Are You a Homeowner Thinking About Climate Change?

Are You a Homeowner Thinking About Climate Change?

Americans are more aware than ever of the effects climate change and natural disasters can have on their homes. According to a report from realtor.com:

More than 3 in 4 recent buyers, 78%, took [natural disasters] into account when choosing the locations of their homes, . . .”

The study also found that many existing homeowners (34%) have already considered selling their houses and moving to a new location because of the changing climate. If you’re like those homeowners and are weighing your options about what to do next, here’s some information to keep in mind as you begin the process of selling your existing house and searching for your new home.

Do Your Research and Work with a Real Estate Advisor To Find a Home That Meets Your Needs

As a homeowner, it’s impossible to control what types of weather events your home is exposed to. As Maiclaire Bolton Smith, Senior Leader of Research and Content Strategy for CoreLogic, says:

“You can’t necessarily remove the location from around you, but there are things you can do to mitigate damage that can happen.”

The first step is understanding how to navigate your home sale and purchase with these specific issues in mind. While that can seem like a difficult undertaking at first, with the appropriate resources and experts on your side, you can simplify the process.

The Mortgage Reports provides some tips for purchasing your next house, including, but not limited to:

  • Vetting the location before you buy
  • Researching Climate Action Plans and learning if the city or state has one
  • Working with professionals for additional assessments on the home’s ability to withstand natural disasters

Ultimately, your best resource throughout the process is a trusted real estate professional. An agent will help you navigate the sale and required disclosures for your existing home, be your expert advisor on local guidelines and information, and keep your goals and concerns top of mind. Even if your advisor doesn’t have the answers to all your questions about how your next home will stand up to natural disasters, they can help connect you with experts and resources who will.

Bottom Line

If you’re becoming more mindful about the effects of climate change and you’re ready to make a move, you’re not alone. Let’s connect so you have a trusted advisor on your side to help you navigate the sale of your current house and find the perfect spot for your next home.

Why Pre-Approval Is Key for Homebuyers in 2022

Why Pre-Approval Is Key for Homebuyers in 2022

You may have heard that it’s important to get pre-approved for a mortgage at the beginning of the homebuying process, but what does that really mean, and why is it so important? Especially in today’s market, with rising home prices and high buyer competition, it’s crucial to have a pre-approval letter prior to making an offer. Here’s why.

Being intentional and competitive are musts when buying a home this year. Pre-approval from a lender is the only way to know your true price range and how much money you can borrow for your loan. Just as important, being able to present a pre-approval letter shows sellers you’re a qualified buyer, something that can really help you land your dream home in an ultra-competitive market.

With limited housing inventory, there are many more buyers active in the market than there are sellers, and that’s creating some serious competition. According to the National Association of Realtors (NAR), homes today are receiving an average of 3.8 offers for sellers to consider. As a result, bidding wars are still common. Pre-approval gives you an advantage if you get into a multiple-offer scenario, and these days, it’s likely you will. When a seller knows you’re qualified to buy the home, you’re in a better position to potentially win the bidding war.

Freddie Mac explains:

“By having a pre-approval letter from your lender, you’re telling the seller that you’re a serious buyer, and you’ve been pre-approved for a mortgage by your lender for a specific dollar amount. In a true bidding war, your offer will likely get dropped if you don’t already have one.”

Every step you can take to gain an advantage as a buyer is crucial when today’s market is constantly changing. Interest rates are rising, prices are going up, and lending institutions are regularly updating their standards. You’re going to need guidance to navigate these waters, so it’s important to have a team of professionals such as a loan officer and a trusted real estate advisor making sure you take the right steps and can show your qualifications as a buyer when you find a home to purchase.

Bottom Line

In a competitive market with low inventory, a pre-approval letter is a game-changing piece of the homebuying process. Not only does being pre-approved bring clarity to your homebuying budget, but it shows sellers how serious you are about purchasing a home.

With Mortgage Rates Climbing, Now’s the Time To Act

With Mortgage Rates Climbing, Now’s the Time To Act

Last week, the average 30-year fixed mortgage rate from Freddie Mac jumped from 3.22% to 3.45%. That’s the highest point it’s been in almost two years. If you’re thinking about buying a home, this news may have come as a bit of a shock. But the truth is, it wasn’t entirely unexpected. Experts have been calling for rates to rise in their 2022 projections, and the forecast is now becoming a reality. Here’s a look at the projections from Freddie Mac for this year:

  • Q1 2022: 3.4%
  • Q2 2022: 3.5%
  • Q3 2022: 3.6%
  • Q4 2022: 3.7%

As the numbers show, this jump in rates is in line with the expectations from Freddie Mac. And what they also indicate is that mortgage rates are projected to continue climbing throughout the year. But should you be worried about rising mortgage rates? What does that really mean for you?

As rates increase even modestly, they impact your monthly mortgage payment and overall affordability. If you’re looking to buy a home, rising mortgage rates should be an incentive to act sooner rather than later.

The good news is, even though rates are climbing, they’re still worth taking advantage of. Historical data shows that today’s rate, even at 3.45%, is still well below the average for each of the last five decades (see chart below):

With Mortgage Rates Climbing, Now’s the Time To Act | Simplifying The Market

That means you still have a great opportunity to buy now with a rate that’s better than what your loved ones may have paid in decades past. If you buy a home while rates are in the mid-3s, your monthly mortgage payment will be locked in at that rate for the life of your loan. As you can see from the chart above, a lot can change in that time frame. Buying now is a great way to protect yourself from rising costs and future rate increases while also securing your payment amount for the long term.

Nadia Evangelou, Senior Economist and Director of Forecasting at the National Association of Realtors (NAR), says:

Mortgage rates surged in the second week of the new year. The 30-year fixed mortgage rate rose to 3.45% from 3.22% the previous week. If inflation continues to grow at the current pace, rates will move up even faster in the following months.”

Bottom Line

Mortgage rates are increasing, and they’re forecast to be even higher by the end of 2022. If you’re planning to buy this year, acting soon may be your most affordable option. Let’s connect to start the homebuying process today.

Two Ways Homebuyers Can Win in Today’s Market

Two Ways Homebuyers Can Win in Today’s Market

If your goal is to purchase a home this year, you might be looking for any advantage you can get in today’s sellers’ market. While competition is still fierce for homebuyers, there are ways you can win and secure the home of your dreams, even in a hot market.

Act Early and Save

The earlier you act this year, the more affordable your purchase will be. That’s because experts project mortgage rates will rise as we move deeper into 2022. According to Freddie Mac, the average 30-year fixed-rate mortgage is expected to be 3.5% by year’s end. Experts forecast home prices will rise as well.

That means the longer you wait, the more it will cost you to buy a home. Instead, act early and purchase your home before rates and prices rise further. Not to mention, the sooner you buy, the sooner you can experience the benefits of continued home price appreciation yourself. Once you have your home, you’ll be able to watch its value rise, giving you confidence that your investment is a sound one.

Buy Now, Move Later

Keep in mind, with high buyer demand like we’re seeing today, you’ll be competing against other potential homebuyers, which means you need to find a way to stand out. One way to accomplish this is to negotiate with sellers and present terms that meet their ideal needs. Danielle Hale, Chief Economist for realtor.com, explains one lever flexible buyers can pull to entice sellers:

“For buyers with more flexible timelines – such as those making a move from a big city – offering a couple extra months on the closing date could sweeten the deal for sellers who also need to buy their next home.”

In other words, if you’re eager to purchase a home now before it becomes more costly and you don’t have to move right away, you could extend the date of your closing and provide the seller with the time they need to find their next home. That’s a deal that could benefit both parties and help you stand out from the crowd.

Of course, it’s important to work with a real estate professional for expert advice on how to make your best offer. Your trusted advisor knows what’s working in your market and what may appeal to sellers.

Bottom Line

Experts project home prices and rates will increase in 2022. That means buyers who are ready should act soon and find ways to strengthen their offer to meet sellers’ needs. Let’s connect today to learn how you can win in today’s market.

Why Inflation Shouldn’t Stop You from Buying a Home in 2022

Why Inflation Shouldn’t Stop You from Buying a Home in 2022

If you’re following along with the news today, you’re probably hearing a lot about record-breaking home prices, rising consumer costs, supply chain constraints, and more. And if you’re thinking about purchasing a home this year, all of these inflationary concerns are likely making you wonder if you should wait to buy. Investopedia explains that during a period of high inflation, prices rise across the board. And while home prices aren’t immune from this increase, here’s why inflation shouldn’t stop you from buying a home in 2022.

Homeownership Offers Stability and Security

Home prices have been increasing for quite some time, and experts say they’re going to continue to climb throughout 2022. So, as a buyer, how can you protect yourself from rising costs for things like food, shelter, entertainment, and other goods and services? The answer lies in housing.

Buying a home allows you to lock in your monthly mortgage payment for the foreseeable future. That means as other prices rise, your monthly payment will be consistent thanks to your fixed-rate mortgage. This gives you the peace of mind that the bulk of your housing costs is shielded from inflation.

James Royal, Senior Wealth Management Reporter at Bankrate, says:

A fixed-rate mortgage allows you to maintain the biggest portion of housing expenses at the same payment. Sure, property taxes will rise and other expenses may creep up, but your monthly housing payment remains the same.”

If you rent, you don’t have that same benefit and you won’t be protected from rising housing costs. As an added incentive to buy, consider that today’s mortgage interest rates are lower than they have been in decades. While inflation decreases what your dollars can buy, low mortgage rates help counteract it by boosting your purchasing power so you can get more home for your money. They also help keep your monthly payments down. This is especially important during an inflationary period because you’ll want to protect yourself from the impact of inflation as much as possible.

Ali Wolf, Chief Economist at Zonda, explains:

“If you have cash and are expecting inflation, you want to think through where you can put your money so it does not lose value. Housing is commonly looked at as a good inflation hedge, especially with interest rates so low.”

Bottom Line

The best hedge against inflation is a fixed housing cost. That’s why you shouldn’t let it stop you from buying a home this year. Not sure where to start? Let’s connect so you have expert advice and help throughout every step of the homebuying process.

How To Hit Your Homebuying Goals This Year [INFOGRAPHIC]

How To Hit Your Homebuying Goals This Year [INFOGRAPHIC]

How To Hit Your Homebuying Goals This Year [INFOGRAPHIC] | Simplifying The Market

Some Highlights

  • If you’re looking to buy a home, you may want to put these items on your to-do list to ensure you hit your goals.
  • It’s important to start working on your credit and saving for a down payment early. When you’re ready to begin your search, work with a real estate professional and get pre-approved so you know how much you can borrow.
  • Connect with a real estate advisor so you have the guidance you need to achieve your homebuying goals this year.