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      Blog :: 2019

      Rent Vs. Own [INFOGRAPHIC]

      Rent Vs. Own [INFOGRAPHIC] | MyKCM

      Some Highlights:

      • Owning your own home vs. renting may lead to some great options, such as locking in your monthly payments and having the freedom to customize your living space.
      • Whether you rent or own, you have to cover someone’s mortgage costs. You may as well be doing so to build your own wealth, rather than that of your landlord.
      • Renting and owning both have up-front fees when you sign your lease or close, respectively. Think about putting that money to work for you!

      Why Now Is the Perfect Time to Sell Your House

      Why Now Is the Perfect Time to Sell Your House | MyKCM

      As a homeowner, it’s always tempting to dream about the next big project you’re going to tackle. The possibilities are endless. Should I renovate? Should I refinance? Should I stay? Should I move? The list goes on and on.

      In today’s housing market, it’s actually a great time to shift your thoughts toward selling your house and moving up into the home of your dreams. Here’s why:

      Inventory is on the rise, but there’s still an overall shortage of houses for sale (less than a 6-month supply found in a more normal market), so homes are going under contract quickly. In fact, the National Association of Realtors (NAR) Realtors® Confidence Index Survey reports that right now homes are only staying on the market for an average of 27 days. That’s less than one month, an even more accelerated pace from the 36-day trend we saw last spring.

      Why Now Is the Perfect Time to Sell Your House | MyKCM

      The same report also indicates there are more interested buyers than active sellers today, which is one of the big factors driving home prices higher.

      .Why Now Is the Perfect Time to Sell Your House | MyKCM

      Why Now Is the Perfect Time to Sell Your House | MyKCM

      This power combination provides an ideal environment for sellers aiming to close a quick sale and earn a big return as we wrap up the summer season.

      Bottom Line

      There’s still time to make a move before the school year starts and the fall weather sets in. Maybe it’s time to make a change. Let’s get together to determine if selling now is the right decision for your family.

       

      Is Renting Right for Me?

      Is Renting Right for Me? | MyKCM

      If you’re currently renting and have dreams of owning your own home, it may be a good time to think about your next move. With rent costs rising annually and many helpful down payment assistance programs available, homeownership may be closer than you realize.

      According to the 2018 Bank of America Homebuyer Insights Report, 74% of renters plan on buying within the next 5 years, and 38% are planning to buy within the next 2 years.

      When those same renters were asked why they disliked renting, 52% said rising rental costs were their top reason. The results of the survey can be seen here:

      Is Renting Right for Me? | MyKCM

      It’s no wonder rising rental costs came in as the top answer. The median asking rent price has risen steadily over the last 30 years, as you can see below:

      Is Renting Right for Me? | MyKCM

      There is a long-standing rule that a household should not spend more than 28% of its income on housing expenses. With nearly half of renters (48%) surveyed already spending more than that, and with their rents likely to rise again, it’s never a bad idea to reconsider your family’s plan and ask yourself if renting is your best angle going forward. When asked why they haven’t purchased a home yet, not having enough saved for a down payment (44%) came in as the top response. The report went on to reveal that nearly half of all respondents believe that “a 20% down payment is required to buy a home.”

      The reality is, the need to produce a 20% down payment is one of the biggest misconceptions of homeownership, especially for first-time buyers. That means a large number of renters may be able to buy now, and they don’t even know it.

      Bottom Line

      If you’re one of the many renters who are tired of rising rents but may be confused about what is required to buy in today’s market, let’s get together to determine your path to homeownership.

      5 Tips to Help You Find the Accessible Home of Your Dreams

      Having trouble finding a home that fits your accessibility needs? You’re not alone. Homebuyers searching for accessible homes often find the process difficult and frustrating. However, these helpful home-buying tips can make locating your ideal home so much easier. Here’s where you should start when it comes to finding and buying a mobility-friendly home.

       

      Plan Your New-Home Checklist Now

       

      Searching for and buying a new home can be a hectic process. To keep essential tasks from getting lost in the shuffle, come up with a list of projects you need to complete to feel safe and comfortable in your new home. Be sure to put changing your locks at the top of that checklist so your new property will be secured from the start. Research top-quality locksmiths in and around your area. You can also use online resources to take care of other tasks around the home, such as hiring house cleaners or setting up necessary utilities.

       

      Make Organizing Finances a Top Priority

       

      Your new-home checklist should also include making financial accommodations to help you purchase your new home. This is a good time to meet with your financial advisor to go over any essential information that will be needed during the home-buying process. This is a step many buyers skip, but financial advisors can provide practical solutions to help you make the most of your home purchase. What’s more, advisors can often make securing home financing as stress-free as possible. That includes accounting for any additional expenses you may incur later, such as costs of accessibility renovations or other upgrades to your home.

       

      Start Your Search with a Real Estate Pro

       

      Many home-buying articles will advise you to begin your home search online, but this is another area where it pays to work with the pros. While that may work in many cases, homebuyers who are looking for specialty or luxury features in a home are better off contacting an experienced real estate professional. This is especially true when those specialty features include accommodations for accessibility. Finding a home with those features can be complicated, but a real estate company with experience in your desired area will be able to anticipate those complications and prepare solutions to offset them.

       

      Look for Stylish, But Safe, Accessibility Upgrades

       

      Your home should be safe and accessible, but that does not mean you have to sacrifice style and luxury. There are so many beautiful ways to incorporate accessibility into a home without those features being overtly obvious. French doors, for example, are a lovely option for wider doorways, while open floor plans can make moving around much easier. For larger homes with multiple floors, a custom elevator can improve your quality of life and add a touch of luxury as well. Your realtor can help you search for available local properties with these small touches so you can find a home that fits your needs and dreams.

       

      Wait Before Making Accessibility Changes on Your Own

       

      Once you and your realtor have put together a list of accommodations you need in a new home, your search should be much easier. However, you still may have trouble finding a property that completely fits with your needs. As you look at potential properties, keep in mind that you can always make renovations once you move in. Living in your home for a bit before you plan extensive upgrades will give you a better idea of what projects you need to make your home more comfortable. Plus, you can plan to employ a contractor to complete multiple jobs at once, rather than spacing them out over time.

       

      Mobility issues do not have to prevent you from finding the home of your dreams. There are plenty of homes with accessibility features on the market — you just need to know where to start to make finding a home that fits you a simple task. Consult an experienced realtor and use the tips above to take the guesswork out of finding an accessible home in your area. 

      5 Powerful Reasons to Own Instead of Rent

      5 Powerful Reasons to Own Instead of Rent | MyKCM

      Owning a home has great financial benefits.

      In a recent research paper, Homeownership and the American Dream, Laurie S. Goodman and Christopher Mayer of the Urban Land Institute explained:

      “Homeownership appears to help borrowers accumulate housing and nonhousing wealth in a variety of ways, with tax advantages, greater financial flexibility due to secured borrowing, built-in ‘default’ savings with mortgage amortization and nominally fixed payments, and the potential to lower home maintenance costs through sweat equity.”

      Let’s breakdown 5 major financial benefits of homeownership:

      1. Housing is typically the one leveraged investment available

      Homeownership allows households to amplify any appreciation on the value of their homes by a leverage factor. A 20% down payment results in a leverage factor of five, meaning every percentage point rise in the value of your home is a 5% return on your equity. If you put down 10%, your leverage factor is 10.

      Example: Let’s assume you purchased a $300,000 home and put down $60,000 (20%). If the house appreciates by $30,000, that is only a 10% increase in value but a 50% increase in equity.

      2. You’re paying for housing whether you own or rent

      Some argue that renting eliminates the cost of property taxes and home repairs. Every potential renter must realize that all the expenses the landlord incurs (property taxes, repairs, insurance, etc.) are baked into the rent payment already – along with a profit margin!!

      3. Owning is usually a form of “forced savings”

      Studies have shown that homeowners have a net worth that is 44X greater than that of a renter. As a matter of fact, it was recently estimated that a family buying an average priced home this past January could build more than $42,000 in family wealth over the next five years.

      4. Owning is a hedge against inflation

      House values and rents tend to go up at or higher than the rate of inflation. When you own, your home’s value will protect you from that inflation.

      5. There are still substantial tax benefits to owning

      We know that the new tax reform bill puts limits on some deductions on certain homes. However, in the research paper referenced above, the authors explain:

      “…the mortgage interest deduction is not the main source of these gains; even if it were removed, homeowners would continue to benefit from a lack of taxation of imputed rent and capital gains.”

      Bottom Line

      From a financial standpoint, owning a home has always been and will always be better than renting.

       

      What You Need to Know About Private Mortgage Insurance (PMI)

      What You Need to Know About Private Mortgage Insurance (PMI) | MyKCM

      Whether it is your first time or your fifth, it is always important to know all the facts when it comes to buying a home. With the large number of mortgage programs available that allow buyers to purchase homes with down payments below 20%, you can never have too much information about Private Mortgage Insurance (PMI).

      What is PMI?

      Freddie Mac defines PMI as:

      “An insurance policy that protects the lender if you are unable to pay your mortgage. It’s a monthly fee, rolled into your mortgage payment, that is required for all conforming, conventional loans that have down payments less than 20%.

      Once you’ve built equity of 20% in your home, you can cancel your PMI and remove that expense from your mortgage payment.”

      As the borrower, you pay the monthly premiums for the insurance policy, and the lender is the beneficiary. Freddie Mac goes on to explain that:

      “The cost of PMI varies based on your loan-to-value ratio – the amount you owe on your mortgage compared to its value – and credit score, but you can expect to pay between $30 and $70 per month for every $100,000 borrowed.” 

      According to the National Association of Realtors, the average down payment for all buyers last year was 13%. For first-time buyers, that number dropped to 7%, while repeat buyers put down 16% (no doubt aided by the sale of their homes). This just goes to show that for a large number of buyers last year, PMI did not stop them from buying their dream homes.

      Here’s an example of the cost of a mortgage on a $200,000 home with a 5% down payment & PMI, compared to a 20% down payment

      What You Need to Know About Private Mortgage Insurance (PMI) | MyKCM

      without PMI: The larger the down payment you can make, the lower your monthly housing cost will be, but Freddie Mac urges you to remember:

      “It’s no doubt an added cost, but it’s enabling you to buy now and begin building equity versus waiting 5 to 10 years to build enough savings for a 20% down payment.”

      Bottom Line

      If you have questions about whether you should buy now or wait until you’ve saved a larger down payment, let’s get together to discuss our market’s conditions and help you make the best decision for you and your family.

      The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Keeping Current Matters, Inc. does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Keeping Current Matters, Inc. will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

      Time for Your Dream Home, Gen X!

      Time for Your Dream Home, Gen X! | MyKCM

      During the housing market crash, Gen X homeowners lost more wealth than other generations. However, things are changing now! A strong economy, increasing home prices, and the recovery of the housing market are helping this generation to regain their lost wealth.

      According to Pew Research Center,

      Their fortunes have rebounded more than those of other generations during the post-recession economic expansion and as home and stock prices have risen. Since 2010, the median net worth of Gen X households has risen 115%. In fact, in 2016, the most recent year with available data, the net worth of a typical Gen X household had surpassed what it was in 2007 ($84,200 vs. $63,400)”.

      The same report also mentioned,

      15% of Gen X’s homeowners were ‘underwater’ on their homes in 2010 (meaning they owed more than they owned). By 2016 only 3% were underwater.

      As a result of homes regaining market value and their increasing net worth, many Gen Xers are presented with the opportunity of selling their current home in order to move up to the house they always dreamed of!

      According to the 2019 Home Buyers and Sellers Generational Trends Report by the National Associations of Realtors, in 2018 Gen Xers made up the second largest share of home buyers by generation at 24%.

      The report also provided some highlights about their purchase:

      • Greatest share that purchased a multi-generational home (16%).
      • Largest share that purchased a detached single-family home (88%).
      • Highest median household income ($111,100).
      • Bought the most expensive homes of all the generations.
      • Job-related relocation was identified as the primary reason to buy.

      But this generation is not only buying- they are selling too!

      • The largest share of home sellers (25%).
      • Highest median household income among sellers ($123,600).
      • Tenure in the previous home was a median of 9 years.
      • House too small was indicated as the primary reason to sell.
      • 91% sold the home using a real estate professional.

      Bottom Line

      If you are a Gen Xer who would like to know exactly how much your house is worth today so you can move up to the home of your dreams, let’s get together to analyze your current circumstances.

       

      The Death of the Vacant Listing?

       

      The Death Of The Vacant Listing?

      About fifteen years ago after attempting to sell a vacant, unfurnished loft, we broke down and took a trip to IKEA to buy a basic set of furniture to stage the property. Style-wise we kept everything mostly white with some black accents, simply to help prospective buyers visually 'scale' the home.

       

      We created an appealing living room and dining area, added some cowhide rugs and bought a Le Corbusier chaise to 'up' the look a bit. It worked! The loft sold rather swiftly after that. Later we added staging 'artwork' - framed blown-up photos that I'd personally taken that were abstracted enough to potentially be 'real' art - as we found so many blank white walls looked cold and uninspired. We re-used that suite of staging items dozens of times afterward with great success. Flash forward and today, I cannot even imagine showing an unfurnished home ever again. It would be marketing suicide, especially on the high end. Professional staging has elevated this from my IKEA-fueled days to an entirely new level where buyers (even at the $20m+ level) are askiing to buy the staged homes fully furnished.

       

      I recall meeting with Rob Lehman about two years ago. He asked me what the one cost-distracting item was that was most critical to what we do and of course I answered STAGING. If we could stage all our listings, and offset the cost for the seller, I thought we'd have a winner.  At the time I envisioned a warehouse full of furniture, but of course that would have been unmanageable.  Of all the value-adds that we bring to the table, I truly believe that COMPASS CONCIERGE's role in providing us the ability to stage by financing the up-front cost is a game-changer for our industry. Anything that makes our role easier and takes away the stress of our clients is a certain winner.

       

      Furnishings not only help buyers scale a property: now, professional staging creates an aspiration lifestyle too. Competing against a staged property with an unfurnished property is almost a waste of time unless deep discounting or a super-hot sellers market is a consideration.

       

      #CompassComingSoon

      #CompassComingSoon

      What is it exactly about Compass COMING SOON listings that is important for you as an agent individually, as well as for all of us at Compass collectively - agents and staff - in every region of the USA? Here are my TOP 10 reasons:       

      1.  Human Beings are by their very nature attracted to having knowledge first, even more so in to-days day and age where there is so much information out there.   

       2.   Like a movie, who wouldn't want to see a movie before the crowds see it? While we like to get information first, we also like the excitement and exclusivity of knowing we were there first. As marketers creating some sense of excitement and energy has a great value and fuels energy behind a marketing campaign. It adds an additional marketing moment of substantive value. 

      3.  COMING SOON listings - if they appear on compass.com first - drive traffic to compass.com. We are all beneficiaries when there are more eyeballs focused on our website.                 

      4.  COMING SOON listings are not exclusionary of other agents within Compass or at competing brokerages. We encourage ALL agents to see our coming soon listings, show them and sell them! All agents benefit by this. They are NOT off-market listings at all.             

      5.  COMING SOON listings take away from 'days on market'. For those of you lucky enough to be in super-fast moving markets, this may not matter to you....yet. Having a COMING SOON listing out for 10 days without the clock starting has value in a world where many search engines automatically list properties in priority of newest.           

      6.  Most Broadway productions are tested in smaller markets before coming to Broadway. Like a Broadway Show, a COMING SOON listing allows you to test the market too. Should you lower or raise the price? Did several agents point out a flaw or feature you may not have noticed or focused as much attention on?                                               

      7.  Clients and Sellers love creative marketers. A COMING SOON listing demonstrates agent innovation and adds to your marketing arsenal. It demonstrates additional value agents bring to the table.       

      8.  In a world where aggregators and technology entities continue to make every effort to minimize or eliminate the human agent, COMING SOON re-captures our essential role in the brokerage equation. It is something these antagonists do not have and may break the consumer's addiction to them. We have evidence it's doing so already.   

      9.  Social Media requires many impressions to have an effect. Many consumers search for newness via social media. COMING SOON affords your followers a reason to follow you more closely....and add followers! In New York a disclaimer is essential, so be sure to check your area what the local MLS rules require: "All listings are simultaneously syndicated to the REBNY RLS. Compass is a licensed real estate broker. All material herein is for informational purposes only, was compiled from sources deemed reliable but is subject to errors and omissions. Compass makes no representation or guarantees that Coming Soon properties are available in your region, or that its use will result in the benefits described herein. This is not intended to solicit properties already listed. Equal Housing Opportunity."                 

      10.  In markets where there is a growing inventory, a COMING SOON campaign can draw attention to your new listing in a crowded sea of options. Slower markets are finding the exhausted buyer who has seen everything to be the most inclined to pounce on the newest. In fast-moving markets with limited options, a time advantage is always a plus.                                                                       

      Have a wonderful day and MEMORIAL DAY WEEKEND. Drive carefully if you are driving and please take care!     

       
       

      Compass Contemplations for Wednesday

      DID YOU KNOW? Existing-home sales ran at a seasonally adjusted annual 5.19 million rate in April, the National Association of Realtors said Tuesday. That was 0.4% lower than March and 4.4% lower than a year ago. The median selling price in April was $267,300, a 3.6% annual increase. First-time buyers made up 32% of transactions in April, while individual investors accounted for 16% of buyers. (Marketwatch)


      DID YOU KNOW? Those living in Minnesota have an average score of 713. South Dakota, Vermont, New Hampshire, and Massachusetts round out the top 5 US states with the highest average credit scores for 2018. The lowest score, 652, belonged to those living in Mississippi. Louisiana, Nevada, Georgia, and Texas are all in the bottom of Experian’s ranking as well, with scores of 659 or below. (CNBC)

      DID YOU KNOW? Over the past year, 22% of respondents in a survey of 2,200 US adults say the average credit card balance they carried was between $100 - $500, while about 10% of people say they had a balance over $5,000. At close to 18% interest.

      DID YOU KNOW?  Over 85% of videos on Facebook are watched without sound. Use subtitles and text. Make the visuals SING!  (INMAN)                                                                                           

      DID YOU KNOW? 25% of American jobs - belonging to about 36 million people - are at risk of being replaced by automation or artificial intelligence over the next 20 years, according to a Brookings Institution report issued in January.

      DID YOU KNOW? New York City’s economy grew 3% from January through March 2019, a bit more than the 2.7% jump in gross city product recorded in the first quarter of 2018. (Crain’s)  

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