Why Winter 2018 is a Great Time to Purchase a Home

It’s no secret in the real estate business that the housing inventory in New Jersey is tight; there are far more buyers than sellers and it’s been that way for a while. This level of competition drives up housing prices (it seems we all know someone who ended up in a bidding war, whether as a home buyer or home seller, or have heard the stories). Another factor that drives home purchases: mortgage interest rates.

How do interest rates originate?
Interest rates are typically determined by a central bank in most countries. In the United States, representatives from the Federal Reserve Board and Federal Reserve Bank comprise the Federal Open Market Committee, which assesses the economic status of the country throughout the year and adjusts interest rates accordingly.

The central bank lends money to retail banks at a discount and then consumers borrow from the retail banks. The rates assigned by the central bank to the retail banks determine interest rates or Prime Interest Rates.

Why interest rates fluctuate
If the central bank wants to discourage consumer borrowing and encourage more saving, it raises interest rates. The banks rely on those deposits in order to raise their worth and have money to lend to another party, which generates additional income from interest collected. When the central bank wants to encourage consumer borrowing and increase spending, it will lower interest rates.

Mortgage interest rates today
Interest rates started creeping up a little bit late in the fall and continue a modest rise—from 3/8 to ½ of a percentage point. Bankrate predicts a slow and steady climb throughout the first half of this year due to various pressures on the U.S. bond market.

The 30-year fixed-rate mortgage rate rose .08 percent in the first week of January, a significant jump after a prior rate drop (it is currently slightly over 4 percent). That said, with New Jersey’s housing inventory being so tight and home values remaining fairly steady, why not strike while the iron is hot?

Some figures from the Mortgage Bankers Association:

  • The 15-year fixed-rate mortgage rose to 3.57 percent from 3.49 percent.
  • The 5/1 adjustable-rate mortgage rose to 3.77 percent from 3.70 percent.
  • The 30-year fixed-rate jumbo mortgage rose to 4.21 percent from 4.14 percent.

Although the difference in monthly mortgage payments is quite small today as interest rates rise (a few dollars a month for most borrowers), there’s no telling where it could end up six months from now—and besides, why pay any more than you have to on a home loan?

Some Americans appear to be catching the clue. According to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey, mortgage applications overall rose 8.3 percent for the week ending January 5, 2017; 52.9 percent of those were refinances (up nearly a full percentage point from the week before). Homeowners and those on the market to purchase a home are locking into rates now.

Get into a new home sooner than later
Again, there is tremendous competition for good houses in northern New Jersey, so if you are planning to purchase a home, there’s no time like the present to get into the real estate market. And, if your credit history is strong, it’s a great time to pre-qualify for a favorable mortgage program at preferential rates.

Another great reason to purchase a home now: you’ll beat the typical spring/summer rush, so there are fewer buyers to compete with. Fewer buyers may help keep prices moderated in your favor. Sellers may also be more willing to negotiate with you.

The real estate agents at Century 21 Cedarcrest Realty will help you zero in on the right towns to meet your criteria and your budget, and work hard to help make your transaction as smooth as possible. We’re experts in Essex County, where our office is located … but we work throughout northern New Jersey, from Hudson County to Warren County and everywhere in between. We’re here with our heavy winter coats, ready to show you our listings, so contact us to get into a new home this winter at (973) 228-1050.

When Less is More in Real Estate

Of all the things that can be most damaging in real estate, clutter tops the list. For many, this just means that the house needs tidied or the shelves need to be cleaned up a bit or even removed. For others, some major outdoor and indoor work may be necessary. The goal here is to maximize the concept of space. Even a large room looks small when it’s cluttered, but even a small room can look large when it’s not cluttered. Use the tips here, but listen to specifics from your real estate agent, who has to experience to know what really matters in your home specifically.

 

De-Personalize the House

 

You may enjoy collecting all sorts of things, but you aren’t trying to impress a buyer with your decorating skills. Instead, you are trying to offer a buyer an open canvas, a place where he or she can imagine their own collections and how they would personalize the space. Consider removing shelves and pictures from the wall, but also make sure to clean up the marks to give a smooth, open appearance.

 

Manage the Landscaping

 

Take a walk around your house, starting at the front. This is the first impression that people have when they come to see if your house is the one they want to invest in. Make sure to clean up any clutter and put away most of the decorations. This is especially true if you happen to have religious decorations. It may be difficult, but you need to keep your personal beliefs out of the buyer’s mind so they can focus on the major aspects of the house itself.

 

Once you have the front yard covered, try cleaning up the back. It’s fine to have your patio furniture out, especially if it goes with the house. Just try to avoid the decorations. It might even be a great time to thin the flowers so they can see what is there, but also see that there is plenty of room for their own interests.

 

Keep in mind that the buyer is looking for a home that fits them and their interests. They want to see if they can make this property fit their lifestyle, not if they can move in to your lifestyle.

Modeling to the Target Buyer

It is hard enough to part with a home you love without trying to imagine that someone will use it in a way you wouldn’t like. If you have the time and the luxury of seeking out a target buyer, then by all means, make the effort to do so. Some houses just suit particular people better. For example, if you own an urban dwelling with a concrete backyard and swimming pool, your realtor probably isn’t going to try and target buyers who are looking for a quiet country dwelling where they can garden all summer long.

 

Maximize Focal Points

 

If your home has specific features that make it perfect for a certain type of lifestyle, you will want to make those features stand out when you market to a specific audience. You might also ask yourself what you can add that would make it even more appealing. If your property has a greenhouse, will you be leaving any supplies so that the owner can use it right away? Those little things can let a buyer know they can start in on their hobbies immediately, without an added expense on top of a new home purchase.

 

Allow for Immersion

 

Some properties aren’t set up so much for hobbies as they are other elements. You will want to be able to immerse your guests in the experience so they can enjoy it with all their senses. Are you trying to demonstrate that your home is a quiet safe haven from the world? Offer a viewing when the neighborhood kids are at school or make sure to do most of the welcoming in the soundproof room. These are the details that can really capture a buyer’s attention. Make the most of them.

 

Avoid Advice

 

Just as much as you want to market to specific buyers, you also want to avoid leaving hints or advice. This is the start of a new journey for them so they will want to do it their way. In the meantime, you don’t want to have to think about them doing things differently than you would because that can limit your pleasure with the experience.

 

Best Season to Sell a Home

Knowing what the best season is to buy or sell a home is just the tip of the iceberg. Believe it or not, there are also best days to list a home or make an offer. Sometimes the best days to buy and sell coincide, but not always. That becomes important when you go from listing your home to shopping for a new one. It can also make a difference in how you or your broker or agent manages your sale or purchase.

 

Spring is the Busy Season

 

Hands down, spring is the busiest season to buy or sell a home. The weather is starting to warm up, but it is not so hot that people don’t want to get out and about. If anything, they are dying to get out of the house. However, this is also the season when your yard looks the worst because the snow just melted and revealed what was left after a long winter. Be sure to spruce things up a bit before you list your home.

 

January Starts Things Off

 

January doesn’t just start the new year, but is probably the best month to start making offers on homes. Most people are waiting for spring to arrive so they can get out and about in comfort. For a home buyer, this means that there is far less competition than there is going to be in a couple of months. For the home seller, it may bring some much needed relief after an expensive winter.

 

Tuesday and Thursday

 

Tuesday and Thursday have a special significance in the real estate world. The first Tuesday of the month is the day that many mortgage payments are due. That means it is a perfect day to make an offer on a house. The owner just made a payment that they really don’t care to make anymore, so they will be more inclined to accept and offer.

 

Thursday is the day to list a house. During the week, people are busy working and they may not have much time to patiently explore what’s for sale. Thursday posting will be listed as new listing over the weekend, so they are sure to get plenty of views.

 

The Last Minute Home Visit Survival Guide

Home visits are a welcome sign that your property is drawing prospective buyers. However, last minute visits are often a home-for-sale nightmare. When it is time to sell, but you need to still live there until it sells, buyers sometimes show up at inconvenient moments. There are survival tips to make the best of the situation, even on a moment’s notice.

 

Be open and honest, but smart: As the homeowner, the ability is there to not allow showings during different times of the day or to turn away last minute requests. Sellers are well within their rights to set boundaries with their real estate agents and request a few hours notice for showings. However, keep in mind that turning away a buyer is turning away a potential sale. Be honest with your agent about your expectations, but consider that there may be times when a buyer is available on short notice.

 

Start packing: In today’s market, there is a supply shortage of great homes. Do not expect your house to languish in the real estate market listings for months at a time. Packing all the items that are not completely essential for daily living will not only get a jump start on your move, but will greatly reduce clutter around the home. This leads to less last minute clean-up time and fewer moments spent scrambling when you get the call or an unexpected knock on the door from a buyer or her agent.

 

Clean as you go: Living a somewhat minimalist lifestyle while packing will make the constant clean-up a little easier. Not allowing the bathroom towels to be strewn about or the beds to remain unmade all day will make the last minute straightening go much more quickly and simply. It is worth the effort to not be caught off guard.

 

Arrange to have a quick get-a-way: Whether through an open arrangement with a neighbor or friend to pop by on short notice or a regular seat at the local coffee house: have places in mind to visit during showings. While it is tempting to want to be home when strangers are mulling through your halls, it is best to not be there. Buyers are going to be less candid about their opinions in front of the seller and will have difficulty picturing themselves as the owners with the current owner present. So, take some time for yourself. It will help you survive with style!

 

Tips for Hosting a Successful Open House

Once you have decided to sell your home, one of the first things your real estate agent will do is schedule your open house. An open house is a showing of your home and property where prospective buyers can drop by and visit during a certain day and time. This is a proven way to get buyers interested in placing a bid or offer on the house quickly. More offers lead to getting a sale close to – or even above – your listing price at closing. When the date for the open house draws near, there are some proven ways to prepare your home to look its very best.

 

Boost the curb appeal: Be sure that the lawn is freshly mowed if it is during the spring or summer months. Clean up any yard damage from play or pets, fix fences, or even hire a landscaper to spruce things up around the yard. Do not assume that a buyer will see the potential in your property; rather, show them an inviting entrance to a home.

 

Kick the clutter: Clean it up! Sellers sometimes think that a buyer will be attracted to a homey atmosphere. This is a common mistake. Prospective buyers aren’t interested in seeing how the current inhabitants live. Instead, a buyer wishes to envision him or herself living in the home. So, avoid excessive knick-knacks, store excess furniture and any valuables in a storage locker or friend’s home, and put fresh towels in the restroom. A professional carpet cleaning or a coat of paint can also go a long way towards impressing the next owner.

 

Make other plans: Owners, their children, and pets should not be present for the open house. Many sellers find this uncomfortable, as they worry about their belongings and wish to supervise or answer questions. While this is a perfectly normal way to feel, it does make the buyers less likely to make an offer. They will feel disinclined to voice their honest opinions of your property to the agent.

 

A successful open house can culminate in multiple offers and a faster sale. A great agent will help with tips specific to your home’s unique appeal and be your guide through the process.

 

Yes, You Can Get a Mortgage after Bankruptcy: Here’s How

Perhaps you think that you cannot get a mortgage after a bankruptcy but that’s not entirely true. It is still possible to get a mortgage after bankruptcy but it’s important to know what to do and how to do it properly. For example, you should first wait at least 24 months after your bankruptcy is discharged before you apply for a mortgage. You might be able to get approved for one before then but the interest rates will not be favorable to you.

So here are some tips to getting a mortgage after bankruptcy:

  1. First, you should review your credit report. The bankruptcy is going to show up and affect your score in a big way but it might not be as bad as you think. You should pull your credit report and track it regularly so you can see if there are any other things there that don’t belong and also that there are no creditors continuing to report the debts that you have covered in your bankruptcy. You need to report any mistakes or discrepancies so your report is always accurate.
  2. Always pay your bills on time. While this is just something that you should do anyway, paying on time shows that you are responsible with your finances and it helps show credit worthiness when you do attempt to apply for a mortgage.
  3. Your bankruptcy must be discharged before you apply for a mortgage. If you are still in credit counseling or a program that takes care of your finances for you, a lender will not be interested in speaking with you. So once you are properly discharged after the bankruptcy, you can begin looking at your options.
  4. Use secured credit cards. A secured credit card is a good way to rebuild your credit after a bankruptcy. It allows you to use your own secured funds to get a credit card that will then count toward your credit rating when you use it safely. You should not apply for too much credit at one time and you should only use a portion of your credit. Don’t max out your cards – even secured cards.
  5. Wait 2 years. Again, waiting two years after your bankruptcy can help you get a better rate with interest rates that are more favorable to you. You will save in the long run and it will be worth the wait.

Now that you have this information about getting a mortgage after bankruptcy, you’re ready to begin the home buying process. Talk to your real estate agent if you need a referral to a lender or if you need help narrowing down your options.

What Happens if I’m Renting and My Landlord Goes into Foreclosure?

What Happens if I’m Renting and My Landlord Goes into Foreclosure?

 

In the past, if you were renting and your landlord went into foreclosure, you could be immediately forced out of the home. However, times have changed and new laws make it possible for renters to live out their lease in most cases. In other cases, they may be able to recover costs from the original landlord.

 

Talk with Your Landlord

 

If your landlord goes into foreclosure and actually tells you about it, you may need to discuss other things, like utilities. If your landlord was taking care of the utilities as part of your rental agreement, you need to find out if that is still going to happen. Someone who isn’t making their house payment with your rent money may not be paying the utilities either. Try to get as much information as you can so you are able to plan ahead for the safety of your own family.

 

Thank You Obama

 

In 2009, President Obama signed an act to protect tenants from having their lives turned upside down if their landlord went into foreclosure. The Protecting Tenants and Foreclosure Act of 2009 was designed to give tenants a chance to recover from what to them may be an abrupt change.

 

The act basically states that tenants can live out their original lease undisturbed. Since some tenants live on a month to month lease, this could have meant that they had 30 days to move out. However, the act gives them 90 days to find a new home. The only exception is when someone buys the property with the intent to live there. In such cases, the tenant has 90 days, regardless of whether they live on a month to month lease or not.

 

Recovering Costs

 

Aside from potentially having to deal with a higher rent, moving itself is expensive. You may need to travel to investigate a potential rental, pay application fees, and rent a truck to move your furnishings. Renters can sometimes recover some of those costs by taking their original landlord to small claims court.

 

Naturally, while you are living in the rental, all of the details of the lease and your responsibilities still stand. It may be even more important to follow the lease to the letter in order to avoid being evicted because of your own folly. If this happens, you won’t be able to recover costs from your former landlord because you will have to move due to your own behavior and the details of the lease. Talk to a real estate agent about your opens if you do need to move. It may just be time to buy your own home!