Mortgage Interest Rates Go UP
A little less home for your buck, but don't give up, get in the game!
The window may be closing to get the best home for your buck, but mercifully enough (for all those I've been urging for months to get off the fence), the window appears to be closing slowly. In fact, we may have simply reached another mortgage interest rate plateau, but the ratcheting incline in rates is simply inevitable. A 3.5% 30 year fixed mortgage rate will likely not be seen again in any one's lifetime. But there's no crying in real estate, just like in baseball. Today's 4.5% 30 year fixed mortgage rate still seems like fiction prior to 2008, and is nothing to shake a stick at. In less than two years, rates will be much higher, and so will inventory levels, so home prices will likely not increase rapidly as we saw in 2000 to 2006 (a historically normal rate of appreciation is a welcome sight). So $500,000 today will be $510,000 in two years, but rates at one to two percent higher will make the $510,000 home that much further out of reach. There is no question about it, the window is narrowing for getting the most home for your buck. Adjust, re-calibrate, then take action and don't waste another moment thinking about missed opportunity even if it was due to your own hesitation or lapse of judgment. Get in the game as it is now; the window of opportunity is closing but it isn't shut just yet in terms of getting the best home for your money.
Real estate agents, even for some of my readers of this blog, have the unfortunate and at least somewhat undeserved reputation of "exaggerating" market conditions. It was no exaggeration when the Federal Reserve announced it would scale back on buying bonds later this year; it was a trigger for the spike in mortgage interest rates. The last month, and in particular the last three business days, have more than proven my point about urgency and lost opportunity. I won't over use the "I told you so" motif, but unlike many users of that cliched expression, I definitely DO NOT hate to say it. In fact, we have a gift and a reprieve; buyers and sellers still have a chance to act before the game completely changes. Real estate agents like myself who have successfully adjusted to all kinds of market changes over many, many years are ready for the game change (which essentially means simply different players), and those real estate professionals like myself will all adjust accordingly. But a number of you reading these words will simply not be able to be a player after the next significant mortgage rate jump; not for a long while, anyway, and I'd just as soon help you seize the day rather than wait for a second (or third or fourth) best opportunity possibly several years away. I am not speaking scare tactics, I am not preaching fear, I am speaking from current observation and many years experience.
Buyers, I want you to get the most out of the way things are while there is still time, wherever you happen to be on the buying spectrum. Sellers, I want you get the most out of the somewhat shallower pool of qualified buyers. The proverbial iron may have cooled a bit, but it is still hot enough to forge a real estate victory.
Saturday, June 29, 2013
Sunday, June 23, 2013
Fast Paced Market Means Fundamentals Are Essential
Demands of a High Speed Real Estate Market:
Strong Fundamentals
In any fast-paced professional sport, particularly those in which speed is enhanced by tools such as in hockey or enhanced by machines such as in NASCAR or formula racing, if you have to think about what your next move is you are probably too late already. Solid, firmly embedded training is absolutely essential; team members without the fundamentals of their lighting-fast sport entrenched in their minds will undoubtedly fail. In a residential real estate market moving as quickly as the one we are currently experiencing, buyers need to be quick on their guard and home sellers need to be quick (and honest) in their evaluation of their home's weaknesses. I have been focusing on real estate fundamentals in my blog lately primarily because it has been easy to become complacent due to the lackluster pace of the market in the previous six years. Fundamentals, though not forgotten, may have been re-prioritized in the minds of buyers and sellers, especially those who have laid low for six or more years. My recent observations of this near super sonic speed marketplace have made it clear that real estate refresher courses are in order.
Significant and potentially expensive or even dangerous fundamental physical areas of concern in any home must be identified:
1. Water leaks: the stains are the tell-tale sign, though some significant problems may not leave visible stains. Still, the fundamental rule is to look for stains on ceilings and near the baseboards, especially in basements or attics.
2. Shifting foundations: look for large, non-hairline cracks along the home's foundation are worth investigating.
3. Drainage issues: look for standing water, either in and around the foundation of the home or in the yard.
4. Termites: an underrated problem; look for weakened or grooved wood, especially near ground level, and watch for unusual "piles" of wood "droppings" anywhere in or around the home.
5. Worn roofs: look for broken our missing copings and buckled shingles, while you're checking out the same area for water spots.
6: Inadequate wiring: look for antiquated fuse boxes, extension cords (indicating insufficient outlets), and outlets without a place to plug the grounding prong.
7. Plumbing problems: look for very low water pressure, banging noises in the pipes, etc.
Obviously, nothing can be better than a full home inspection by a trained pair of eyes, but you can provide your own due diligence by retaining these fundamentals and thereby determining whether or not a professional inspection (and the price tag that goes with it) is worthwhile given the pace of the market. Don't let the speed of the market intimidate you, there is still a fantastic albeit narrowing window at work through the summer, and to use the analogy of different sport for which my town of Huntington Beach is known, the conditions are ideal to catch an excellent wave. In fact, while I saw the market conditions emerging for the summer, I admit did not fully anticipate the dramatic jump in activity, but I have experienced first hand the benefits of returning to real estate fundamentals which may have otherwise become rusty over the last five to six years. Keep your fundamentals at the top of your mind, and you'll end up with (at least) one in the "win" column.
Friday, June 14, 2013
A Buyer's Dream Town
Huntington Beach: Always A Buyer's Dream Town
I've preached from the hilltops already how this unique period in history is creating an ideal but already closing window of opportunity for residential real estate buyers and sellers. I have no doubt that homily will resurface here in this blog, though perhaps not until we are facing the next phase in this ever-transforming real estate market (which I anticipate to be a less heated, slower paced, but even more balanced buyer/seller market), and my comments about the soon-to-be-gone urgent conditions of the day will be little more than a "I told you so" diatribe. For the moment, however, I am done with my ranting as to WHY you should buy and buy NOW. I want to talk about WHERE you should buy. I've helped buyers buy and sellers sell homes all over Southern California, but there is a reason why my home and my focus is in Huntington Beach: the city is the perfect balance of everything a homeowner could want in one town.
I'll admit it is easy to brag about Huntington Beach right now. Summer is here, and summers in Huntington Beach are nothing short of legendary. People may not know it by name, but when they are thinking of summer just about anywhere in the Northern Hemisphere, they are likely picturing an image which could easily be taken from the beachfront along Huntington Beach. My Huntington Beach readers who are already residents know one of the main selling points of our town, for anyone who loves the beach and/or surfing, is our role as the perennial home of the US Open of Surfing http://www.usopenofsurfing.com/ . Although the event is a month away in the depth of summer, from July 20th to the 28th, Huntington Beach is already getting ready to play host of a global celebration for the ultimate summer event. Regardless of one's level of interest or understanding of the sport of surfing itself, the sheer numbers of activities and peripheral events (and people from all around the world coming to participate) make this the premier Southern California beach event.
I've said it before, and I'll say it again: the other unique advantage to living in Huntington Beach is not only it's own events, or its personality kept relatively intact while still being able to constantly reinvent and regenerate itself; Huntington Beach enjoys a fantastic proximity to just about anywhere you would want to go in Southern California. San Diego's many attractions? South on 405 will take you there. Get some skiing in? Multiple routes inland and to the north. Want to see what's happening in the other Orange County beach communities? Take Pacific Coast Highway due south, each city has a distinct personality as you go down to San Onofre. Want to walk on the wilder side of beach communities (that is, get out of Orange County)? Head due north on Pacific Coast Highway. In fact, if you'll like the US Open of Surfing, you'll love some of the events going on with our neighbors to the north, such as the South Bay International Surf Festival from July 31st to August 4th. Hermosa Beach, Manhattan Beach, Redondo Beach and Torrance explode with surfing and surf-related beach events during this beach lover's dream festival. Getting there from Huntington Beach is a gorgeous summer ride, with windows or convertible top down, along the longest stretch of beachfront or beach-close highway in California; so rare is the "getting there' as good as the arrival.
To reiterate a few previous blogs: buy now. To reiterate this blog in three words: buy Huntington Beach.
Ann Stefanucci
714-822-9453
annstefanucci@gmail.com
I've preached from the hilltops already how this unique period in history is creating an ideal but already closing window of opportunity for residential real estate buyers and sellers. I have no doubt that homily will resurface here in this blog, though perhaps not until we are facing the next phase in this ever-transforming real estate market (which I anticipate to be a less heated, slower paced, but even more balanced buyer/seller market), and my comments about the soon-to-be-gone urgent conditions of the day will be little more than a "I told you so" diatribe. For the moment, however, I am done with my ranting as to WHY you should buy and buy NOW. I want to talk about WHERE you should buy. I've helped buyers buy and sellers sell homes all over Southern California, but there is a reason why my home and my focus is in Huntington Beach: the city is the perfect balance of everything a homeowner could want in one town.
I'll admit it is easy to brag about Huntington Beach right now. Summer is here, and summers in Huntington Beach are nothing short of legendary. People may not know it by name, but when they are thinking of summer just about anywhere in the Northern Hemisphere, they are likely picturing an image which could easily be taken from the beachfront along Huntington Beach. My Huntington Beach readers who are already residents know one of the main selling points of our town, for anyone who loves the beach and/or surfing, is our role as the perennial home of the US Open of Surfing http://www.usopenofsurfing.com/ . Although the event is a month away in the depth of summer, from July 20th to the 28th, Huntington Beach is already getting ready to play host of a global celebration for the ultimate summer event. Regardless of one's level of interest or understanding of the sport of surfing itself, the sheer numbers of activities and peripheral events (and people from all around the world coming to participate) make this the premier Southern California beach event.
I've said it before, and I'll say it again: the other unique advantage to living in Huntington Beach is not only it's own events, or its personality kept relatively intact while still being able to constantly reinvent and regenerate itself; Huntington Beach enjoys a fantastic proximity to just about anywhere you would want to go in Southern California. San Diego's many attractions? South on 405 will take you there. Get some skiing in? Multiple routes inland and to the north. Want to see what's happening in the other Orange County beach communities? Take Pacific Coast Highway due south, each city has a distinct personality as you go down to San Onofre. Want to walk on the wilder side of beach communities (that is, get out of Orange County)? Head due north on Pacific Coast Highway. In fact, if you'll like the US Open of Surfing, you'll love some of the events going on with our neighbors to the north, such as the South Bay International Surf Festival from July 31st to August 4th. Hermosa Beach, Manhattan Beach, Redondo Beach and Torrance explode with surfing and surf-related beach events during this beach lover's dream festival. Getting there from Huntington Beach is a gorgeous summer ride, with windows or convertible top down, along the longest stretch of beachfront or beach-close highway in California; so rare is the "getting there' as good as the arrival.
To reiterate a few previous blogs: buy now. To reiterate this blog in three words: buy Huntington Beach.
Ann Stefanucci
714-822-9453
annstefanucci@gmail.com
Tuesday, June 4, 2013
No More Room on the Fence
(I don't mean to sound pushy, but)
"Get In or Get Out Time" is Hitting the Real Estate Market!
Too Many Indicators Say "Get Off The Fence"
Summer is at your doorstep, and I mean to be blunt and urgent, but not pushy: You are in the market to buy a home, or sell your home, or you're out of the market, starting pretty much as soon as you read this. The current market conditions are already making this happen, and the summer peak of the market is still months away. A year's worth of uptick in prices, including recent local sales of homes well and above asking price, tell me it's a growth market for sellers. There is urgency for sellers, specifically, because the conditions of this market are unique and inevitably short lived. The residential building permits being issued at a rate not seen in nearly six years indicates to me that this upward tick in home prices will eventually level off, but probably not in time for mortgage interest rates to remain as low as they are now. The eventual mortgage rate increase is an obvious, looming urgency for buyers and it is two-fold: homes aren't likely to come down in price (even if home prices do increase at a slower rate due to increasing inventory) and rates are likely to go up. Put another way, a buyer's ideal home which presents an affordable payment today may literally not be affordable within a week. Everything about the current real estate market is pointing to a frenzied, fast-paced, win-win whirlwind of a summer.
There is no room on the fence, to again put it bluntly, homeowners and future homeowners who want to grab a piece of this very rare market and the benefits which pertain to it need to do so immediately. Cash offers/investors are still common, but mortgage lenders are lending again, provided borrowers/buyers can jump through the many additional hoops and safeguards now in place. Buyers who qualify can qualify for more of a home by way of the lower payment available for not much longer as mortgage rates will with certainty be rising even more than in recent days. Sellers can take advantage of a significant rise in equity before it levels off, and while they themselves can still capture a still-ridiculously-low mortgage rate. For the first time in my blog I'm speaking to both buyer and seller more directly than ever before because the market is demanding immediate action: If you were considering buying, get started now! If you were considering selling, get started now!
I will be having a different conversation with clients, and a different discussion on this blog, in three month's time, of this I am certain. Among my many mortgage banking friends and the experts I follow regularly, all seem to agree that at best, mortgage rates will rise consistently before the end of the year and may downtick briefly by around this time next year or slightly earlier, but not long enough to have the impact low mortgage rates are having at this very moment; with all the other dramatic circumstances surrounding them. There are many conversations to have at any given time (even the worst of times, as we've had until last year) in real estate, and when it comes to the American Dream it ultimately knows no interest rate (relatively speaking), but today's conversation is unparalleled and speaks very loudly toward action. Fence sitters, observers and the watchtower vigilant observers of the real estate market, let me help you get down and get going; if you have had reason enough to watch what is happening, you know the time is now to be a doer and not merely a watcher.
Ann Stefanucci
714-822-9453
annstefanucci@gmail.com
"Get In or Get Out Time" is Hitting the Real Estate Market!
Too Many Indicators Say "Get Off The Fence"
Summer is at your doorstep, and I mean to be blunt and urgent, but not pushy: You are in the market to buy a home, or sell your home, or you're out of the market, starting pretty much as soon as you read this. The current market conditions are already making this happen, and the summer peak of the market is still months away. A year's worth of uptick in prices, including recent local sales of homes well and above asking price, tell me it's a growth market for sellers. There is urgency for sellers, specifically, because the conditions of this market are unique and inevitably short lived. The residential building permits being issued at a rate not seen in nearly six years indicates to me that this upward tick in home prices will eventually level off, but probably not in time for mortgage interest rates to remain as low as they are now. The eventual mortgage rate increase is an obvious, looming urgency for buyers and it is two-fold: homes aren't likely to come down in price (even if home prices do increase at a slower rate due to increasing inventory) and rates are likely to go up. Put another way, a buyer's ideal home which presents an affordable payment today may literally not be affordable within a week. Everything about the current real estate market is pointing to a frenzied, fast-paced, win-win whirlwind of a summer.
There is no room on the fence, to again put it bluntly, homeowners and future homeowners who want to grab a piece of this very rare market and the benefits which pertain to it need to do so immediately. Cash offers/investors are still common, but mortgage lenders are lending again, provided borrowers/buyers can jump through the many additional hoops and safeguards now in place. Buyers who qualify can qualify for more of a home by way of the lower payment available for not much longer as mortgage rates will with certainty be rising even more than in recent days. Sellers can take advantage of a significant rise in equity before it levels off, and while they themselves can still capture a still-ridiculously-low mortgage rate. For the first time in my blog I'm speaking to both buyer and seller more directly than ever before because the market is demanding immediate action: If you were considering buying, get started now! If you were considering selling, get started now!
I will be having a different conversation with clients, and a different discussion on this blog, in three month's time, of this I am certain. Among my many mortgage banking friends and the experts I follow regularly, all seem to agree that at best, mortgage rates will rise consistently before the end of the year and may downtick briefly by around this time next year or slightly earlier, but not long enough to have the impact low mortgage rates are having at this very moment; with all the other dramatic circumstances surrounding them. There are many conversations to have at any given time (even the worst of times, as we've had until last year) in real estate, and when it comes to the American Dream it ultimately knows no interest rate (relatively speaking), but today's conversation is unparalleled and speaks very loudly toward action. Fence sitters, observers and the watchtower vigilant observers of the real estate market, let me help you get down and get going; if you have had reason enough to watch what is happening, you know the time is now to be a doer and not merely a watcher.
Ann Stefanucci
714-822-9453
annstefanucci@gmail.com
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