Should you buy or rent a home?

 

See for yourself!

Lenders

There are a ton of lenders out there, some good, some very good and some not so good. Closed on a house today with some sellers of mine. Unfortunately the lender the buyer was using was not very on top of things. Always needing just one more thing. It was frustrating for all involved. If you are thinking about buying a house,  call and get a recommendation, you will be glad you did!


It reminds me of a buyer of mine who went to a lender and was eventually turned down. This was after another lender he had gone to totally flaked out on him.  I convinced him to call one of my recommended lenders and after he did his response was; "Wow, when I leave a message I get a call right back!." Yes, that is how it is supposed to happen. He is now the proud new owner of the following home.

"Look at Me!" Homes-Nampa

For a while I would pick a house to feature that had grabbed my attention with it's paint and state, "Look at Me!" It has been a few months but a couple homes shouted at me this week. Both are located in Nampa. Enjoy!

Wow! Look at this footage and location!

I have a super new listing, located in the central valley just off Five Mile and Fairview roads- you are close to most everything. Want to run down to all the new happenings at the Village in Meridian? Bang, you are there. Prefer to head towards Boise? Presto, no problem.

This super large 2915 square foot,   5 bedroom, 3 bath home is clean and well maintained and just waiting for you! It does have a small east facing back yard with patio, perfect for enjoying those summer eves. Nothing else available like it in this area.

Give me a call and I will answer any questions or schedule your private showing.

To remodel or not to remodel, that is the question.

When it comes to remodeling, homeowners often wonder if a project is worth the investment. According to the 2014 Cost vs. Value Report, several remodeling projects are not only valuable, but also return more than 78 percent of their costs upon resale. Many of those projects are exterior replacement projects, which Realtors^® rated having the biggest bang for the buck.

“Exterior projects such as entry door, siding and window replacements can recoup homeowners a substantial amount upon resale,” said Dave Ferguson. “These types of projects are essential to home maintenance, so the good news is many homeowners are already doing them. Another plus is that these projects are generally inexpensive, and besides keeping your home functioning properly, they also add instant curb appeal. This is especially important if you are considering selling.”

The 2014 Cost vs. Value Report compares construction costs with resale value for 35 midrange and upscale remodeling projects in 100 markets across the country. Realtors^®provided their insight into local markets and buyer home preferences within those markets. Overall Realtors^® estimated that homeowners would recoup an average of 66.1 percent of their investment in 35 different improvement projects, an increase of 5.5 points over last year and the largest increase since 2005. For the second consecutive year, the value of remodeling is up for all of the projects included in the survey.

Eight of the top-10 most cost-effective projects nationally in terms of value recouped are exterior projects. Realtors^® judged a steel entry door replacement as the project expected to return the most money, with an estimated 96.6 percent of costs recouped upon resale. It’s consistently the least expensive project, costing little more than $1,100 on average. Other worthwhile exterior projects included two different siding replacement projects, including fiber-cement siding, expected to return 87 percent of costs, and vinyl siding, expected to return 78.2 percent of costs. Two garage door replacement projects were also in the top 10, both expected to recoup more than 82 percent of costs. Rounding out the top exterior projects were two window replacement projects; wood window replacement and vinyl window replacement both recoup more than 78 percent of their costs.

According to Ada County Association of REALTORS each neighborhood is different and the desirability and resale value of a particular remodeling project varies. “That is why it’s important to work with a Realtor^®,” said Ferguson. “A Realtor^® is the best resource for helping homeowners decide what improvement projects will provide the most return upon resale in your market. Realtors^® have a unique understanding of local markets, desirable home features and buyer preferences.”

In addition to the exterior projects, two particular interior remodeling projects can recoup substantial value at resale. An attic bedroom is expected to return 84.3 percent of costs, and a minor kitchen remodel is estimated to recoup 82.7 percent of costs. The improvement project estimated to return the least at resale is a home office remodel, estimated to recoup only 48.9 percent.

The 2014 Cost vs. Value Report is published by Remodeling magazine publisher Hanley Wood, LLC and is done in collaboration with the National Association of Realtors^®. Additional data for the report can be found at NAR’s consumer website, HouseLogic.com. The website includes a wide variety of ideas and projects to help homeowners maintain, enhance and improve the value of their home.

Courtesy of the Ada County Association of Realtors

Ada County January Market Report

Single family home sales in January 2014 were 406 in Ada County, an increase of 10% compared to January 2013.  January sales were strong, and, when linked with December gives us two months in a row or double digit year-over-year increases.

Dollar volume for January was up 23% to $96 million.

Days on Market for January were 70.  Yep. You read that right…70. In December we were at 59. In January 2013, Days on Market was 53. Is this a one time “blip” or something more. Check back in March.

New homes sold in January totaled 99; up 27% from last year.

Existing home sales were 307; up 6%.

Historically, January sales decline from December by an average of 27%. January 2014 posted a 29% increase over December 2013.

Of the total sales in January, 12% were distressed; up 2% from last month. In January 2013, 25% of sales were distressed.

For the month of January, REO sales (70% of Distressed; 34 total sales) exceeded Short Sales (30% of Distressed; 17 total sales).

Pending sales at the end of January were 813; down 15% from January 2013.

Of Pending sales in distress (14%), there was a decrease in the number of Short Sales (from 57% to 56% of activity; 31 total sales) and a increase in REO sales (from 43% to 44%; 25 total sales).

January median home price was $208,190; up 12% from January 2013.

New Homes median price for January was $267,000; up 11% from January 2013. For Existing homes the increase is 12% to $189,900.

The number of houses available for sale at the end of January increased  slightly from December  2013 to 2,044.  This reverses four consecutive month of decrease.  This is 22% more than last year at this time.

Historically, inventory doesn’t increase very much until April.

Of the total active listings, 11% are distressed, down 1% from the end of December 2013.

With inventory experiencing seasonal decreases and the percentage of distressed inventory holding very low, median home price will remain strong through the end of this year.

Of our Distressed Inventory, 70% is Short Sales (157) and 30% is REO (67).

In Ada County we now have 4.2 months of inventory on hand, up a little from the end of December.

The price category in shortest supply is <$100K where we have 1.7 months.

From $100,000 to $119,000 we have 2 months available.

From $120,000 to $160,000 we have just over 3 months available inventory.

From $160,000 to $300,000 we have 4 months…except for the very popular $250,000 – $300,000 which has only 3.5 month’s supply available.

Above $300,000 we have a 5 month’s supply. Above $500,000 the supply is closer to seven months.  Remembering that six months of available inventory describes a “stable real estate market”; it looks like we are heading into a period of “normal” like we haven’t seen in several years.

Of sales in January, the most popular price point was $120,000 to $160,000 (21%); followed by $160,000 to $200,000 (14%) and  $200,000 to $250,000 with 13%.

So…what’s next?

The end of 2013 showed some “odd” data points;

• Sales to First Time buyers fell to 31%


• Cash sales (investor purchased) were nearly 30%

This suggests continued pressure on new household formation; which we’re counting on in 2014.

At the same time, buyers having 20% or more for their downpayment represented 38% of all buyers. This is the first time in four years in which buyers with 20% downpayments exceeded 37%.

This is clearly the impact of CFPB rules for QM on home buyers.

This morning NPR reported that Idaho has the highest percentage of minimum wage workers in the nation…but we are growing jobs faster than the national average.

Bottom line…its going to be a complicated first quarter for real estate.

 

Mortgage Rates Projected to Rise as Tapering Continues

Mortgage Rates Projected to Rise as Tapering Continues  Posted: 18 Feb 2014 04:00 AM PST It is projected that if the Fed continues to cut back on bond purchases that long term mortgage rates would start to climb. Many experts felt that Janet Yellen, who replaced Ben Bernanke as Fed Chair, was going to be less inclined to continue tapering bond purchases at the level established. However, in her testimony in front of the Financial Services Committee last week, Yellen made it quite clear that she will in fact continue the current pace of tapering: “In December, the Committee judged that the cumulative progress toward maximum employment and the improvement in the outlook for labor market conditions warranted a modest reduction in the pace of purchases, from $45 billion to $40 billion per month of longer-term Treasury securities and from $40 billion to $35 billion per month of agency mortgage-backed securities. At its January meeting, the Committee decided to make additional reductions of the same magnitude. If incoming information broadly supports the Committee's expectation of ongoing improvement in labor market conditions and inflation moving back toward its longer-run objective, the Committee will likely reduce the pace of asset purchases in further measured steps at future meetings.” What does that mean to a prospective purchaser? Currently, Freddie Mac’s 30 year rate is at 4.28%. Here are the projected interest rates for this time next year:

 

A Flood of Listings Coming to the Market?

I found this survey rather surprising: 71% or folks surveyed are considering selling their home this year!

From KCM Blog:



We have previously talked about the diminishing supply of housing inventory and how it is impacting the real estate market. The situation might be about to change dramatically according to a recent survey by Lending Tree.

The survey revealed three interesting findings. Of those surveyed:

1. 63% have a positive outlook on the economy this year


2. 69% have a positive outlook on housing this year


3. 71% said they are considering selling their home this year

While the first two findings are good news, the third was rather amazing.

71% of homeowners are considering selling their home in the next 12 months!

While we realize that 70% of the housing inventory in this country could never be turned over in a year, it is interesting that people are again thinking about moving. There has been a pent-up selling demand over the last few years because families lost both equity in their homes and confidence in the economy. Rising prices have returned equity to many and an improving economy is again rebuilding consumer confidence.

Bottom Line

Only time will tell. However, even if a small portion of that 71% actually decide to sell, this year’s real estate market could be very interesting as we move forward.

 

Percentage of Distressed Sales Dropping

It is very reassuring to see the percentage of distressed sales dropping in the Treasure Valley. (A distress sale is one where it was  a short sale, in foreclosure or bank/ HUD owned.)

In Ada County, from a high of 48.7% in 2011, down to 30% in 2012 and last year on down to 13.9%

Canyon County had a high of 72.7% in 2010, down to 50.3% in 2012 and 23.4% last year.

This year should be lower still, as the end of 2013 in both counties showed a significantly lower number that the beginning of the year. A nearly steady decline was shown in both.

Be My Valentine, Buy a House today!

Prices are continuing upward, perhaps the best Valentine gift would be buy a house today!

If you are curious about how the whole southwest area of Idaho breaks down, check out the following pie chart.

Thanks again to Hennessey Appraisals for these great graphics.

Homes Sold In Ada and Canyon Counties

Some additional graphs showing distribution of homes sold in Ada and Canyon Counties, courtesy of Hennessey Appraisals.

Homes Sold In Ada and Canyon Counties, 2008-Present, We're Back!

 

A super graph showing our valley sales numbers and resulting median amounts.  The short explanation…WE"RE BACK. Okay, may be not totally back comparing to 2005, but we are healthy!

My thanks to Hennessey Appraisals.

Buying a Home: Should You Do it Now or Later?

Buying a Home: Should You Do it Now or Later? Posted: 11 Feb 2014 04:00 AM PST Last month, the Federal Reserve, in a unanimous vote, decided to further decrease its bond purchasing. The bond purchases were the government’s stimulus package created to keep long term mortgage interest rates artificially low in order to help drive the housing market. Most experts believe that tapering will cause interest rates to increase as we move through the year. Interest rates have remained relatively stable since the onset of the tapering in December. This is probably because the first round of increases had already been ‘priced into’ the equation last summer when rates skyrocketed by over a full percentage point just on the speculation that tapering would take place later in 2013. However, as we move forward, most analysts believe rates will start to rise culminating in a rate close to a full percentage point higher than current rates by this time next year. For example, Freddie Mac, Fannie Mae, The Mortgage Bankers’ Association and the National Association of Realtors have all recently projected rates to be between 5-5.4% at this time next year. Bottom Line If you are a first time buyer or a move-up buyer, the cost of the mortgage on your new home will probably increase as we move through the year. If the timing makes sense, buying sooner rather than later may save you a substantial amount of money over the long term in lower mortgage payments.

 

5 Things You Probably Don’t Know About VA Loans

There is a lot of veterans using VA loans in today's market, so I felt this was a timely article.

VA loans are the most misunderstood mortgage program in America. Industry professionals and consumers often receive incorrect data when they inquire about them. In fact, misconceptions about the government guaranteed home loan program are so prevalent that a recent VA survey found that approximately half of all military veterans do not understand it.

With this in mind, we would like to debunk the most common myths about VA Loans.

Myth 1: The VA loan benefit has a “one time” use.

Fact: Veterans and active duty military can use the VA loan many times. There is a limit to the borrower’s entitlement. The entitlement is the amount of loan the VA will guarantee. If the borrower exceeds their entitlement, they may have to make a down payment. Never the less, there are no limitations on how many times a Veteran or Active Duty Service Member can get a VA loan.

Myth 2: VA home loan benefits expire if they are not used.

Fact: For eligible participants, VA mortgage benefits never expire. This myth stems from confusion over the veteran benefit for education. Typically, the Montgomery GI Bill benefits expire 10 years after discharge.

Myth 3: A borrower can only have one VA loan at a time.

Fact: You can have two (or more) VA loans out at the same time as long as you have not exceeded your maximum entitlement and eligibility. In order to have more than one VA loan, the borrower must be able to afford both payments and sufficient entitlement is required. If the borrower exceeds their entitlement, they may be required to make a down payment.

Myth 4: If you have a VA loan, you cannot lease the home.

Fact: By law, homeowners with VA loans may rent out their home. If the home is located in a non-rental subdivision, the VA will not guarantee the loan. If the home is located in a subdivision (such as a co-op) where the other owners can deny or approve a tenant, the VA will not approve the financing. When an individual applies for a VA loan, they certify that they intend on making the home their primary residence. Borrowers cannot use their VA benefits to buy property for rental purposes except if they are using their benefits to buy a duplex, triplex or fourplex. Under these circumstances, the borrower must certify that they will occupy one of the units.

Myth 5: If a borrower has a short sale or foreclosure on a VA loan, they cannot have another VA loan.

Fact: If a borrower has a claim on their entitlement, they will still be able to get another VA loan, but the maximum amount they would otherwise qualify for may be less. For example, Mr. Smith had a home with a $100,000 VA loan that foreclosed in 2012. If Mr. Smith buys a home in a low cost area, he will have enough remaining eligibility for a $317,000 purchase with $0 money down.  If he did not have the foreclosure, he would have been able to obtain another VA loan up to $417,000 with no money down payment.

Veterans and Active duty military deserve affordable home ownership. In recent years, the VA loan made up roughly 13% of all home purchase financing. This program remains underused largely because of misinformation. By separating facts from myth, more of America’s military would be able to realize their own American Dream.

 

5 Reasons to Buy a Home Now Instead of Spring

From KCM Blog

Based on prices, mortgage rates and soaring rents, there may have never been a better time in real estate history to purchase a home than right now. Here are five reasons purchasers should consider buying before the spring market arrives:

Supply Is Shrinking

With inventory declining in many regions, finding a home of your dreams may become more difficult going forward. There are buyers in more and more markets surprised that there is no longer a large assortment of houses to choose from. The best homes in the best locations sell first. Don’t miss the opportunity to get that ‘once-in-a-lifetime’ buy.

Price Increases Are on the Horizon

Prices are projected to appreciate by over 25% from now to 2018. First home buyers will probably pay more both in price and interest rate if they wait until the spring. Even if you are a move-up buyer, it will wind-up costing you more in net dollars as the home you will buy will appreciate at approximately the same rate as the house you are in now.

Owning a Home Helps Create Family Wealth

Whether you are rent or you own the home you are living in, you are paying a mortgage. Either you are paying your mortgage or your landlord’s. The Fed, in a recent study, revealed that the net worth of the average homeowner is 30 times greater than that of a renter.

Interest Rates Are Projected to Rise

The Mortgage Bankers Association, the National Association of Realtors, Freddie Mac and Fannie Mae have all projected that the 30-year mortgage interest rate will be over 5% by the this time next year. That is an increase of almost one full point over current rates.

Buy Low, Sell High

We would all agree that, when investing, we want to buy at the lowest price possible and hope to sell at the highest price. Housing can create family wealth as long as we follow this simple principle. Today, real estate is selling ‘low’ compared to where it will be next year. It’s time to buy.

 

Biggest Staging Sins

Here are 8 of the biggest staging sins sellers make and how agents can help their sellers avoid these pitfalls before it costs them a sweet deal.

1. Collection Overload.

It is very difficult for almost any collection to look orderly and neutral, two high-level aims of home staging. Unless the homeowner has attractive, high-end built-in cases to house the collections and the target buyers share a similar affinity for the objects, even the coolest collection can come off as a pile of space-consuming clutter.

When it comes to shockingly bad staging decisions, the choice to give a taxidermy or gun collection a starring role in a home’s staging is high in the oh-so-bad rankings. For some buyers, these collections can trigger ethical and sanitation and can distract from the strengths and features the property has to offer.

2. Echo-Chamber Staging.

In an echo chamber, sounds are amplified because they simply bounce around in that closed space. When left alone, the same thing can happen to sellers if they do not have outside input. And unfortunately, it seems to be the bad staging ideas that get amplified, more than the good ones. Echo chamber staging happens when the sum total of a staging team, well, one person. That bold wallpaper in the bathroom may seem like a good idea, but a little perspective—and another opinion—may prove otherwise.

3. Failure to edit.

You’ve heard thirty-somethings who still live at home diagnosed with failure to launch? Well, failure to edit is a close cousin of this syndrome.  As the New York Times recently put it, “the job of stagers is to reverse the accumulated creep of hundreds of small and misguided design decisions, and to erase any hints of the messiness of daily life.” Your client might have a fantastic rug, a beautiful sofa, amazing tchotchkes and the highest-end personal effects, but chances are good that their cumulative first impression to a buyer viewing the home will still fall short of the “one broad stroke of gorgeousness” the Times piece correctly says home sellers should aim for, with their staging.

The failure to edit is a generalized syndrome which can manifest in all sorts of specific staging woes, from garden variety clutter to disastrous decor style mash-ups.

4. Silly scenarios.

The difference between staging and interior design is simple: staging is cost-and-time efficient design undertaken with the specific objective of showing a home off to its best advantage, playing up its features and helping prospective buyers visualize the best lives they could possibly live in the home, should they choose it. Unfortunately, this has led some well-intentioned sellers and stagers to believe they should stage one bedroom as a Parisian boulevard (Eiffel tower mural included), another with a full-blown butterfly theme and the third as the beach—complete with umbrella, towels on the wall and sunscreen bottles on the nightstand. I saw this house, folks. With my own two eyes.

5. The ‘lived-in’ look.

When a home is being shown for sale, it must be immaculate, every single time it’s being shown. It should look like no one lives there: no toothbrushes, curling irons, protein shake mixes or paperwork allowed.

Is this difficult to keep up? Absolutely. But you’d be surprised at how bad an impression just a few personal toiletries or dishes can make.

6. Closet cramming.

Out of sight is not out of mind. Home buyers today are desperate for storage space and will undoubtedly open those same, crammed-tight doors in an effort to evaluate how the home ranks for storage. Beautifully organized closets with ample room create an impression in the buyer’s mind that they, too, can have an orderly life in the home.

7. Failing to stage for all the senses.

A house that smells like pet mayhem or smoke or has a noisily defective heater is a tough house to sell, no matter how beautifully it is staged. Unfortunately, smells and sounds are very easy to get acclimated to, when you live with them. Buyers, though, will detect them the second they walk in—and the moment they do is the moment we in the business call “turn-off time.”

8. Not to.

Ultimately, the most shockingly bad of all staging decisions is the surprisingly frequent decision not to bother staging the home at all. This explains homes like the one I once viewed which had residents still sound asleep in their beds, in the dining room, as the listing agent walked myself and my mortified buyer clients through the property. On the less bizarre end of the non-staged spectrum, this is how lovely homes with vast potential end up selling at a discount, as cosmetic fixers at a discount. This is a particular tragedy in cases where the owners could have painted, spruced, moved loads of things out and a few newer things in and made much, much more money on their homes

 

 

Existing Home Sales