Happy Halloween!
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| As a reminder, I’m always here if you or your friends and family need any home financing advice. My clients are important to me and I’m happy to help anyone you know that might need advice in any way I can. |
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© 2011 W.J. Bradley Mortgage Capital Corp., 201 Columbine Street Suite 300, Denver, CO 80206. Phone #303-825-5670. NMLS ID 3233. Trade/service marks are the property of W.J. Bradley Mortgage Capital Corp. This is not a commitment to lend. Restrictions apply. All rights reserved. Some products may not be available in all states. WJB is not acting on behalf of or at the direction of HUD/FHA or the federal government.
What makes San Bruno unique and why is it a great place to buy a home?
San Bruno is a city that offers the perfect balance for a home buyer, especially for new home buyers looking for their starter home. The location, the downtown scene, and the weather are all high points that recommend it!
The location of San Bruno, between San Francisco and Silicon Valley, gives any home buyer a convenient compromise for those couples who may be working areas, as many couples in the area do. Also, getting to downtown San Francisco is faster from San Bruno than from the Sunset District of SF because of the easy access to the 101 and 280 freeways!
San Bruno is also very close to SFO and has a friendly business climate. The class “A” office spaces have attracted companies such as Walmart.com, YouTube and United Airlines! Lastly, the northern part of San Bruno is considered the “end of the fog line” meaning you will have more warm and sunny days while living in San Bruno, as compared to many parts of San Francisco.
All of these things and more make San Bruno an amazing city to live in and a great place to buy a home, raise a family and work!
Why should you hire a real estate agent when buying or selling a home, rather than trying to do it on your own?
This is one of those questions that is frequently asked, but despite the many great answers the attractiveness of saving some money I’m going to reiterate a few key points!
The first is, if your are a buyer, working with a buyers agent is always a good idea because they are someone who knows the area and will be able to find you the key things you’re looking for in a home. But, most of all, the commission of the agents is customarily paid by the seller so you don’t have to worry about the cost of working with the agent!
Sellers, since they do pay the commission of the agents need to hear these few key things agents do that increase your home sale! First, with the market the way it is and the excessive amount of ‘short sale’ and ‘foreclosure’ properties, you need to understand how to successfully price your home for your area.
These troubled properties have brought investors and opportunists out of the woodwork looking to “steal” a home. It’s hard for the buying public to recognize the difference between homes that are priced competitively and those that are put on the market at a steep discount to attract a lot of buyers. Those homes prices are then jacked up during the bidding process.
The main thing a seller needs to be sure of is that their home is priced competitively but not so competitively it is lumped into the same category as the troubled homes in the area. An agent also has the marketing skill to get your home in front of the right eyes, and show, negotiate, and close the transaction with the least amount of hassle to you!
How is the housing market in San Bruno these days?
The housing market in San Bruno is recovering in the same manner as the rest of the peninsula, thankfully! It’s still strong for selling homes that are in good condition with competitive prices. There are also still homes that need some cosmetic upgrades, if you’re looking for a mild fixer upper!
Essentially these homes have become “stale” on the market due to faulty marketing techniques which gives a buyer the opportunity to find some really attractive deals! It helps when you work with a local agent who knows the area and inventory and is willing to dig a little to find these deals!
Taking Advantage of Today’s Market: Investments, Retirement and Second Homes
Housing inventories are up, which means prices are low, and interest rates are still great. Put those together and you’ve got the perfect opportunity to buy a new home. But what if you already have a home you love? Are you out of the market?
Not necessarily! Have you considered buying a second or investment home, or planning for your retirement? If you are in good financial standing with good credit, this is a way you can be part of this amazing real estate market — there may never be a better time to buy! This could be the chance of a lifetime to purchase additional real estate before rates are no longer at these historic lows.
Location, Location, Location
If you’re looking for a vacation or second home, there are a lot of highly desirable areas hard hit by the downturn in the housing market that will yield great bargains. Locations with a lot of foreclosures such as Arizona, in the Phoenix and Scottsdale areas; Central and Southern California, in San Diego, San Jose and Salinas; and Miami and Panama City in Florida still have lovely properties in good shape — and these are historically great vacation spots, for you or for renting out to other travelers! Look to a national real estate company to find an agent who can help you review properties in another state.
But a vacation home doesn’t have to be a plane ride away. If you want to be able to pack up the family and drive a couple of hours to your vacation destination, saving some travel money and ensuring you’ll use the property more than once a year, then just take a look around your home state. If you’re in the city, consider a country cottage; leave your beach bungalow for a mountain retreat. If you’ve always wanted a change of scenery available when the mood strikes you, now is your chance to make that desire a reality.
If you’re pondering a retirement home, there are other factors you’ll need to consider. Do you need to stay close to family for frequent visits, or should your home be a getaway for the grandkids? Do you want a strong senior community with lots of planned activities and meetings to keep you busy, or a quiet retreat where you can be left to your own devices? These factors will influence whether you choose a retirement community in Florida or a city like Austin, Texas, with a lively arts and music scene, for your next home.
Rentals Rise
Another way to take advantage of today’s rates and housing prices is to purchase property that you then turn around and rent. Rental properties are commanding higher and higher prices as foreclosures rise and fewer people are making home purchases. In cities around the country you should be able to charge enough rent to cover your mortgage and a home repair program — and still possibly even make a little profit on top. Be sure you research rental prices in your selected area before you buy, however, so you don’t end up pricing yourself out of the market.
Prices are so low in some areas that you also have the option of just buying and holding property instead of needing to rent it out. Cities in Oklahoma, Pennsylvania and Tennessee currently have very low home prices, but Forbes.com predicts they’ll gain value in the next year. Buy low, sell high — even in a crazy housing market like this one, some tenets stay true.
Expert Advice
Look for a real estate agent who is well-versed in investment properties, especially if you are buying a property to rent in a location far from home. If you’re looking at investing in a townhouse or single-family home, you’ll need their knowledge of the area to ensure you buy in a neighborhood well-suited to renting; if you’re plunging into the apartment market, you’ll need them to help you find a property in good shape, and probably to select a management company or reliable repair service you can line up in advance. Another option is to partner with a seasoned real estate investor, providing the capital and relying on your partner’s instincts to make good choices and get a decent return on your investment.
If you’re looking for a home to use yourself or to move into upon retirement, your best bet is to visit the area yourself and engage an agent while you are there. This way you can be sure the home has all the features and amenities that are important to you and your family.
It’s a great time to jump into the real estate market as an investor or to make that second-home or retirement-home purchase, but it won’t last. Interest rates are beginning to creep up and market watchers are seeing signs of an end to this low-cost, high-inventory period. Talk to me today about your financial goals and take advantage of today’s market before this opportunity is gone!
Contact me today to learn more.
The Magic and Frustration of Real Estate
The real estate market can be both magical and frustrating all at the same time. In many parts of the Bay Area, such as PaloAlto, the Sunset, Burlingame, or Mill Valley, it’s as if we are back in the 2004 real estate market where every property hadmultiple offers and lots of them were all cash offers. In other parts of the Bay Area, however, like Oakland, Novato, Vallejo, and parts of San Jose, the market is much softer and has not yet rebounded. Sales still happen in these areas, but only if the property is priced right. Additionally, much of the inventory is still made up of foreclosures and short sales. Even if these areas may not be hot, they still present a great opportunity for investors and first time homebuyers. It is amazing how locations a few miles apart can see diverging trends.
While markets like Palo Alto can bear price increases, multiple offers, and a healthy pace of sales, there are several other markets throughout the Bay Area that cannot. In real estate, it is all relative. Each sale needs just one seller and one buyer. The value is determined by who is the seller, the profile and capability of the buyer, the support of the lender, the type of real estate you are buying or selling, inventory, days on the market of the competition, list / sales price of past sales, and whether you are in a negotiating situation or a competitive world fighting against all cash multiple offers.
The key to navigating all of this is education. You need to know what market you are selling or buying in and what will it take to get the house sold or to buy one. The rules are not only different in different areas, but they can also change daily based on what is selling and at what price point. Additionally, the media confuses us even more. ZIllow will tell us that home prices fell 3% in the first quarter, the steepest decline since 2008, and Fiserv Inc. is predicting home values still have 5-10% more to decline. Yet, this is not what homebuyers who are trying to buy a home in Palo Alto or the Sunset are experiencing.
So, what does all of this mean? What we can say is that what should be is sometimes, what seems logical is sometimes, and what can be often is just because it can be. That’s the magic and frustration of real estate. There are no set rules and the journey is often not the one we expected. In the end, buy in a good location, take out a conservative loan, and wait 5 years. From Palo Alto to Novato, real estate will reward you.
Economic Roundup: August 1, 2011
| Last week started off with news that consumer confidence had rebounded in July. The Conference Board’s Consumer Confidence Index, which had dropped in June, increased to 59.5 for July (1985=100), up from June’s 57.6, however, consumer sentiments for the month were a mixed bag. The Present Situation Index, how consumers feel about the economy’s current status, decreased to 35.7 from 36.6, while the Expectations Index, how they feel it will fare in the future, rose to 75.4 from 71.6 last month. An improving short-term outlook helped drive the overall confidence index, but consumers still have their doubts, said Lynn Franco, director of The Conference Board’s Consumer Research Center. |
| “Consumers’ appraisal of current business and employment conditions, however, was less favorable as concerns about the labor market continue to weigh on consumers’ attitudes,” she said. “Overall, consumers remain apprehensive about the future, but some of the concern expressed last month has abated.” Consumers stating business conditions are “good” decreased to 13.4 percent from 13.7 percent, while those claiming business conditions are “bad” increased to 39.0 percent from 38.4 percent. Consumers’ appraisal of the job market also fell, with those claiming jobs are “hard to get” increased to 44.1 percent from 43.2 percent, while those stating jobs are “plentiful” remained unchanged at 5.1 percent. In terms of short-term outlook, the proportion of consumers expecting business conditions to improve over the next six months increased to 17.7 percent from 16.5 percent, but those anticipating business conditions will worsen also increased, to 15.2 percent from 14.9 percent. New home sales took a slight dip in June, with sales of new single-family houses skirting downward to an annual rate of 312,000, according to estimates released last week by the Census Bureau and the Department of Housing and Urban Development. This marked a 1 percent drop from May’s revised rate of 315,000, but was 1.6 percent over June 2010′s estimate of 307,000. In terms of pricing, the median sales price of new houses sold in June was $235,200; and the average sales price was $269,000. The estimate of new homes for sale at the end of June was 164,000, which represents a supply of 6.3 months at the current sales rate. Looking at manufacturing, new orders for durable goods decreased $4.0 billion (2.1 percent) in June to $192.0 billion, according to an advanced report released by the Census Bureau last week. The decrease followed a 1.9 percent increase in May. Durable goods orders have been down two of the last three months, including June. Transportation, also down two of the last three months, took the largest hit, with transportation equipment dropping $4.2 billion (8.5 percent) to $45.4 billion. Excluding transportation, new orders actually increased 0.1 percent. Shipments of manufactured durable goods for June increased $1.0 billion (0.5 percent) to $196.0 billion, with machinery shipments, up four of the last five months, posting the largest gain, $0.7 billion (2.6 percent) to $29.1billion, the bureau reported. Unfilled orders for manufactured durable goods for June increased $2.1 billion or 0.2 percent to $862.7 billion, with machinery once again the strong performer; up $2.1 billion (2.0 percent) to $111.2 billion. Inventories of manufactured durable goods in June, increased $1.6 billion (0.4 percent) to $357.2 billion. Encouragingly, initial claims for jobless benefits for the week ending July 23 dropped to 398,000, a decrease of 24,000 from the previous week’s revised figure of 422,000, the Employment and Training Administration reported. The four-week moving average dipped to 413,750, a drop of 8,500 from the previous week’s revised average of 422,250. The total number of insured unemployment during the week ending July 16 dropped to 3,703,000, a decrease of 17,000 from the preceding week’s revised level of 3,720,000. The four-week moving average was 3,721,000, a decrease of 5,250 from the preceding week’s revised average of 3,726,250. This week will see a busy calendar of economic headlines, starting today with June’s construction spending figures from the Census Bureau. Tomorrow follows with June’s personal income and expenditures from the Bureau of Economic Analysis, as well as car and truck sales for July from the auto manufacturers. Wednesday, the Census Bureau will release June’s factory orders and on Thursday the Employment and Training Administration will release initial jobless claims data for last week. On Friday non-farm payrolls, hourly earnings, average workweek and the unemployment rate for July is released from the Bureau of Labor statistics, as well as June’s consumer credit figures from the Federal Reserve. |
Why should I buy instead of rent?
The long term financial benefits of buying are pretty clear to most people. You gain equity in your home, you have an asset rather than just giving money to your landlord each month. You also have free reign of your space to do with as you want, home improvement projects, painting, etc!
But beyond the obvious financial benefits you also have the security of your own home, pride of ownership and community that comes along with it! Now is a time that many people are being cautious and staying on the sidelines. Interestingly, it is times like these that people often look back at and say, “I should have done it then”.
Rehabilitating Your Dream Home
Home buying can be a nerve-wracking experience. You sift through multiple properties, visit the ones that grab your interest, and then finally decide on your dream home — but there’s just one problem: it’s a fixer-upper desperately in need of some TLC.
That dilemma is not uncommon today. Perhaps the home was treated poorly by a long string of renters, the owner ignored a serious problem or key fixtures were even sold off. Whatever the case, don’t be shocked or overly disappointed. Increasingly, home buyers are faced with the prospect of buying a fixer-upper in today’s real estate market.
Often, attractively priced properties that are foreclosure sales can sometimes come with cosmetic problems that may seem huge. It is not uncommon for a homebuyer to walk through a foreclosed home and discover that the kitchen was gutted by the former owners who sold off not only the appliances, but the cabinetry to boot.
This can even turn into a real problem that could hamper obtaining financing because often missing fixtures such as toilets and sinks can render the house “unlivable” per code. Who wants to buy a home they legally cannot inhabit?
Fortunately, there’s a government loan program available that can help you with that fixer-upper you wish to purchase. The Federal Housing Administration created the 203(k) loan specifically to help homebuyers rehabilitate homes they wish to purchase to live in, but that are in disrepair. A 203(k) loan lets a qualified borrower not only finance the purchase price of the home, but also include the price of the necessary repairs to the home.
A Closer Look
Again, the goal is for the buyer to live in the home, so this is not for investors. So the types of properties that qualify for the loan are:
* Single-family dwellings up to units that house no more than four families
* The residential portion of a mixed-use property (i.e., a property that is both commercial and residential in nature)
* An existing construction that has been finished for at least one year
* A home that will be torn down, but where the foundation will still remain
* A home that will be moved to a new foundation
* FHA-approved condos
There are two types of 203(k) loans, and the one that is right for your intended property depends on how much work needs to be done.
In terms of amount, a streamlined 203(k) provides up to $35,000 that can be added to the loan to cover the improvements, in addition to the purchase price of the home. For a standard 203(k), the homeowner can borrow the purchase price of the home, plus the price of the improvements, up to 110 percent of the home’s expected value after the improvements. (And again, this is assuming you can qualify for the total loan amount.) The money for the improvements is actually put into an escrow account that is used to pay for materials and the parties being contracted to do the work to the home.
Time is an important element of 203(k) loans. You must start construction within 30 days of the close of the loan and your work must be completed within six months. This might leave you wondering: what do you do if the house isn’t habitable? With a standard 203(k), you may be able to finance up to six months’ mortgage payments so that you can afford to live somewhere else while the construction is in progress.
Another critical time element is the paperwork. FHA rehab loans can take longer to close with a lender that doesn’t have experience with them, because there is more paperwork. So to avoid those sorts of delays, make sure you work with a lending professional that is experienced with 203(k) loans.
What kind of improvements are covered? 203(k) loans support a broad range of rehab work, including painting; room additions and second story additions; decks and patios; grading and drainage; bathroom and kitchen remodels; finished attics and basements; structural changes and repairs; environmental rehab such as removing lead paint or making energy conservation improvements; roofing; flooring; and accessibility upgrades for disabled residents. But what’s not covered are major luxury upgrades, such as a swimming pool or hot tub. That said, when upgrading your bathroom, for instance, you might be able to install a whirlpool bath tub. Again, the key is to speak with an experienced 203(k) lender that is well-versed in the details of the program.
Ultimately, what does a 203(k) loan mean for you? Freedom. The freedom to choose the home that is perfect for you and that you love, even if it needs some work that you would otherwise not be able to finance. If you or anyone you know is currently home shopping, but some of the properties you’re finding need some attention, I would love to help you review your financing options. Please contact me at the information provided on this message — and happy hunting!
Contact me today to learn more!
The Mortgage Lender/REALTOR® Relationship
As a mortgage lender, I have worked with both REALTORS® and Real Estate Agents, but I prefer and always recommend working with REALTORS®, as they adhere to a very strict set of guidelines and code of ethics. But do you know the difference between the two? This article explains the difference in detail, read on for more information!
