You've probably heard it from everyone…the market is getting better. While it's nice to hear, it is even better to SEE and UNDERSTAND. I'm going to show you a few graphs that show you exactly WHY the market is better and why you may reconsider jumping in to buy or sell.
Please keep in mind that all of the data I will be highlighting below is for Federal Way area codes 98023 and 98003.
1. The chart below is the number of homes "For Sale" vs. "Sold" for the last 5 years. As you can see, from 2009-2011 to , during any given month, there were more than 300 homes on the market. However, only around 50 sold each month. Imagine how hard it would be to sell your home if you had a 16% chance each month….and that is if your house is priced right. To entice buyers, homes had to sell for cheep.
2. Chart #2 is the same as above, only focusing on the last three years. What we see here is a cycle of low inventory and a better chance to sell your home. Clearly, during the winder months, there are less "For Sale" and therefore "Less Pending". In Nov-Feb, sellers had a 40% chance of selling their home. During the summer months, an average of roughly 45%.
3. With the exact same data from chart #2, we can see the "average sold price per square foot" for homes in area codes 98023 and 98003. From Jan 2012 to Jan 2014, we've seen an increase in Price Per SqFt of 23.4%. From Dec 2013 to Dec 2013, there was an 8.3% increase.
In conclusion, the Federal Way housing market is alive and kicking. It's growing rapidly each month. With inventory in short supply, sellers are getting top dollar for their home – no matter what time of year it is. If you are considering selling or buying, now is a good time. For those who are buying, values will continue to rise and so will your payment.
If you have questions on this or other area codes, please let me know and I would be happy to pull similar statistics!
Through the NHF Down Payment Assistance Program, you can basically get FREE MONEY through a GRANT! You don't have to pay it back, and it's not hard to qualify!
Last week I met with some clients and a Mortgage Lender whom I've worked with on several occasions. As I heard him explain this program to them, my jaw basically hit the floor. The monthly payment does end a little higher, but because you are getting the 3%-5% downpayment for free, it takes years (8 in my clients case) to make up the difference!
Here is what Andy Fernando from Alpine Mortgage said about this program:
"For many people today, the number one challenge to buying a home is putting together the down payment. With Alpine Mortgage Planning has solved that problem with the NHF Down Payment Assistance Program.
NHF is a down payment GRANT, not a loan. The grant available is either 3% or 5% of the homes price, and works in conjunction with a 3.5% down FHA fixed rate home loan. If you meet the qualifications and criteria for the loan program, NHF is GIVING you the money for the down payment. Here are the basic criteria:
- 30 year fixed rate mortgage
- Rates determined by amount of grant you request, 3% or 5% of loan amount
- Maximum debt to income qualifying ratio of 45%
- Income limits apply by county (King – $101,430, Pierce – $82,110)
- Regular FHA underwriting standards apply
To find out if you qualify for Alpine Mortgage Plannings NHF Down Payment Assistance Program, get in touch with your Alpine lender today. By providing your current income, asset, and credit information, along with a short interview for an application, we can get a preliminary credit determination very quickly, sometimes in a matter of hours. "
I am seriously completely in awe of this program. If you have been thinking about buying a house, but are simply waiting to save up a down payment, I urge you to look into this program to see if you qualify. Home prices are on the rise, so by the time you save up the down payment, you will be spending more on the house you want. And dont forget this is a GRANT! They basically gift you the down payment.
If you have any questions about this program, let me know, or reach out to Andy Fernando. I highly reccomend him. His contact info is below!
Andy Fernando | Mortgage Advisor
Alpine Mortgage Planning
C 206.498.5355 | f 855.718.4221
I am sad that they are being dragged around for months with no end in sight.
I am sad that we have little control in a tough situation.
I am sad that through everyone else's garbage, they are doing the right things and just trying to buy a great house for their family. But despite them being prepared, saving up, staying on top of the ball, they are the ones suffering.
With all of this, you would think I'm a lawyer and my clients are going through a long legal battle. I suppose you could say there is somewhat of a legal battle, but this is different.
This is a short sale.
When buying a home, a short sale can look like a great bargain on paper. All you have to do is wait a few months to get that price, right? Wrong. BEST CASE scenario….the lien holder (who really has all the power in these situations) only haggles you up in price a little, and you only spend 2-3 months waiting. This is not typically the case.
We've been working on this going on 10 months now, and it's been a nightmare for all parties. Without going into specifics, we've been in negotiations twice, it took a month to schedule an inspection with a very non-cooperative tenant, after waiting months, the bank decided they wanted almost $100,000 more for the home. That gap was way too large to fill (and over valued), so they put the home back on the market, and after dropping it a few times, we got back in there. Since then, we've waited 5 months.
The problem is, there are a bunch of
morons people doing their job at the banks. Each file passes through numerous hands, it gets stacked in the corner, and they simply don't care that there are real people – who have put their lives on hold – on the other end.
If you (as a buyer) break contract or are late on a deadline, they take notice and could even cancel the file! However if they are late, or they don't carry though on things that were promised…it's your fault. You are SOL. That is a tough pill to swallow, but it's true.
Don't they just want to get the house sold? We find ourselves asking. Yes, in theory. But some button pusher at the bank probably has a quota to fill and must try his darndest to get the most money for the house…even if it means putting it back on the market and waiting for a new buyer. So this is why if you don't bend over backwards at times, they can take it away. And that's not fair, or right, but that's the way it is.
There are times that short sales can go smoother. But if you are considering buying a short sale, think hard about not only the time its going to take and the deals and homes you might miss out on while waiting, but the enormous emotional struggle you may face.
Another sad part about short sales is while they are a great way for people under water to get out of their home, the banks are stringing them along as well. They simply want to get out of the home with as little damage on their credit, and with the most ease possible, but the banks are making this process long and arduous for them as well.
As a Realtor, I am glad to pursue short sales for my clients. In this case, it is 100% the right house for this family, no questions about that. And because of that, the struggles may be worth it. But ask your Realtor to talk to you about their experience with a short sale and decide if that really is a route you want to take.
Questions? Have your own experiences to add? Please do comment below.
Lets face it, morgage rates continue to blow my mind. Early 2014 projections saw rates slowly increasing as the government started "tapering." By 2015, rates were projected to be mid 5%. However, buyers and refinancers alike have been blessed with the continuation of low interest rates.
If you are waiting for interest rates to drop before jumping into the market, STOP. They are low! You may see week to week highs and lows, but current rates are the lowest they have been in decades.
Projections of 2015 mortgage rates and availability [/caption]
Since the real estate crash, the market has been slowly gaining momentum. Homeowners are feeling more confident as their equity is starting to increase. From 2013 to 2014, the average sales price in King/Pierce County has risen 8.3%.
On the other side of the coin, mass amounts of 1st time homebuyers entered the market. Recent graduates now have a steady income and mortgage rates have remained low – a healty incentive for any potential home buyer. So many homebuyers have entered the market, in fact, that the demand for homes rose increadibly and the supply couldnt keep up.
What this high demand created was craziness. In places close to Seattle and Bellevue, it was common to recieve multiple offers by day 3. I've heard as many as 18 offers! People would offer above list price by $50,000 or more, they would wave the inspection contingency (keep in mind many Seattle homes are older and it is likely they have aging issues), $100,000 earnest money and more!
In the South Sound area, we did see above list price offers, multiple offers, and many within a week of the home being put on the market.
ENTER LATE AUGUST/SEPTEMBER
Across the board, things have slowed. People took their last minute vacations and are getting kids ready for school again. I've spoken with many agents who have agreed that showings on their listings have all slowed WAY down. I have seen this slowing on my listings as well, and the further out from the Seattle epicenter, the slower they get.
So what does this mean? For sellers, it means sticking it out, or making some agressive moves before the holiday season hits. There are simply less buyers in the market, so you need to make your home stand out and attract one of those few buyers.
For buyers, this means there is somewhat limited inventory, but you may not be competing with 10 other buyers. You may negotiate significant price drops and for the seller to pay closing costs.
It's amazing how it all goes back to supply and demand. The market will bear what the market will bear.
How has housing looked in your area?
As a seller, you dream of seeing those Benjamin's on the table. They are simple, easy, and close quickly. However, if you are a buyer trying to compete for investment properties or even owner-occupant homes, cash buyers may easily beat you out if you don't know what you are up against.
What are cash offers?
Cash offers are just that….cash. The buyer is planning on paying for the property in cash. At the time they submit the offer, they must prove they have the cash in hand. It can't be "on its way" or promised, without proof.
Cash offers also mean there is no financing contingency. Financing contingencies include a bank who needs to make sure their pending loan is secured with a correctly-priced property. This means there will be an appraisal, underwriting, and possible time delays. Cash is valuable when the property has significant defects that might make the home un-financable.
Who is offering cash?
For lower-priced properties, cash buyers are typically investors. They are looking to purchase a property, fix it up with decent repairs, then flip the house to sell or rent out.
We also see cash buyers in the high price range – people who have sufficient funds to purchase their dream home outright. These people have typically done their share of looking at available homes and when they find "the one" they are willing to pay for it.
How to combat cash offers?
To make it simple, you have to make your offer more sexy. Offer a higher price and wave contingencies. I typically don't recommend waving inspection or financing contingency because you never know what will happen. However, if you are in a hot and competitive market, like we are in Seattle/Bellevue, you MUST put your best foot forward. I've even heard of people offering a non-refundable deposit of $100,000 if they back out for any reason. These buyers were so confident that they wanted this house, they put their money where their mouth is. The $100,000 would be applied to the sales price at closing, but should they walk away for ANY reason, the sellers would get to keep the 100k. That prospect is extremely enticing.
If you can't offer 100k nonrefundable deposit, consider including a personal letter with your strong offer. Express to the sellers why you want this house. This especially works if you plan on occupying this house. If I am selling a home and have a cash offer from investors that I know will rent out my beloved home, verses an equally good offer (with financing) from people who will cherish and enjoy the work I've put into my home, I'm taking the owner-occupant letter.
In the end, cash might win out, but it never hurts to try. Put your best offer on the table when you know you are up against cash, and may the best offer win!
In today's market, it's common to meet someone who went through a forclosure, short sale, or bankrupcy. In fact, it may have been you! Since the market crash in 2007-2008, thousands of people have had to face these difficulties, and it's nothing to be ashamed about.
Many may think that they have to wait a lifetime before they can finance another home.
But that simply isn't true.
It may be surprising how soon a buyer can qualify again! . If this is you, or you know someone in this situation, please SHARE this information with them! It is crippling to think it will be a lifetime before you can move into that dream home.
Email firstname.lastname@example.org for a copy of this flyer, share on Facebook, or simply forward this blog post to a friend!
If you ARE ready to obtain fincancing – despite your background and history – I reccomend contacting Andy Fernando at Alpine Mortgage – he's very responsive and knowledgable. Afernando@alpinemc.com
It is interesting to see the trends of mortgate rates since 1971. You can really see the correlation of events in history to these rates. I know people who during the 80's, were excited that their interest rates hit 13%! What a change since then.