Be Happy You’re a Homeowner

5,300 Reasons to Be Happy You’re a Homeowner | MyKCM
 

Studies have shown that, in many cases, the largest asset a family owns is the house they live in. Over the last twelve months, that asset has gained substantial value.

CoreLogic just released their 2019 3rd Quarter Homeowner Equity Insights Report. The report revealed that:

“U.S. homeowners with mortgages (roughly 64% of all properties) have seen their equity increase by a total of nearly $457 billion since the third quarter 2018, an increase of 5.1%, year over year.”

The equity in a property is determined by comparing the current value of the property against the outstanding mortgage debt. As prices rise, the equity in a home increases.

The report went on to explain that the average homeowner gain in equity over the last twelve months was $5,300.

Here’s a map showing the average equity gain by state:5,300 Reasons to Be Happy You’re a Homeowner | MyKCMSince the housing crash in 2008, many homeowners have felt trapped in their current houses, as they didn’t have enough equity to sell. The gains in equity over the past few years may have freed some homeowners who have a desire to move.

Bottom Line

If you’re curious about your home’s equity, let’s get together to do a market analysis on the current value of your house. You may be pleasantly surprised.

Holiday Gifts Are Not the Only Hot Things Right Now

by Christie Cannon

Holiday Gifts Are Not the Only Hot Things Right Now

Holiday Gifts Are Not the Only Hot Things Right Now | MyKCM
 

Black Friday is behind us and holiday gifts are flying off the shelves in stores and online. Unlike last year, however, there’s another type of buyer that is very active this winter – the homebuyer.

Each month, ShowingTime releases their Showing Index, which tracks the average number of appointments received on active U.S. house listings. The latest index revealed:

“Traffic was more active once again compared to 2018, as the nation saw its third straight month of higher year-over-year showing activity…The 5.5% increase in showings nationwide was the largest jump in activity during the now three-month streak of year-over-year increases vs. 2018.”

The same report indicates showings increased in every region of the country:

  • The South increased by 10.8%
  • The West increased by 8.6%
  • The Northeast increased by 3.8%
  • The Midwest increased by 1.5%

Why is the traffic more active?

One of the main reasons buyer traffic has increased year-over-year is that mortgage rates have fallen dramatically. According to Freddie Mac, the average mortgage rate last December was 4.64%. Today, the rate is almost a full percentage point lower!

Bottom Line

There are first-time, move-up, and move-down buyers actively looking for the home of their dreams this winter. If you’re thinking of selling your house in 2020, you don’t need to wait until the spring to do it. Your potential buyer may be searching for a home in your neighborhood right now.

DFW Ranked as One of the Country's Best Housing Markets!

by Christie Cannon

D-FW ranked as one of the country’s best housing markets

Provided by: The Dallas Morning News

The National Association of Realtors in its just-released forecast picked 10 home markets across the nation that it expects to outperform during the next three to five years.

Along with the D-FW area, the Realtors economists picked Charleston, S.C.; Charlotte, N.C.; Colorado Springs; Columbus; Fort Collins, Col.; Las Vegas; Ogden, Utah; Raleigh, N.C., and Tampa.

 
 

“Some markets are clearly positioned for exceptional longer term performance due to their relative housing affordability combined with solid local economic expansion,” NAR’s Chief Economist Lawrence Yun said in the new report. “Drawing new residents from other states will also further stimulate housing demand in these markets, but this will create upward price pressures as well, especially if demand is not met by increasing supply.”

The Realtors’ study said that strong job growth is driving up prices in the top markets.

“In Ogden, Las Vegas, Dallas, and Raleigh, job growth rose nearly 3%,” the report said.

In the D-FW area, the Realtors found that 75% of recent home moves were by renters.

And looking at relocations to the area, the Realtors said that moves of the moves were from Houston and Los Angeles.

The median age of people who moved to North Texas was 29.
THE REALTORS FOUND THAT THE MEDIAN VALUE OF HOMES BOUGHT BY MOVERS TO THE D-FW AREA WAS $289,700.

Last year more than 550,000 people moved to Texas – most of them coming from California.

Almost 140,000 people moved to the D-FW area last year, with the most relocations to Dallas and Tarrant counties.

Through the first 11 months of 2019, sales of homes in North Texas by real estate agents are up 2 percent year-over-year and median home prices are 3% higher than in the same period of 2018.

The study also looked at where people moving to D-FW come from.
The study also looked at where people moving to D-FW come from.(National Association of Reatlors)

Have You Buegeted For Closing Costs?

by Christie Cannon

Have You Budgeted for Closing Costs?

Have You Budgeted for Closing Costs? | MyKCM
 

Saving for a down payment is a key step in the homebuying process, and it’s not the only piece you need to include in your budget. Another factor that’s important to plan for is the closing costs required to obtain a mortgage.

What Are Closing Costs?

According to Trulia,

When you close on a home, a number of fees are due. They typically range from 2% to 5% of the total cost of the home, and can include title insurance, origination fees, underwriting fees, document preparation fees, and more.”

For those who buy a $250,000 home, for example, that amount could be between $5,000 and $12,500 in closing fees. Keep in mind, if you’re in the market for a home above this price range, your costs could be significantly greater. As mentioned before,

Closing costs are typically between 2% and 5% of your purchase price.

 Trulia gives more great advice, saying,

“There will be lots of paperwork in front of you on closing day, and not enough time to read them all. Work closely with your real estate agent, lender, and attorney, if you have one, to get all the documents you need ahead of time.

The most important thing to read is the closing disclosure, which shows your loan terms, final closing costs, and any outstanding fees. You’ll get this form about three days before closing since, once you (the borrower) sign it, there’s a three-day waiting period before you can sign the mortgage loan docs. If you have any questions about the numbers or what any of the mortgage terms mean, this is the time to ask—your real estate agent is a great resource for getting you all the answers you need."

Bottom Line

Let’s get together to discuss the homebuying process, to be sure your plan includes budgeting for what you need to purchase your dream home – without any surprises!

Get Your Home Winter Ready!

by Christie Cannon

Displaying blog entries 201-210 of 376

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Christie Cannon
Keller Williams Realty
5933 Preston Road #300
Frisco TX 75034
972-215-7747
Fax: 972-215-7748
Keller Williams Frisco - The Christie Cannon Team - http://www.christiecannon.com