Bryson called out of the blue one Saturday afternoon with an air of excitement in his tone. “Remember that house in the country we looked at a couple years ago?” Of course, Jennifer remembered the stunning, historic brick farmhouse. “Amber and I want to buy it!” He’d had to let it go when he fell in love with it back in 2007, but it had never left his mind. And when the sign went up in early 2011…Bryson knew it was for him. The pressure was on to sell his current home. He worked day and night to prepare it for the market while Jennifer developed a pricing strategy that would offer a quick sale with enough equity to buy the farmhouse. And she began the delicate negotiations on the farmhouse, which resulted in an incredible purchase price and easy terms. In 26 days, an offer was received on house #1, which enabled them to pend the farmhouse, and all closed on time 30 days later. The only hiccup in that deal came from the new baby who arrived in the middle of it all, but Bryson now gets to rock his baby girl from the front porch at green acres.
Eric and Terri are on work assignment in Cuba. In preparation for their return to the States after Thanksgiving, they asked Jennifer to help them buy a house in Zionsville. They had specific goals: four bedrooms, a basement, a nice yard and a good deal. Not such a hard find, but a house hunting trip was out of the question. And Jennifer had to fill the bill on her own. Pictures flew back and forth to Cuba via email. Telephone conversations were short and difficult, but the third home she recommended was the winner! The property sailed through the inspections, appraisal, and closing – it’s a great house in superb condition – but they bought it sight unseen! A first for Jennifer. They’ll LOVE it when they see it next month!
These suggestions come from David Stevens, president & CEO of the Mortgage Bankers Association (and thanks to Inman News for the interview):
1) MARKETS ARE STABILIZING. The real deliquency rate is down to 8.5% this year vs 10% last year. New foreclosure starts are down. Florida, Nevada & Arizona are stabilizing. All that means less bank-owned inventory, which would give private sales an opportunity to realize some stabilization and opportunity to sell at fair market value.
2) NEGATIVE EQUITY AND DECLINING HOME VALUES ARE CONCENTRATED IN FIVE KEY STATES. In fact, 50% of the total national foreclosure problem is concentrated in those 5 states, so Stevens says that those who quote declines in the average price of homes are using “dangerous data.” In fact, he claims that if the foreclosure sales are removed from total market data, the average sales prices of privately-owned homes would actually be up. Now, I have to say I’ve been claiming this about Indy for the past 5 years. We didn’t have a bubble, we didn’t have a burst. Our foreclosure inventory is moving to a reduced level almost daily. And good, clean, well-priced homes are selling at fair-market value.
3) THIS IS LITERALLY THE BEST TIME EVER TO BUY A HOME. 30-yr fixed rates are actually at 4%. No gimmicks, no tricks. Yes, 4%. They have NEVER before been this low. Did you know that a 2% increase in the rate for a 30-yr loan on a $200,000 house could cost you $87,937 in additional interest over the life of the loan? That is a staggering punishment for not acting NOW if you’re in the market to buy a house with the bank’s money! Some would-be-buyers worry about property values continuing to decline and are sitting on the fence. People! If a $200,000 house declines 5% in the next year, that’s only $10,000. Buying NOW could still save you $77,937 over the life of the loan, and who knows what type of equity you could build if you look beyond the short-term risk. You’ve got to live somewhere. That rental you’re in sure isn’t going to increase in value for you!
4) THE COMING HOME SHORTAGE. I said, “what?” But this makes sense! Gen Y is stabilizing professionally and coming of age. There are now 80 million Americans, ages 18-34 years old. They are the largest generation of Americans ever; even larger than the Boomers. And they will need a place to live pretty darn soon. They won’t be in college or living in their parents’ basements forever. And if you haven’t noticed, there’s not been a lot of new construction in the past 5 years or so. Home values are all about supply & demand. Giddy up, that’s good news when you think about it!
5) JOB CREATION AND TIGHT CREDIT. Stevens believes those two short-term problems are the biggest weight on the housing market. Jobs are obvious, and the tight credit situation is just the pendulum swinging too far from where it was before the crash in 06-07. Give it time, the jobs will return, and the lenders will loosen up a bit. It’s already starting.
Now, I see a lot of wisdom in these comments. #2 is a BRILLIANT way to look at the choice of “risking it” to buy now. I mean, I’ve been bellowing about these crazy low rates since they hit 4% (in fact, for years actually, because they were crazy good at 6% and then 5.5% and then 5% etc), but man, oh man, what would our parents have given to buy with money that cheap 30 years ago? And to realize that holding out to “see what the market will do” could cost that much money?! Also, #4 CURLS MY TOES. He’s so right on that thinking. Hopefully, all these production builders won’t go vertical fast enough and resale will have a chance on the fun-side of the supply & demand game.
Anyway, nobody can predict what will happen this evening, much less the future of the local housing market, but these comments give me hope. Hang in there and if you want to save yourself about $88,000 over the next 30 years, CALL ME NOW 🙂 Happy Friday.
The perfect match for a large family, close to town and priced to sell! You will love the large, sunny family room addition, and the overall floor plan is perfect for an active family with lots of bedrooms and living spaces. New flooring downstairs, fresh paint, nice stainless steel appliance package, a large yard and a super location close to town. Ready for immediate occupancy, this one is hard to beat for the money.
New to the market & an exceptional find! 5bdrm home in beautiful Normandy Farms is well maintained, nicely updated & full of appeal. Warm hardwoods add richness to the lodge-feel of this custom home. Master on the main floor provides privacy & ease, nice open plan is modern & easy-living, & unique brickwork in the kitchen adds depth & warmth. Dry basement w/ fireplace is an easy finish project for instant equity. Loft area flanked by 3 bedroom suites keeps younger members of the family comfortable in their own space. A true “must see!”