3 Advantages of Selling Your Home During the Holidays

Thank you, Dave Ramsey:

3 Advantages of Selling Your Home During the Holidays

The Tip: Thanks to reduced competition, motivated buyers and a warm and cheery holiday home, you can sell your home faster and for more money during the holiday season.

We all know—or maybe we assume—that spring and summer are the best times to sell a home. And it’s true that many buyers do plan their new home purchases during the warmer months. But that doesn’t mean all the serious buyers evaporate after Labor Day.

If your home is for sale now, you’re actually in a great position to sell your home faster and for more money by taking advantage of the unique characteristics of the holiday selling season.

1. Less Competition

You’re not the only homeowner who’s considered taking your home off the market during the holidays—most don’t want the hassle. And most new sellers will decide to wait until the first of the year or even springtime to put their homes up for sale.

That’s great news for you because you won’t have to compete with dozens of other homes just like yours to get buyers’ attention. Reduced inventory means more buyers checking out your home, either online or in person. Keep their attention by making sure your home is priced to sell and that your home is in “show” condition at all times.

2. Motivated Buyers

Anyone who takes time out of their busy holiday schedule to shop for a new home is serious about buying now. Perhaps they are buying a home for tax reasons or are relocating to start a new job in the new year. Maybe they’ve been looking for months and just haven’t found that perfect home yet.

Whatever their reason, make it easy for these folks to get a good look at your home by staying flexible with your showing times and be open to negotiating contract terms that work with their schedules.

3. Your Home Looks Great

Emotion plays a huge role in which home a buyer purchases, and you can capitalize on that by making your home cozy and cheery during showings. Tasteful decorations and a minimum of clutter will allow buyers to see their own families celebrating the holidays in your home next year.

Make sure your decorations enhance rather than detract from your home’s best features, and remember to remove them as soon as the season is over.

Get Your Home Sold With the Advice of a Pro

Experienced real estate agents know that home sales remain steady into the holidays, so if you’re looking for professional advice, work with an agent who understands the advantages of selling a home now.

Dave’s real estate Endorsed Local Providers (ELPs) sell homes in all types of markets all year long. You can trust your ELP to stick with you during the busy holiday season and get your home sold at a great price. Find your ELP today.

Home sales slip in November and December from a year ago

3 Big Reasons Why Home Sales Are Falling

DAILY REAL ESTATE NEWS | FRIDAY, DECEMBER 20, 2013

Existing-home sales dropped in November, falling 4.3 percent from October sales, and marking the first time in more than two years that home sales are below year ago levels, the National Association of REALTORS® reports. 

What’s behind the drop in sales? NAR’s chief economist Lawrence Yun pinpoints three main factors: Higher mortgage rates, constrained inventories, and continuing tight credit.

1. Higher mortgage rates: The 30-year fixed-rate mortgage is up nearly a full percentage point in the past year, causing home buyers to face an increase in borrowing costs. The 30-year fixed-rate mortgage increased to 4.26 percent in November compared to a 3.35 percent average in November 2012, Freddie Mac reports. 

The Federal Reserve announced this week that it would begin winding down its bond-buying stimulus program next month, which is expected to result in higher mortgage rates. The average 30-year fixed-rate mortgage could likely rise to 5 percent or 5.5 percent next year, Yun notes. 

2. Tight credit: New rules defining Qualified Mortgage will take effect soon, and could leave more borrowers on the sidelines. “New underwriting rules to protect borrowers, effective in January, will prohibit many loan features, set tighter limits on the amount of debt a borrower can have and still get a mortgage, and require that lenders accurately measure a borrower’s ability to repay,” says Steve Brown, NAR’s president. “This means that qualified borrowers are getting a loan that they are very likely to be able to repay, but some borrowers may wind up paying much more for their mortgage, or not get a loan at all due to the tougher standards. The new rules may tighten credit too much, but we’re hopeful regulators will make adjustments if this proves to be true.”

3. Constrained inventories: Housing inventory in November fell 0.9 percent to 2.09 million existing homes available for sale. The total housing inventory represents a 5.1-month supply at the current sales pace, NAR notes. One factor is a shrinking number of distressed homes – foreclosures and short sales. Distressed homes accounted for 14 percent of November sales compared to 22 percent in November 2012, NAR notes. 

“There is a pent-up demand for both rental and owner-occupied housing as household formation will inevitably burst out, but the bottleneck is in limited housing supply, due to the slow recovery in new home construction,” Yun notes. “As such, rents are rising at the fastest pace in five years, while annual home prices are rising at the highest rate in eight years.” 

The national median home price for existing-homes was up 9.4 percent year-over-year in November, averaging $196,300 nationwide. 

--REALTOR(R) Magazine Daily News and “What Fed Tapering Means to You,” The Wall Street Journal (Dec. 19, 2013) 

First Time Home Buyer Process

Thanks to Jay Jenkins!

You've found the house. The bank is in your corner. You've got a top notch real estate agent watching your back. 

It's time to pull the trigger. It's time to buy your house.

Until you've been through the homebuying process a time or two, the jump from "prospective buyer" to "buyer" can seem confusing. The process, so long as the bank is in your corner from the start, is actually pretty straightforward. 

To whom should I make the check out?
If you've hired a good real estate agent, which I'm sure you have, the process will be even easier. Your real estate agent will be your guide as you navigate this jungle.

The first step is to make an offer to purchase. The exact rules and contracts can vary, so lean on your agent to guide you. If the form is endorsed by the National Association of Realtors, then odds are you're good to go. 

Because there is so much variation from state to state and so much nuance to the "Offer to Purchase Contract," I'll speak only generally here. Rely on your agent. Remember, the agent is financially rewarded when the house sells. Your agent wants your offer to be accepted, and he or she wants you to be able to afford it. If the bank says no, the agent doesn't get paid.

The seller will probably negotiate with you. That is to be expected and is totally normal. Remember to stay calm and negotiate from strength. You've done your homework, and you know what the home is worth.

Its easy to become emotionally attached at this point. But you have to stick to your financial plan. If the seller is unreasonable, you must be willing to walk away from the deal.

Offer accepted
With a little luck, you're offer will be accepted. Congratulations! 

The next step is to notify the bank and formally apply for your mortgage loan. The sooner, the better, as the bank has a multi-step process it must begin and complete before your offer to purchase expires. 

The bank will ask you to sign a smorgasbord of government-required disclosures, although the changes in bank regulations over the past few years makes this part of the process much easier.

Pay attention to the disclosures. They are important. Do not let the banker rush you to sign. You're on the cusp of borrowing a huge sum of money. Understand fully what you're signing up for. 

Other people in the process you'll need to know
There are a handful of other professionals who will play a part in your journey to homeownership. Again, lean on your real estate agent for help; think of him or her as your project manager. 

Your agent can make recommendations of whom to hire and what prices are reasonable, and he or she will coordinate everyone's schedules.

First, you'll need to buy insurance for your new home. This is as simple as calling a few insurance agents to price-compare. When you've selected one, just notify your bank of your choice, and it will coordinate from there. Pretty simple.

Your real estate agent can also help you select a licensed home inspector to inspect the property for damages, structural integrity, termites, and other issues hiding behind the walls. When the inspection report is finished, there will invariably be something the inspector found that he or she recommends fixing.

The choice is up to you, but it's usually worth going back to the seller to negotiate for most or all of the fixes to be done before closing the loan. Again, to beat a dead horse, your real estate agent can help you assess the report and advise you on the best course of action. 

Your real estate agent can also help you select a lawyer to close the loan for you. The lawyer will take care of filing all the paperwork properly with the government and ensuring that all the loan documents are correct. You will need to notify the bank of your choice so it can coordinate the loan closing with the lawyer. 

Meanwhile, back at the bank
While you and your real estate agent are making things happen out in the real world, the bank is hard at work behind the scenes. 

The bank will order the appraisal, which generally takes two to four weeks to complete. The bank will give your financial statements and application a final review. They'll communicate with the insurance company and tax assessor's office to determine your obligations there. 

The bank will ask you if you would like to escrow the payments for insurance and property taxes. What this means is that you will pay the the money to cover insurance and taxes to the bank monthly with your loan payment. The bank holds the money and pays the insurance and property taxes when they are due. 

The downside is that you're giving the bank your money and sacrificing the interest or other value that money could bring to you if it were not escrowed at the bank. To each his own. However, I recommend escrowing. The peace of mind is worth more than the small amount of opportunity cost.

The bank will also calculate all the sources and uses of cash in the loan closing. This includes all the taxes, fees, and other monies you will be required to pay at closing. These fees vary substantially by state and bank, but the bank will disclose an estimate to you upfront. So pay attention to the disclosures!

When the appraisal is complete, the bank will give your loan package one final review and, hopefully, approve the loan. 

The closing table
When closing day finally arrives, you will head to your lawyer's office to sign all the paperwork and receive the keys to your new home.

The lawyer will walk you through all the paperwork and ensure that you fully understand everything you're signing. If you have questions, ask! You are paying him or her, so don't get shy. Get your money's worth!

If you will be bringing any money to closing, such as your down payment, fees, or other closing costs, make sure to bring a certified check from your bank. Most lawyers won't accept a personal check or card transaction.

When everything is signed, witnessed, and ready to go, you can proudly call yourself a homeowner. The lawyer will file everything officially at the Register of Deeds office for you a day or two later.

From the National Association of Realtors

What a Government Shutdown Means
(As of September 30, 2013)

Congress has failed to approve a Continuing Resolution (CR) providing funding for most government operations. Therefore, spending authority for most of the government expired at midnight on September 30, 2013. Until legislation providing for funding is signed into law, many offices and programs of the federal government are now shut down. This means many, but not all, government programs, including some that impact federal housing and mortgage programs, have been suspended or slowed due to the lapse in government funding. The Office of Management and Budget (OMB) requires each agency to have contingency plans in place. The information below is based on NAR staff review of agency agency contingency plans for the current shutdown and past experience with previous shutdowns and near-shutdowns.

Federal Housing Administration HUD’s Contingency Plan states that FHA will endorse new loans in the Single Family Mortgage Loan Program, but it will not make new commitments in the Multi-family Program during the shutdown. FHA will maintain operational activities including paying claims and collecting premiums. Management & Marketing (M&M) Contractors managing the REO portfolio can continue to operate. You can expect some delays with FHA processing. VA Loan Guaranty Program Lenders will continue to process and guaranty mortgages through the Loan Guaranty program in the event of a government shutdown. Expect some delays during the shutdown. Flood Insurance The Federal Emergency Management Agency (FEMA) confirmed that the National Flood Insurance Program (NFIP) will not be impacted by a government shutdown, since NFIP is funded by premiums and not tax dollars. Changes to the flood insurance program scheduled to take effect on October 1 will be implemented as scheduled. Rural Housing Programs For the U.S. Department of Agriculture programs, essential personnel working during a shutdown do not include field office staff who typically issue conditional commitments, loan note guarantees, and modification approvals. Thus, lenders will not receive approvals during the shutdown. If the lender has already received a conditional commitment from the Rural Development office, then the lender may proceed to close those loans during the shutdown. A conditional commitment, which is good for 90 days, is given to a lender once a USDA Underwriter approves the loan. If a commitment was already issued, the funds were already set aside and the lender may close the loan at its leisure. If Rural Development has not issued a conditional commitment, the lender must wait until funding legislation is enacted before closing a loan.

It is important to note that the traditional definition of “rural” for qualifying communities for assistance will be continued in effect during the shutdown. We expect that language to continue the current definition will be included in whatever funding measure is eventually enacted. Government Sponsored Enterprises Fannie Mae and Freddie Mac will continue operating normally, as will their regulator, the Federal Housing Finance Agency, since they are not reliant on appropriated funds. Treasury The Making Home Affordable program, including HAMP and HAFA, will not be affected as the program is funded through the Emergency Economic Stabilization Act which is mandatory spending not discretionary.

Sellers who delay may miss out!

Some would-be move-up home sellers are eyeing home prices carefully. They’re waiting to see how much home prices appreciate more before they consider selling their home. But they may be missing their perfect opportunity, some housing experts say. 

The best time to move may depend on when the home owner purchased their current residence, says Daren Blomquist, vice president of RealtyTrac. Blomquist says that home owners who purchased their home during the sluggish market the last two to three years may find moving up in 2013 may be their prime opportunity. 

"Because they bought near the bottom, these home owners should have built up some good equity that can go toward the purchase of a new home, and waiting longer to build more equity likely won’t provide much advantage given that other homes that they might want to move up to will also be appreciating at roughly the same pace," Blomquist told HousingWire.

Home owners who wait much longer to sell their home may miss out. 

"If you're selling one house just to move up to another, it does you no good to wait for prices to rise — the price of the move-up home will increase faster than the price of the place you're leaving behind," says Redfin CEO Glenn Kelman. 

Plus, mortgage rates are expected to come off the 3.5 percent range and reach 4.4 percent in the next year, according to the Mortgage Bankers Association. That will increase the costs of financing your next home. 

Source: “The Time to Sell Is a Waiting Game for Some,” HousingWire (March 21, 2013)

Read more

Home Owners Reluctant to Sell; Inventories Fall

Three easy steps for selling your house in less than a week!

Do you want to sell your house?

Would you like to have a contract for full list price or more in less than a week?

Here are three easy steps to ensure that your house is one of those “hot” properties that everyone wants:

1) Price it correctly. In real estate many factors determine price. Location, schools, amenities and features all figure into the calculation. Don’t try to “test the market” by starting high and work your way down. Price your home at market and you will do OK. Price it slightly below market and you will have buyers beating a path to your door.

2) Have the property in move-in ready condition! Buyers want to buy a house and NOT a project. Buyers want to visualize placing their furniture and do not want to think about the cost of replacing the roof.

3) Make your house available to be shown. No one will buy your house if they can’t see it. It doesn’t make any sense at all to offer a product that cannot be displayed. Every showing that is prohibited is one less chance to get top dollar for your house.

 To sum up, price, condition and availability are the three keys to selling a house quickly.

Do it right from the start and you will most likely have multiple offers in less than a week.

Thank you to Active Rain Real Estate Broker sharing site.

NAR Announces Pending Home Sales are Up!

WASHINGTON (February 27, 2013) - Pending home sales rose in January, and have been above year-ago levels for the past 21 months, according to the National Association of Realtors®. There were healthy monthly gains in all regions but the West, which is constrained by limited inventory but was slightly improved.

The Pending Home Sales Index,^* a forward-looking indicator based on contract signings, increased 4.5 percent to 105.9 in January from a downwardly revised 101.3 in December and is 9.5 percent above January 2012 when it was 96.7. The data reflect contracts but not closings.

The January index is the highest reading since April 2010 when it hit 110.9, just before the deadline for the home buyer tax credit. Aside from spikes induced by the tax credits, the last time there was a higher reading was in February 2007 when it reached 107.9.

Lawrence Yun, NAR chief economist, said inventory is the key to this year's housing market. "Favorable affordability conditions and job growth have unleashed a pent-up demand. Most areas are drawing down housing inventory, which has shifted the supply/demand balance to sellers in much of the country. It's also why we're experiencing the strongest price growth in more than seven years," he said.

"Over the near term, rising contract activity means higher home sales, but total sales for the year are expected to rise less than in 2012, while home prices are projected to rise more strongly because of inventory shortages," Yun said.

The PHSI in the Northeast rose 8.2 percent to 84.8 in January and is 10.5 percent higher than January 2012. In the Midwest the index increased 4.5 percent to 105.0 in January and is 17.7 percent above a year ago. Pending home sales in the South rose 5.9 percent to an index of 119.3 in January and are 11.3 percent higher January 2012. In the West the index edged up 0.1 percent in January to 102.1 but is 1.5 percent below a year ago.

Yun expects approximately 5.0 million existing-home sales this year. However, price growth could exceed a 7 percent gain projected for 2013 if inventory supplies remain low. Previously, NAR had expected 5.1 million existing-home sales in 2013, while prices were forecast to rise 5.5 to 6.0 percent.

The National Association of Realtors^®, "The Voice for Real Estate," is America's largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries. For additional commentary and consumer information, visitwww.houselogic.com and http://retradio.com.

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^* The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined. By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.