If You are Thinking of Selling, Now’s the Time

If you thought about selling your house this year, now may be the time to do it. The inventory of homes for sale is well below historic norms and buyer demand is skyrocketing. We were still in high school when we learned the concept of supply and demand: the best time to sell something is when supply of that item is low and demand for that item is high. That defines today’s real estate market. Jonathan Smoke, the chief economist of realtor.com, in a recent article revealed:

“Our preliminary review of April activity on realtor.com shows that traffic, searches, and listing views are up more than 35% over last year. With 3 million jobs created and close to 1.5 million new households formed in the past 12 months, many more people want a new home of their own, and they want it bad. Their patience will be tested with tight supply—indeed, the No. 1 impediment of active shoppers in April was not being able to find a home that meets their needs.”

In this type of market, a seller may hold a major negotiating advantage when it comes to price and other aspects of the real estate transaction including the inspection, appraisal and financing contingencies.

Bottom Line

As a potential seller, you are in the driver’s seat right now. It might be time to hit the gas.

Contact Bernie McDonnell today!  Synergy Realty Group   bernie@coloradospringsrealty.biz  (719) 659 9482  www.berniemcdonnell.com 

Buying a Home is 35% Less Expensive than Renting! In the latest Rent vs. Buy Report from Trulia, they explained that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage throughout the 100 largest metro areas in the United States. The updated numbers actually show that the range is from an average of 16% in Honolulu (HI), all the way to 55% in Sarasota (FL), and 35% Nationwide! The other interesting findings in the report include: Interest rates have remained low and even though home prices have appreciated around the country (3.9%), they haven’t greatly outpaced rental appreciation (3.7%). “In the past year, these two trends have made homeownership even more affordable compared with renting.” Some markets might tip in favor of renting if home prices increase at a greater rate than rents and if – as most economists expect – mortgage rates rise, due to the strengthening economy. Nationally, rates would have to rise to 10.6% for renting to be cheaper than buying – and rates haven’t been that high since 1989.  Bottom Line Buying a home makes sense socially and financially. Rents are predicted to increase substantially in the next year, so lock in your housing cost with a mortgage payment now

In the latest Rent vs. Buy Report from Trulia, they explained that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage throughout the 100 largest metro areas in the United States. The updated numbers actually show that the range is from an average of 16% in Honolulu (HI), all the way to 55% in Sarasota (FL), and 35% Nationwide!

The other interesting findings in the report include:

• Interest rates have remained low and even though home prices have appreciated around the country (3.9%), they haven’t greatly outpaced rental appreciation (3.7%). “In the past year, these two trends have made homeownership even more affordable compared with renting.”
• Some markets might tip in favor of renting if home prices increase at a greater rate than rents and if – as most economists expect – mortgage rates rise, due to the strengthening economy.
• Nationally, rates would have to rise to 10.6% for renting to be cheaper than buying – and rates haven’t been that high since 1989. 

Bottom Line

Buying a home makes sense socially and financially. Rents are predicted to increase substantially in the next year, so lock in your housing cost with a mortgage payment now.

Looking for a low-cost apartment? Good luck. Colorado Springs apartment rents climbed to near record high in first quarter.

Finding an apartment in the Colorado Springs area remains a challenge, and those that are vacant will continue to cost a pretty penny, a new report shows.  Rents averaged nearly $879 a month from January through March, the second-highest figure on record and an increase of almost $57 a month - or nearly 7 percent... Read more:  http://goo.gl/PRBSjK

Why rent? Purchasing a home means no more monthly increases! Call me today!

Bernie McDonnell GRI SFR CMHS

Synergy Realty Group          
Cell phone: (719) 659-9482
Email: bernie@coloradospringsrealty.biz
Website: http://coloradospringsrealty.biz

Attaining the American Dream: The 5 Financial Reasons to Buy

The American Dream of homeownership is alive and well. The personal reasons to own differ for each buyer, with many basic similarities. Eric Belsky, the Managing Director of the Joint Center of Housing Studies at Harvard University expanded on the top 5 financial benefits of homeownership his paper - The Dream Lives On: the Future of Homeownership in America. Here are the five reasons, each followed by an excerpt from the study:

1.) Housing is typically the one leveraged investment available.

“Few households are interested in borrowing money to buy stocks and bonds and few lenders are willing to lend them the money. As a result, homeownership allows households to amplify any appreciation on the value of their homes by a leverage factor. Even a hefty 20 percent down payment results in a leverage factor of five so that every percentage point rise in the value of the home is a 5 percent return on their equity. With many buyers putting 10 percent or less down, their leverage factor is 10 or more.”

2.) You're paying for housing whether you own or rent.

“Homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord.”

3.) Owning is usually a form of “forced savings”.

“Since many people have trouble saving and have to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings to another day.”

4.) There are substantial tax benefits to owning.

“Homeowners are able to deduct mortgage interest and property taxes from income...On top of all this, capital gains up to $250,000 are excluded from income for single filers and up to $500,000 for married couples if they sell their homes for a gain.”

5.) Owning is a hedge against inflation.

“Housing costs and rents have tended over most time periods to go up at or higher than the rate of inflation, making owning an attractive proposition.”

Bottom Line

We realize that homeownership makes sense for many Americans for an assortment of social and family reasons. It also makes sense financially. If you are considering a purchase this year, contact Bernie McDonnell, berniemcdonnell@coloradospringsrealty.biz who can help evaluate your ability to do so.

Property taxes too high? Act quickly to appeal them. Cutoff date June 1, 2015

The El Paso County Assessor need comparable houses that have sold to change your property valuation. Problem is they are only looking from July 1, 2012 to June 30, 2014. What to do? Call a Realtor. They can get you comps from that timeframe. Don't have a Realtor, contact me...I'll help.

Bernie McDonnell GRI SFR CMHS

Synergy Realty Group          
Cell phone: (719) 659-9482
Email: bernie@coloradospringsrealty.biz
Website: http://coloradospringsrealty.biz

Synergy Realty Group - where we are not #1 - YOU ARE!  By the way, I'm never too busy for any of your referrals!

6 ways to WIN a bidding war in a hot housing market

The housing market is still in the early spring of recovery, but if you're a buyer, you know it's already hot out there.

1. Get your financial house in order—and get as much cash as you can.  Get preapproved for a loan. Now. Today's mortgage market is still relatively tight, and home sellers are leery of loans that might not be set in stone. If you can, bring cash to the table. Sellers are worried about appraisals coming in low and loans not closing, so be ready to cover the difference with cash.

2. Come in fast and strong.  Be the first offer, and don't insult. This is not the time to lowball, not with the lack of listings out there. Nothing turns a seller off more than someone undervaluing their prized possession. Come in either at or just slightly below asking, so they know you're serious.

3. Escalation clause.  This is an amount of money the buyer agrees to increase his/her offer, if there are other bids. So let's say the purchase price of the home is $400,000, but you expect it could go as high as $450,000. Put in an escalation clause saying you are willing to go as high as $460,000 (if you are). Make sure, however, that the clause also says the seller can only take the winning bid up to a level just above competing offers. In other words, if your competitors only go as high as $430,000, the seller can't expect you to pay $460,000, only, say, $431,000.

4. Preinspection.  Yes, this will cost you a few hundred dollars that may not come back to you, but yes, it can help in a supertight market. Ask to do a preinspection before submitting an offer.

5. Show the love.  If you love, love, love the house, then let the seller know that, either directly or through your real estate agent. Don't be afraid to write a letter, send a picture of your kids and be specific.

6. Be smart, not sappy.  Buying a home is one of the most emotional things you will ever do. That said, keep it to yourself. Make sure you've fully researched the market: Look at the most recent comparable sales ("comps") and compare prices to a year ago, visit the local school, have coffee at the closest Starbucks and chat with the neighbors. See if there is a local listing service and scroll through recent posts. Then don't let your emotions steal your wallet. Don't overpay because you get all wrapped up in the heat of the competition. I don't care what house you're looking at, it's not the only house you can ever be happy in.

Questions?  Contact Realtor Bernie McDonnell for more information (719) 659-9482