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      Buyer Demand Surging as Spring Market Begins

      Buyer Demand Surging as Spring Market Begins | MyKCM

      Last fall, some predicted that the 2019 residential real estate market would be a disaster. There was even the belief that we might experience a housing crash like the one that occurred during the last decade.

      However, according to two separate reports*, buyer demand dramatically increased over the last three months, leading into this spring buyers’ market (the March data is not yet available).

      Both the ShowingTime Showing Index and the National Association of REALTORS Buyer Traffic Index show that buyer demand has increased in each of the last three months.

      Buyer Demand Surging as Spring Market Begins | MyKCM

      Why the increase in demand? Increased buying power.

      According to the National Association of Realtors’ Economists’ Outlook Blog, purchasing a home has become more affordable, which has led to increased demand.

      “Due to the combination of falling home prices and mortgage rates, the income needed to make an affordable mortgage payment (mortgage no more than 25% of income) on a median-priced home with 10% down payment and 30-year fixed rate mortgage decreased from $60,425 in June 2018 to $53,783 as of February 2019, and the difference of $6,642 represents a gain in buying power because one can afford a home purchase at a lower level of income.”

      Bottom Line

      It appears the spring buyers’ market is going to be much stronger than many had projected. Whether you are selling or buying, this is important news.

       

      *The methodology behind the indices:

      The ShowingTime Showing Index

      “The ShowingTime Showing Index® tracks the average number of buyer showings on active residential properties on a monthly basis, a highly reliable leading indicator of current and future demand trends.”

      The National Association of REALTORS® Buyer Traffic Index

      “In a monthly survey of REALTORS®, NAR asks respondents ‘Compared to the same month last year, how would you rate the past month’s traffic in neighborhood(s) or area(s) where you make most of your sales?’ NAR compiles the responses into an index, where an index above 50 indicates that more respondents reported “stronger” traffic than “weaker” traffic.”

      Your Home's Spring Maintenance Checklist

      Your Homes Spring Maintenance Checklist [INFOGRAPHIC] | MyKCM

      Some Highlights:

      • Every spring, your home needs some extra TLC!
      • Whether you plan on selling your home this spring or not, conducting this maintenance will help ensure your home functions well for the rest of the year.
      • Your real estate agent will have a list of specific suggestions for getting your house ready for market and is a great resource for finding local contractors who can help!

      5 Reasons To Sell Your House This Spring!

      5 Reasons To Sell Your House This Spring! | MyKCM

      Here are five compelling reasons listing your home for sale this spring makes sense.

      1. Demand Is Strong

      The latest Buyer Traffic Index from the National Association of Realtors (NAR) shows that buyer demand remains strong throughout the vast majority of the country. These buyers are ready, willing, and able to purchase… and are in the market right now! More often than not, multiple buyers are competing with each other for the same home.

      Take advantage of the buyer activity currently in the market.

      2. There Is Less Competition Now

      Housing inventory is still under the 6-month supply needed for a normal housing market. This means that, in most of the country, there are not enough homes for sale to satisfy the number of buyers.

      Historically, the average number of years a homeowner stayed in his or her home was six, but that number has hovered between nine and ten years since 2011. Many homeowners have a pent-up desire to move, as they were unable to sell over the last few years due to a negative equity situation. As home values continue to appreciate, more and more homeowners are granted the freedom to move.

      Many homeowners were reluctant to list their home over the last couple of years for fear that they would not find a home to move in to. That is all changing now as more homes come to market at the higher end. The choices buyers have will continue to increase. Don’t wait until additional inventory comes to market before you to decide to sell.

      3. The Process Will Be Quicker

      Today’s competitive environment has forced buyers to do all they can to stand out from the crowd, including getting pre-approved for their mortgage financing. Buyers know exactly what they can afford before home shopping. This makes the entire selling process much faster and simpler. According to Ellie Mae’s latest Origination Insights Report, the time to close a loan has dropped to 47 days.

      4. There Will Never Be a Better Time to Move Up

      If your next move will be into a premium or luxury home, now is the time to move up! The inventory of homes for sale at these higher price ranges has created a buyer’s market. This means that if you are planning on selling a starter or trade-up home, it will sell quickly, AND you’ll be able to find a premium home to call your own!

      According to CoreLogic, prices are projected to appreciate by 4.6% over the next year. If you are moving to a higher-priced home, it will wind up costing you more in raw dollars (both in down payment and mortgage payment) if you wait.

      5. It’s Time to Move on With Your Life

      Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?

      Only you know the answers to these questions. You have the power to take control of the situation by putting your home on the market. Perhaps the time has come for you and your family to move on and start living the life you desire.

      That is what is truly important.

      How to Put Your Housing Cost to Work for You

      How to Put Your Housing Cost to Work for You | MyKCM

      There has been a lot written about the benefits of homeownership. One benefit that continues to rise to the top is the added wealth homeowners gain simply by paying their mortgage while their home increases in value over time.

      The National Association of Realtors (NAR) recently broke down the equity gained from price appreciation and principal payments in their Economists Outlook Blog. Homeowners who purchased their homes five years ago have already gained almost $80,000 in equity over that time with 80% of the gains coming from price appreciation.

      For a homeowner who purchased their home 30 years ago, they have gained nearly $250,000 in equity with 70% coming from price increases. The full results can be seen in the chart below.

      How to Put Your Housing Cost to Work for You | MyKCM

      According to the Home Price Expectation Survey, a family who purchased a median priced home this January can expect to gain more than $42,000 over the next five years simply from price appreciation alone.

      Bottom Line

      Your home is one of the only investments you can live inside as you pay it off over time. If you are ready to use your housing costs to build wealth, let’s get together to discuss how to make your dream a reality.

      Homeownership is a Cornerstone of the American Dream

      Homeownership is a Cornerstone of the American Dream |MyKCM

      “The rumors of my death are greatly exaggerated.”

      The famous quote attributed to Mark Twain can apply to homeownership in the United States today. During the housing bubble of the last decade, the homeownership rate soared to over sixty-nine percent. After the crash, that percentage continued to fall for the next ten years.

      That led to speculation that homeownership was no longer seen as a major component of the American Dream. That belief became so widespread that the term “renters’ society” began to be used by some to define American consumers.

      However, the latest report by the Census Bureau on homeownership shows that over the last two years, the percentage of homeowners has increased in each of the last eight quarters.

      Homeownership is a Cornerstone of the American Dream |MyKCM

      Going forward…

      It appears the homeownership rate will continue to increase.

      The 2019 Aspiring Home Buyers Profile recently released by the National Association of Realtors revealed that 84% of non-owners want to own a home in the future. That percentage increased from 73% earlier last year.

      Bottom Line

      In the United States, the concept of homeownership as part of the American Dream is very much alive and well

      What are the Benefits of Becoming a Homeowner?

      What are the Benefits of Becoming a Homeowner? | MyKCM
       

      Every family has a list of important dates. We celebrate birthdays, anniversaries, pet adoptions…and the list goes on. For 64.4 percent of households in the United States, this list includes the day they became a homeowner for the first time!

      Why is this date important? Homeownership is not just a roof over your head! It represents shelter, stability, wealth, and pride! For decades, homeownership has been an important part of the American Dream!

      However, many people question if the next generations see the same benefits of homeownership as their predecessors.

      In case we have forgotten, some of those benefits are:

       

      Non-Financial Benefits

       

      1) Educational Achievement: Homeownership has a positive impact on academic achievement, including reading and math performance in children 3-12 years old.

      2) Civic Participation: “Owning a home means owning a part of the neighborhood.” Homeowners have a stronger connection to their neighborhood and are more committed to volunteer.

      3) Health Benefits: Adjusting for a range of demographic, socioeconomic and housing-related characteristics, homeowners have a substantial health advantage over renters.

      4) Public Assistance: The report shows 47% of homeowners use their home equity credit lines to help pay other debts, diminishing their need for public assistance.

      5) Property Maintenance and Improvement: A well-maintained home not only generates benefits through consumption and safety, but a high-quality structure also raises mental health.

      6) Pride of Ownership: This place is unique as it is “yours.” You can customize it according to your likes and personality.

      In addition to financial benefits, homeownership also brings significant social benefits. These not only pertain to the family, but extend to the communities, the state, and the country!

      Financial Benefits

       

      Buying a home is an investment in your future!

      1. Appreciation: On average, home prices are appreciating annually at a rate of 3.6%. This helps to create a safety net.
      2. Forced Savings: Your mortgage is like a forced savings plan! With each payment, you are reducing the principal of your loan.
      3. Home Equity: Homeownership builds equity every single month. You can later use that equity to start a business, send your children to college, etc.
      4. Net Worth: A homeowners’ net worth is 44x greater than renters! This gives you the financial freedom to invest.
      5. Stability: Rent prices increase 4% annually! A fixed mortgage payment allows you to save for future projects and guard against inflation.
      6. Tax Benefits: The government has created tax benefits to encourage customers to purchase. (Talk to your CPA to see which benefits apply to you).

      Bottom Line

      Homeownership is and will always be part of the American Dream! There are many financial and non-financial benefits to take advantage of when owning a home. If owning a home is part of your dream, contact a local real estate professional to help you with the process!

      What is the Cost of Waiting Until Next Year to Buy?

      What is the Cost of Waiting Until Next Year to Buy? [INFOGRAPHIC] | MyKCM

      Some Highlights:

      • The cost of waiting to buy is defined as the additional funds it would take to buy a home if prices & interest rates were to increase over a period of time.
      • Freddie Mac predicts interest rates to rise to 5.1% by the end of 2019.
      • CoreLogic predicts home prices to appreciate by 4.8% over the next 12 months.
      • If you are ready and willing to buy your dream home, find out if you are able to!

      Selling Your Home? Make Sure the Price is Right!

      Selling Your Home? Make Sure the Price is Right! | MyKCM

      If you’ve ever watched “The Price is Right,” you know that the only way to win is to be the one to correctly guess the price of the item you want without going over! That means your guess must be just slightly under the retail price.

      In today’s shifting real estate market, where more inventory is coming to market and home values are projected to appreciate at lower rates, homeowners will not be able to price their homes as aggressively as they were able to just last year.

      They will have to employ the same strategy: be the closest without going over!

      As we have explained before, pricing your home at or slightly below market value actually increases the number of buyers who will see your home in their search!

      Over the last six months, more inventory has come to market while the months’ supply of inventory available has dropped. This means that the demand for homes to buy is still very strong throughout the country!

      Homeowners who make the mistake of overpricing their homes will eventually have to drop the price. This leaves buyers wondering if the price drop was caused by something wrong with the homes when in reality nothing was wrong, the price was just too high!

      Bottom Line

      If you are thinking about listing your home for sale this year, let’s get together to properly price your home from the start!

      Is the Recent Dip in Interest Rates Here to Stay?

      Is the Recent Dip in Interest Rates Here to Stay? | MyKCM

      Interest rates for a 30-year fixed rate mortgage climbed consistently throughout 2018 until the middle of November. After that point, rates returned to levels that we saw in August to close out the year at 4.55%, according to Freddie Mac’s Primary Mortgage Market Survey.

      After the first week of 2019, rates have continued their downward trend. As Freddie Mac’s Chief Economist Sam Khater notes, this is great news for homebuyers. He states,

      “Mortgage rates declined to start the new year with the 30-year fixed-rate mortgage dipping to 4.51 percent. Low mortgage rates combined with decelerating home price growth should get prospective homebuyers excited to buy.”

      In some areas of the country, the combination of rising interest rates and rising home prices had made some first-time buyers push pause on their home searches. But with more inventory coming to market, continued price growth, and interest rates slowing, this is a great time to get back in the market!

      Will This Trend Continue?

      According to the latest forecasts from Fannie Maethe Mortgage Bankers Associationand the National Association of Realtorsmortgage rates will increase over the course of 2019, but not at the same pace they did in 2018. You can see the forecasts broken down by quarter below.

      Is the Recent Dip in Interest Rates Here to Stay? | MyKCM

      Bottom Line

      Even a small increase (or decrease) in interest rates can impact your monthly housing cost. If buying a home in 2019 is on your short list of goals to achieve, let’s get together to find out if you are able to today.

      Top Renovations to Complete Before You Sell Your House

      Top Renovations to Complete Before You Sell Your House [INFOGRAPHIC] | MyKCM

      Some Highlights:

      • If you are planning on listing your house for sale this year, here are the top four home improvement projects that will net you the most Return on Investment (ROI).
      • Minor bathroom renovations can go a long way toward improving the quality of your everyday life and/or impressing potential buyers.
      • Upgrading your landscaping or curb appeal helps get buyers in the door. These upgrades rank as the 2nd and 4th best renovations for returns on investment.
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