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Sellers in the West, Buyers in the East
Zillow, an online real estate site, recently released a study that listed the markets for sellers and buyers in the United States. The study showed that there is an east/west divide. Basically, if you’re on the West Coast, it’s a seller’s market. If you’re on the East Coast (or Midwest), it’s a buyer’s market. Obviously, if you compare New Jersey to California, there’s a lot of difference, and not just in terms of miles. Things are different out there. But why is one coast showing one market, and the other coast an entirely different market?
For starters, there are relatively strong job markets on the West Coast, which is helping to create more demand. Since there is a limited supply, this is causing a rapid appreciation for homes and giving sellers the edge. And, housing prices and interest rates are still favorable, so some buyers want to buy NOW. They’re willing to pay a bit more for a home because they know it’s still a great deal, and the sellers get to take more of a profit than they would have a few years ago.
Here in New Jersey and our surrounding areas, however, the housing market is appreciating more slowly. Homes are staying on the market for a bit longer, and this gives buyers the edge. If a seller wants to take advantage of the market and sell off their existing home, they’ll be much more willing to take a little less and move on rather than holding onto the property. This isn’t the case in every township, but it is the picture for things at large.
So, what can you be looking at this fall? It depends on who you are. If you’re the buyer, then you can expect to have the upper hand, and you may be able to land your NJ dream home by asking the seller to come down in price. If you’re the seller, on the other hand, expect to have your home on the market a little longer and perhaps have to lower your asking price. Or, you could always wait for that perfect buyer to come along, which isn’t asking too much in this market. New Jersey does, after all, have unique, one-of-a-kind homes.
Tips for Selling Your Home in the Fall
Spring is the busiest time of the year for home sales, but did you know that fall is the second? If you weren’t in a position to list your home in the spring, don’t think you have to wait until next year to put it on the market. Fall is a great time to list your home, especially since many categories of buyers – first-time buyers, retirees and those who have just transferred to a new job – are often looking for a home at this time of the year. Also, it’s still a great time to purchase a home thanks to lower home prices and interest rates, so the market is competitive.
Here are some tips for selling your home in the fall. And, with less homes on the market, you’re already one step ahead!
Add Curb Appeal
A home sale begins with the buyer’s view of the property from the outside, whether they are driving past or looking online. It’s easy to lose sight of what the exterior of your home looks like when you spend the majority of time indoors, so be objective about what you see, or ask a friend or neighbor for their opinion. The yard doesn’t have to be complex, especially at this time of the year, but make sure that the yard is clean and well maintained. The leaves should be picked up, kids’ toys put away, shrubs trimmed and so forth.
Make the Home Move-In Ready
Moving is hard enough, and most people want to move in over the weekend so that they can return to work on a Monday. Making your home move-in ready is a huge advantage to prospective buyers. This means less work, headache and money trying to get the place ready to live in. Give the walls a fresh coat of paint with neutral colors. Replace old carpet and repair cracked tiles, ripped screens, dripping faucets and other major blemishes. Staging a home is part of your selling strategy, so the more your home is ready to be moved into, the more advantage you have.
Keep the Home Cozy
Fall is the time of year where people spend more time indoors, enjoying the comforts of home. You want to make buyers feel right at home when they look at your place, so evoke these feelings by burning apple cinnamon candles or baking pumpkin pie. Turn on the heat if it’s cold outside to keep the home warm (at least during showing times). If it’s early fall and still warm, open the window and let in a cool breeze. Let in natural light by pulling back curtains, and draw in fall colors with orange, browns and deep red decor.
How Much of a Down Payment Do I Really Need?
If you’re planning on purchasing a home, it’s important to know the facts regarding down payments. First-time buyers are often surprised to learn how much they need to put down, especially in today’s returning market. The good news is that there are many options available that may fit your current situation. Homeownership is still the American dream, and if you’re tired of paying someone else’s mortgage, buying a home may be right for you.
20% Down Payment Industry Benchmark
In the mortgage industry, 20% down is considered the benchmark down payment. A 20% down payment looks good on paper and indicates financial security. But, what if you don’t have this much cash to put down on a home? With the high cost of rent, you may not have been able to put much away, but are still able to make mortgage payments. Fortunately, 20% down is not a requirement, nor expected in many cases.
What Other Down Payments are Available?
For an FHA loan, which is backed by the Federal Housing Administration, the minimum down payment is 3.5% down. An FHA loan is a nice option for first-time buyers who don’t have a ton of cash, and the loan requirements are typically more flexible. The one thing to be aware of is that FHA loans carry a monthly mortgage insurance payment, which can add significant dollars onto your payment each month.
Another popular option for homebuyers is to put 5% down and still secure a conventional mortgage. And, with a conventional loan, you may be able to get rid of the private mortgage insurance after accumulating 20% equity in a minimum of 24 months.
What if You Don’t Have a Down Payment?
Some buyers simply have nothing to put down, but this doesn’t mean that purchasing a home is out of the question. The Department of Veterans Affairs does offer a program where the homebuyers don’t have to put anything down, but it’s available only to military veterans, and the home must pass a clear pest report.
A second option is through the Department of Agriculture, USDA. You don’t need to be a veteran for this loan, but it’s only available for homes that are designated rural by the USDA.
Your best option is to meet with a realtor or loan officer who can inform you of your loan options and what down payment will help you secure a home loan.
Add Curb Appeal to Your Home – On a Budget!
A home with good curb appeal draws in interest, and that’s a good thing, especially if you’re planning on putting your home up for sale. If you make the home look great on the outside, people will naturally want to know what’s on the inside. Of course, if you are selling your home, you don’t want to put too much money into boosting its exterior. Fortunately, there are smart, budget-friendly ways to enhance your home’s curb appeal without hurting your pocketbook.
Paint the Door and Replace Hardware
Give your door a makeover by painting it a bold color, such as red or blue. Clean off all dirty spots, and use metal polish on the door handles. If the hardware is dull and dingy, replace it with a new set. Don’t forget to match the hardware to the other metal elements on your home – house numbers, light fixtures – so that everything functions together.
Clean and Install Light Fixtures
Go through and give your home’s exterior lights a good cleaning. Not only with the glass look crystal clear, but also the light will shine brightly in the evenings. If your home is lacking in outdoor lighting, consider installing inexpensive solar lights. The added fixtures are both decorative and functional, and will help your home pop in the day and night.
Add Potted Plants or Container Plants
Instead of digging and planting, add color and personality to your home by incorporating potted or container plants. With fall coming up, you can add a lot of interest to your home by planting colorful mums in pots and arranging pumpkins and gourds on the stoop.
Refresh Planter Beds
The way you take care of your flower beds tells a lot about how you take care of your home. Give your flower beds an update by pulling weeds, pruning growth, planting new flowers and laying down new mulch. Consider adding an edging system using stone or brick – a small area won’t cost much.
Shutters and Trim
If your home already has shutters and trim, give them a fresh coat of paint. If you don’t have window shutters or door trim, think about adding them. Simple molding installed around your front door is an effective and affordable way to make the home’s welcome point inviting and intriguing.
Exterior Facelift
Walk around the home and decide what could use a facelift. Give the exterior windows a good cleaning. Power wash the deck, walkways and siding for a bright and clean appearance. Remove debris or old furniture and repair railings and cracked concrete. If you’re looking for a suitable replacement, consider stone veneer that’s lightweight, affordable and super stunning.
5 Reasons to Love New Jersey
Are you considering relocating to New Jersey? Or perhaps you’re already a NJ native but are trying to convince a friend or family member to make the move. Whatever the case, this blog post is for you! Here are five amazing reasons to give the Garden State a chance!
1. Varied Landscape
On the West Coast, you get mountains and white sand beaches. The South – warm, sandy deserts. In the central part of the U.S., you see hundreds of miles of flat land. But in Jersey, you get everything. There are miles of farmland, breathtaking mountains, cityscapes and beaches. This means you can make your home anywhere you want – you can literally never get bored!
2. Adorable Mini Towns
One of the neat aspects to living in Jersey is that there are quaint little towns throughout the state. Most offer the perfect blend of urban and suburban life. There are places to grab a bite to eat, charming streets and rich history embedded in each town. From family friendly Little Falls to the marshes of Meadowland, you can get an entire history lesson in one drive.
3. Proximity to the Beach
Another highlight to New Jersey is the cozy beach towns. Many people have summer homes on Long Beach Island where they spend the weekends in the summer. And, no matter where you live in NJ, most residents are no more than an hour away from the coast. Nothing beats sitting off the beach in the summer, enjoying salt water taffy and french fries with vinegar.
4. Proximity to Manhattan
Millions of people can only dream of visiting the Big Apple, but for people living in NJ, it’s only a bus, train or ferry ride away. In fact, many people work in the Big Apple where job opportunities are more plentiful, and enjoy suburban living in New Jersey. Living right next to the city offers financial security, especially in an unstable economy.
5. Excellent Schools
New Jersey takes a lot of pride in their education system. There are numerous NJ schools in the 2014 U.S. News Best High Schools rankings, including 25 with gold medals, 19 silver medals and 32 bronze medals. Each municipality has their own school district essentially, which means that each district gets a lot of attention from committed families.
4 Savvy Home Pricing Tricks
Selling your home in today’s market may not be as easy as you had hoped, but there are things you can do speed the process along and make buyers feel like they are getting a good deal. An experienced realtor can help with this, as they can inform you of what other properties in your area are selling for, and which price range will attract the most attention from prospective buyers. They may also recommend these four tricks.
1. Make it look like a deal.
People make assumptions within a fraction of a second, so you need to make your price look attractive right off the bat. For instance, you know that $1.99 looks better than $2.00, even though it’s only a penny less. So, think in these terms. Also, research has found that buyers perceive prices to be lower when numbers on the right are declining from lower numbers, such as 2 to 1 rather than 9 to 8.
2. List higher than what you’ll accept.
Buyers always feel like they’re getting a deal when they have some wiggle room. That said, always price your home higher than what you’ll actually accept. If you need some reference prices, share the price of competing homes in your area.
3. List at a precise number.
Another interesting part of the human brain is that we tend to associate exact prices as a bargain, whereas rounded numbers indicate quality. Selling your home at $395,530 rather than $396,000 can make it look like you’ve thought long and hard about what your home is worth and aren’t willing to negotiate much more. This trick can be helpful if you’re in a tough market with few bids.
4. Make lowered house prices obvious.
If you do have to lower your price, make sure that it’s easy for prospective buyers to compute. They will be more inclined to jump on the property because they may perceive it as being a bargain and think that others will be making a bid as well. You can specify the dollar discount or drop the price by $5,000 to $10,000, leaving the last three digits the same.
Signs You Need to Dump Your Real Estate Agent (And Find a New One!)
How did you find your current real estate agent? Were you referred to them? Did you find them online? Many people end up working with a real estate agent that they casually bumped into, either online or in person. The fact is that it can be difficult to find ‘the one’ when you first start your search. Often times, it takes working with someone to realize that they aren’t the one who is going to sell your home, or find you a new one.
Here are common signs that it may be time to dump your real estate agent and find someone new.
Your real estate agent doesn’t listen.
Listening is very important because your realtor needs to understand your motivations, interests, expectations, etc. It’s a big deal to purchase a home, and your agent should understand and respect this. They should know exactly what you’re looking for so that they can find the best properties that match your budget, needs and lifestyle. If they seem to be directing you toward any property that pops up on the market, you may need to rethink your arrangement.
Your agent is inexperienced.
You should not feel that your home search is your realtor’s second job. They should make it a priority to find you that perfect home that you feel safe and comfortable in. Good agents are licensed by the state and have strong track records. If you feel that your agent is inexperienced, isn’t familiar with the area or simply lacks the knowledge to lead you in the right direction, it’s time to find someone who has the necessary training and certification to get the job done right.
Your agent is critical.
We all want different things in life, and a home you may find beautiful, another person may not. That’s okay. Your realtor’s job is to find you a property that YOU love. If you find them being critical or harsh about your expectations, it’s time to move on. You know what you can afford and what you feel comfortable with, and your realtor should support you until you find that home.
Think you need a new real estate agent? Let an experienced, trustworthy and knowledgeable agent from Cedarcrest help you find your dream home!
2014 Summer Real Estate Trends
If you haven’t found the home of your dreams yet, don’t panic. This summer is a great time to finally make that investment, but it’s not over yet. You’ll be pleased to know that it’s still a smart time to buy a home, and this won’t be changing anytime soon. In fact, you may see lending standards loosen up in order to promote homeownership. Here are some trends to watch for this summer and early fall, especially as you narrow down your search.
Mortgage Rates Are STILL Low
Mortgage rates are still at historic lows because the economy isn’t improving as fast as we thought. It’s predicted by the Mortgage Bankers Association that a 30-year fixed rate could average 4.9 percent by the third quarter and reach 5 percent by the end of 2014. Only time will tell, but the good news is that you can lock in a low interest rate if you buy in 2014.
Lending Standards Are Not So Tight
Lending standards aren’t as tight as they once were, although they are still stricter than during the housing boom. Still, it’s important to boost homeownership rates, and for this reason, lenders are becoming more flexible and willing to listen to borrowers on common-sense issues. This includes accepting lower credit scores for both FHA and conventional loans.
Discounts on FHA Loans
FHA loans have become more popular, but the cost of mortgage insurance has made these loans an obstacle for many buyers. The FHA recently announced that they would be willing to lower the cost of mortgage insurance for buyers who are willing to go through a home counseling program before buying a home. The program isn’t in effect yet, but the discount that it would allow for is promising. Buyers would be silly not to take advantage of it.
Home Prices Aren’t Rising Fast
Even though house prices are rising steadily, they aren’t going up as fast as we thought. Spring was particularly slow, so if you are in the position to purchase a home now, you can enjoy low mortgage rates and low housing prices. At this time, there is a demand for homes, and inventory is low. This can make it more challenging to find your dream home, but it’s certainly not impossible. With the right realtor, you can find homes that fit your vision as soon as they come onto the market.
Top Benefits of Homeownership
Owning a home is more than the American Dream. It’s a decision that offers financial, social and emotional benefits. Still, buying a home is a big step, and the initial costs associated with it can scare people away. If you’re contemplating buying your first home or re-entering the housing market after renting for some time, keep these benefits in mind. We can assure you that the pride and stability that comes from owning a home will make everything else seem like a minor inconvenience.
Tax Deductions
Come tax time, you can deduct the interest paid on the mortgage throughout the year. You may also be able to deduct closing costs, points paid and fees for your loan application and appraisal.
Increasing Value
This may be hard to believe coming out of a recession, but homes are still considered a safe and steady investment. The national median home price has risen every year since 1968 when this information was tracked. As you pay your mortgage down, you’re basically putting money in the bank as a form of equity.
Equity
As you pay your mortgage down and the value of your home goes up, you’re building up your equity. It’s almost like paying yourself instead of paying your landlord. Once you have enough equity, you can move to a bigger home, or use it for borrowing power. Equity can help you secure another loan or take out a line of credit for education expenses or big ticket items.
Stability
Homeownership offers stability both financially and socially. With a fixed-rate income, you know what your mortgage payments will be each month for the next 30 years. On a social level, you know where you will be living, and you don’t have to worry about the landlord ending a contract.
Flexibility and Freedom
You can paint the walls pink. You can put in hardwood floors. You can plant a tree and watch it grow. You have freedom to do the things you want, and hopefully a stable neighborhood to go along with it. With renting, there are far more limitations that can prevent you from turning your house into a home.
Tips for Winning a Bidding War
You don’t have to be a bidding man to win a bidding war. Even though the housing market has been slow to recover, many areas are seeing bidding wars on for-sale properties. In fact, it’s not uncommon for some areas to see 10-15 offers on homes the day they go on the market. Low mortgage rates and housing prices make it a good time to buy, and low inventory creates these bidding wars. To compete in these wars, you’ll need to be financially prepared to make the investment. You should also be familiar with the neighborhood and exactly what you’re looking for.
Here are a few helpful tips for winning a bidding war in today’s market.
Have Your Lending in Place
Too many buyers start working with lenders when they begin looking at homes. If you’re going to make a bid, you need to have your lending in place. Talk to lenders in advance and have a preapproval letter in hand before making a bid. This way, you’ll be more likely to win the war because financing is already in place.
Put Cash Aside
Financing is good, but so is cash. A down payment of at least 20% is ideal, but more cash is better. You want to show the sellers that you have the funds to close on the home, and the ability to make up the difference if the appraisal comes out low.
Make a Fast Offer
You can’t wait in today’s market. When you see a home you like, set up a time to view it as soon as possible. Not only should you make a fast offer, but also personalize it. You can talk to the realtor to determine what motivations the sellers need to close the deal and use this to your advantage. The goal is to make your offer look attractive compared to all the others.
Eliminate Contingencies
If you can, eliminate contingencies so that nothing slows down your offer. Common contingencies include financing, appraisals or home inspections. If you can’t waive these, at least find a way to shorten them. You want to make your offer strong and avoid having the sellers wait on things that may not come through. So, if you don’t need that home warranty after all, don’t ask for it.
