Would-Be to Should-Be

Some would-be buyers have emotional reasons to own a home like having a place of their own where they can raise a family, feel safe and secure and enjoy their friends’ company. Other buyers’ dominant reasons might be financial in nature such as building equity or lowering their cost of housing.52407681-250.jpg

Regardless of what might be motivating people to want their own home, it is easy to justify that now is a good time to purchase. Let’s look at a $250,000 example using a FHA loan.

The total payment will be about $1,835 dollars a month. If the payment is lower than the rent a person is paying, that should encourage a person to continue investigating.

In this example, when you consider the monthly principal reduction, the monthly appreciation and the tax savings, even with money added for monthly maintenance, the net cost of housing is less than half the total house payment.

Considering all those advantages, the would-be buyer is spending over $1,100 per month more to rent than it would be to own. In a year’s time, they would lose close to $14,000 which is more than the down payment of $8,750 required on this price home.

Most would-be buyers understand that a home is a big investment but they may not understand the advantage of the leverage caused by the low down payment mortgage. The benefits extend beyond a return on the down payment but to the value of the home.

In this example, the $8,750 down payment grows to an equity of $73,546 in seven years based on 2% annual appreciation and normal amortization on a 30-year loan. If you calculated that as a rate of return, you’d be challenged to find anything that could compare with it.

rent vs own 2017.png

To see what your numbers might look like, check out this Rent vs. Own. If you need any help or have any questions, contact us. Part of our greatest satisfaction is helping would-be buyers understand why they should-be.

Give me a call to discuss your plans to own! 252-916-5048

Advertisements

Divorce in Raleigh, NC Real Estate Market

WHEN YOU CAN’T CUT THE HOUSE IN TWO…

70% of divorces involve real estate.

As a Certified Divorce Real Estate Professional, I am here to help both parties involved through a smooth yet emotionally difficult process when they need to sell the marital home and purchase new homes moving forward.

As a member of your professional divorce team, my goal is to:

  1. Help clients understand the legal and tax aspects of divorce in regards to the sale of the marital home and other real estate.

  2. Offer alternatives to the usual mistrust and the emotional responses as a result of dividing real estate assets.

  3. Work with both parties together to help them save and make money now and down the road with regards to real estate.

  4. Work with both parties, not just one, in selling the marital home for the best price.

The sale of the marital home is not an isolated decision. There are short and long term financial, emotional and tax consequences. As a Certified Divorce Real Estate Professional, I can offer my clients the best guidance regarding the opportunities of selling the marital home. The goal should be a client that has their individual needs met and is making informed decisions from a knowledgeable professional.

Contact me today to discuss your options. It’s best to discuss BEFORE you make decisions.

DeLoachHeadshot

VALERIE DELOACH
the Joe Ward team
RE/MAX UNITED
Cell: 252-916-5048
valeriedeloach@gmail.com

Let’s Connect!
facebook wordpress zillow-icon-new googleplus-2
twitter linkedin pinterest instagram

Pricing Your Home To Sell in Raleigh, NC

If you are planning to sell your home in the Triangle market, you may be tempted to try listing it at a high price just to see if you can get it. You see that houses in your neighborhood are selling in a matter of days with competing offers and think, “Why can’t I get a piece of that pie?”

DON’T DO IT.

Pricing your home appropriately from the beginning is critical in selling it at the best price. Research shows that if you price your home too high, then you must lower the sales price numerous times before it actually sells and you end up selling it for much less than you should have.

fullsizerender-1
In the Triangle market in 2016, homes that were priced appropriately from the beginning sold on average at 99.55% of the list price. On the other hand, if it was priced too high in 2016, then it ended up selling at 92.76% of the original sales price!

If you price your home too high, some potential buyers won’t want to look at it at all, while others will simply schedule an appointment, go look at it, then walk away without making an offer.

A lot of sellers who interview Realtors will choose the listing agent who suggests the highest price for their property. BEWARE… You want to choose a listing agent, like Joe Ward, who provides the best comparative market analysis and explains how your home should be priced to sell quickly. You want a Realtor who tells you the truth, not one who tells you only what you want to hear.

In a market like ours, you don’t want your home to sit on the market for sale for weeks on end… you want your Realtor to have to send out an email like this one I received last week on a $240,000 home I was planning to show the day it went on the market:

IMG_3055.PNG

I also had a situation a couple of weeks ago where a townhome went on the market on Wednesday with showings starting at noon on Saturday. I scheduled an appointment for noon on Saturday. Thursday I received an email that someone had made a strong offer SIGHT UNSEEN and they had accepted the offer!

So choose the RIGHT professionals to work with in the selling of your home and the purchase of your new home. In this market, you need someone who can help you line the dominoes up right to help you avoid moving twice!

Pricing your home to sell is the first piece of the puzzle…

We are a real estate team who cares about our clients. If you are considering buying or selling your home and would like some honest, professional, and experienced guidance, please contact Valerie DeLoach at 252-916-5048 or valeriedeloach@gmail.com.

 

Save

THIS IS GOING TO BE THE YEAR!

Every year, it seems like the same things are on the list but this could be the year you really do invest in a rental home.Resolutions.png

Rents are climbing, values are solid and mortgage rates are still low for non-owner occupied properties. A $150,000 home with 20% down payments can easily have a $300 to $500 monthly cash flow after paying all of the expenses.

There are lots of strategies that can be successful but a tried and true formula is to invest in below average price range homes in predominantly owner-occupied neighborhoods. These properties will appeal to the broadest range of tenants and buyers when you’re ready to sell.

Single family homes offer an opportunity to borrow high loan-to-value mortgages at fixed rates for long terms on appreciating assets with tax advantages and reasonable control.

This can be the year to make some real progress on your resolutions. The first step may be to invest some time learning about rental properties by attending a FREE webinar on January 4th at 7:00 PM Central time zone by national real estate speaker Pat Zaby. Click here to register. If you can’t attend live, by registering you’ll be sent the link to watch at your convenience.



_PDP0035

From left to right, Deborah Swainey (919-412-8650), Joe Ward (919-518-8182),
Valerie DeLoach (252-916-5048), and Kellie McDonald (919-961-2720).

We are a real estate team who cares about our clients. If you are considering
selling your home and would like some honest, professional, and
experienced guidance,
please contact us today.

Connect with us on social media to learn more about our team and
how we can help you find your new home!

facebook wordpress twitter linkedin pinterest instagram googleplus-2

It Isn’t Final Until It’s Funded

Mortgage approval isn’t final until it’s funded.  Things can change prior to the loan being closed that can affect a pre-approval such as changes in the borrowers’ financial situation or possibly, factors beyond their control like interest rate changes.40783733-250.jpg

Good advice to buyers is to do nothing that can affect your credit report until the loan closes. Opening new credit cards, taking on new debt for a car or furniture or changing jobs could affect the lender’s decision if they believe you may no longer be able to repay the loan.

The benefits of buyer’s pre-approval are definitive: it saves time, money and removes the uncertainty of knowing whether the buyer is qualified. The direct benefits include:

  • Amount the buyer can borrow – decreases as interest rates rise
  • Looking at “Right” homes – price, size, amenities, location
  • Find the best loan – rate, term, type
  • Uncover credit issues early – time to cure possible problems
  • Bargaining power – price, terms, & timing
  • Close quicker – verifications have been made

It is a very common practice for mortgage lenders to require income and bank verifications and to re-run the borrowers’ credit one final time just prior to closing. Mortgage approval isn’t final until it’s funded.


_PDP0035

From left to right, Deborah Swainey (919-412-8650), Joe Ward (919-518-8182),
Valerie DeLoach (252-916-5048), and Kellie McDonald (919-961-2720).

We are a real estate team who cares about our clients. If you are considering
selling your home and would like some honest, professional, and
experienced guidance,
please contact us today.

Connect with us on social media to learn more about our team and
how we can help you find your new home!

facebook wordpress twitter linkedin pinterest instagram googleplus-2

 

Waiting to Buy? Do The Math!

Some people wait to buy a home until they have 20% down payment to avoid paying the mortgage insurance which is required by lenders when the loan-to-value ratio is greater than 80%, with the exception of VA loans.

To illustrate a typical situation, let’s assume that buyers have $10,000 for a down payment on a $200,000 home. They could purchase it today with a 95% loan or save another $30,000 in order to get an 80% loan without mortgage insurance.

If it took three years to save the additional down payment, the $200,000 home at 3% appreciation would cost $218,545. A 20% down payment on the increased sales price would be $43,709, less the $10,000 the buyers currently have leaves them $33,709 to save which would amount to $936.36 a month. They would secure a $174,836 mortgage at the then current mortgage rates, which in all likelihood, will be higher than today’s rates.

The alternative is for the buyer to purchase the home today with a 95% loan at today’s low interest rates plus approximately $85 a month for mortgage insurance depending on their credit score. At the end of three years, the unpaid balance would be $179,548.  Assuming the home will be worth the same $218,545, the buyer’s equity would be almost $39,000.  To reduce the mortgage to the same amount as the first example, the buyer would need to make an additional $125 a month principal contribution above the normal payment. Then, the mortgage would have an unpaid balance at the end of three years of $174,775.

When there is sufficient equity in the home, the mortgage insurance is no longer required. Some lenders may drop the mortgage insurance requirement with an appraisal to provide proof. In other situations, it may require refinancing to eliminate the insurance.  Call to discuss options that may be available to you.

2016-09-19_7-55-19.jpg


_PDP0035

From left to right, Deborah Swainey (919-412-8650), Joe Ward (919-518-8182),
Valerie DeLoach (252-916-5048), and Kellie McDonald (919-961-2720).

We are a real estate team who cares about our clients. If you are considering
selling your home and would like some honest, professional, and
experienced guidance,
please contact us today.

Connect with us on social media to learn more about our team and
how we can help you find your new home!

facebook wordpress twitter linkedin pinterest instagram googleplus-2

Do Listing Photos Matter?

Listing photos may be one of the most important marketing efforts that lead to a potential buyer. The Joe Ward team has professional photos taken as part of the listing agreement at no additional cost to you!

Nearly all buyers use the Internet during the home search process. They usually start looking at homes online for a while before they even contact an agent. It’s far more efficient to screen properties by looking at the pictures that have been posted than to make appointments with each homeowner, drive all over town and waste a lot of time looking at homes that would never meet a buyer’s criteria.

This slideshow requires JavaScript.

  • There needs to be enough pictures of a property to adequately represent the home; most websites allow for at least 24 and more may be needed if it is a large home. Our photographer takes a portfolio of shots for us to choose from to best present your house to prospective buyers.
  • Our photographer takes horizontal shots to accommodate the format of most listing websites.
  • Our pictures are well-lit so that it is easy to see all of the features of the room. Natural light is preferred over the limitations of flash.
  • We take the pictures with a wide-angle lens so that you can see the majority of the room in one picture.
  • Large rooms are taken from different angles to give the buyers a different perspective.
  • Our listing coordinator often assists the photographer by staging rooms prior to taking the pictures so they will give the buyer an idea of what the room might look like with their own things in it.
  • We arrange pictures to help buyers visualize the floorplan as if walking through it.

Everyone occasionally takes a great picture but it doesn’t make them a photographer. Since the photography can be one of the most important marketing efforts, you want to use the Joe Ward team to show the home to its best advantage.

Our #1 goal is to sell your home for the highest price and as quickly as possible. Give us a call today for a commitment-free listing appointment with Joe Ward! Give him an hour of your time so that you can hear the details of our detailed marketing plan. The Joe Ward team also has an “easy exit” plan, so there is no stress in signing a listing agreement! There is a reason that our team sells 90% of our listings when most realtors only sell about 40-50% of their listings. Call us today 919-518-8182.

_PDP0035

From left to right, Deborah Swainey (919-412-8650), Joe Ward (919-518-8182),
Valerie DeLoach (252-916-5048), and Kellie McDonald (919-961-2720).

We are a real estate team who cares about our clients. If you are considering
selling your home and would like some honest, professional, and
experienced guidance,
please contact us today.

Connect with us on social media to learn more about our team and
how we can help you find your new home!

facebook wordpress twitter linkedin pinterest instagram googleplus-2

Should You Sell Your Home-Turned-Rental?

In the last few years, some people who were unable to sell their homes, rented them instead. The market has improved in most places and the home may easily sell now and possibly, for a higher price.

Even though the opportunity to sell in the near future might not change, there could be unnamedanother opportunity that could quickly disappear for some homeowners.

Most homeowners are aware that there is a capital gain exclusion on the profits of a principal residence of up to $250,000 for single taxpayers and $500,000 for married taxpayers filing jointly. The rule requires that you must own and use the home as your principal residence for two out of the last five years.

A homeowner can rent their home for up to three years and still be eligible for the exclusion. As an example, if they had owned and lived in it for two years and then rented it for two and a half years, they would need to sell and close the transaction before the remaining six months expired.

If there was a $200,000 profit in the home that didn’t qualify for the exclusion, a 15% long-term capital gain tax of $30,000 could become due depending on the tax bracket of the owner. With some careful planning, the tax could be avoided. Awareness of the time frames and the right team of tax and real estate professionals could save a considerable amount of the homeowner’s equity.


 

As your real estate professional, I have the training and experience to provide solutions to make homes more marketable and help structure favorable transactions.  Please forward this article to your friends or family who could benefit from it.

Joe Ward
Re/Max United
Joe@JoeWard.net

How Much Will It Cost To Wait?

It has been said that change is the only constant. Most of the financial experts have been expecting interest rates to increase along with home prices. While homes, in most markets, have definitely seen increases over the past five years, the mortgage rates today are actually lower than they were a year ago.

cec2f9ac-b61f-4ad2-b66a-4b3524ff1c1cIf the interest rates were to increase by 1% over the next year while homes appreciated at 6% during the same time frame, a $250,000 home would go up by $15,000 and the payment would be $211.53 more each month for as long as the owner had the mortgage. The increased payments alone would amount to $17,769 for the next seven years.

When facing a decision to postpone a purchase for a year, a legitimate question to ask oneself would be: “how will it feel to have to pay more to live in basically the same home a year from now?”

It is easy to understand that if the price of a $250,000 home goes up by 6%, it increases the price by $15,000. A slightly more difficult concept to realize is that if the interest rate were to go up by ½%, it is approximately equal to a 5% increase in price. A 1% increase in mortgage rates would approximately equal a 10% change in price. This means that if a home goes up in price by 6% and the interest rate goes up by 1%, it is equivalent to the price of the home going up by a little more than 16%.

Use the Cost of Waiting to Buy calculator to estimate what it might cost to wait to purchase based on your own estimates of what interest rates and prices will do in the next year. It may just give you the nudge you need to START SHOPPING!!!


Don’t wait!!! Inventory is LOW, Prices are RISING, and interest rates are DOWN…….. It’s a great time to buy if you can find the perfect home for you and your family! Contact one of the buyer’s agents on the Joe Ward team today. We are more than happy to get you pointed in the right direction.

_PDP0035

From left to right, Deborah Swainey (919-412-8650), Joe Ward (919-518-8182),
Valerie DeLoach (252-916-5048), and Kellie McDonald (919-961-2720).

We are a real estate team who cares about our clients. If you are considering
selling your home and would like some honest, professional, and
experienced guidance,
please contact us today.

Connect with us on social media to learn more about our team and
how we can help you find your new home!

facebook wordpress twitter linkedin pinterest instagram googleplus-2

 

Increase Your Marketability

The seller has three tools available to affect the marketability of their home: price, condition and terms. Price is the easiest to adjust for the competing properties, amount of inventory or market conditions. However, lowering the price is not necessarily the best decision when trying to maximize the proceeds of sale.

If a home is in poor or outdated condition, updating can be done to make it show favorably with other homes that are currently on the market. Sometimes, sellers rationalize not doing the work by saying they believe the buyers would rather make their own choices. The truth is that most buyers are using all their resources to get into the home and will have to live in its present condition until they can save enough to make the changes they want.

Another reason to go ahead and invest the money and effort into improving the condition is that it is difficult for buyers to imagine the home any other way than its current condition. When comparing one home to another, buyers will sometimes refer to a home as the “stinky house” or the “old kitchen” which may put it at a disadvantage.

While price and condition are the main things that control the marketability, terms can be equally effective. Terms relate to financial considerations made by the seller to induce a buyer to make a decision to purchase their home.

Seller-paid points or closing costs, interest rate buy downs and owner-financing are examples of terms that may increase the marketability of a home because of the additional benefits they offer to buyers.

An example could be that a seller will carry a 10% second lien so that the buyer can get an 80% loan and avoid the expense of mortgage insurance. The seller gets most of their equity plus a fair interest rate on the loan that doesn’t have to be tied up for 30 years like the first mortgage.

Increasing the marketability of your home is a great conversation to have with your real estate professional especially to help you get the highest price in the shortest time with the fewest problems. Just be aware that not all agents may be as creative as some.


As your real estate professional, I have the training and experience to provide solutions to make homes more marketable and help structure favorable transactions.  Please forward this article to your friends or family who could benefit from it.

the Joe Ward team
Re/Max United