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An ongoing series of informational entries

Homeowners in Danger of Foreclosure

July 7, 2021

        One group of homeowners continues to be behind on their mortgage payments. If that trend should continue, it could threaten the strength of certain real-estate markets across the country.

        Many homeowners with mortgages backed by the Federal Housing Administration, or FHA, are delinquent on their homes, according to a new analysis from the American Enterprise Institute, a conservative think-tank based in Washington, D.C.

        Around 14.7% of the 7.6 million FHA mortgages outstanding nationwide were delinquent as of May, up slightly from the previous month. Additionally, 10.5% of these loans were seriously delinquent, meaning they were 90 days or more past due and in danger of going into default.

         These figures include loans that are in forbearance — at the start of the pandemic, federal regulators and lawmakers set up forbearance programs that allow homeowners to pause making mortgage payments. Those forbearance programs were extended again, allowing homeowners to make an initial request for payment relief until the end of September. Depending on when a homeowner made their first request, they can pause payments for anywhere from six to 18 months.

        The overall number of Americans requesting forbearance has declined in recent weeks, but the percentage of borrowers facing financial challenges remains higher among FHA borrowers. The FHA program targets homeowners with lower credit scores and less money saved for a down payment — the program tends to be popular among first-time buyers and people of color.

        The open question is what happens to the FHA borrowers in distress currently when the clock runs out on their forbearance. Most Americans who exited forbearance successfully resumed making their payments and were able to arrange to have the money they owe deferred until the end of the loan’s term. Those who can’t make their normal payments as they previously did may be able to have their loan modified, but that isn’t a given.

FHFA Pushes COVID-19 Forbearance to Sept 2021

June 7, 2021

        Real estate pros are report homes fetching multiple offers to the likes of 20 or even 97 bids on listings as the homebuying frenzy continues. To win in a bidding war, buyers may be willing to waive contingencies and stretch their budgets to the absolute max.

       The Federal Housing Finance Agency—the regulator of Fannie Mae and Freddie Mac—has extended pandemic-related forbearance options for multifamily properties until the end of September. This marks the third extension of the program, which most recently had been set to expire on June 30.

       Property owners with a Fannie Mae or Freddie Mac-backed multifamily mortgage can enter a new or modified forbearance if they experience a financial hardship due to the pandemic. To qualify, property owners must inform tenants in writing about tenant protections available during the property owner’s forbearance and repayment period. Property owners also must agree not to evict tenants solely for the nonpayment of rent while the property is in forbearance.

       While COVID-19 cases are declining and many homeowners continue to emerge from forbearance, many renters, who are unable to benefit from rising home prices, have not financially recovered from the pandemic, the FHFA’s director, said in a statement. To help those families still struggling to pay their rent and to help multifamily property owners maintain their properties, FHFA is extending the multifamily COVID-19 forbearance and tenant protections through the end of September 2021.

Buyers Go to Extremes to WIN a HOME!!!

May 7, 2021

        Real estate pros are report homes fetching multiple offers to the likes of 20 or even 97 bids on listings as the homebuying frenzy continues. To win in a bidding war, buyers may be willing to waive contingencies and stretch their budgets to the absolute max.

        Some buyers are offering $100,000 above asking price, Debbie Barrera, a broker at Realty Austin in Austin, Texas, told The Wall Street Journal. She even had a buyer offer $500,000 above asking price for a home with a pool.

         “It’s just crazy, there’s no other word to describe it,” Barrera told the WSJ. “It’s a frenzy.”

             What’s driving it? Low housing inventories. In March, the housing market had 28% fewer homes for sale than a year earlier, according to the National Association of REALTORS. Meanwhile, historically low mortgage rates are enticing buyers to purchase a home now.

                     More Buyers Paying Cash to Win Bidding Wars

                              ‘I’ve Never Seen a Market This Hot’

                         Report: Half of Homes Sell Above List Price

       Sellers are expecting a lot more from buyers when they do list their homes for sale, too. A recent survey showed that 24% of homeowners expect to get more than their asking price and 29% of sellers plan to ask for more than what they think their home is worth. 

       Further, 16% of home sellers expect a bidding war on their home and to have multiple offers to choose from; 25% expect to have an offer within a week of listing; 16% expect to receive a cash offer; 24% don’t expect to pay for any repairs or improvements to the property; and 16% of sellers expect buyers to waive contingencies, such as financing, appraisal, or home inspection.

       However, waiving too much or overpaying could lead to buyer’s remorse later on.  For example, financial analysts are warning buyers to stay within their budget and not to overstretch to win in a bidding war. Most analysts recommend homeowners spend no more than between a quarter and a third of their monthly gross income on a mortgage payment or between 35% and 45% of a monthly gross income if including maintenance, taxes, and insurance. 

For example, buyers who earn $100,000 a year shouldn’t spend much more than about $2,340 a month on their mortgage, depending on their financial goals like paying off debts, saving for retirement, or meeting other obligations.

Millions of Americans' still can't make their 

mortgage payments? 

April 7, 2021

     Although the economy has shown significant signs of improvement in 2021 thus far, many homeowners continue to face financial challenges. A new report from the Consumer Financial Protection Bureau finds significant disparities among which Americans have encountered those hurdles.

       As of March, around 4.7% of all active mortgage loans remained in forbearance, the CFPB estimated, while roughly 0.5% of loans were believed to be 60 or more days delinquent.  

       The forbearance programs put in place by federal lawmakers in 2020 allow mortgage borrowers to postpone making their monthly payments if they’re experiencing financial hardship. At the end of forbearance, servicers are supposed to provide these homeowners with a range of options to handle the unpaid debt that accrued over during that time.

       Many homeowners who requested forbearance at the start of the pandemic have already resumed making their monthly payments. The remaining homeowners who are still taking advantage of the payment relief are more likely to be people of color, have less equity in their home and to have faced challenges paying off their debt prior to COVID-19.

      As with other financial indicators, the CFPB found there were significant disparities based on race and ethnicity in whether a borrower was likely to still be in forbearance on their home loan as of March. 

       More than 9% of Black mortgage borrowers were in forbearance, while the same was true of more than 8% of Hispanic borrowers. In both cases, that’s significantly higher than the forbearance rate among white borrowers, of whom less than 4% are in forbearance.

Americans fall further behind during the pandemic and can't make their mortgage payments

March 7, 2021

     Homeowners are having a harder time catching up on missed mortgage payments than other borrowers, new federal research shows.

       The share of  homeowners in forbearance stood at about 11% in mid-April, more than double the overall rate and that of white borrowers, according to the Federal Reserve Bank of Philadelphia. The rate for Hispanic homeowners hovered around 8.4%.

       The mortgage forbearance program laid out in the March 2020 stimulus bill was designed as a short-term solution, a way for homeowners to postpone payments on federally backed mortgages until the economy and consumers recovered.

       That is how the program has functioned for many. The share of homeowners in forbearance has decreased for eight straight weeks, to 4.49% as of mid-April, according to the Mortgage Bankers Association. Almost one in 10 homeowners signed up for forbearance at the height of the program’s use last June.

       But the overall improvement masks a slower recovery for Black borrowers. Between June 2020 and mid-April 2021, the share of Black homeowners in forbearance fell 35%, compared with a 43% drop overall, according to data from the Federal Reserve Bank of Philadelphia. Asian, white and Hispanic borrowers saw improvement rates of between 45% and 53%.

        The uneven economic recovery threatens to widen racial gaps in wealth and homeownership. Heading into the pandemic, the median Black household had about eight times less wealth, or the difference between assets and debts, than the average white family, according to the Brookings Institution. In 2020, 45% of Black families owned homes, below the 75% rate of white families and 67% of Americans overall, according to the Census Bureau.

Where You Can Still Snag Homes for $100K or Less 

February 7, 2021

     Home prices are surging by double-digit percentages annually, but deals can still be found in pockets throughout the country.

  These searched listings in 150 of the largest metro areas to find which ones had the most homes for sale at $100,000 or less. That is significantly lower than the national median asking price, which was $340,000 in December.  Homes that are $100,000 or less aren’t exactly common.  The following is list of the seven markets with the most listings for $100,000 or lower. Only one metro per state was included for geographic diversity. The metros reflected include the city and surrounding towns, suburbs, and smaller urban areas.

        1. Detroit

Median home list price: $251,550

Number of homes listed at $100,000 or less: 1,070

        2. St. Louis

Median home list price: $231,500

Number of homes listed at $100,000 or less: 916

        3. Pittsburgh

Median home list price: $239,500

Number of homes listed at $100,000 or less: 659

        4. Chicago

Median home list price: $327,025

Number of homes listed at $100,000 or less: 506

        5. Davenport, Iowa

Median home list price: $149,950

Number of homes listed at $100,000 or less: 499

        6. Cleveland

Median home list price: $197,000

Number of homes listed at $100,000 or less: 462

        7. Birmingham, Ala.

Median home list price: $256,800

Number of homes listed at $100,000 or less: 386

Markets That Will Grow the Most in 2021

January 7, 2021

     For several housing markets, their growth in 2020 is expected to continue this year, particularly in cities where tech and government jobs are more plentiful. 

7 top markets for 2021 based on the combined yearly percentage growth in both home sales and prices forecast for 2021.

       1. Sacramento-Roseville-Arden-Arcade, Calif.

2021 sales growth (year-over-year prediction): 17.2%

2021 price growth (year-over-year prediction): 7.4%

Combined growth: 24.6%

       2. San Jose-Sunnyvale-Santa Clara, Calif.

2021 sales growth: 10.8%

2021 price growth: 10.8%

Combined growth: 21.6%

     3. Charlotte-Concord-Gastonia, N.C.-S.C.

2021 sales growth: 13.8%

2021 price growth: 5.2%

Combined growth: 19%

     4. Boise City, Idaho

2021 sales growth: 9.8%

2021 price growth: 9.1%

Combined growth: 18.9%

     5. Seattle-Tacoma-Bellevue, Wash.

2021 sales growth: 8.9%

2021 price growth: 9.7%

Combined growth: 18.6%

     6. Phoenix-Mesa-Scottsdale, Ariz.

2021 sales growth: 11.4%

2021 price growth: 7%

Combined growth: 18.4%

     7. Harrisburg-Carlisle, Pa.

2021 sales growth: 14.4%

2021 price growth: 3.8%

Combined growth: 18.2%

The Top 5 Real Estate Sales, Marketing Stories of 2020

December 7, 2020

     Your online outreach may have never been more important than it was in 2020—a socially distant year due to the COVID-19 pandemic. Generating content perfectly tailored to your prospects could help you increase your clout, while also being an information source for buyers and sellers to help them through the uncertainties of the year.

Check out these top five most-clicked on stories in sales and marketing: 

1. Easy Property Fixes to Prompt a Quick Sale

Small upgrades and aesthetic swaps can make all the difference in drawing buyers to a home.

2. Earnest Money: A Primer for New Agents

Get an overview of what real estate agents and their clients should know about earnest money and how it impacts the real estate transaction.

3. Personable Content Gets Leads

Pay attention to the messages you’re sending—not just the tools you’re using—to connect with prospects.

4. MLS Games People Play

Think twice before tweaking data to boost property exposure. It may be common, but it's unprofessional.

5. Strategies to Land Listings in Today’s Market

You need to try more than traditional prospecting methods to find sellers in this pandemic-weary market. Learn how to do what your competitors aren’t.

Tight Lending Blocks Some Would-Be Buyers

November 7, 2020

     Not everyone is able to take advantage of all-time-low mortgage rates. Available housing credit has reached its lowest level since February 2014, Bloomberg News reports.

       In January 2019, 44% of Ginne Mae’s purchase loans were granted to borrowers who had FICO scores below 700 and debt-to-income ratios of more than 40%. However, a year later, Ginnie Mae granted just 38% of borrowers loans with FICO scores below 700. And in August, that dropped to 36%, according to data from the Urban Institute. Ginnie Mae guarantees loans that are popular with first-time home buyers and lower-income borrowers.

       Overall, an index of housing credit produced by the Mortgage Bankers Association shows that the availability of loans has dropped eight out of nine months so far this year. MBA’s index has fallen 35% year over year.

       On the other hand, borrowers with good credit are getting the lowest mortgage rates ever, making their home purchases even more affordable. Freddie Mac reported last week that the 30-year fixed-rate mortgage averaged an all-time low of 2.81%, the 10th record low for mortgage rates.

Are Low Mortgage Rates to Blame for 

High Home Prices?

October 7, 2020

     Double-digit price increases for homes are not exactly what most people in real estate predicted to occur in a recession. But could low mortgage rates—the 30-year fixed-rate mortgage hit a record-low average of 2.81% last week—be partially to blame?

“The combination of what could be the lowest mortgage rates of our lifetimes, a paucity of inventory, and a desperate rush of buyers has resulted in median home list prices hitting new records,” realtor.com® reports.

       Home prices were 12.2% higher for the week ending Oct. 10 than they were a year ago, realtors data shows.

"It's unprecedented for us to get a massive run-up in home prices during a recession," says Sam Khater, Freddie Mac's chief economist. "It's clear that [mortgage] rates matter even more than unemployment rates.”

       Low mortgage rates are helping buyers afford higher home prices, and they’re creating a buying frenzy in the housing market to lock in such low rates. Home buyers purchasing a median-priced home at about $350,000 still pay about $80 less than if they purchased a median-priced home of $315,000 last year at a higher interest rate average of 3.69%, a realtor.com® analysis shows.

        Affordability goes up with low mortgage rates. However, home buyers do need a higher down payment as prices rise.

High home prices with high mortgage rates, on the other hand, is not a good combo, that if mortgage rates go up by even a half-point, hundreds of thousands of buyers may no longer be able to purchase a home. First-time buyers, who tend to have smaller budgets, likely would experience the biggest repercussion.

Black Homeowners Pay More for Mortgages

September 7, 2020

     Black homeowners pay, on average, more in mortgage interest, mortgage insurance, and property taxes than other homeowners, according to a new study from Massachusetts Institute of Technology. The differences are making wealth gaps grow between Black and white homeowners, says study author Edward Golding, executive director of MIT’s Golub Center for Finance and Policy.

       The study finds that the overall differences in mortgage interest payments ($743 per year), mortgage insurance premiums ($550 per year), and property taxes ($390 per year) add up to $13,464 over the life of the loan. “That amounts to $67,320 in lost retirement savings for Black homeowners,” the study notes.

       Black homeowners continue to pay higher interest rates due to the lack of refinance opportunities too, Golding says in the study. This results in Black homeowners paying about $475 more per year than white homeowners.

       Also, nearly a quarter of the disparity in homeownership costs for Black homeowners is due to local property assessments.

Inventory Uptick Signals More 

Confident Sellers

August 7, 2020

     More homes are gradually coming onto the market in a hopeful sign that homeowners may finally be warming up to the idea of selling, according to data from realtor.com®’s latest Weekly Housing Report. An incremental uptick in available inventory is welcome news to home buyers struggling to find a property to purchase. Last week, homes sold a full two weeks faster than the same time period a year ago and were listed for an average of $38,000 more, realtor.com®’s report shows.

       “Home sales are shaping up for a record-breaking October,” says Javier Vivas, director of economic research for realtor.com®. “There are so many buyers in the market right now that even the slight improvements we’re seeing in inventory could push the number of homes sold this month near mid-2000s levels. If sky-high prices continue to lure more sellers into the market, it could prompt the inventory rebound we’ve been waiting for—which would be welcome news for frustrated buyers.”

       Total inventory is down 38% compared to a year ago. However, last week's numbers mark the fourth consecutive week that the number of homes for sale has stayed even or improved. The number of new listings on the market fell 5% compared to a year ago, also marking an improvement over last week, when new listings were down 7%.

Pet Peeves Drive Bathroom Renovations, Houzz Says

July 7, 2020

     A top pet peeve of homeowners: an old or outdated space in the owner’s suite bathroom. It has sparked a wave of renovations of the space, according to the 2020 U.S. Houzz Bathroom Trends Study, reflecting nearly 1,600 homeowners in the midst of or planning a remodeling project for an owner's suite bathroom .

       Nearly 90% of homeowners renovating an owner's suite bathroom say they are changing the style as a way to bring it up to date, the study says. Insufficient storage, small showers, poor lighting, and limited counter space were the chief complaints about the spaces.

       That’s likely why the main areas upgraded in an owner's suite bathroom renovation tend to be showers, light fixtures, countertops, and vanity cabinets, the Houzz survey shows. Homeowners are seeking larger spaces. They’re increasing the size of their showers (54% of bathroom renovators), and 20% are increasing their bathroom’s overall size.



Nearly 16 Million People Have Moved During the Pandemic

June 7, 2020

     The pandemic has sparked Americans to relocate in large numbers. From February through July, more than 15.9 million people filed change-of-address requests with the United States Postal Service.

Twenty-eight percent of nearly 10,000 adults recently surveyed by the Pew              Research Center said the most important reason they moved was to reduce their risk of contracting COVID-19. Another 23% said they moved because their college campus closed; 20% wanted to be with their family; and 18% cited financial reasons for their move, including job loss.

         Many of these moves may be temporary, however. Temporary change-of-address requests were up nearly 27% from February through July compared to last year, according to an analysis from MyMove.com. A temporary change of address reflects consumers who forward their mail to a new location but plan to move back to their old address within six months.

Record-High Lumber Costs Drive Up 

New-Home Prices 

May  7, 2020

      Shoppers seeking newly constructed homes are facing sharply increased prices as the cost of lumber has soared to record highs. Many buyers are finding themselves priced out of the new-home market, builders say.

Recent price spikes in lumber have added more than $16,000 to the typical cost of a new single-family home. The multifamily sector is also feeling the impact, with the typical apartment seeing an increase of more than $6,000, according to data from the National Association of Home Builders.

       The increase has priced more than 2.1 million U.S. households out of the market for a median-priced new home, according to the NAHB.

Average lumber prices have increased by more than 170% since mid-April. They’ve reached a record high of more than $800 per 1,000 board feet, a common industry measure. Builders are advocating for lawmakers to take action to increase the supply and reduce the cost of lumber, saying lumber shortages could stress the housing market beyond its current state if too many buyers become priced out of the new-home market.

       Residential construction can lead the nation out of its current economic downturn, as it has during virtually every major economic disruption over the past five decades, It is vital that elected officials support policies that help America’s home builders gain access to reasonably priced building materials, particularly lumber.

Mortgage Amounts Surge to Record Highs 

April  7, 2020

     Home buyers are taking on bigger mortgages as they compete in a fierce housing market and face higher home prices. The average home purchase loan amount reached $375,000 last week, according to the Mortgage Bankers Association. That represents the highest average home mortgage since the MBA began the survey in 1990.

       Tight housing inventories across the country mixed with strong buyer demand are causing home prices to quickly appreciate. The National Association of REALTORS® reported that in October the median existing-home price for all housing types jumped 15.5% year-over-year to $313,000.

       In general, financial analysts recommend that monthly housing costs should not exceed 30% of take-home pay. Those monthly housing costs should include more than just the mortgage payment too, but also property taxes, homeowners insurance costs, private mortgage insurance (if applicable), and homeowner association fees. For example, The Motley Fool says that if a household earns $3,000 a month after taxes that would then give them $900 to spend on their monthly mortgage payment and those additional housing expenses.

Appliance Manufacturers Focus on Hygiene 

March  7, 2020

     Appliance manufacturers are putting a new focus on keeping bad germs out as they look to attract virus-weary buyers to their new products. LG Electronics, Whirlpool, and others are rolling out products that focus on hygiene by removing germs and allergens.

For example, LG Electronics is touting refrigerators that have sterilizing ultraviolet lights. Whirlpool Corp. is launching washing machines with built-in heating designed to eliminate germs from clothes. 

Beko Electrical Appliances Co. has introduced “HygieneShield” to a range of its refrigerators and ovens that include disinfection drawers.

Since the pandemic, consumers have been rushing to buy products for greater germ control inside their homes. From mid-March to the end of August, sales of vacuum cleaners, fans, humidifiers, and water filters climbed 32% compared to a year ago, according to NPD data, as reported by The Wall Street Journal. Washing machines with purifying steam functions increased in demand by 46% from May to August. Air-treatment appliances increased 23% in that time period.

10 Places Where Living Costs Are Actually Dropping 

February  7, 2020

     Apartment Guide recently analyzed 250 of the largest metro cities in the U.S. to find out where the cost of living is going down. Researchers factored in groceries, housing, utilities, transportation costs, healthcare, and miscellaneous expenses into overall cost changes. The following are the places where the cost of living expenses dropped the most from the first quarter of 2020 to the third quarter:

Palm Coast-Flagler County, Fla.: -3.4% overall cost change (led by a 13.7% drop in groceries)

Johnson City, Tenn.: -3.3% (led by a 12.6% drop in groceries)

Huntsville, Ala.: -3.1% (led by a 7.4% drop in transportation)

Casper, Wyo.: -3% (led by an 8.5% drop in groceries)

Joliet-Will County, Ill.: -3% (led by a 7.7% drop in groceries)

Minot, N.D.: -3% (led by a 5.7% drop in housing costs)

Sussex County, Del.: -3% (led by a 9.4% drop in grocery costs)

Stockton, Calif.: -3% (led by an 11% drop in grocery costs)

Bakersfield, Calif.: -2.9% (led by a 6.8% drop in grocery costs)

Montgomery, Ala.: -2.9% (led by a 6.3% decrease in housing costs)

Reading List for 2020 to build your business 

January 7, 2020

           Investing in real estate can be a great way to diversify a portfolio while adding a hedge against market volatility. Real estate isn't directly correlated to the market so when stocks rise and fall, property investments can provide stability in a portfolio. There are different ways to invest in real estate — from real estate investment trusts to turnkey properties to multifamily rentals — and each has its own nuances to learn. Reading books about real estate investing is one way to learn the ins and outs before diving in. Real estate investing books can offer a general overview of how to navigate property investing or drill down to the specifics of different investment types. But which books are worth your time and which ones are just fluff? As you build your library of real estate investing books, here are the read-worthy options to help you navigate every stage of your property investing journey. These are 20 books that have helpful in my real estate business and I wanted to share with all of you.  Remember it would also be beneficial to have a coach or a season investor guide you if you are a newbie, as well as staying up to date with the laws within the states you invest in. 

TOP 20 BOOKS: 

1. Business Secrets from the Bible by Daniel Lapin
2. The Intelligent Investor by Benjamin Graham

3. The Go-Giver by Bob Burg, John David Mann

4. Start with WHY by Simon Sinek

5. Rich Dad Poor Dad by Robert T. Kiyosaki

6. The Compound Effect by Darren Hardy

7. The 7 Habits of Highly Effective People by Stephen Covey

8. Who Moved My Cheese? by Spencer Johnson

9. Exactly What to Say by Phil Jones

10. The 10X Rule by Grant Cardone

11. Buy, Rehab, Rent, Refinance, Repeat by David Greene

12. Never Split the Difference by Chris Voss

13. The Lean Startup by Eric Ries

14. Secrets of Closing the Sale by Zig Ziglar

15.  The 4-Hour Workweek: Escape 9-5

16. What Self-Made Millionaires Do by Ann Marie Sabath

17. As a Man Thinketh by James Allen

18.  The Richest Man in Babylon by George Clason

19. The Art of Intentional Thinking by Peter Hollins

20. Raising Private Capital by Matt Faircloth

How to attract consumers for 2020

December 7, 2019

            Buyers, data security threats, MLS vulnerabilities, and venture capital growth are poised to shake up the housing industry over the next two years, according to the 2020 Swanepoel Trends Report. The 200-page report, which was released Monday by real estate consulting and research firm T3 Sixty, is in its 15th year and is closely watched for insights into the key issues affecting the industry.

 

             The real estate business, historically dominated by fragmented independent contractors and mom-and-pop brokerages, is becoming more comprised of larger companies armed with artificial intelligence platforms that are hyper-focused on enhancing the consumer experience, the report notes. “The industry is changing at what appears to be an unprecedented pace,” writes Stefan Swanepoel, chairman and CEO of T3 Sixty. “The industry feels chaotic. Perhaps more than ever, residential real estate brokerage leaders struggle to answer the all-important questions: How do I determine what is important, and where do I get a thorough analysis of the topics, trends, innovations, business models, and companies rapidly pushing the industry into the future?”

The report highlights some of the following issues impacting the industry over the next 18 to 24 months:

Growth of iBuyers. This business model enables homeowners to accept instant offers on their properties, leading to a quicker sale and bypassing the traditional selling approach. 

Data security vulnerabilities. About 30% of real estate websites do not run on a recently patched web platform, the T3 Sixty report finds. “Outdated systems can be more vulnerable to hacks that serve malware to website visitors,” the report notes. 

Post-transaction services. Brokerages are paying more attention to how they keep in touch with clients after a transaction.

MLS disputes. MLSs have long been the cornerstone of the real estate market, but they’re facing many challenges that have forced them into consolidation. The report highlights several challenges for MLSs: lower and incomplete for-sale inventory in their databases, an increase in off-MLS listings, expanding iBuyer markets, and the growth and consolidation of brokerages and data vendors into national entities.

Venture capitalists foster high-tech. The growth of venture capitalists is a driving force behind real estate’s major transformation, the report notes. Venture-backed startups seek to bring streamlined housing searches, simplified and speedier transactions, and artificial intelligence to the market. 

Best time to buy is NOW!!!

November 7, 2019

     The best days of the year to buy a home all fall in the month of December, according to an analysis released by ATTOM Data Solutions, a real estate data firm.


     Buyers who purchase a home during the holiday, will likely realize the biggest discounts below full market value compared to any other time of the year, according to the study of more than 23 million single-family home and condo sales over the past six years in the market.


    Closing on a home during the holiday's or within the New Year can be one of the most financially gifts you can give yourself. While alots of folks are shopping for holiday sales' or getting ready to ring in the New Year, our data shows that buyers and investors are buying homes rapidly during this time of the year and looking for discounts.


      Researchers pegged that the best deals would fall on the following dates, but this is just a predication:  Dec. 26, Dec. 31, and Jan. 4, in that order, as the best days for home buyers to grab the biggest discounts on their home sale.         

Rent-to-Own

October 7, 2019

     Homeowners rushed to take advantage of a sizable drop in mortgage interest rates, and potential buyers are impressed.

     The renter then moves in and pays a monthly bill that essentially includes funds for a future down payment. Rather than accumulate in a savings account owned by the renter, those funds earn the renter “purchase credits.” 

      The renter can then put those purchase credits towards a down payment to buy the home in the future — but only if the renter remains in the home for two years. 

Alternatively, the renter can move out and redeem their accumulated purchase credits for cash — but again, only if they stay in the home for at least two years.

      Meaning that even home-buyers that would be considered wealthy in other cities can’t necessarily afford homes in any area of the U.S. based on their income. 

     Customers or households must earn $35, 000 - $65,000 

a year and have some savings to qualify, and eligible homes have to be priced between $75,000 and $150,000.  The renter then moves in and pays a monthly bill that essentially includes funds for a future down payment. The goal is to bring back affordable housing to our communities

7 Alternative Investments That Might Fit Your Portfolio

September 7, 2019

      With market volatility causing concern for many investors, it’s no surprise that some are looking for alternative investments. These investments are outside the realm of stocks and bonds. In many cases, they aren’t directly correlated with stock and bond markets, which can make them attractive, especially in times of turmoil. It’s important, though, to carefully consider your portfolio, circumstances and long-term investing plan. 

        Consider consulting with a professional to help figure out what alternative investments are likely to work best and how much of your portfolio should be devoted to them. Remember, any investment comes with the risk of loss. Also, it’s vital to know how such investments are taxed. As long as you understand what you’re getting into, alternative investments can bolster a portfolio against volatile stock and bond market conditions. 


                                Here are seven to consider:

1.Raw land.

2.Tax liens.

3.Oil and gas MLPs (Master Limited Partnership - for tax sheltered distributions from the profits)

4.Precious metals.

5.Art and collectibles.

6.Venture capital or angel investing.

7.Cryptocurrency.

Mortgage refinances spike 12% on a big rate drop, but home-buyers pull back again

August 7, 2019

  Homeowners rushed to take advantage of a sizable drop in mortgage interest rates last week, but potential buyers were unimpressed.


Total mortgage application volume rose 5.3% from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Volume was 46.5% higher than a year ago, when rates were significantly higher.


Refinances drove the volume, rising 12% for the week and a stunning 116% from one year ago. Refinances are highly sensitive to even small interest rate moves, and last week’s was significant.


The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.01% from 4.08%, with points increasing to 0.37 from 0.34 (including the origination fee) for loans with a 20% down payment. That rate was 83 basis points higher one year ago.


“The Federal Reserve cut rates as expected last week, but the bigger influence on the financial markets was the development that a trade war with China has started. The result was a sharp drop in mortgage rates, which will likely draw many refinance borrowers into the market in the coming weeks and months ahead.

13 Areas to Keep Your Eyes on as an Investor/Landlord

July 7, 2019

   Renting out a property can be profitable, but there are a number of potential issues to watch out for, including tenant troubles, property maintenance issues, vacancy costs, or even a failure to reach your overall investing goals.

In order to avoid problems, owners should be mindful of the things that can affect the rental value of their property—or their long-term peace of mind when it comes to a tenant. 

1. Tenant Reference And Employment Checks

This should go without saying, however, too many landlords meet prospective tenants in person and trust them because they are nice and affable people. Unfortunately, not everyone has the best track record with their previous landlords and a lot of future pain can be saved by both asking for references.

2. Systems Failing And Things Breaking

Have a plan before things break and systems fail. Build relationships with plumbers, electricians, handymen, etc., creating a strong network of vendors that you can trust. Empower your tenants to get immediate help by having a list of approved vendors in a book you can leave at the property. 

3. Eviction Rights

Don't rent to anyone you can't evict. Who rents your home will make or break your rental income. If it is your friend, family or partner then when the time comes to make that decision of evicting, you won't do it. 

4. Realistic Rent Amounts

Check local rental listings to find out what you can realistically charge. If you want to find a good tenant, the rent must be comparable to the going market rate. 

5. Local Laws

Landlords will be tempted to rent more space than is locally allowed, such as a finished basement that is not approved as a legal unit. 

6. Your Investing Goals

One thing many first-time landlords forget to do is define their investing goals. We certainly did this with our first rental property. We figured, as long as it was cash-flowing, we'd keep renting it out. However, we failed to take into account the appreciation and diminishing return on equity. 

7. If The Numbers Work

Before you get emotionally invested in the idea of converting your home into a rental, you have to run the numbers. Ask yourself: "If I was a real estate investor analyzing this property for potential purchase as a rental, do the numbers work?" 

8. Condition Of The Home's Maintenance

In assisting a client with finding a rental property, you must consider the condition of the home's maintenance. Whether a relocation getting a sense of the area or moving from an apartment, the rental experience can make or sour the client to an area, ownership and your service. 

9. Getting Long-Term Tenants

Consider finding tenants that are interested in longer-term leases as this will save you time and money in the long run. Any property rented out will experience wear and tear, but you can avoid this annual cost if tenants are not moving out each year. A

10. Renters Insurance

I always make sure that the tenants who rent my clients' properties have rental insurance coverage. This protects them in the event that something goes wrong during the tenancy. - 

11. Vacancy Costs

Remember that pricing a property at market rate helps you become cash flow positive sooner and lowers vacancy costs. Landlords often price their property above market rate to "see what you can get." Starting your pricing too high actually lowers interest from renters. 

12. Home Warranty Plans

Becoming a landlord? Be sure to pay a few hundred dollars a year on a home warranty plan that covers repair costs with a minimum fee upfront and make the tenant pay the fee each time. Hire a property manager to oversee the property and any work orders placed with the home warranty company. Day 

13. Property Inspection

Getting a property inspection prior to tenants moving in is always a good idea. It will help owners understand if there are any "hidden" issues within the home so that they can make repairs on them before they could snowball over time. 

Using a FHA Loan to invest in Real  Estate is an Option

June 7, 2019

      ONE WAY TO MAKE MONEY over the long haul is to invest in real estate. However, investing in real estate can be tricky because you often need a great deal of capital to buy real estate especially for investment.

You can get around the capital requirement, though, with a little creativity. If you're hoping create cash flow from renting, and you want a solid investment for the future, one way to do it is to use an FHA loan.

An FHA loan is a home loan guaranteed by the federal government. Traditional lenders make these loans to those who meet the requirements and the government guarantees them.

[ SEE: How to Invest in Real Estate Without Buying Property. ]

When you use an FHA loan, you only need a 3.5% down payment. On a $300,000 property, that's $10,500. That's much more affordable for many real estate investors than coming up with a 20% down payment – or meeting a $1 million minimum for an investment club.

       Using an FHA loan is the foundation for rental income for people like Brandon Turner of BiggerPockets.com. He's used the FHA loan to start investing in real estate to great effect.

Buying a rental property with an FHA loan. When you buy a rental property using an FHA loan, it's important to note that you must live in that home for at least a year. So, if you buy a single-family home, you'll have to make it your primary residence for 12 months before you can start renting it out.

       The way around this, if you want to start building your rental empire immediately, is to purchase a duplex or a four-plex. You can use an FHA loan to buy a property with up to four units, so this gives you the chance to live in one of the units, making it your primary residence, while renting out other units.

       After a year, you can move out of your unit and make way for another renter. In some cases, it makes sense to hire a property management company to take care of the renters after you move out. As an on-site landlord, you have to be available at all hours, and you might be tired of that after doing it for a year.

       No matter which route you take, it's important to have a plan of attack ahead of time. Make sure you know your end goal. 

       Have a clear vision for the property and what you plan to do with it. A plan can help you decide what kind of property to buy and be ready to move out when it's time to turn it into an income stream.

Ways to Display Your Property

May 7, 2019

       Your home should have a unique expression of the interests of its inhabitants. Plates, rare books, antiques are just some of the items one can collect and display. These pieces readily get conversations started and offer the opportunity to showcase them in stylish ways. Read on to discover how unexpected spaces in the home can be the perfect gallery for personal treasures.


Welsh sideboard

       Practical and stylish, a sideboard offers discreet storage options on an uninterrupted surface. These timeless pieces were once relegated to the dining room, but now can be placed anywhere. Beyond serving food, they also offer a convenient area to display your treasures, particularly plates and vintage silverware. The trick is to select one focal point and keep backgrounds neutral. Collections will shine without overwhelming. If your display is particularly colorful, consider placing against a white or beige wall.


Pigeonholes of a desk

       A desk can be the perfect place to display a collection. Pigeonholes were once used to store office supplies and papers. They now can provide space for a mini gallery. Start by clearing off stationary and polishing for the cleanest surface. Arrange your collection in a way that pleases you the most and get ready for the compliments.


Bookshelves

       From masks to statues of all sizes, sculpture is one medium that thrives on proximity. These multi-dimensional works should be viewed from as many angles as possible. Bookshelves provide the perfect space for display, as most are elevated or at eye level. This placement also prevents accidents by keeping too many hands away from creating a hazard. To enhance these bold objects, consider adding the right lighting. A spotlight or single light may wash out intricate details. Diffused light, such as sunshine, works best. If that is not possible, try recessed lighting.


Built-ins

       Versatile built-ins are meant to be filled with personal treasure. Books, Depression-era glass or action figures can all find a home on them. These small landscapes offer the right amount of space and light to bring dimension and character to a flat wall. For the more creative types, deepen the impact of your display by playing with layers. Arrange books as a foundation and move smaller décor items to the forefront for a multi-dimensional look that will start many conversations. Love displaying your personal treasures as much as you love collecting them. This article was inspired by the April 1958 issue of Better Homes & Gardens magazine, proving beloved collections are timeless and always in style.  

Real Estate Software Information

April 7, 2019

Types of Real Estate Software

       There are five types of real estate accounting software that are used in the industry. Each type is used for different operational purposes. The most popular types of accounting software include the following.


Real Estate Transaction Management Software


The software is used by Asset Managers and Investors who deal in properties for generating cash flows. It helps forecast return on assets and income streams over a period. For example, if you invest in a property and want to calculate cash flows at a certain interest rate, the software can quickly crunch the numbers on a monthly basis for you. On the other hand, if you want to charge a certain amount of rent each month, the software will tell you the exact rate of return on investment.  The transaction management software helps real estate investors improve the efficiency of their investment.


Real Estate Accounting Software


The pure accounting software is used to manage the ledger accounts and for recording expenses and income. They are the most common type of programs and used by almost everyone in the real estate industry.  The accounting software is also used to track any expenditure you make on a property for maintenance or upgrades. Real Estate professionals record marketing and admin expenses on the accounting software as well as the expenses they incur for prospecting on a client’s behalf. Commission income is also recorded on the software and it forms the basis of tax returns.


Customer Relationship Management Software


The CRM software does not fall directly under the umbrella term ‘accounting software’ but it is closely related to other management programs. The CRM is used to generate leads and prospects that the real estate agents nurture and convert into active client accounts. While it is possible to generate sales without the CRM software, you would be relying completely on chance and hope that a customer approaches your agents on their own. The CRM software helps you build a database of potential leads and contacts that will drastically improve your sales team’s efforts.


Real Estate Investment Processing Software


Special database platforms are used to turn regular loans and home mortgages into specialized security packages that can be traded on Wall Street. The programs help create database files in the form of packages that can be purchased by institutional investors in the market.


Benefits of Real Estate Accounting Software 

The advances in digital technology have made it much easier to develop and implement accounting software for real estate businesses. For example, the ability to update the accounting database through cloud accounting software will allow better coordination between staff members. The five major benefits of accounting software for real estate business are outlined below.

      1. Well designed real estate accounting programs make it easier for agents and processors to record information or generate bills and invoices. A lot of software use automation where information entered in one column is automatically filled in the other relevant columns as well.

     2. The real estate accounting software makes it easier to organize records in the central ledger and search through them quickly. A real estate firm without any accounting software would be severely restricted in its ability to grow operations beyond a certain point.

    3. The ledger records created through accounting software can be stored in multiple locations for better security and reliability. All it takes to create backup records are a few clicks and data can be easily restored in case of accidental damage.

    4. Modern Accounting Software offers synchronization where multiple sales agents can work on the same client to update different information. For example, suppose a broker is working with a client in the field and shows them a property that the client signs up to buy. The broker gets the client’s e-signature to seal the deal and the record is updated via their mobile device. The client then makes an EFT through their bank to the real estate agency that is received and confirmed by the firm’s accountant sitting in the office. This kind of real-time coordination is only possible with real estate accounting software platforms.

   5. Accounting software can also improve your business profitability by decreasing processing times and ensuring accuracy for your business transactions. Since many of the functions are automated, the staff can focus on core business operations.

   6. Real Estate accounting software also helps you calculate the accurate financial position of your business with the help of analytical tools and ratios.

8 Red Flags to Identify Scammers 

March 7, 2019

With just about every rental search beginning online these days, it's a given that con artists will try to take advantage of eager consumers. Combine the fake listings with rental brokers looking to pull a bait-and-switch with a rental of lower quality or higher rent, and you'll have a hard time believing which listings are real.


The Federal Trade Commission warns consumers about rental listing scams as a common danger on its website, instructing individuals to report suspected scams to the site the listing was posted on, as well as local law enforcement and the FTC itself.

Major red flags for rental scams include:


•The listing photos have an MLS watermark.

•The listing details are vague.

•They don't want to show you the place first.

•They're ready to make a deal with no background info.

•They're out of the country.

•They want you to sign before seeing anything.

•The asking rent doesn’t match up.

•They instruct you to wire money.


While active cons online can be reported, little is being done to try to prevent predatory apartment listings from being posted online in the first place.  The problem is most of the listings aren't real, and … this isn't going anywhere. No one – neither the (listing) website nor the state – no one's policing this, and I don't believe there's anyone that's going to be policing this.


While some sites do confirm listing info with the original poster, sites that follow the Craigslist platform of allowing listings to be posted for free help foster an environment where fake listings may be more common than real listings. It falls to you as the renter to spot telltale signs of a rental scam. Here are eight red flags to look for in online rental listings that indicate a possible con.


The Listing Photos Have an MLS Watermark


If the rental listing's photos sport a watermark – which is used to identify the owner of the photo – look closely. Scammers sometimes illegally pull photos from the local multiple listing service, where properties are listed for sale by real estate professionals. When a photo appears with an MLS watermark, the person who posted the rental doesn't have the original photo because he or she isn't actually associated with the property.


The Listing Details Are Vague


Not everyone is great at writing a rental description, but if basic details seem overly vague or don't quite make sense, it's probably because the person who posted the property has never been there. Omitting details on utilities or mentioning an attraction that's more than a mile away as being within walking distance can be an indication that the poster isn't familiar with the area or doesn't expect you to be familiar with it.

For brokers looking to pull a bait-and-switch on a renter searching for a new home, Goldman says it's common for them to avoid putting the exact address of the available apartment so the renter can't spot the lie. 


They Don't Want to Show You the Place First


If you reach out about an online rental listing and the responder doesn't immediately discuss showing you the available space, consider it a telltale sign that he or she has no association with the property. This also goes for potential renters reaching out to small-time landlords. If they have no interest in learning more about the property or coming to see it first, it may be a scam.


They're Ready to Make a Deal With No Background Info


You want a landlord or property manager who seeks reliable tenants. If someone claims to be ready to sign the lease with only email communication and no background on your financial stability, he or she is likely looking to get a one-time payment from you and may disappear before you move.  The FTC warns against adhering to requests for a security deposit or first month’s rent before you’ve signed the lease and met the landlord in person. You should never pay any amount beyond an application fee before you've confirmed the space is available, the individual you're working with is associated with the property and you've signed a contract that makes you the legal tenant.


They're "Out of the Country"


The reason many scammers give that they can't meet with you in person is they're temporarily out of the country. As the FTC reports on its website, scammers may even put in the effort to make it seem realistic: "It might even involve a lawyer or an 'agent' working on their behalf. Some scammers even create fake keys," and send them to you in the mail.


They Want You to Sign Before Seeing Anything


To avoid brokers looking to trick you into paying them a fee for an apartment they falsely advertised, don't agree to sign anything before you’ve seen the place that was promised.

Goldman says these brokers will have you sign a contract that states you owe a finder’s fee for any apartment they show you that you choose to rent. You may end up liking the place, but it probably wasn’t the place you wanted originally. Just in general, you're there under false pretenses.


The Asking Rent Doesn't Match Up


Con artists and shady brokers will hook many victims with the promise of a rent that can almost seem too good to be true. "That stuff is just all over everywhere," If you're looking at rentals in a certain neighborhood and spot one for a few hundred dollars less than the rest, proceed cautiously. Chances are it's either a fake listing or a fake rental rate to try to draw you in.


They Instruct You to Wire Money


Nigerian prince or not, any request for you to wire the security deposit or first month's rent is the clearest sign of a scam. Once the money has been collected, there's no way for you to get it back, and the person you thought you were in contact with can easily disappear.



But don't think you've outsmarted all possible fraudsters.  More careful renters means con artists will only try harder to trick you.

Trends to Watch in Real Estate

February 7, 2019

These are some of the trends that have been listed to watch in 2019 


Younger home buyers

Opportunity zones

E-commerce

Rising interest rates

Increased construction prices

Big data

Build to rent


As stocks continue to fizzle and pop, real estate investment strategies may look more promising. Historically, real estate has outperformed the stock market, acting as a stabilizer for investors when volatility takes hold. These eight real estate trends are the ones to watch in 2019.


Younger home buyers

Home ownership may have a new face in 2019 as younger buyers enter the market, while older homeowners make their exit. “Many millennials have recovered from the 2009 crash and have managed to find jobs that will allow them to afford homes,” says Nick Giovacchini, director of client services at AlphaFlow in San Francisco. As baby boomers age, they may be looking to trade down from larger homes to more affordable options, such as smaller rentals or senior living facilities. High-end home sellers may have to reduce prices as millennials increase demand for more affordable housing.


Opportunity zones

Tax Cuts and Jobs Act, opportunity zones are new territory for real estate investors. With valuations at cycle highs and fundamentals waning, the tax incentives offered by these programs are massively attractive, especially as not all of these zones are created equal, acknowledging numerous cities may prove to be diamonds in the rough. As capital flows in, certain sub-markets could see increased volume, and increased liquidity is a positive for the commercial real estate environment.


E-commerce

The retail landscape is in a state of flux as brick-and-mortar stores attempt to stem the e-commerce tide but 2019 may bring even stiffer competition. “Many consumers find it easier to purchase goods online, potentially threatening traditional retail’s survival.  E-commerce is forcing many retailers to close store locations because they money they take in isn’t enough to cover the cost of their rents.  Real estate investors who want to maintain a position in traditional retail should consider hair and nail salons, restaurants, yoga studios and gyms – services not accessible via e-commerce and may be better positioned to survive market downturns.


Rising interest rates

One of the biggest headwinds facing the commercial real estate market in 2019 is the combination of rising interest rates and slowing appreciation, principal analyst with EDR Insight. This means borrowers face a higher cost of capital at the same time that assets may not necessarily be showing higher yields to accommodate those costs. The Federal Reserve raised rates four times in 2018, with at least two hikes projected for 2019.