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Savings Strategies Every First-Time Homebuyer Needs To Know
If homeownership is on your goal sheet for your future, you’re probably working on your savings. And a big priority is making sure you’ve got a plan in place for things like your closing costs, down payment, and more.
Here are a few strategies that can help speed up that process.
Budget and Track Your Expenses: To start, create a detailed budget that tracks the money you’ve got coming in and the money going out. This’ll give you a better look at your finances as a whole.
Cut Down on Unnecessary Spending: Now that you have your budget sheet done and you know how you’re spending your money, look for any line items that aren’t absolutely essential. If you cut down on those, you can re-allocate that cash toward buying a home. Even the little things can add up. As the National Association of Realtors (NAR) says:
“The majority of first-time buyers did make financial sacrifices to purchase a home. For those who did, the most common sacrifices buyers reported were cutting spending on luxury goods, entertainment, and clothes.”
Automate Your Savings: Once you know how much you want to set aside for your homebuying budget, look for ways to make it easy. If you have to transfer money manually, you may forget to do it. But getting some automatic transfers set up helps drive consistency and removes the temptation to spend it elsewhere. Realtor.com explains:
“If you’re struggling to put enough money away because of the constant temptations to blow your paycheck, consider automating the process. Ask your employer if you can have your paycheck deposited into multiple accounts—if so, instruct it to send a certain percentage of your salary directly into your savings account. Or go through your bank . . .”
Lean into Any Side Hustles You Have: Do you have a gig you do (or have done before) to net some extra cash? Taking on part-time work, freelance jobs, or picking up a side hustle can help give your savings a boost.
Put any Unexpected Cash To Good Use: If you get any sudden windfalls, like a tax refund, bonus, inheritance, or cash gift from family, put it toward your house fund.
By using these strategies and focusing on your savings over time, you can make sure you’re well on the path to having what you need to buy your first home. As Ramsey Solutions says:
“Budgeting shows your money who’s in charge (that’s you). It gives you the power to tell your money where to go instead of having to wonder where it went. It’s how you make any money goals happen—like saving for a down payment.”
Bottom Line
If you need more strategies for getting ready to buy, let’s connect.
Selling Smart: Why a Real Estate Agent Makes All the Difference
If you’re considering selling your house on your own as a “For Sale by Owner” (FSBO), you want to think about if it’s really worth the extra stress. Going this route means shouldering a lot of responsibilities by yourself – and, if you’re not an expert, that opens the door for mistakes to happen and can quickly become overwhelming.
A report from the National Association of Realtors (NAR) shows two key areas where people who sold their own house struggled the most: pricing and paperwork.
Here are just a few of the ways an agent makes those tasks a whole lot easier.
Getting the Price Right
Setting the right price for your house is important. And, if you’re selling your house on your own, two common issues can happen. You might ask for too much money (overpricing). Or you might not ask for enough (underpricing). Either can make it hard to sell your house. According to NerdWallet:
“When selling a home, first impressions matter. Your house’s market debut is your first chance to attract a buyer and it’s important to get the pricing right. If your home is overpriced, you run the risk of buyers not seeing the listing.
. . . But price your house too low and you could end up leaving some serious money on the table. A bargain-basement price could also turn some buyers away, as they may wonder if there are any underlying problems with the house.”
To avoid these problems, team up with a real estate agent. Agents know how to figure out the perfect price because they have a deep understanding of the local housing market. And they’ll use that expertise to set a price that matches what buyers are willing to pay, giving your house the best chance to impress from the start.
Understanding and Performing Paperwork
Selling a house involves a bunch of paperwork and legal documentation that has to be just right. There are a lot of rules and regulations to follow, and that makes it a bit tricky for homeowners to manage everything on their own. Without a pro by your side, you could end up facing liability risks and legal complications.
Real estate agents are experts in all the contracts and paperwork needed for selling a house. They know the rules and can guide you through it all, reducing the chance of mistakes that might lead to legal problems or delays. As an article from First American explains:
“To buy or sell a home you need to accurately complete a lot of forms, disclosures, and legal documents. A real estate agent ensures you cross every ‘t’ and dot every ‘i’ to help you avoid having a transaction fall through and/or prevent a costly mistake.”
So, instead of dealing with the growing pile of documents on your own, team up with an agent who can be your advisor, helping you avoid any legal bumps in the road.
Bottom Line
Selling a house on your own can cost you a lot of time and stress. Let’s connect so you have help with all the finer details, including setting the right price, handling all the paperwork, and so much more. That way we can take that stress off of your plate.
The Wealth-Building Power of Homeownership
If you’re trying to decide if buying a home is worth it, consider the long-term benefits, like building equity as home values grow over time. According to the FHFA, home values have increased by 315.7% since 1991. Home equity is one reason owning your own place can really pay off in the long run. When you’re ready, DM me.
Your Equity Could Make a Move Possible
Many homeowners looking to sell feel like they’re stuck between a rock and a hard place right now. Today’s mortgage rates are higher than the one they currently have on their home, and that’s making it harder to want to sell and make a move. Maybe you’re in the same boat.
But what if there was a way to offset these higher borrowing costs? There is. And the money you need probably already exists in your current home in the form of equity.
What Is Equity?
Think of equity as a simple math equation. Freddie Mac explains:
“. . . your home’s equity is the difference between how much your home is worth and how much you owe on your mortgage.”
Your equity grows as you pay down your loan over time and as home prices climb. And thanks to the rapid home price appreciation we saw in recent years, you probably have a whole lot more of it than you realize.
The latest from the Census and ATTOM shows more than two out of three homeowners have either completely paid off their mortgages (shown in green in the chart below) or have at least 50% equity (shown in blue in the chart below):
That means the majority of homeowners have a game-changing amount of equity right now.
How Your Equity Can Help Fuel Your Move
After you sell your house, that equity can help you move without worrying as much about today’s mortgage rates. As Danielle Hale, Chief Economist for Realtor.com says:
“A consideration today’s homeowners should review is what their home equity picture looks like. With the typical home listing price up 40% from just five years ago, many home sellers are sitting on a healthy equity cushion. This means they are likely to walk away from a home sale with proceeds that they can use to offset the amount of borrowing needed for their next home purchase.”
To give you some examples, here are a few ways you can use equity to buy your next home:
- Be an all-cash buyer: If you’ve been living in your current home for a long time, you might have enough equity to buy your next home without having to take out a loan. If that’s the case, you won’t need to borrow any money or worry about mortgage rates.
- Make a larger down payment: Your equity could also be used toward your next down payment. It might even be enough to let you put a larger amount down, so you won’t have to borrow as much at today’s rates.
The First Step: Determine How Much Equity You Have in Your Home
Want to find out how much equity you have? To do that, you’ll need two things:
- The current mortgage balance on your home
- The current value of your home
You can probably find the mortgage balance on your monthly mortgage statement. To understand the current market value of your house, you can pay hundreds of dollars for an appraisal, or you can contact a local real estate agent who will be able to present to you, at no charge, a professional equity assessment report (PEAR).
Once you’ve connected with a trusted local agent and run the numbers, you’re one step closer to making a move you may not have thought was realistic – all thanks to your equity.
Bottom Line
If you want to find out how much equity you have and talk more about how it can make your next move possible, let’s connect.
The Sweet Spot for Buying Luxury Homes
If you’ve been looking for a home at the high end of your market, but haven’t found the right one, you may have put your search on hold. But according to recent data, now may be the time to jump back in. Here’s why.
There Are More Luxury Homes To Choose From
What’s considered the top-end of the market, or a luxury home, will always vary by location. But generally speaking, they’re homes that are valued in the top 5% of any given market. According to a recent report from the Institute for Luxury Home Marketing, the selection of luxury homes is increasing (see graph below):
As the graph shows, there are considerably more single-family luxury homes available now than there were a year ago. In fact, there are even more than there were just a month ago. This means you should have a wider variety of top-of-the-line homes to choose from, each with unique features and styles.
Whether you were searching for the latest design elements, like modern kitchens with chef-grade appliances, a breathtaking view, or integrated smart home technology, more luxury inventory means you should have an easier time finding one that matches your taste and lifestyle.
Rising Luxury Home Prices Can Help You Build Wealth
Another important factor to consider is that luxury home prices are on the rise. According to HousingWire, luxury home prices have increased by 8.7% over the past year. That’s why:
“People with the means to buy high-end homes are jumping in now because they feel confident prices will continue to rise . . . They’re ready to buy with more optimism and less apprehension.”
This means buying before prices climb higher – and while more inventory is on the market – may be your sweet spot. Because home prices are rising, owning a home could help you build more generational wealth over time. On the other hand, if you wait to buy, you might end up paying more for the same home later on as luxury prices continue to rise.
Bottom Line
With growing inventory and rising prices, you have a greater selection of luxury homes to choose from and an opportunity in front of you. Want to see the higher-end homes that are available in our area? Let’s connect today.
What To Expect if You Buy or Sell a Home This June
June is a busy month in the housing market because a lot of people buy and sell this time of year. So, if you’ve got a move on your mind and you’re looking to make it happen this month, here’s a snapshot of what you need to know to make sure you’re ready.
If You’re Buying This June
A lot of homebuyers with children like to move after one school year ends and before the next one begins. That’s one reason why late spring into summer is a popular time for homes to change hands. And whether that’s a motivator for you or not, it’s important to realize more buyers are going to be looking right now – and that means you’ll want to be ready for a bit more competition. But there is a silver lining to a move this time of year. This is also when more sellers will list – so you should find you have more options. As an article from Bankrate says:
“Late spring and early summer are the busiest and most competitive time of year for the real estate market. There’s usually more inventory listed for sale than other times of year . . . This is a double-edged sword for a buyer, as you will be met with more opportunities but [also] much more competition.”
During this busy season, it’s extra important to work with a trusted real estate agent. Your agent will help you stay on top of the latest listings, share expertise on how to make a strong offer in a competitive market, and give you insight into things like what the home is actually worth so you can make an informed decision when you buy. As Forbes says:
“Approaching the market confidently, armed with good information and grounded expectations will take you far. Don’t let the hustle of the market convince you to buy something that’s not in your budget, or not right for your lifestyle.”
If You’re Selling This June
Because there are more buyers this time of year, you’re in a great spot as a seller. Many of those buyers are highly motivated to make their move happen before the next school year kicks off – so they’ll likely put in strong offers to try to make that possible. That means, if your house shows well and is listed at market value, you could see your house sell faster or for a higher price. According to the National Association of Realtors (NAR):
“Warmer weather and the end of the school year encourage more people to buy and sell, respectively. Buyers are looking to move and settle before the new school year begins, contributing to increased competition and, consequently, higher prices.”
You want to be sure you’ve got a great agent on your side to help you with the contingencies on those offers and any negotiations that take place so you can pick the best offer. Make sure you go over closing dates with your agent. Buyers trying to time their move with the school year may need to delay a bit or move faster. This can depend on the school calendar where you live. As U.S. News Real Estate explains:
“ . . if your house goes under contract in early summer, the buyer may ask for a delay in closing or move-in until the school year finishes or their current home has sold. Alternatively, a buyer later in summer may be looking to close quickly and move in under a month. Remain flexible to keep the deal running smoothly, and your buyer may be willing to throw in concessions, like covering some of your closing costs or overlooking the old roof.”
Bottom Line
If you’re looking to make a move this June, let’s chat so you know what to expect. We’ll come up with a plan that factors in current market conditions, but still works for you.
More Than a House: The Emotional Benefits of Homeownership
With all the headlines and talk about housing affordability, it can be tempting to get lost in the financial side of buying a home. That’s only natural as you think about the dollars and cents of it all.
And while you ultimately need to be able to afford a home you buy, don’t lose sight of why homeownership was so important to you in the first place. That’s because buying a home is so much more than just a financial transaction. As the National Association of Realtors (NAR) says:
“The benefits of purchasing and owning your place of residence are both financial and emotional – pride in homeownership and the feeling of security are huge intangible benefits.”
Here’s a look at just a few of those more emotional or lifestyle perks, to help anchor you to why homeownership is one of your goals.
A Sense of Satisfaction
Owning a home is often associated with better mental health and well-being. That’s probably because buying a home is a big milestone. And the sense of satisfaction and pride that comes with achieving that goal just feels good. A recent article from the Mortgage Reports says:
“By and large, homeownership brings more satisfaction than renting. . . Surveyees scored the overall happiness level of homeowners at 88% compared to 67% for renters.”
More Stability for Your Family
Another thing that may make homeowners feel more satisfied is that they’re finally able to put down roots. Think about it. If you’re used to moving each time your lease renews and your rent climbs, staying put for a while would be nice not just for you, but for any loved ones that live with you.
A home can provide more predictability and the chance to make long-term friends. That should reduce everyone’s stress too. As NAR explains:
“Families also benefit from homeownership, with studies proving that parents are able to spend less time in a stressed state, therefore spending more time with their children. The ability for parents to feel stable has a huge impact on children’s behavioral issues, educational success, and future economic success.”
A Stronger Feeling of Community
And if you’re also looking for a sense of belonging for yourself, homeownership can help with that too. As FinHabits says:
“Homeowners tend to be more involved in their local communities, leading to a stronger sense of belonging . . .”
It makes sense. Your home connects you to your neighborhood and, by extension, your broader community. That’s because owning a home gives you a stake in that community’s future. So, becoming more involved and wanting to do what you can to help improve the area while making long-term relationships with neighbors is only natural.
The Ability To Make the Space Your Own
And don’t forget, your home is a place that’s all yours. Unless you’ve got specific homeowner’s association requirements, you’re free to customize it however you see fit.
So, if renting has been cramping your style, it’s time to express yourself and jump on the latest trends (if you want to). Whether that’s small home improvements or full-on renovations, your house can be exactly what you want and need it to be. And as your tastes and lifestyle change, so can your home. Picture coming home each day to a place that feels like you. That’s a feeling like no other.
Bottom Line
If you want to enjoy a sense of accomplishment and pride in where you’re living, let’s have a conversation to go over what you need to do now to make this future happen for you.
Top Reasons To Own a Home
Today’s market can feel like a lot to navigate, but these reasons show why homeownership is worth it if you’re ready and able to buy.
When you want to enjoy these amazing advantages, I’m here to help guide you through the process.
The Biggest Mistakes Buyers Are Making Today
Buyers face challenges in any market – and today’s is no different. With higher mortgage rates and rising prices, plus the limited supply of homes for sale, there’s a lot to consider.
But, there’s one way to avoid getting tripped up – and that’s leaning on a real estate agent for the best possible advice. An expert’s insights will help you avoid some of the most common mistakes homebuyers are making right now.
Putting Off Pre-approval
As part of the homebuying process, a lender will look at your finances to figure out what they’re willing to loan you for your mortgage. This gives you a good idea of what you can borrow so you can really wrap your head around the financial side of things before you start looking at homes. While house hunting can be a lot more fun than talking about finances, you don’t want to do this out of order. Make sure you get your pre-approval first. As CNET explains:
“If you wait to get preapproved until the last minute, you might be scrambling to contact a lender and miss the opportunity to put a bid on a home.”
Holding Out for Perfection
While you may have a long list of must-haves and nice-to-haves, you need to be realistic about your home search. Even though your ideal state is you find a home that checks every box, you may need to be willing to compromise – especially since inventory is still low. Plus, a home that has everything you want may be too pricey. As Investopedia puts it:
“When you expect to find the perfect home, you could prolong the homebuying process by holding out for something better. Or you could end up paying more for a home just because it meets all your needs.”
Instead, look for something that has most of your must-haves and good bones where you can add anything else you may need down the line.
Buying More House Than You Can Afford
With today’s mortgage rates and home prices, there’s no arguing it’s expensive to buy a home. And while it may be tempting to stretch your finances a bit further than you’re comfortable with to make sure you get the house, you want to avoid overextending your budget. Make sure you talk to your agent about how changing mortgage rates impact your monthly payment. Bankrate offers this advice:
“Focus on what monthly payment you can afford rather than fixating on the maximum loan amount you qualify for. Just because you can qualify for a $300,000 loan doesn’t mean you can comfortably handle the monthly payments that come with it along with your other financial obligations. Every borrower’s case is different, so factor in your whole financial profile when determining how much house you can afford.”
Not Working with a Local Real Estate Agent
This last one may be the most important of all. Buying a home is a process that involves a lot of steps, paperwork, negotiation, and more. Rather than take all of this on yourself, it’s a good idea to have a pro working with you. The right agent will reduce your stress and help the process go smoothly. As CNET explains:
“Attempting to buy a home without a real estate agent makes the process more arduous than it needs to be. A real estate agent can give you professional legal guidance, market expertise and support, which will save you time, money and stress. They can also increase your chances of finding the right home so you don’t have to spend hours scouring the internet for listings.”
Bottom Line
Mistakes can cost you time, frustration, and money. If you want to buy a home in today’s market, let’s connect so you have a pro on your side who can help you avoid these missteps.
How an Agent Helps Market Your House
You’re ready to sell your house. But what do you need most from your real estate agent? Well, the National Association of Realtors (NAR) asked that very question to recent sellers and found one of the top things they were looking for is help marketing their house to potential buyers. Maybe that’s what you need the most help with too.
You expect your real estate agent to write a great description of your house for the listing and pair it with some high-quality photos. But that’s not all you’re going to get when you partner with a great agent.
They’ll do a lot more to make sure your house stands out. Here are some of the most common methods real estate agents use to market homes according to that same report from NAR (see graph below):
So, how can you benefit from your agent using these methods?
- Listing on the MLS – By listing your house on the MLS, it will get more visibility from other real estate agents and buyers. This could lead to more traffic, which could ultimately help you see an increase in offers and ultimately a better price.
- Using a Yard Sign – A yard sign catches the eye of people driving or walking by. This method drums up local interest since people who live nearby might have friends or family looking to move into the area. It also prominently displays your agent’s contact information, so interested buyers can get in touch easily.
- Having an Open House – When your agent advertises and hosts your open house, buyers see others are interested in your house, too. This competition can lead to stronger offers. An open house is also easier for you since you only need to leave once for many buyers to visit. Plus, your agent may get useful feedback on what people like or don’t like, which can help you make improvements to attract more buyers later, if needed.
- Showcasing on Your Agent’s Website – Having your house visible on your agent’s website allows for a professional presentation of your property. Additionally, people visiting your agent’s website are more likely to be serious buyers who are ready to make a move.
- Social Networking – Your real estate agent works hard to have a wide-ranging social media presence. Marketing your house this way allows them to reach a large audience. It also makes it easy for people to share your listing with friends and loved ones who might be interested.
- Providing Virtual Tours – Virtual tours are extremely convenient for buyers, especially those who are relocating from out of town. This method allows them to tour anytime, day or night. It shows your agent is using the latest technology to market your house.
There are many tools that can be used to market your house. As NerdWallet sums up:
“A good real estate agent will have a robust plan to promote your listing in an effort to find the right pool of buyers. Adding your home to databases of available homes called multiple listing services (MLS), open houses, 3D virtual tours, professional photography and broker tours for buyers’ agents (particularly for luxury homes) are all factors that may go into a marketing plan.”
As a seller, it’s smart to work with a creative local real estate agent who can maximize them to make sure you get as many eyes on your house as possible.
Bottom Line
When it comes to marketing your house, working with a local real estate agent has tons of benefits. If you’re ready to sell, but don’t know where to start, let’s chat.
