“Is it economically feasible for me to buy a house?” Barrett’s Corner Ep. 11

Check out this week’s episode of Barrett’s Corner below!  This week’s question comes from Scout in Austin, TX.

Also, check out all my videos on my YouTube channel.  booyah!

 

 

Barrett Raven
barrettraven@gmail.com
512.970.2648

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Why so many home sellers enlist the help of a real estate agent…

Did you know that FSBOs —homes that are For Sale by Owner — account for only about 8 percent of home sales? Or that many properties that start out as FSBOs end up being listed with and sold by a Realtor? Here’s why so many people sell their homes with the help of a real estate agent:

More exposure. Homes offered by owner get less exposure to home buyers, and in multiple offer situations, fewer bidders. The higher the number of bidders on a property and the more exposure a property gets, the better, when it comes to a home’s selling price.

Pricing assistance. A common mistake among those selling on their own is pricing their property too high or too low. A real estate agent is armed with information that can help you price your property right so that it sells quickly without leaving money on the table. So it’s not difficult to understand why the typical FSBO home sold for $185,000 compared with $240,000 for agent-assisted home sales. Real estate agents can be a tremendous help in setting the right listing price and helping home sellers get the most for their property.

Assistance with selling process. Real estate agents do many tasks other than simply helping you get the most money for your property. Agents manage all of the required paperwork involved in selling a home, help the seller determine things they should do before they list their home and during the listing process, and coordinate the other professionals involved in a home sale, such as an inspector and appraiser.

 

 

Barrett Raven
barrettraven@gmail.com
512.970.2648

The benefits of shopping for a home in late summer

Year in and year out, spring and summer are the busiest home buying seasons. And each year, home buying activity starts to slow down in August and September. Many people time household moves during summer vacations and want to be settled into their new homes when school starts again for their children. That’s exactly why late summer/early fall can be a great time to shop for a home.

Research shows that historically, due to the seasonal slowdown in demand, the supply of available properties tends to start to increase in late summer. Real estate website Zillow.com has found that in housing markets nationwide, listings tend to climb in August and the highest share of listings with at least one price reduction most often occur in August and September.

In addition, the inventory of homes available for sale typically peaks in August, declining into fall and through winter and not increasing again until the spring home buying season begins again.

It’s also important to keep in mind that although mortgage rates are up from record lows, they remain low by historical standards. Low mortgage rates stretch your home buying dollars. Thinking about buying a home? Start your home buying journey with us.

 

 

Barrett Raven
barrettraven@gmail.com
512.970.2648

You’re in a multiple-offer situation. Now what?

You found a home your family loves. But you’re not the only one who wants it. What’s the best way to make an offer on a home that other buyers are vying for as well? Here are some ways to put your best foot forward:

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Sometimes, multiple offers got me like…

Start off with your best offer. This isn’t the time to start with a lowball offer and wait for the seller to mak

e a counteroffer before you offer more. If you have competition, you’ll want to consider making your best offer right off the bat. That said, don’t let a multiple offer situation push you into offering more than you’re comfortable paying.

Make sure you’re pre-approved. Make sure you’re pre-approved for a home loan before you start your home search, not just prequalified. Attach your pre-approval letter to your offer.

Don’t skimp on earnest money. An adequate earnest money deposit is a sign that you’re serious about buying the home.

Don’t waive the home inspection. In multiple offer situations, it’s easy to get caught up in the competition and do whatever it takes to win. To stand out, some buyers will even elect to not make a professional home inspection a contingency of their offer. Home inspections are an important part of the home buying process and can help you spot costly problems.

Relax. There are so many parts of a multiple offer situation you have no control over, so try not to let the stress get to you!

 

 

Barrett Raven
barrettraven@gmail.com
512.970.2648

What to expect when an appraisal comes up short

32498400 - mortgage concept. isolated on white background 3dThe appraisal is an important part of the home buying process. But what happens if the appraisal comes up short of the agreed-upon selling price?

Here’s an example: A home is listed for sale for $350,000. It’s a multiple bidding situation, so you offer a higher price of $370,000 to gain an edge over other buyers. Your offer is accepted by the seller. However, your lender’s appraisal comes back and it shows the value of the home is only $350,000. That means the lender is only going to provide you with a loan based on that amount.

When an appraisal comes in lower than expected, home buyers have a few choices. If you really want the home and have the cash on hand, you could make up the difference with a larger downpayment. You also could try to negotiate a lower selling price. The seller doesn’t have to lower the selling price, of course, and will understandably be reluctant to do so. In some cases, the buyer and seller each give a little, with the seller lowering the price and the buyer making a larger downpayment.

Another option is to see if it’s possible to order a second independent appraisal or to appeal the existing appraisal. Your lender can let you know if there’s any type of appraisal review process. You and your real estate agent will have to analyze the appraisal to make sure the appraiser included all relevant comparable sales on the report

Lastly, if you have an appraisal contingency in your offer, you have the option of walking away. It’s a last-ditch option if all other efforts fail.

 

 

Barrett Raven
barrettraven@gmail.com
512.970.2648

Can homeownership make you happy? 

12656437_MDid you know that numerous studies over many years show a link between owning a home and happiness and overall well-being? For example, a report by the Consumer Financial Protection Bureau shows that homeowners generally have higher financial well-being than non-homeowners.

In the CFPB’s report, homeowners have an average financial well-being score of 58. That’s higher than both renters (with average of 49) and those who neither rent nor own (average of 50). The U.S. average financial well-being score is 54. You can read the entire report at this link.

Research studies have linked owning a home to a number of positive outcomes. Researchers at the University of Southern California and the University of San Diego, for example, have linked homeownership to a reduced risk of teenage pregnancy and a lower possibility that a child will drop out of school. A study conducted by Ohio State University found that children of parents who own their own homes are more likely to score higher in reading and math and have fewer behavioral problems.

At the very least, buying the right home can a key ingredient in being happy, according to a report by HomeAdvisor. The company’s research in the area has found that homeowner happiness boils down to an affordable and comfortable home in a safe and connected neighborhood and with a reasonable commute. Good things to keep in mind during your next home search.

 

 

Barrett Raven
barrettraven@gmail.com
512.970.2648

Pre-approved for a home loan? Don’t do these four things…

When purchasing a home, your mortgage pre-approval is based on your current financial situation. That’s why once you are pre-approved, you should avoid making big changes to your finances. Here are several things you’ll want to avoid doing while you’re in the process of financing a home purchase:

Do the opposite of what I'm telling you...and you will be doing this at the closing table..jpg

1. Taking on more debt. Talk to your lender first before you open any new credit accounts, request a credit line increase or co-sign on a loan. As a general rule, you’ll want to avoid taking on any new debt before you close on your home.

2. Changing your job. Your pre-approval is based on a number of factors, including your employment status and pay.

3. Making a big purchase. Check with your lender before making any big purchase, either with credit or with cash. Wait to purchase furniture and other big-ticket items.

4. Making late payments. Stay up to date on all of your credit obligations and utility payments. Now’s not the time to have overdraft your checking account.

 

 

Barrett Raven
barrettraven@gmail.com
512.970.2648