Tuesday, October 10, 2017

Time to get off the fence! Interest rates are still low, but who knows for how long?

If you’re considering buying a home, ask any real estate agent worth their salt and they’ll tell you: NOW is the time to do it. The real estate market is seemingly changing by the day, and if you want to get a great home for a great price, making a move now is in your best interest; conditions a year from now (or even six months from now) aren’t likely to be as hospitable. And why is that? Why shouldn’t you, if you’re interested in buying a home, wait? Why is NOW the time to make a move? The first reason you should buy a home now is that interest rates are extremely competitive. While they aren’t at the near-historic lows homeowners enjoyed in 2016, they’re still hovering in the high 3%’s for 30-year fixed mortgages and the low 3%’s for 15-year loans. But that’s going to change. Mortgage rates are scheduled to rise at least 3 times in 2018, with many experts predicting the interest rate for a 30-year fixed mortgage to reach 5% by the end of 2018. But what does that mean for you as a potential homeowner? Let’s say your mortgage principal is $200,000. If you secured your mortgage with a 3.87% interest rate, the total interest you would pay over the course of the loan would be $138,571 (360 monthly payments of $940, for a total of $338,571). Now, if you secured a mortgage with a 5% interest rate, the total interest you would pay over the course of the loan jumps to $186,152, a difference of $43,581 (if you’re interested in how changing interest rates affect the total cost of a mortgage, you can check out this interest rate calculator tool). Locking in a lower interest rate on your mortgage will save you tens of thousands of dollars over the course of your loan, which is why securing a loan now is in your best interest. 2. Competition is getting fierce Another reason now is a good time to purchase a home is that housing markets are growing more competitive every day. Now that much of the country has recovered from the recession, more and more people are in the position to purchase real estate. And the more people there are on the market, the more competition there is for homes. Competition is getting fierce in markets across the country. Homes are sold almost immediately, often at above asking price, and sellers are often dealing with multiple offers. The competition in most real estate markets is still manageable and deals are still to be found, but as the economy continues to improve, the competition will heat up even more – making finding and buying the home of your dreams significantly more challenging (not to mention expensive). 3. Homes are getting more expensive by the day… Speaking of expensive, homes are (literally) getting more expensive every day. In fact, as of June 2017, home prices have been rising every single month for well over 5 years. And that trend shows no sign of slowing. Experts predict home prices will jump up to 5% more in 2017 and another 3.5% in 2018 (with hot markets, like the Pacific Northwest, seeing even greater increases). Which means that if you purchase a home at the end of 2018, you can expect to pay an average of 8.5% more than you would pay today. Combine the rising interest rates with the rising home prices and you’ve got a recipe for paying a lot more for a home a year from now than you would pay today. 4. … And there are fewer to choose from One of the factors in rising home costs is low inventory. When there are too many people who want to buy homes and not enough homes for them to buy, it drives up prices and competition in the market. We have a huge problem with low inventory now, but unfortunately, that problem doesn’t have a simple solution. As interest rates rise, people are less likely to put their homes on the market in an effort to preserve the lower interest rates on their mortgages. The moral of the story is: there’s low inventory now, but there’s likely to be lower inventory in the future, which means prices will soar even higher. It’s better to buy now then it is to wait for the problem to get worse. Buying a home is a big decision. But if it’s a decision you’re considering, now’s the time to make a move. You’ll enjoy lower interest rates and an overall less expensive (and less stressful!) experience today than you will if you wait. So get out there and find your dream home!

Wednesday, October 4, 2017

Sand Castle Days 2017

Thu, Oct 5, 2017 8:00am Sun, Oct 8, 2017 5:00pm Clayton's Beach Bar (map) Master Sand sculptors Walter McDonald (aka Amazon Walter) and Lucinda Wierenga (aka Sandy Feet) are South Padre Island residents and 30 years ago started Sandcastle Days as a way to demonstrate the magical sculpting qualities of South Padre Island sand AND the critical importance of protecting our beautiful coastal shores. Master Sand sculptors Walter McDonald (aka Amazin Walter) and Lucinda Wierenga (aka Sandy Feet) are South Padre Island residents and 30 years ago started Sandcastle Days as a way to demonstrate the magical sculpting qualities of South Padre Island sand AND the critical importance of protecting our beautiful coastal shores. Over the years this FREE family-fun event has grown from a local celebration to qualifying event for the World Championships of Sand Sculpting where 30,000+ fans come to watch the sand come alive. Admission to this year’s event is FREE and boasts a new location, live music, art booths, great food, and an exciting new evening. Check back here and on the event schedule page for more details!

Monday, September 11, 2017

5 Surprising (and Useful!) Ways to Save for a Down Payment

Buying your first home conjures up all kinds of warm and fuzzy emotions: pride, joy, contentment. But before you get to the good stuff, you’ve got to cobble together a down payment, a daunting sum if you follow the textbook advice to squirrel away 20% of a home’s cost. Here are five creative ways to build your down-payment nest egg faster than you may have ever imagined. 1. Crowdsource Your Dream Home You may have heard of people using sites like Kickstarter to fund creative projects like short films and concert tours. Well, who says you can’t crowdsource your first home? Forget the traditional registry, the fine china, and the 16-speed blender. Use sites like Feather the Nest and Hatch My House to raise your down payment. Hatch My House says it’s helped Americans raise more than $2 million for down payments. 2. Ask the Seller to Help (Really!) When sellers want to a get a deal done quickly, they might be willing to assist buyers with the closing costs. Fewer closing costs = more money you can apply toward your deposit. “They’re called seller concessions,” says Ray Rodriguez, regional mortgage sales manager for the New York metro area at TD Bank. Talk with your real estate agent. She might help you negotiate for something like 2% of the overall sales price in concessions to help with the closing costs. There are limits on concessions depending on the type of mortgage you get. For FHA mortgages, the cap is 6% of the sale price. For Fannie Mae-guaranteed loans, the caps vary between 3% and 9%, depending on the ratio between how much you put down and the amount you finance. Individual banks have varying caps on concessions. No matter where they net out, concessions must be part of the purchase contract. Related: New Law Protects You from Surprise Closing Costs 3. Look into Government Options The U.S. Department of Housing and Urban Development, or HUD, offers a number of homeownership programs, including assistance with down payment and closing costs. These are typically available for people who meet particular income or location requirements. HUD has a list of links by state that direct you to the appropriate page for information about your state. HUD offers help based on profession as well. If you’re a law enforcement officer, firefighter, teacher, or EMT, you may be eligible under its Good Neighbor Next Door Sales Program for a 50% discount on a house’s HUD-appraised value in “revitalization areas.” Those areas are designated by Congress for  homeownership opportunities. And if you qualify for an FHA-insured mortgage under this program, the down payment is only $100; you can even finance the closing costs. For veterans, the VA will guarantee part of a home loan through commercial lenders. Often, there’s no down payment or private mortgage insurance required, and the program helps borrowers secure a competitive interest rate. Some cities also offer homeownership help. “The city of Hartford has the HouseHartford Program that gives down payment assistance and closing cost assistance,” says Matthew Carbray, a certified financial planner with Ridgeline Financial Partners and Carbray Staunton Financial Planners in Avon, Conn. The program partners with lenders, real estate attorneys, and homebuyer counseling agencies and has helped 1,200 low-income families. 4. Check with Your Employer Employer Assisted Housing (EAH) programs help connect low- to moderate-income workers with down payment assistance through their employer. In Pennsylvania, if you work for a participating EAH employer, you can apply for a loan of up to $8,000 for down payment and closing cost assistance. The loan is interest-free and borrowers have 10 years to pay it back. Washington University in St. Louis offers forgivable loans to qualified employees who want to purchase housing in specific city neighborhoods. University employees receive the lesser of 5% of the purchase price or $6,000 toward down payment or closing costs. Ask the human resources or benefits personnel at your employer if the company is part of an EAH program. 5. Take Advantage of Special Lender Programs Finally, many lenders offer programs to help people buy a home with a small down payment. “I would say that the biggest misconception [of homebuying] is that you need 20% for the down payment of a house,” says Rodriguez. “There are a lot of programs out there that need a total of 3% or 3.5% down.” FHA mortgages, for example, can require as little as 3.5%. But bear in mind that there are both upfront and monthly mortgage insurance payments. “The mortgage insurance could add another $300 to your monthly mortgage payment,” Rodriguez says. Some lender programs go even further. TD Bank, for example, offers a 3% down payment with no mortgage insurance program, and other banks may have similar offerings. “Check with your regional bank,” Rodriguez says. “Maybe they have their own first-time buyer program.” Not so daunting after all, is it? There’s actually a lot of help available to many first-time buyers who want to achieve their homeownership dreams. All you need to do is a little research — and start peeking at those home listings!

Saturday, September 9, 2017

Why didn’t the seller send me a counteroffer?

I submitted an offer to buy a house. Instead of accepting my offer or sending back a counteroffer, the seller replied with a form called Seller’s Invitation to Buyer to Submit New Offer. On it, he wrote a comment that he would view my offer more favorably if I increased my offer price. Why didn’t he just make a counteroffer? Though often sellers will respond with a counteroffer when an offer doesn’t quite meet their approval, sometimes they will reply with the form you mentioned. The form—only for use by Texas REALTORS® and their clients—enables the seller to continue marketing the property to other buyers while you consider your next move. You can discuss with your Texas REALTOR® whether to submit a new offer based on the comment the seller provided in the form. You may not want to wait too long, since the seller can entertain other offers in the meantime.