According to recent surveys conducted by Freddie Mac, a large amount of Baby Boomers and those over 55 years of age are making plans to relocate to rentals in the next few year. Over 5 million people stated they will most likely rent by 2020. This huge move of so many people will probably affect housing costs.
“When a population this large expects to move into less expensive rental housing, we have to expect it will create significant new pressure on both the supply and cost of existing affordable rental housing,” says David Brickman, executive vice president of Freddie Mac Multifamily.
I’m interested to hear what your future plans are! I put together a quick multiple-choice survey and would love to hear from you.
For more on the Baby Boomer Sell-Off, http://realtormag.realtor.org/daily-news/2016/06/29/get-ready-for-baby-boomer-sell?om_rid=AAT-f0&om_mid=_BXdARuB9PMCl01&om_ntype=RMODaily&om_rid=AADLJb&om_mid=_BXjqZoB9QAyY$0&om_ntype=SRESMonthly#sf29938537
Buying real estate can be a stressful process especially if it’s your first time buying and you aren’t familiar with the terminology. Below are the definitions to some of the common real estate terms you’ll hear throughout the process.
A written justification of the price paid for a property, primarily based on an analysis of comparable sales of similar homes nearby.
An opinion of a property’s fair market value, based on an appraiser’s knowledge, experience, and analysis of the property.
This has different meanings in different states. In some states a real estate transaction is not consider “closed” until the documents record at the local recorders office. In others, the “closing” is a meeting where all of the documents are signed and money changes hands.
Closing costs are separated into what are called “non-recurring closing costs” and “pre-paid items.” Non-recurring closing costs are any items which are paid just once as a result of buying the property or obtaining a loan. “Pre-paids” are items which recur over time, such as property taxes and homeowners insurance. A lender makes an attempt to estimate the amount of non-recurring closing costs and prepaid items on the Good Faith Estimate which they must issue to the borrower within three days of receiving a home loan application.
An additional individual who is both obligated on the loan and is on title to the property.
A condition that must be met before a contract is legally binding. For example, home purchasers often include a contingency that specifies that the contract is not binding until the purchaser obtains a satisfactory home inspection report from a qualified home inspector.
An oral or written agreement to do or not to do a certain thing.
A record of an individual’s repayment of debt. Credit histories are reviewed my mortgage lenders as one of the underwriting criteria in determining credit risk.
The legal document conveying title to a property.
The part of the purchase price of a property that the buyer pays in cash and does not finance with a mortgage.
A deposit made by the potential home buyer to show that he or she is serious about buying the house.
An item of value, money, or documents deposited with a third party to be delivered upon the fulfillment of a condition. For example, the earnest money deposit is put into escrow until delivered to the seller when the transaction is closed.
Once you close your purchase transaction, you may have an escrow account or impound account with your lender. This means the amount you pay each month includes an amount above what would be required if you were only paying your principal and interest. The extra money is held in your impound account (escrow account) for the payment of items like property taxes and homeowner’s insurance when they come due. The lender pays them with your money instead of you paying them yourself.
A mortgage in which the interest rate does not change during the entire term of the loan.
A thorough inspection by a professional that evaluates the structural and mechanical condition of a property. A satisfactory home inspection is often included as a contingency by the purchaser.
An insurance policy that combines personal liability insurance and hazard insurance coverage for a dwelling and its contents.
A type of insurance often purchased by homebuyers that will cover repairs to certain items, such as heating or air conditioning, should they break down within the coverage period. The buyer often requests the seller to pay for this coverage as a condition of the sale, but either party can pay.
A term which can refer to the institution making the loan or to the individual representing the firm. For example, loan officers are often referred to as “lenders.”
This usually refers to the loan officer’s written opinion of the ability of a borrower to qualify for a home loan, after the loan officer has made inquiries about debt, income, and savings. The information provided to the loan officer may have been presented verbally or in the form of documentation, and the loan officer may or may not have reviewed a credit report on the borrower.
The amount borrowed or remaining unpaid. The part of the monthly payment that reduces the remaining balance of a mortgage.
“Private mortgage insurance” (PMI)
Mortgage insurance that is provided by a private mortgage insurance company to protect lenders against loss if a borrower defaults. Most lenders generally require PMI for a loan with a loan-to-value (LTV) percentage in excess of 80 percent.
A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold.
The noting in the registrar’s office of the details of a properly executed legal document, such as a deed, a mortgage note, a satisfaction of mortgage, or an extension of mortgage, thereby making it a part of the public record.
A legal document evidencing a person’s right to or ownership of a property.
A company that specializes in examining and insuring titles to real estate.
If you qualify for a VA Home Loan, it is a great opportunity to purchase a home without putting any money down towards the sale price.
You may be eligible for a VA Home Loan if you meet one or more of the following:
- You have served 90 consecutive days of active service during wartime,
- You have served 181 days of active service during peacetime,
- You have more than 6 years of service in the National Guard or Reserves,
- You are the spouse of a service member who has died in the line of duty or as a result of a service-related disability.
Once you have determined if you’re eligible, there are a few things you can do prior to finding a home to buy that can make the process go much smoother.
Run your own credit report. Errors show up sometimes, so look it over closely before the lender runs your credit report.
Obtain your Certificate of Eligibility (COE) from the VA. This certificate isn’t necessary to start your home buying process, but it will be required later to verify your length and character of service. This tells the VA is you are eligible to use the VA home loan benefits. To start the process yourself, you can visit the Veterans Administration site at http://benefits.va.gov/benefits/ .
Gather some of the necessary documents your lender will require:
- Bank statements for the last2 months.
- All W2s for the last 2 years.
- Last 2 years of Federal Tax Returns.
- Pay stubs for the last 30 days.
- Copy of each borrower’s identification.
The True Cost of Home Ownership
Will the appliances in the home need upgrading—now or in the near future? Don’t forget to check out the water heater and HVAC.
Moving from a one-bedroom apartment to a three-bedroom house often means you’ll need more furniture. Evaluate furniture needs and costs for your new home.
Before purchasing a home that needs remodeling, ask a contractor to give you an estimate. Homeowners often underestimate the costs.
Principal, Interest, Taxes, and Insurance (PITI)
If you have a fixed rate mortgage, the payment will remain the same for the life of the loan. Taxes and insurance may increase.
Homeowner Association Fees
Fees or assessments for a condo, townhouse or single-family home with an association can increase yearly. Compare fees of similar properties line-by-line. Check what the fee includes; for example, utilities gas, electricity, garbage pickup, and water. Watch out for special assessments for capital repairs and improvements to common areas.
Replacing the roof, painting the siding or trim, sealing the driveway, sealing the deck, replacing windows, gutter cleaning or repair, septic and well maintenance are just some of the additional exterior maintenance costs in owning a home. Some jobs you can do yourself, but others require professionals. Don’t forget the tools that go along with home maintenance: power washers, compressors, heavy-duty ladders, and power tools.
If you’ve been renting, your landlord probably picked up the tab for repairs and general maintenance. Once you own your home you’ll be footing the bill. You will need to maintain appliances, plumbing and electrical systems, carpets, floor and wall coverings, and so on.
If you are renting, you’re probably used to budgeting for utilities. But the cost of heating a one-bedroom apartment can pale in comparison with the bills for an entire house. A real estate professional can help you find out about the current occupant’s costs but family size and usage impacts those numbers.
Yard Care and Snow Removal
Plan on buying a lawnmower and other landscaping tools or budget for a professional lawn service. Include a snow shovel or snow blower.
Buyer’s Remorse: Negotiating Mistakes that Buyers Most Often Regret
When two parties enter into negotiations on a home, there are far too many opportunities for bumps and obstacles to get in the way. What are the most common traps, and how can you avoid them? Consider these common stumbling blocks for successful negotiating, and ways to find a better path:
1. INADEQUATE PLANNING Before writing your first offer, clarify your priorities, strengths, and weaknesses—AND the seller’s. A true negotiating strategy is about much more than price. Think beyond step one, anticipating possible responses and counter offers. With careful forethought and a little creativity, you’ll feel much more confident about your negotiating plan and improve your odds of success.
2. GETTING EMOTIONAL Stick to the facts and remain as objective as possible. Feelings of personal insult or anger don’t contribute anything of value to a negotiation. (In fact, it’s more likely to cloud your ability to think clearly.) If a seller rejects some aspects of your offer, try to calmly and rationally understand their perspectives.
3. IMPATIENCE Sometimes the negotiating process takes time to unfold. Stay relaxed and focused on your purchasing objectives. You may need to be flexible and open to alternative ways to reach them.
4. FEAR While patience is a virtue, don’t let fear paralyze your ability to make decisions. If you find a house that’s a good fit, don’t be afraid to submit an offer. Too often, buyers delay action and the house goes under contract with someone else. (Buyers rarely make this mistake twice.)
5. BLIND SPOTS Your objective is to own a home. Don’t lose sight of that goal by putting too much emphasis on smaller obstacles and distractions that may present themselves during the negotiation process. Stay focused on the big picture.
6. LACK OF KNOWLEDGE Learn as much as you can from your buyer’s rep about current market conditions. Knowledge is power, which can be used to your advantage in shaping your negotiating strategy.
7. STUBBORNNESS Negotiations are ultimately about two parties reaching a win-win agreement. Don’t be completely unwilling to compromise. Instead, focus on joint problem solving.
Your Accredited Buyer’s Representative can coach you further on these and other points specific to your buying situation, helping you approach your negotiations smoothly and successfully.
The Accredited Buyer’s Representative (ABR®) designation is awarded by the Real Estate Buyer’s Agent Council (REBAC), a subsidiary of the National Association of REALTORS® (NAR). To learn more about REBAC and access various home buyer resources, please visit REBAC.net.
If this will be your first Spring/Summer in town or even if you’ve lived in Juneau for years, Juneau Food Tours is a fun way to experience many of the amazing foods and history the town has to offer!
Buy tickets and read more about the tours here: http://www.juneaufoodtours.com/
When: Daily, May 1 – October 1
Time: Times vary, please see calendar
Cost: $129 plus 5% city sales tax
What’s Included: All tastings, a guided walking tour, reusable shopping bag, bottled water
Who: Anyone age 12 and up. Moderate fitness levels are recommended
Capacity: Up to 12 guests per tour
Wear: Light rain jacket recommended and comfortable walking shoes
Weather: Rain or shine, we will dine!
Where: Tour meets at the Alaska Commercial Fishermen’s Memorial (location provided upon ticket purchase)
Dietary restrictions: We will do our best to accommodate dietary needs.
Distance covered: Approximately 1.2 miles
Juneau has so many fun things to do all year round. Whether you’re an adventurous, outdoor person, or shopping and seeing a play indoors is more your style, there’s always something to go out and do! Since it’s currently winter, lets focus on some of the fun things you can do during these cold months.
1. Eaglecrest Ski Area: Head up to the mountain for some down-hill skiing, snowboarding or cross-country skiing. This is a great family activity and if you’re not feeling up to skiing or snowboarding, they have a great lodge to sit and sip hot coco while the kids burn off some energy!
2. Heli-Skiing: If you’re a little more of an adrenaline junky, you can take it to the next level by taking a short helicopter ride and ski or snowboard where no one else has! You can do a half-day, full-day or even several day package trips. For more information on heli-skiing, go to http://alaskapowder.com/ .
3. Juneau Arts & Humanities Council: Juneau has a very rich arts and culture scene. Go to http://www.jahc.org/ to check out some of the many concerts, plays, and other art events going on around town all year long.
4. Shopping and Dining: Downtown Juneau has an abundance of amazing shops where you can buy hand-made items, clothes, shoes, jewelry, art, and SO much more! The food choices are outstanding and no matter what you’re in the mood for, Juneau has it! Here’s just a handful of the restaurant choices around town http://www.tripadvisor.com/Restaurants-g31020-Juneau_Alaska.html .
#1. Is the economy stable? Be sure the property values and average income in the area are rising or at least staying stable.
#2. Is it a good investment? Ask your realtor about price appreciation in the neighborhood you’re interested in. They may not be able to predict the future, but they can give you a good idea based off of the neighborhood’s history and if a home’s value in the area will grow.
#3. Do you like what you see? How does it feel to you? Are the houses in the are maintained nicely? Do the neighbors seem pleasant? Pick a nice day and walk around the neighborhood/s you’re interested in to get a feel for how it would be like to live there.
#4. How’s the school district? If you have children, this is probably one of your number one concerns. Visit the schools in the neighborhood and ask for feedback from friends, family or coworkers who have children enrolled in those schools. A good school district is also great for your resale value!
For more information on finding the perfect house and neighborhood for your family, go to my site http://www.sellingjuneau.com .