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      Blog :: 04-2017

      Your Tax Return: Bring it Home

       

      Your Tax Return: Bring it Home | MyKCM

      This time of year, many people eagerly check their mailboxes looking for their tax return check from the IRS. But, what do most people plan to do with the money? GO Banking Rates recently surveyed Americans and asked the question - “What do you plan on doing with your tax refund?”

      The results of the survey were interesting. Here is what they plan to do with their money:

      • 41% - Put it into savings
      • 38% - Pay off debt
      • 11% - Go on a vacation
      • 5% - Make a major purchase (car, home, etc.)
      • 5% - Splurge on a purchase

      Upon seeing the research, The National Association of Realtors (NAR) wondered if this could help with a constant challenge cited by many people who wish to purchase a home – saving for the down payment.

      In a recent post in NAR’s Economists’ Outlook Blog, they explained:

      “With a sizable tax refund, the average American would have a decent down payment depending on which region or market you live in.”

      They went on to add:

      “[A]pproximately 5 percent of all respondents indicated they would make a major purchase which does not seem like a lot. However, there is a bigger group 41 percent who see saving the tax return is best and that group could be potential homebuyers if they are not already.”

      In other words, putting that money toward purchasing a home is a form of savings.

      Bottom Line

      When one considers that first-time home buyers in 2016 had an average down payment of 6%, a decent tax return could go a long way toward the necessary funds needed for a down payment on a house. Or perhaps, the down payment needed by a son or daughter to make their homeownership dream a reality. How are you going to spend your return?

      Real Estate Mogul: Here's Why You Should Buy

       

      Real Estate Mogul: Here’s Why You Should Buy | MyKCM

      Real Estate mogul, Sean Conlon, host of The Deed: Chicago on CNBC, was recently asked the question, should you buy? Or should you rent a house?

      Conlon responded:

      “I am a true believer that you save every penny and you buy your first house… and that is still the fastest path to wealth in this country.”

      Conlon went on to suggest that first-time buyers put down 10-20% “if they can make it work,” and to remain in their home at least 4-5 years to see a return on their investment.

      Who is Sean Conlon, and why should you listen to his advice?

      Within a few years of working in the real estate industry, Conlon had established himself as one of the leading agents in the United States and has founded 3 billion-dollar brokerages dealing in residential, commercial and investment sales. Since immigrating to America from the United Kingdom in 1990, he believes very strongly in the American Dream and the role that homeownership plays in achieving it. Conlon is quoted on his website as saying:

      “I treat people the way I would like to be treated if I went in to buy a house and I work harder than anybody I know. I think if you do that in America, you will always succeed.”

      Bottom Line

      Homeownership is an investment you can leverage against in the future that not only provides shelter and safety but also helps you build your family’s wealth. If you are debating whether or not to purchase a home this year, let’s get together to discuss the opportunities available in today’s market!

      Thinking of Selling? Now Is the Time to Act

      Thinking of Selling? Now Is the Time to Act | MyKCM

      If you thought about selling your house this year, now may be the time to do it. The inventory of homes for sale is well below historic norms and buyer demand is skyrocketing. We were still in high school when we learned the concept of supply and demand: the best time to sell something is when supply of that item is low and demand for that item is high. That defines today’s real estate market.

      Jonathan Smoke, Chief Economist at realtor.com, revealed in a recent article that:

      “The biggest challenge to buyers this spring will be simply finding a home to buy and getting it successfully under contract. That’s because the supply of homes for sale is at an all-time low, and yet demand is strong and getting stronger.”

      Smoke goes on to say:

      “We started the year with the lowest inventory of homes available for sale that we’ve ever seen on realtor.com. While we did see inventory grow 2% in February, total inventory was down 11% over last year.”

      In this type of market, a seller may hold a major negotiating advantage when it comes to price and other aspects of the real estate transaction including the inspection, appraisal and financing contingencies.

      Bottom Line

      As a potential seller, you are in the driver’s seat right now. It might be time to hit the gas.

      Millennials Flock to Low Down Payment Programs

      Millennials Flock to Low Down Payment Programs | MyKCM

      A recent report released by Down Payment Resource shows that 65% of first-time homebuyers purchased their homes with a down payment of 6% or less in the month of January.

      The trend continued through all buyers with a mortgage, as 62% made a down payment of less than 20%, which is consistent with findings from December.

      An article by DS News points to the new wave of millennial homebuyers:

      “It seems that the long-awaited influx of millennial home buyers is beginning. Ellie Mae reported that mortgages to millennial borrowers for new home purchases continued their ascent in January, accounting for 84 percent of closed loans.”

      Among millennials who purchased homes in January, FHA loans remained popular, making up 35% of all loans closed. Ellie Mae’s Executive Vice President of Corporate Strategy Joe Tyrrell gave some insight into why:

      “It is not surprising to see Millennial borrowers leverage FHA loans because they typically offer lower down payments and lower average FICO score requirements than conventional loans. Across the board, we're continuing to see strong interest in homeownership from this younger generation.”

      Bottom Line

      If you are one of the many millennials who is debating a home purchase this year, let's get together to help you understand your options and set you on the path to preapproval.

      The Importance of Using a Professional to Sell Your Home

      The Importance of Using a Professional to Sell Your Home | MyKCM

      When a homeowner decides to sell their house, they obviously want the best possible price for it with the least amount of hassles along the way. However, for the vast majority of sellers, the most important result is actually getting their homes sold.

      In order to accomplish all three goals, a seller should realize the importance of using a real estate professional. We realize that technology has changed the purchaser’s behavior during the home buying process. According to the National Association of Realtors’ 2016 Profile of Home Buyers & Sellers, the percentage of buyers who used the internet in their home search increased to 94%.

      However, the report also revealed that 96% of buyers who used the internet when searching for homes purchased their homes through either a real estate agent/broker or from a builder or builder’s agent.Only 2% purchased their homes directly from a seller whom the buyer didn’t know.

      Buyers search for a home online but then depend on an agent to find the home they will buy (50%), to negotiate the terms of the sale (47%) & price (36%), or to help understand the process (61%).

      The plethora of information now available has resulted in an increase in the percentage of buyers that reach out to real estate professionals to “connect the dots.” This is obvious, as the percentage of overall buyers who have used agents to buy their homes has steadily increased from 69% in 2001.

      Bottom Line

      If you are thinking of selling your home, don’t underestimate the role a real estate professional can play in the process.

       

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