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      Blog :: 03-2017

      Renting or Buying… Either Way You're Paying a Mortgage

      Renting or Buying… Either Way You’re Paying a Mortgage | MyKCM

      Renting or Buyingâ?¦ Either Way Youâ??re Paying a Mortgage | MyKCM

      There are some people who have not purchased homes because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you are living with your parents rent-free, you are paying a mortgage - either yours or your landlord’s.

      As Entrepreneur Magazine, a premier source for small business, explained this month in their article, “12 Practical Steps to Getting Rich”:

      While renting on a temporary basis isn't terrible, you should most certainly own the roof over your head if you're serious about your finances. It won't make you rich overnight, but by renting, you're paying someone else's mortgage. In effect, you're making someone else rich.”

      Christina Boyle, Senior Vice President and head of the Single-Family Sales & Relationship Management organization at Freddie Mac, explains another benefit of securing a mortgage vs. paying rent:

      “With a 30-year fixed rate mortgage, you’ll have the certainty & stability of knowing what your mortgage payment will be for the next 30 years – unlike rents which will continue to rise over the next three decades.”

      As an owner, your mortgage payment is a form of ‘forced savings’ which allows you to build equity in your home that you can tap into later in life. As a renter, you guarantee the landlord is the person with that equity.

      Interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.23% last week.

      Bottom Line

      Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, now may be the time to buy.

      Looking to Move-Up to a Luxury Home? Now's the Time!

      Looking to Move-Up to a Luxury Home? Now’s the Time! | MyKCM

       

      Looking to Move-Up to a Luxury Home? Nowâ??s the Time! | MyKCM

      If your house no longer fits your needs and you are planning on buying a luxury home, now is a great time to do so! We recently shared data from Trulia’s Market Mismatch Study which showed that in today’s premium home market, buyers are in control.

      The inventory of homes for sale in the luxury market far exceeds those searching to purchase these properties in many areas of the country. This means that homes are often staying on the market longer, or can be found at a discount.

      Those who have a starter or trade-up home to sell will find buyers competing, and often entering bidding wars, to be able to call your house their new home.

      The sale of your starter or trade-up house will aid in coming up with a larger down payment for your new luxury home. Even a 5% down payment on a million-dollar home is $50,000.

      But not all who are buying luxury properties have a home to sell first.

      In a recent Washington post article, Daryl Judy, an associate broker with Washington Fine Properties, gave some insight into what many millennials are choosing to do:

      “Some high-earning millennials save money until they are in their early 30s to buy a place and just skip over that starter-home phase. They’ll stay in an apartment until they can afford to pay for the place they want.”

      Bottom Line

      The best time to sell anything is when demand is high and supply is low. If you are currently in a starter or trade-up house that no longer fits your needs, and are looking to step into a luxury home… Now’s the time to list your house for sale and make your dreams come true.

      What Are the Experts Saying about Mortgage Rates?

      What Are the Experts Saying about Mortgage Rates? | MyKCM

      What Are the Experts Saying about Mortgage Rates?

      What Are the Experts Saying about Mortgage Rates? | MyKCM

      Mortgage interest rates have risen over the last few months and projections are that they will continue their upswing throughout 2017. What impact will this have on the housing market? Here is what the experts are saying:

      Laurie Goodman, Co-director of the Urban Institute’s Housing Finance Policy Center:

      “In 1984, 1994, 2000, and 2013, every time we have rate increases, we have increases in nominal home prices. We expect this to be more pronounced, as there is a big demand-and-supply gap at the present time.”

      Scott Anderson, Chief Economist for Bank of the West:

      “The tightening labor market, rising wage growth, high levels of consumer confidence and a millennial generation with a pent-up demand for housing should allow the housing market to weather the storm of gradually rising interest rates.”

      Ivy Zelman in her latest ?“Z” Report:

      “Although we strongly believe that the housing supply-demand imbalance for single-family homes will continue to drive above-average home price appreciation, just as falling mortgage rates aided pricing power on the margin in recent months, we expect the opposite effect to become evident in the coming months. As such, we project year-end home price inflation of 4.8% for 2017 and 4.1% for 2018.”

      Bob Walters, President & COO of retail mortgage lender Quicken Loans:

      “A modest increase in mortgage rates won’t have much of an effect on home purchases. A buyer may need to slightly re-evaluate which homes they can afford, but it’s not likely to make an impact on qualifying, in most cases.”

      First American Chief Economist Mark Fleming:

      "Our survey data shows that mortgage rates would have to be significantly higher to have any meaningful impact. The house buying power that borrowers have, even with rates below five percent, still remains historically strong."

      A Tale of Two Markets: Inventory Mismatch Paints a More Detailed Picture

      A Tale of Two Markets: Inventory Mismatch Paints a More Detailed Picture | MyKCM

       

      The inventory of existing homes for sale in today’s market was recently reported to be at a 3.6-month supply according to the National Association of Realtors latest Existing Home Sales Report. Inventory is now 7.1% lower than this time last year, marking the 20th consecutive month of year-over-year drops.

      Historically, inventory must [...]

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