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Market @ A Glance: May 2017 Edition

May 17, 2017

Local Market Update - San Diego County - Real Estate
Here is the latest scoop on the local and state housing markets. For specific information on your neighborhood or a market analysis on your home please  Just send me an email or call me at 619-888-2117. 

 

 

7 Important Things Home Sellers Often Forget To Do

May 11, 2017

 

By: Angela Colle, ClientDirect

Most people don’t plan on living in their first (or second or maybe even third) home forever, but knowing when the time is right to put that baby on the market can be tricky.

In fact, it can feel kind of like breaking up with a longtime boyfriend or girlfriend. Deep down, you knew you wouldn’t be with that person forever—but ending things can be way easier said than done.

Sometimes life changes force the issue: There’s little reason for self-doubt or trauma-level angst if you’re relocating to another state or you know your newborn twins won’t fit in your one-bedroom bungalow. But without a pressing reason staring you in the face, it can be hard to know when you’ve outgrown your home.

So how do you know when it’s the right time to let go?

1. You’re feeling cramped, and you can’t add on

Your family might not be growing, but that doesn’t mean your lifestyle still fits in your current house.

If you’ve started working from home, for example, or you’ve adopted an extended family of indoor cats—or maybe you’ve just never gotten over your dream of having a sewing room—your house might be too small.

But before you jump to conclusions, see if paring down your possessions works to free up some space.

Another option might be to finish an attic or basement, add another room, or even add a whole story to your home. But, of course, that won’t work for everyone.

“If your property isn’t large enough or your municipality doesn’t allow it, moving to a bigger home may be your best option,” says Will Featherstone, founder of Featherstone & Co. of Keller Williams Excellence in Baltimore.

To decide which route to take, check your local building laws and get estimates from two or three contractors. It also wouldn’t hurt to check with your REALTOR®. Sometimes adding on won’t increase the value of a home, and you don’t want to make big-time improvements that will bring only a small-time return on your investment.

2. You have too much space

On the other hand, perhaps you’re feeling overwhelmed by vacant rooms and silence. (Hello, empty nesters!)

“In this case, it no longer makes sense to have, say, four bedrooms and a basement,” Featherstone says.

Saying goodbye to a family home can be difficult, but you should consider how feasible it is to stay. If yardwork and house upkeep are getting to be a little too much, or soaring utility bills are cramping your style, it might make more sense to move.

3. You’re over the neighborhood

Maybe you can no longer deal with the rigid rules of your homeowners association, or perhaps your neighbors turned their house into a rental for frat guys. Whatever the reason, neighborhood dynamics can change dramatically over time.

And sometimes, you can change. Maybe the 40-minute commute to work didn’t seem like such a big deal the first few years, but now you’re dreading it every day. Or your kids are getting older, which can be a big problem if you’re not in the right location.

“If you can’t afford a private school system, you are limited to one school for your children,” Featherstone says. “Moving may be a benefit to your child’s education.”

4. Remodeling won’t offer a return on your investment

Giving your kitchen or bathroom a face-lift can make your house feel like new again, which might be all you need to decide you want to stay put for years. But that doesn’t mean it’s a financially sound decision.

“Before making significant improvements, you should really study the neighborhood and know the highest price point of your neighborhood,” Featherstone says.

If your home is already similar in style and condition of some of the priciest homes in the neighborhood, remodeling might be a bad idea, and you should consider selling instead.

5. You can afford to sell

Sure, you’re going to make money when you actually sell your house, but as the adage goes, it takes money to make money. So seller beware: You probably won’t be sitting around and waiting for the dollars to roll in.

“Before you consider selling, you should have the funds available to prepare your home for sale,” Featherstone says.

Most sellers need to make some minor improvements such as painting, landscaping, or updating flooring to get a good price on their home. Those costs will come out of your pocket at first, so it’s a good idea to have a cushion before you start.

6. You’re ready to compete

If you’re living in a seller’s market, you might be enticed to offload your home before things cool off. But don’t forget—once you sell, you’ll probably be a buyer, too.

“If your market is hot, your home may sell quickly and for top dollar, but keep in mind the home you buy also will be more expensive,” Featherstone says.

If you’re going to get out there, you should make sure you’re ready to compete.

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117. 

Defying Predictions, Mortgage Rates Are Dropping—Here’s Why

May 4, 2017

Daniel Acker/Bloomberg via Getty Images

 

 

Written by: Clare Trapasso, Realtor.com

Anxious would-be home buyers have been watching mortgage interest rates finally begin ticking up again in 2017, ` years of historical lows. And when the Federal Reserve raised the short-term interest rate in March, the conventional wisdom was that mortgage rates would follow suit—as they typically do.

But that’s not happening this time around. Despite a Fed hike just last month and two more looming on the horizon, the average interest rate for a 30-year fixed-rate mortgage fell back below 4% for the first time since November, according to Freddie Mac.

They were at just 3.97% as of Thursday, down from 4.08% the previous week and a high of 4.3% for the year, on March 16.

“If you had an answer to that question, you’d probably make millions trading on Wall Street,” says Danielle Hale, managing director of housing research at the National Association of Realtors®. “Interest rates are really tricky to predict.”

Yet even a small change in the interest rate can be a game changer for buyers. A fraction of a percentage point can add up to hundreds of extra dollars a year in mortgage payments. And that extra money can make a real difference in the kinds, sizes, and locations of homes that buyers can afford.

What’s really driving down mortgage interest rates

Mortgage interest rates are influenced by the Federal Reserve’s short-term interest rates, but in fact they’re more closely tied to the 10-year U.S. Treasury bond market. That’s because as investments, bonds and mortgages are similar: Investors consider them significantly safer bets than the more volatile stock market.

So when investors got spooked by the rising stock market (fearing a downturn) and the unpredictability of the current U.S. administration, they put their money into bonds. And since mortgage rates are generally an inverse reflection of the strength of the bond market, when bonds are up, mortgage interest rates drop.

“Investors are a little skeptical because the stock market keeps climbing,” says Don Frommeyer, a mortgage officer at Marine Bank in Indianapolis. “They’re looking for safe ways to invest their money, and they’re going back to the bond market.”

They’re also not quite as optimistic about how quickly President Donald Trump’s infrastructure plans will come to fruition, after having invested in sectors expected to profit from those plans. So they’re turning back to bonds.

“Now people are re-evaluating and coming to the conclusion that [these promises] are going to take a lot longer than they expected,” says Freddie Mac’s chief economist, Sean Becketti.

How long the downward trend might last

The lower rates aren’t just confined to conservative 30-year fixed-rate loans. Rates averaged 3.23% on 15-year fixed-rate loans and 3.1% on five-year adjustable-rate mortgages as of Thursday, according to Freddie Mac.

“It’s good news for people who are already in the market,” says Hale. “Lower mortgage rates translate into a lower monthly payment.”

But this situation might not last. With two more Fed hikes expected this year, mortgage rates are likely to fall back in line with their usual pattern. They’re anticipated to keep going up gradually, Hale adds.

Of course, life can always throw us a curveball.

“There’s so much uncertainty and volatility in the market,” there’s no way of knowing what the mortgage rates will do next, says Becketti.

 

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117. 

How Healthy Is Your Condo Board? How to Conduct a Thorough Checkup

April 27, 2017

(Baitong333/iStock)

 

By Margaret Heidenry | Apr 25, 2017

As uncomfortable as it might be to get poked and prodded while you’re clothed in a paper gown, medical checkups are essential to maintaining your health. Well, guess what? That same wisdom applies to buying a home—particularly if that home is a condo. Why? Because with condos, you’re paying someone else to be in charge of a lot of the maintenance, from lawn mowing to repairs. What if they slack off and let that stuff go? If so, things will start to break down from neglect—and, like a sneeze spreading through an office, this could ultimately infect your own home, and how much it’s worth. So whether you’re shopping for a condo or just curious to know whether the one you’re already in is healthy, here’s how to conduct a thorough checkup.

General appearance

Most doctors start a physical by taking a good look at the patient—likewise, you’ll want to give any association a thorough once-over.

“It’s a matter of observing the condition of the entire development, not just the home you’re considering buying,” says Lance Stendal, president of Omega Property Management in Maple Grove, MN. A well-kept association usually signals a robust bank account; one with a rundown appearance may suggest a lack of cash.

In the waiting room, you fill out a stack of papers about your health history because the past informs the future. Same goes for a condo association’s paperwork. As a purchaser, you’ll get a packet that typically contains the proposed annual budget and last year’s approved budget, says Scott Reidenbach, founding partner of Reidenbach & Associates, a Wayne, PA–based law firm.

Make sure the current budget accurately reflects needed routine maintenance; an association that’s consistently over budget is a sickly one. Capital improvements on the horizon should be mostly funded. If there is a shortfall, that money is more likely than not going to come out of your pocket—and possibly bleed you dry.

Questions to ask

A routine checkup may not reveal problems if you don’t ask the condo association board or managing agent the right questions. Here are two biggies:

How many delinquent owners are there? Size matters in determining this. Two tardy owners will have more impact in a 10-unit association than a 100-unit association.
Is there any pending or threatened litigation? If so, say hello to pricey lawyers’ fees.

Beware if condo fees are too high—or low

Condo fees are the price you pay so that you can kick back at home while others are hired to repair roofs and clean the communal pool. So, condo fees aren’t bad per se, but nothing makes a condo owner’s blood pressure rise like constant hikes in fees.

Fee hikes are unpopular and can be prevented with responsible budgeting. So, ask if the board has raised the monthly dues on existing unit owners in the past—or plans to in the future. A consistent rise in fees is a symptom of financial trouble.

On the flip side, Stendal says to be wary of the siren song of low—or no—assessments, which could mean the board isn’t focused enough on the needs of the association. And deferring repairs in order to keep fees low simply digs a deeper hole. Don’t use the fee amount as a gauge for buying in one condo building over another until you understand how those monies are allocated, says Stendal. A fee of $250 might be better than $200 if it’s properly spent on operating expenses, budget, and contributing to reserves.

Measure your condo board’s immune system

A condo’s reserve account is like its immune system—it’s a special force that fights whatever curveballs come its way. To determine if it’s readily stocked with enough antibodies, check out the condo’s Replacement Reserve Study. This report helps a condo prepare for any major financial hits it might face in the future by detailing anticipated income and expenses over the next 30 years for capital projects.

The current balance sheet should show that the association has the money in the bank that the RRS recommends, not just what may seem like a large sum.

For perspective: Divide the total reserve balance by the number of units.

“A million dollars looks like a lot,” says Stendal. “But when you have to divide that among 400 homes, a share is only $2,500!”

If the condo faces an emergency and doesn’t have a full coffer, the owners might be bled dry with a surprise assessment or a permanent hike in condo fees.

The prognosis

If your condo is ailing, many states allow you to back out of a contract. For example, Minnesota mandates the seller provide the buyer with current financials, the most recent annual report, and a copy of the RRS, says Stendal. The buyer is given 10 days to review them. During that time, the buyer can cancel the contract for any reason and without penalty.

If your condo is suffering and you want to help revive it, become engaged in the process. Hold the board and management company accountable for the situation, and consider serving on the board yourself. It might take some work, but this ensures you’ll call the shots on your own condo’s health.

Margaret Heidenry is a writer living in Brooklyn, NY. Her work has appeared in The New York Times Magazine, Vanity Fair, and Boston Magazine.

 

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117. 

How is California’s Housing Market Doing?

April 20, 2017

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117. 

 

 

 

 

 

San Diego 8th Hottest Market in March

April 13, 2017

 

Post by:  North San Diego County Association of REALTORS®

Spring has barely sprung, but it appears we’re already in the thick of a frenzied spring home buying season. Depending on who you’re listening to, San Diego County’s housing market seems to be off to a blooming start. Industry sources confirm the market is growing and getting stronger. Low inventory continues to be a significant problem, as well as high prices are keeping waves of buyers at bay. However, thanks to uncommonly low interest rates, mortgage payments have remained pretty reasonable even in the face of increasing purchase prices.

Among the latest housing market headlines:

— According to the University of San Diego Burnham-Moores Center for Real Estate, the local economy is picking up steam and is expected to do better than what had previously been expected. The Center’s Index of Leading Economic Indicators is now forecasting employment growth at 30,000 new jobs in 2017, compared with a previous forecast of 25,000 jobs announced at the end of 2016. Analysts say the economy is growing because of improved local labor conditions, rising prices of local stocks and stronger measures of U.S. consumer confidence due to President Trump’s business-friendly policies.

— According to http://www.Realtor.com, the National Association of REALTORS® official website, San Diego was the 8th “hottest” real estate market in March with the typical home taking just 38 days to sell. California led the United States with six of the top 10 real estate markets. Nationwide a home is typically on the market for 69 days, eight days less than this time last year. It’s much less in California, however, with homes in booming Silicon Valley homes typically selling after just 25 days.

— According to the latest housing market report from the California Association of REALTORS® (C.A.R.), the median number of days it took to sell a single-family home dropped from 37.4 days in January to 33.4 days in February and was down from 41.5 days in February 2016.

— According to CoreLogic, an Irvine-based real estate data and analytics information service, the median sales price of a home in San Diego County jumped by 8.1 percent in February, compared with the same month a year earlier, while the number of homes sold fell by 1.6 percent. The median price of a San Diego County home was $492,000 in February, up from $455,000 in February 2016. In Southern California, the median price of a home was $460,000 in February, up 1.1 percent from the month before and up 7 percent from the same period last year.

— Also according to C.A.R., existing single-family home sales totaled 400,500 in February on a seasonally adjusted annualized rate, down 4.7 percent from January and up 4.9 percent from February 2016. February’s statewide median home price was $478,790, down 2.2 percent from January and up 7.6 percent from February 2016.

Also, closed escrow sales of existing, single-family detached homes in California remained above the 400,000 benchmark for the 11th consecutive month and totaled a seasonally adjusted annualized rate of 400,500 units in February, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. The statewide sales figure represents what would be the total number of homes sold during 2017 if sales maintained the February pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

Finally, C.A.R. said the share of homes selling above asking price dipped from 31 percent a year ago to 30 percent in February. Conversely, the share of properties selling below asking price increased to 37 percent from 35 percent in February 2016. The remaining 34 percent sold at asking price, down from 35 percent in February 2016. The homes that sold above asking price, the premium paid over asking price edged up to 12 percent, up from 11 percent a year ago.

“While it’s encouraging to kick off the year with back-to-back yearly sales increases, moving forward, California’s housing market could lose steam in the long term as the Fed begins to adjust the federal funds rate,” said C.A.R. President Geoff McIntosh. “In the short term, however, the specter of higher interest rates may push buyers off the fence to purchase a home before mortgage rates move even higher.”

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117. 

Real Estate on Opening Day

April 6, 2017

Consider me your #1 resource for all things Real Estate! Selling, buying, upsizing, downsizing, relocating, investing, vendor referrals, shoulder to cry on during renovations and more. Just send me an email or call me at 619-888-2117. 

 

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