Rather than understanding what investors are looking for, many real estate agents lack work ethic and can be difficult to coach. It is imperative that you let the agent know exactly what you are looking for or he or she will bring you many loser deals.
Do not leave out any details when explaining to a real estate agent what you are looking for. You should specify the locations you are looking for, the price range, the return/cap rate you are looking for, the type of home, the number of bedrooms, and other details which are important to you.
A good agent will also be willing to make multiple offers and make a low ball offer. Some agents do not like investors and only work with the typical home buyer. That is fine, but we need to be aware of that as early as possible.
You should ask other buyers for recommendations before choosing a real estate agent. Often, investors will be more than happy to give you recommendations on investor-friendly agents. If you are serious about investing in real estate, remember that what works for one investor might not work as well for you. Make sure you are comfortable with the investor friendly broker before signing a contract.
It is also possible to find reviews of agents on sites like Zillow and realtor, however I would strongly recommend getting a recommendation from an investor you know. It is also a good idea to find a realtor who is able to bid on HUD homes, as these homes can be great deals and it makes things much easier if your agent is qualified to bid on them.
Finally and most importantly, make sure your real estate agent has invested in properties themselves since these individuals understand us, buyers, far better than those who have never purchased real estate before.
Choosing a good realtor is challenging, but don’t cut corners on finding one as a good realtor will take your business to the next level and make your life much easier.
Re/Max Heritage Realtors are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.
Mortgage Rates Are Rising … But That Doesn’t Mean It’s a Bad Time to Buy Homes
Will 2022 be the year you buy a house?
If you’re hoping to buy a house in 2022, you’re probably watching the market closely.
Interest rates are on the rise. And home prices have climbed at a record pace in 2021.
Does that mean it’s a bad time to buy a house?
Not according toJon Meyer, The Mortgage Reports loan expert and licensed MLO.
“While it’s always nice to get a better rate and have a smaller total monthly payment, if you can afford the home it’s never a bad time to buy,” Meyer says. Here’s why.
Is now a good time to buy? Key takeaways
As always, buying a home is subjective. It’s more about your personal finances than it is about the market.
Here are some key housing trends in 2022 to keep in mind:
With home prices still rising it makes sense to buy sooner rather than later if you can afford to do so
Home price gains should slow down in 2022, but not reverse. So it’s not worth waiting on lower home prices
Mortgage rates are climbing. But don’t let that put you off. Even if they reach 4%, that’s still less than half the historic average
Higher mortgage rates likely on the way
After watching interest rates tumble to all-time lows in 2020 and 2021, it’s tempting to play the waiting game and see if they can fall further.
However, theFreddie Mac monthly averagefor 30-year fixed rates has been on the upswing over the last quarter.
“My mentor used to always tell me, ‘The person who says they know where rates will be in the future knows less than the person who knows nothing,’” Meyer said.
“He didn’t mean we can’t gauge the market or have a decent idea where rates are trending. His underlying message was you can’t chase rates.”
Do rising mortgage rates mean it’s a bad time to buy a house?
The Federal Reserveannounced on Dec. 15that American consumers should expect a series of rate hikes throughout the year.
Givenwhat we know now, locking in a mortgage rate sooner will likely be better than later in 2022. Plus, the longer you own a home, themore equity you build.
“Even if rates jump up 1 percentage point from where they are today, they still wouldn’t be considered high interest rates historically.”
But that doesn’t mean prospective buyers should be put off by rising rates.
Historically speaking, today’s mortgage loans are still ultra-affordable. And they should stay that way throughout 2022.
“Even if rates jump up 1 percentage point from where they are today, they still wouldn’t be considered high interest rates historically. When my father bought his first house, he got a loan with an 11.5% interest rate,” Meyer added.
Home prices will keep making gains
With low mortgage rates and a squeezed inventory stoking buyer demand, housing appreciation hit never-seen-before heights in 2021.
The median U.S. sales price shot up 14.6% annually in the four-week period ending Dec. 26 and climbed to a new all-time high of $361,171, according to Redfin.
However, slowing price growth shouldn’t be misconceived as falling prices. All indicators point to rising housing values in 2022, just at a lesser pace.
“At least buyers have the benefit of low mortgage rates. But by next year, inflation may spread to more consumer goods,” said Redfin Chief Economist Daryl Fairweather.
“Even though our new year’s forecast includes more listings and slower home-price growth, buyers may feel so pinched by other expenses that they have to reduce their housing budgets.”
Is renting the answer?
Renting has its advantages, like not having to pay property taxes or homeowners insurance, especially if you’re not yet committed to where you want to live long-term.
But it’s similar to leasing a car, according to Meyer. “You pay every month to own nothing at the end of the day.”
With the supply of available for-sale listings so low and purchase prices continuing to climb, rent prices are also surging.
Now, the average renter faces even larger monthly costs and a higher rate of appreciation than homeowners.
Redfin found the average monthly rent grew to $1,985 in November, up 6.8% monthly and 20.5% annually. Comparatively, borrowers who put 5% down had a median payment of $1,551, which grew 1.1% from October and 19.9% from the year prior.
Rental market summary
November 2021
Month-over-month growth
Year-over-year growth
Average monthly rent
$1,985
6.8%
20.5%
Median monthly mortgage payment for home buyers w/ a 5% down payment
$1,551
1.1%
19.9%
Source: Redfin
With housing costs growing at such a rapid rate, inflation reached 6.8% in November and hit its highest level since 1982.
Many consumers were priced out of the for-sale marketplace and then turned to the rental market. That heightened demand and the anticipated elevated inflation rate will push up rent prices and could make it more financially challenging than buying.
“First inflation came for the for-sale housing market, and now it is coming for the rental market,” said Fairweather.
“Anyone who bought a home before this year can pat themselves on the back because their mortgage payments are fixed, meaning their biggest recurring expense is immune to inflation.”
Gambling on interest rates and home prices
Some buyers might be tempted to wait on lower interest rates — or slower home price growth — before they enter the market.
But if you as a home buyer wait for mortgage rates to drop to a certain range, you run the risk of:
Losing out on the house you wanted
Being priced out of listings you could’ve previously afforded
Waiting on lower rates that might never materialize
Meyer provides an in-depth hypothetical on how holding out for lower mortgage rates or property prices can potentially hurt you:
“When you wait for the right interest rate, you are gambling,” he says.
Home buying example
“Let’s assume you’re a borrower qualified up to a total monthly payment of $2,500.” If today’s interest rate is 3.25%, here’s how your home buying budget might look:
Home price: $500,000
Down payment: 20% ($100,000)
Monthly principal and interest payment: $1,740
Total monthly mortgage payment: $2,360
“You are qualified and can afford the home,” Meyer says, “but you decide you’re going to wait for rates to retreat back under 3%.”
“Now, six months have passed and rates are still at 3.25% and the original home you wanted is no longer available. An identical property in the same neighborhood is listed, but the market kept its pace and that home is listed at $530,000.”
Thanks to the higher price tag on that home, your monthly payments have risen and you’re almost maxing out your budget. Your down payment amount has risen, too.
Home price: $530,000
Down payment: 20% ($106,000)
Monthly principal and interest payment: $1,845
Total monthly mortgage payment: $2,497
And this is assuming you haven’t taken on any additional debt in the meantime, adds Meyer. “If you have an additional $1,000 balance on your credit card and can’t pay it off, you no longer qualify for the home.”
Risks of waiting to buy
“In terms of the price of the house, I have personally seen clients price themselves out of the market they were targeting just hoping housing prices were going to fall a bit and instead they continued to rise.”
“Then there is the other scenario that can happen,” he says. “Rates never go down and continue to rise.”
If mortgage rates go high enough, this could price you out of your qualified monthly payment and the home you want to buy.
For these reasons, Meyer cautions against chasing lower rates and/or lower home prices.
“It not only harms your wallet,” he says, “but more importantly, your ability to qualify for the house you want.
This underscores Meyer’s overarching point that now is always the right time to buy if you’re ready and can afford it.
Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.
WASHINGTON (November 22, 2021) – Existing-home sales increased in October, marking two straight months of growth, according to the National Association of Realtors®. Two of the four major U.S. regions saw month-over-month sales climb, one region reported a drop and the fourth area held steady in October. On a year-over-year basis, each region witnessed sales decrease.
Total existing-home sales,1https://www.nar.realtor/existing-home-sales, completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 0.8% from September to a seasonally adjusted annual rate of 6.34 million in October. Sales fell 5.8% from a year ago (6.73 million in October 2020).
“Home sales remain resilient, despite low inventory and increasing affordability challenges,” saidLawrence Yun, NAR’s chief economist. “Inflationary pressures, such as fast-rising rents and increasing consumer prices, may have some prospective buyers seeking the protection of a fixed, consistent mortgage payment.”
Total housing inventory2at the end of October amounted to 1.25 million units, down 0.8% from September and down 12.0% from one year ago (1.42 million). Unsold inventory sits at a 2.4-month supply at the current sales pace, equal to September’s supply, and down from 2.5 months in October 2020.
The median existing-home price3for all housing types in October was $353,900, up 13.1% from October 2020 ($313,000), as prices climbed in each region. This marks 116 straight months of year-over-year increases, the longest-running streak on record.
“Among some of the workforce, there is an ongoing trend of flexibility to work anywhere, and this has contributed to an increase in sales in some parts of the country,” said Yun. “Record-high stock markets and all-time high home prices have worked to significantly raise total consumer wealth and, when coupled with extended remote work flexibility, elevated housing demand in vacation regions.”
Properties typically remained on the market for 18 days in October, up from 17 days in September and down from 21 days in October 2020. Eighty-two percent of homes sold in October 2021 were on the market for less than a month.
In October, first-time buyers were responsible for 29% of sales, up from 28% in September and down from 32% in October 2020. NAR’s 2021 Profile of Home Buyers and Sellers –released earlier this month4– reported that the annual share of first-time buyers was 34%.
Individual investors or second-home buyers, who make up many cash sales, purchased 17% of homes in October, up from both 13% in September and from 14% in October 2020. All-cash sales accounted for 24% of transactions in October, up from both 23% in September and from 19% in October 2020.
Distressed sales5– foreclosures and short sales – represented less than 1% of sales in October, equal to the percentage seen a month prior and equal to October 2020.
According to Freddie Mac, theaverage commitment rate(link is external)for a 30-year, conventional, fixed-rate mortgage was 3.07 in October, up from 2.90% in September. The average commitment rate across all of 2020 was 3.11%.
Single-family and Condo/Co-op Sales
Single-family home sales rose to a seasonally adjusted annual rate of 5.66 million in October, up 1.3% from 5.59 million in September and down 5.8% from one year ago. The median existing single-family home price was $360,800 in October, up 13.5% from October 2020.
Existing condominium and co-op sales were recorded at a seasonally adjusted annual rate of 680,000 units in October, down 2.9% from 700,000 in September and down 5.6% from one year ago. The median existing condo price was $296,700 in October, an annual increase of 8.7%.
“At a time when mortgage rates are still low, buying and securing a home is a wise investment,” said NAR PresidentLeslie Rouda Smith, a Realtor® from Plano, Texas, and a broker associate at Dave Perry-Miller Real Estate in Dallas. “NAR will strive to make homeownership obtainable for all who want to pursue one of the key components of the American Dream.”
Regional Breakdown
Existing-home sales in the Northeast fell 2.6% in October, registering an annual rate of 750,000, a 13.8% decline from October 2020. The median price in the Northeast was $379,100, up 6.4% from one year ago.
Existing-home sales in the Midwest rose 4.2% to an annual rate of 1,500,000 in October, a 6.3% decrease from a year ago. The median price in the Midwest was $259,800, a 7.8% jump from October 2020.
Existing-home sales in the South increased 0.4% in October, posting an annual rate of 2,780,000, a 3.5% drop from one year ago. The median price in the South was $315,500, a 16.1% climb from one year prior.
Existing-home sales in the West neither rose nor fell from the prior month’s level, registering an annual rate of 1,310,000 in October, down 5.1% from one year ago. The median price in the West was $507,200, up 7.7% from October 2020.
The National Association of Realtors® is America’s largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries.
Ready to make a Move?
Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.
Florida Realtors has released its resale housing market statistics for September, and they continue to show a pace of home sales activity well above pre-pandemic levels.
Closed sales of existing single-family dropped just over 5% in the Orlando market when we compare it to this time last year but we have to keep that in perspective. Last year the pandemic pushed transactions from Spring into Summer so if we look at September 2019 closed sales across Florida were actually up by over 20 percent.
The rate of growth in median sale prices from month-to-month has slowed and we actually recorded a slight drop in the median home prices as we continue to see things levelling off.
Inventory increased slightly in September(less than 1%)and that’s the lowest increase since February of this year which means we still have 39% fewer homes on the market than this time last year. Prices appear to have levelled but if inventory starts tightening again we could see price growth ticking upwards, although what happens to interest rates going forward could also effect short term demand.
In the longer run, the only way we can address this shortage is to accelerate the production of new homes. Inventory remains just below one months supply and a balanced market is six months. So, we continue the long march back to a balanced market but until then Brad O’Connor Chief Economist at Florida Realtors summed it up best when he said “it’s a seller’s world, and the rest of us are just living in it”.
Well that’s all for now but remember every market and every community is different so for the latest information on buying or selling make sure you speak with your Realtor here at Bardell Real Estate and I look forward to seeing you next month.
Ready to make a Move?
Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.
Welcome to this months Market in a minute. Resale activity during July 2021 is showing multiple signs that the housing market is continuing on a steady path towards normality.
Closed sales of single-family homes were down very slightly on a year-over-year basis in July, by just over 2 percent, but that’s the first time sales have been down year-over-year at the statewide level since May of 2020, near the beginning of the pandemic.
Listings of single-family homes continued to rise throughout July but this rebound in inventory will take a long time to get back to the levels we had pre-pandemic. At the end of July, there were still almost 39 percent fewer single-family listings than the year prior, and almost 59 percent fewer listings than at this point in 2019.
The number of new listings increased for the fifth straight month and with inventory rising again, price growth will begin to slow over the coming months. We will increasingly be seeing fewer properties receiving multiple bids over the coming months but for now, were still firmly entrenched in sellers market and it remains red-hot. Orlando’s median home price reached $320,000 in July 2021, continuing a six-month trend of record-setting prices.
So in summary, sales rates are trending back to what we might consider a normal level of growth. Inventory has started a trend back toward normalcy, as well but it’s going to be a long road.
Well that’s all for now but remember every market and every community is different so for the latest information make sure you speak with your Realtor here at Bardell Real Estate and I look forward to seeing you next month.
Ready to make a Move?
Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.
Welcome to this months Market in a minute. We all know the housing market is booming and setting records. Median home prices in the Orlando area reached a new high in June 2021: $315,000. That is a 5% increase from the previous month and a 19% increase over June 2020, when the median home price was $265,000.
Across the state closings in June were up 24% on June last year when the rebound from pandemic started but we are seeing things revert back to a more normal level.
Our real challenge continues to be inventory. We are over 47% below inventory levels for last year, but there are signs pointing to us having reached the peak of the seller’s market.
Inventory of single-family homes had its first significant monthly increase in June since March of last year. Remember we were in a seller market before the pandemic started, but the ratio of buyers to sellers is finally starting to fall a little bit,
So, if we had more homes come to market in June why are inventory levels setting record lows – well, it’s not that we have fewer listings it’s simply a surge in demand ……we have more buyers fueled by low interest rates and people moving into the state.
Looking forward we should see the rate of home price growth cool down somewhat in the coming months, although that will also depend on interest rates and whether they start to trend higher again, as well.
Well that’s all for now but remember every market and every community is different so for the latest information make sure you speak with your Realtor here at Bardell Real Estate and I look forward to seeing you next month
Ready to make a Move?
Bardell Real Estate are the experts in helping you with your selling, buying or renting needs near Orlando, Florida. Make your Disney area experience a forever memorable one. Call us now to speak to a real estate agent.
