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US Housing Report – What This Means for You

US Housing Report – What This Means for You

US-Housing-Report-What-This-Means-for-You

Housing is a major topic of discussion nowadays and for good reason: the national economy is highly dependent on the housing sector. Most people have been affected by the housing crisis through equity, foreclosure or even having to see their compatriots suffer. That’s why more and more people are paying close attention to real estate news and national housing trends. However, for those not familiar with housing trends and statistics, the data can be confusing or even misleading.

On the other hand, buying or selling a home is one of the most exciting things that most of us will ever do in our lifetime. Although most of us decide to sell or buy a home based on our lifestyle preferences, it would be wrong to think that we don’t spend a lot of our time pondering about the housing trends. That’s why it is important to look at the monthly national housing report and try to make sense of it. The US housing report stirs a flurry of real estate news items and articles that you can read to gain perspective about the US housing sector and the overall buyer/seller prospects in the market.

The August report has shown that the real estate sector is gradually returning to its normalcy. These statistics provide agents, investors and other industry players with a clear view of how the local, regional and national housing markets continues to perform and how it is likely to perform in the near future. This sort of information can influence the investing world from top to bottom. Data analyzed for the month of August shows that the housing market is beginning to tip in favor of buyers, unlike the last few months when it has been seriously tipped in favor of sellers. However, that does not mean that sellers are at a disadvantage; instead it means buyer prospects are also increasing.

This year, we have witnessed the growth of inventory in August. And although the overall demand for housing remains strong, the data on the median days is showing that the marketing is striking some sort of balance that bodes well for potential buyers who were unable to find the right property to purchase this spring or summer.

During the first three weeks of August, 2015, inventory listings rose by 3% compared to July. The average list price rose to $233, 000, which accounts for an 8% year-over-year increase per year and almost flat over July. The median number of days on the market rose to 75, showing the tilt in favor of potential buyers.

The metric has fallen 6% year-over-year, which shows that the market is still doing much better than last year, although the 6% month over month increase implies that inventory is currently moving slower than it was in the previous months.

As an agent or investor, you can use the findings on how the US housing market works to improve your online marketing experience. It is important for you to understand how your local market situation is changing before considering the national conditions, although national figures might show how the market might shape up in certain parts of the country.

Without a doubt, you must dig a little bit into the statistics to make sense of them and know exactly what you are considering. Two good guidelines for interpreting statistics are:

  1. Understand what the figures represent
  2. Make sure you are comparing side by side.

And as we all know instinctively, the most important thing is how the local market is shaping up. For example, you may want to know the value of your home. Here, don’t bother checking the national figures. Don’t even consider the average figures in your city. Look at similar homes in the same location as you and compare aspects such as age, size and so on. And only check recently closed sales. Prices might vary considerably from time to time, and asking for prices may not be as helpful as you may think. The same guidelines apply to overall sales activity. Your area could be experiencing an increase in sales activity because a large organization just opened a store along the street. However, that may not affect people a few streets away.

Clearly, properties are sold and bought by forks with their own individual needs in mind, but housing trends and local real estate news can help shed light on the prevailing local conditions. It is important to contact an agent to find out more about how the local housing market is shaping up before buying or selling a home.

What to Consider Before Turning Your Home into a Rental

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So you are considering converting your home into a rental property, but just making your home available for rent is not enough. Here are some important things to consider before turning your home into a rental:

1. Rental Market Price

Although the rental market prices can fluctuate, you need to know how to price your property. There are several ways to know the best market price for your home. Firstly, you may want to contact real estate agencies. With reputable real estate agents, market prices will depend on their database and experience in the industry. Secondly, you can go online and find out how much your unit could fetch from related properties listed by owners or agents. Finally, you may decide to drive around your area and gather as much information as possible. It could be a bit off target, but can help you come up with a reasonable market price.

2. Availability

Even if you don’t want to manage your unit on your own, it is always important to establish contact with renters. So you want to leave them your contact details just in case they need to call you. Obviously, you will want to put some rules in place to ensure your property manager is informed whenever issues arise. If you are not ready or able to commit time to meet the needs of your tenants, then renting out your property may not be a good decision for you.

3. Maintenance

While homeowners enjoy the flexibility and freedom of making any sort of repairs in their properties, such leeway is not given to tenants. You cannot postpone maintenance and repairs while you save money to attend to them. Moreover, if you need to fix minor issues, you may have to hire a handyman, but collecting rent to attend to such issues will end up reducing your profits, thereby making it harder to pay your bills. Before turning your home into a rental property, determine the potential maintenance costs and use such details to decide if renting out your home makes financial sense.

4. Tenants

Many experienced tenants have a horror story about tenants from hell. When pondering whether or not to turn your home into a rental property, consider who your potential tenants will be and whether your neighborhood will supply the required number of tenants that you need to pay your bills without putting your finances at risk. Of course, you don’t want renters who cannot pay rent on time or those who do not respect their neighbors or other people. It is important to take the time to research your prospective pool of tenants before renting out your residence.

5. Assistance

These days, many landlords are seeking the services of real estate agents and property managers who can help do the research as regards finding renters and maintaining their property. Find out the cost of such services to determine whether you can afford their help to ensure renting your house makes financial sense.

Turning a home into a residential or commercial rental property can be a great way to earn some extra income. However, homeowners should consider the aforementioned factors before opening their doors to renters. With proper research and sound financial management, putting your home up for rent might be the right decision for you!

Things to Know Before You Purchase an Income Property

Things to Know Before You Purchase an Income Property

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Purchasing an income property is a huge decision, and one that may have a significant impact on your future financial circumstances. Here are some things to know before purchasing an income property:

1. Know Your Investment Expenses

You will need to spend a lot of money to buy, and to maintain your property. When you purchase an income property, you will most likely pay for legal fees, utilities, maintenance, evictions, accounting, and capital improvements. Based on how you manage your financing, there are other expenses that you may incur, including land transfer fees and administrative charges. This can greatly increase the costs of purchasing an income property.

2. Location, location, location

While it might seem obvious, you should never purchase an income property without evaluating the location first. You don’t have to purchase a property in a lavish neighborhood, but it’s important to familiarize yourself with the area first. Pay a visit to your would-be property at different times of the day and week, and make sure the area is comfortable enough and that the neighborhood has everything a potential homeowner would need (markets, schools, hospitals, supermarkets and so on).

3. Financing Your Property

Paying for an income property is much easier than many people think. Paying by cash is a smart move because it saves you from having to cope with loans and bank requirements. However, if you want a greater leverage, opt for a down payment. To cater for the remaining costs, consider getting a mortgage. However, be careful when assessing loans. Read the terms and conditions, and know the interest rates beforehand.

4. Self Management versus Professional Management

Whether or not you should manage your income property will depend on your plan, availability, qualities and preferences. On the contrary, hiring a professional property manager will help reduce the costs of repair and reduce vacancy.

5. You Won’t Get Rich Overnight

You can make a significant amount of money by investing in income properties, but is also true you won’t get rich overnight. The real estate market is often unpredictable, so it is important that you know what to expect regarding your return on investment. You can’t afford to be naive, and you need to be well funded. The best thing is to purchase a property that you can well afford and keep it as simple as possible.

Is purchasing an income property the best investment decision for you? Consider local market conditions, realtor advice, and real estate news or contact an agent to discuss your options.

Pros and Cons of Renting Versus Owning

Pros and Cons of Renting Versus Owning

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In the past, owning a home was always the better option for most people. However, due to the economic recession, more and more people now prefer renting over ownership. When home prices drop, many homeowners find themselves struggling to pay their mortgages. On the other hand, paying for monthly home rent can be a stressful. It is a frequent expense that has a huge impact on your financial situation and you don’t get any asset under your name.

In order to you to determine whether you should rent or buy your home, be sure to catch up on the latest real estate news and consider all the pros and cons of renting versus owning to help you make an informed decision.

Advantages of Renting

  • Lower upfront costs: When buying a home, it requires a potential homeowner to pay a huge down payment for the house, including several property costs such as home inspection and closing expenses. Unlike owning, renting would require you to pay only the first and last rental payment along with a security deposit. Renters don’t have to incur any extra costs, such as home inspection, maintenance costs and so on. This will allow the renter to save a significant amount of money. Renting also gives you freedom and flexibility that you need to consider different properties and locations without having to commit to a particular neighborhood.
  • Changing Career/Job: when you need to change careers or jobs within a short period of time, renting a home is a better option. If you plan to move or relocate to a different area or city due to a job change, you don’t have to worry about other costs relating to the home you are currently living in.
  • An opportunity to improve your credit score: by establishing a history of timely rental payments, you can be able to create a good credit score.
  • No maintenance: when you are faced with a home maintenance issue, you don’t hire a repairman; instead you simply need to call the landlord.
  • Additional expenses: sometimes, the landlord may cater for common utilities, such as water, heat, hot water, garbage and sewer, among others.

Disadvantages of Renting

  • Renting typically limits you to beautifying your own home.
  • You Are required to stick to your landlord rules.
  • You have no control over changes in rental payments.
  • No equity is established on the home whenever you make your rental payments.

Advantages of Buying

  • Builds Equity: whenever you pay your home mortgage, you boost your level of ownership with the property in question. Owning your home can also allow you to refinance the property and use good rates to fund future purchases.
  • Tax Deductions: owning a home can also give you an opportunity to enjoy tax deductions or low mortgage interest.
  • Have control over your home design: unlike renting, owning gives you complete control over your home’s interior and exterior design.
  • Maintenance options: unlike renting, owning your home allows you to carry out renovation or remodeling work on your own. You may also call a contractor to do the job for you.
  • Pride of home Ownership: owning a home is still the dream of many, and once you buy a home, you become a proud homeowner.

Disadvantages of Buying

Many financial experts agree that owning a home is a long­term investment. In other words, as the dynamic real estate market keeps on changing, the prices of homes are likely to keep on fluctuating.

That’s why it’s advisable to always catch up on the latest real estate news and market trends.

At the end of the day, determining whether to rent or buy a home all revolves around one thing: your long-term financial situation.

5 Ways to Compete In a Bidding War

5 Ways to Compete In a Bidding War

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Purchasing a home comes with great excitement, but can also be accompanied by unforeseen events whether you are a first­timer or a seasoned buyer. Unforeseen bidding wars can lead to pain and frustration, and these days, bidding wars are a regular part of the house buying process. Each year, more than half of buyers in the country get caught in bidding wars when trying to buy their dream home. By understanding the steps necessary in the negotiation process and planning well in advance, you can greatly increase your chances of securing your dream home. Here are 5 ways to compete in a bidding war and turn the odds of securing the property in your favor:

1. Find out Exactly How Hot the Property Listing Is

Most property buyers start engaging in a bidding war without figuring out what other buyers are offering, but you can easily know how desirable your preferred apartment is. Generally speaking, you can easily tell if a property is popular or not. If they plan an open house on a given Thursday, for instance, that means that there are many offers being made, and they are ready to accept the final bid on Friday.

2. Cash Is Vital

Those with significant cash reserves have generally done well in the real estate market. Cash gives you a competitive edge over other buyers. However, that does not mean that you can’t excel without hard cash, but it can be extremely helpful. That’s why it is becoming more and more popular in the investing world. Studies show that all­cash deals account for over 40% of the latest property sales in the market. That figure is up significantly compared to past trends. As an investor, it is always recommended to keep up to date with the latest real estate news and market trends. Again, as an investor, you would like to show the ability to secure the funding, which in itself can help you to gain the trust of sellers.

3. Make Paperwork Your Friend

It is advisable to be well prepared with all the paperwork. You want to be able to show your financial statement, your references and other pieces of information that can help you in the bidding war.

4. Remain Flexible

While some people are impatient to close the deal, others are not. Especially in high­stakes deals, it can be extremely helpful to remain a bit flexible. Entertaining different options as regards inspections, financing and leasing can help make your offer more appealing than the rest.

5. Connect With the Seller

Generally speaking, most sellers have an emotional connection to their home. Understandably, they want the buyer to take care of the house as much as they did. The best way to show the seller that you truly love the home is to describe what you love about the property, why you would like to live there, and why you think the home will suit your lifestyle. This will win over the seller, and make your offer stand out so you can get that dream home before anyone else!