Lee Morof's Real Estate Blog

Last week’s scheduled economic news was sparse due to no scheduled releases on Monday and the Veterans Day Holiday on Wednesday. A report on job openings was released on Thursday along with regularly scheduled weekly reports on jobless claims and Freddie Mac’s report on mortgage rates.

Mortgage Rates, Weekly Jobless Claims Rise

Mortgage rates rose last week according to Freddie Mac. The average rate for a 30-year fixed rate mortgage rose to 3.98 percent from last week’s reading of 3.87 percent. The average rate for a 15-year fixed rate mortgage rose to 3.20 percent from the prior week’s reading of 3.09 percent; the average rate for a 5/1 adjustable rate mortgage was also higher at an average of 3.03 percent as compared to the prior week’s average rate of 2.96 percent. Discount points were unchanged for all three types of mortgages at 0.60 percent for fixed rate mortgages and 0.40 for 5/1 adjustable rate mortgages.

New jobless claims rose last week to 276,000 claims filed against the expected reading of 268,000 new claims and the prior week’s reading of 276,000 new jobless claims filed. The Labor department reported 5.53 million job openings on September, which was the second highest reading since the inception of the job openings report in 2000.

The Labor Department also reported that the quits rate held steady at 1.90 percent for the sixth consecutive month. Fed Chair Janet Yellen has said that the Fed considers the quits rate an indicator of economic strength; if workers have enough confidence to quit their jobs for new jobs, this a strong economy. The quits rate has held steady for six months, which could signal to the Fed that the economy is not yet ready for a rise in interest rates that analysts expect to occur in December.

U.S. News recently cautioned that a combination of rising home prices and interest rates could quickly cool housing markets as first-time and moderate income buyers are priced out of the market and other would-be buyers find it difficult to qualify for the mortgages they need to finance home purchases. Recent hikes in mortgage rates are a likely response to the anticipated Fed rate hike in December.

What’s Ahead

Next week’s scheduled economic reports include the National Association of Home Builders Housing Market Index, Housing Starts and minutes from the most recent meeting of the Fed’s Federal Open Market Committee. The minutes may provide additional insight into how Fed policymakers are approaching the decision about raising the target federal funds rate.

Switching houses? Then now is the perfect time to finally go through all the clutter and make some tough decisions about what needs to move and what needs to go away.

There is no point in waiting until after a move to go through the junk lying around, as tempting as it may be, so here are five ways to decide what should find a new home before a move.

Start With A Trip To The Dump

Before starting the move, grab some garbage bags and do a sweep of the house, making sure to toss out anything that needs to go to the dump. This will clear up the home of anything unnecessary and makes it easier to throw out some items when there’s no decision making pressure.

Decide What Furniture Will Be Replaced In Advance

A new home often means new furniture. By deciding in advance which items will be purchased new, homeowners can prepare to either sell or give away their older furniture before they move. Saving space and cutting down one extra step after moving in.

Sell Or Donate What You Don’t Need

Holiday decorations are the perfect example of items that are only taken out once a year and tend to be replaced before they are ever reused. There are probably similar boxes or shelves in every home filled with items that will never be used again but are still held onto.

Now Is A Good Time To Go Through The Closet

Clothes are not looked at as seriously as other objects when clearing space because they can easily fold down or be tucked away. It’s simpler for most people to just throw all their clothes in a box or travel bag before moving, but this is the perfect time to finally go through and donate anything that doesn’t fit or is never worn.

Be Patient With Children

It is hard for kids to part with their toys, even ones they haven’t used in years. These are part of their identity and telling them what they need to throw out can impact them emotionally and make a move that much harder. Sit down with the children and have a long talk about moving and donating items to see if they are ready to go through their things.

Thinking about buying a new home? The service of a real estate professional can go a long way in finding you the home of your dreams in the budget you are looking for.

If you’re in the market for a mortgage, you may want to set up a pre-qualification meeting with a mortgage professional. Even if you’re not 100% sure who you’d like to apply for a mortgage with, pre-qualification can still be a valuable step to take. And given that it only takes a few minutes, it’s something every potential homeowner can do.

So why should you go to a mortgage pre-qualification meeting with a mortgage lender? Here are just a few reasons why it’s a great idea.

It’ll Give You A Good Idea Of How Much House You Can Afford

A mortgage pre-qualification is not the same thing as a pre-approval. When you pre-qualify for a mortgage, your lender will use information that you provide – information like your debts, your income, and your assets – to determine what size of a mortgage you can afford. This affordability information discovered during pre-qualification is then verified during pre-approval.

Pre-qualification usualy doesn’t involve a credit check, and it only takes a few minutes. The advantage of a pre-qualification is that it helps to guide your house hunt. When you know what kind of a home you can afford, it’s easier to navigate the real estate market.

It’ll Help You To Budget Your Expenses

A pre-qualification is a great way to get your household budget sorted out as a homeowner. When you pre-qualify, your potential new lender will tell you what kind of a mortgages would work best for you and your situation. That means you can easily budget for estimated mortgage expenses and know what to expect before you apply for a mortgage.

Some Agents And Sellers Require It

The pre-qualification phase is the first step in the mortgage process. When you’re buying a home, agents and sellers will want to see that you have a good chance of getting a mortgage, as this makes the sale much easier. For that reason, a number of sellers and real estate agents highly prefer buyers who have been pre-qualified – and some of them simply won’t sell to a buyer who hasn’t been pre-qualified.

Mortgage pre-qualification is a great way to sort out your budget, determine what kind of a home you can afford, and persuade a seller to sell to you. And given that it only takes a few minutes to get pre-qualified, it’s a simple step that simply should not be skipped. Contact your trusted mortgage professional today to learn more about getting pre-qualified for a mortgage.

When it comes to selling a home, it is a common belief that once the offer is accepted, there is nothing else to be negotiated. However, issues and obstacles that can arise during the home inspection can be a cause for discussion with the seller. Whether you’re currently searching for houses or your offer has already been accepted and you’re preparing for the next step, here are some tips in the event that the home inspection isn’t up to par.

Be Cautious About What You Say

Without a doubt, anything that you discuss with the real estate agent regarding the property you’re looking at is going to be addressed with the seller. Instead of telling the agent everything is fine and dandy, maintain a poker face with any deficiencies in the home so you can assess them after the inspection. While a seller may think they have you on the line if all seems fine during the inspection, maintaining your peace and negotiating after the fact may end up providing a better post-inspection deal for you.

Decide What Deficiencies Are Most Important

Before negotiating any repairs or defects with the seller and how this can benefit you, ensure you prioritize what deficiencies must be fixed and what you can live without. There may be leaks and small dings in cupboards that may not be much of an issue, whereas damage in a hardwood floor that you don’t want to renovate may serve as a deal breaker. Deciding what is most important will ensure that the seller knows you’re really interested, and it will likely convince them that the fixes will make for a successful sale.

Request A Credit For Repairs

If a seller knows you’re interested in a home, you may be able to get a little bit of leeway in terms of what you can negotiate following the inspection. Instead of expecting them to deal with the hurdles of home repair, ask the seller to consider a credit so that you can ensure the repairs are completed on your own. This will not only enable you to have the repairs completed the way you would like them done, it may also make the moving process a smoother transition for all of you.

There are certain deficiencies that can show up during the home inspection, so it’s important to consider how re-negotiation can benefit both the buyer and the seller. If you’re curious about home inspections and other aspects of purchasing a home, you may want to contact your local real estate agent for more information.

Last week’s economic reports included releases on construction spending and several labor-related reports including ADP payrolls, Non-Farm payrolls, average hourly earnings and weekly jobless claims. Freddie Mac reported that mortgage rates rose as the national unemployment rate decreased to 5.00 percent.

Labor Reports Show Mixed Results

Key readings on employment showed mixed results as ADP payrolls decreased to 182,000 from September’s downwardly revised reading of 190,000 private sector jobs added. U.S. jobs expanded to a reading of 271,000 jobs added in October, which exceeded expectations of 180,000 jobs added and September’s reading of 137,000 jobs added. This was the fastest pace for job growth in 2015 and fueled expectations that the Federal Reserve may raise interest rates in December. In addition, the national unemployment rate dropped to 5.00 percent in October, which was the lowest unemployment rate in seven years.

Weekly jobless claims rose by 276,000 new claims, which exceeded the expected reading of 263,000 new claims and the prior week’s reading of 240,000 new claims.

In testimony before The House Financial Committee, Federal Reserve Chair Janet Yellen said that the central bank’s objective was to regulate financial institutions “in a manner that promotes the stability of the financial system as a whole.” This indicates that the Federal seeks to prevent threats to major financial institutions that could result in a repeat of the great recession in 2008.

Chair Yellen also said that the Federal Reserve Board and the FDIC have written a rule requiring the largest financial institutions to show that any financial failure could be “resolved in an orderly manner through the bankruptcy court.” These comments suggest that the Federal Reserve has ongoing concerns about the stability of the largest financial institutions and the economy; this could cause the Fed to take a wait-and-see attitude on raising interest rates in December. The Fed is expected to address interest rates in its December meeting of the Federal Open Market Committee, which directs monetary policy for the Fed.

Mortgage Rates Rise, Construction Spending Dips

Average mortgage rates rose across the board last week according to Freddie Mac. The average rate for a 30-yar fixed rate mortgage rose by 11 basis points to 3.87 percent; the average rate for a 15-year fixed rate mortgage rose by 11 basis points to 3.09 percent and the average rate for a 5/1 adjustable rate mortgage rose by seven basis points to 2.96 percent. Discount points were unchanged at 0.60, 0.60 and 0.40 percent respectively.

Construction spending slowed in September to a reading of 0.60 percent which met expectations based on August’s reading of an increase of 0.70 percent.Construction spending slows as fall and winter seasons approach, but analysts are monitoring construction activity as low inventories of available homes continue to increase demand for homes and home prices in many areas.

What’s Ahead

Next week’s scheduled releases for economic reports are slim; no reports are scheduled for Monday and Tuesday markets are closed for the Veterans Day holiday. Freddie Mac will release mortgage rates on Thursday and the weekly Jobless Claims report will also be released. Other scheduled reports include retail sales, retail sales except automotive sector and the University of Michigan’s report on consumer sentiment.

Buyers generally seek the least expensive home in the best neighborhood they can handle.

Like the person in the video says, you want to present a home that fits in the neighborhood but doesn’t stand out too much. For example, if neighbors are all 4 bedrooms, 3 baths and 3000 square feet additions that make your home 5, 4, and 4000 will make yours harder to sell.

Improvements should make it show well and fit well in the neighborhood. Last-minute capital investments in large structural changes arent likely to pay off. But cosmetic upgrades like paint and landscaping help a home show better and often do pay off. Of course, all systems and appliances should work to get a top price.

To make your home competitive and attract buyers and bids work with a professional real estate agent and start early.

With all of the care and consideration that can go into deciding if a home is the right fit, it can add a wrench to the mix to realize that you may not have a lot of time to put in an offer. It’s certainly important to weigh all of the factors of buying a home before deciding to put yourself in the ring, but here is why you’ll want to come to a conclusion quickly when it comes to a home you love.

It’s An Ideal Home, For You And Many Others

If you’ve finally found a home that you can see yourself and your family in, and you’re seriously considering putting in an offer, there’s a good chance that there are many other people who might also be quite interested in it. While you’ll need to determine whether it’s the right neighborhood, size and price before putting in an offer, you’ll want to consider these decisions relatively quickly so that someone doesn’t beat you to the punch.

A Quick Decision Means You’re Serious

Most home sellers are interested in getting an offer that is quite close to their asking price, but like anyone, they can have intuitions about potential buyers and may be more comfortable with someone who is reliable. By posing an offer to the seller in short order, you will make them aware of your keenness and interest, and – at the end of the day – this may actually inspire more trust in them. If they need to sell the home quickly or are planning a move of their own soon, this can make a considerable difference.

The Prices Are Always Rising

If you’ve been perusing the market for a while, deciding to make an offer on a home you can really see yourself in may end up being a money saver. According to Zillow, the average rental price in the United States has risen by 14% since 2011 to $1400 per month, and home prices are also beginning to increase. This means that it’s becoming an even better investment to put money into property instead of rent, so that you can make up the difference in your finances in the present and the future.

It’s important to make an educated decision when deciding to purchase a home, but by deciding quickly if a home works for you and making your interest known you may have more success.

If you’re buying a home, you’ll want to try to get your mortgage processed as quickly as possible. Improperly filed mortgage applications are one of the biggest reasons why home sales get delayed, and if you have a hard move-out date already set, it’s critical that your mortgage process goes smoothly.

With careful planning, though, you can shorten the mortgage process and get your financing approved faster. Here’s what you need to do to speed up the approval.

Get Your Paperwork in Order Before You Apply

One of the biggest reasons why mortgages get delayed is because the applicant is missing a vital piece of paperwork. Something like a missing pay stub or a forgotten home insurance document can hold up the mortgage process, so make sure you have everything you need before applying for your mortgage.

When you apply for your mortgage, you’ll need pay stubs dating back four weeks, plus a bank statement for the last 30 days. Note that you’ll need the actual mailed statement from your bank – online screenshots don’t qualify. You’ll also need a homeowner’s insurance declaration document and any legal documents pertaining to your finances, like a divorce decree.

Keep Your Finances Consistent Once You’ve Applied

Once you’ve started the mortgage approval process it’s critical that you keep your finances fairly consistent, as major changes will mean your mortgage lender will need to restart the evaluation process. Try to avoid making larger than usual bank deposits, and don’t take out a new loan or credit card. Keep your credit card usage similar to where it’s been in the past.

If you do end up making major changes to your finances, make sure you send the proper documentation to your lender as soon as you can. Call ahead of time to make sure you know what you need to send.

Don’t Forget to Mention Assets and Debts

Before your mortgage is approved, your lender will want to take a thorough look at your existing debts and assets. If you exclude information, your lender will need to spend extra time untangling the situation and determining your proper finances. Make sure you tell your lender about any and all investment properties you own, mortgages on other homes, or loan and credit card balances that are past due.

Getting a mortgage is a complicated process, but having your documents in order can speed things up and ensure you get your mortgage on time.

Starter homes are incredibly popular for young couples who plan to have a family in the future but don’t need a large place yet.

Life moves pretty fast sometimes and many couples find themselves expecting children before they have begun to look for the next home. This shouldn’t be a problem, as moving into a larger home before the baby arrives can be a lot easier than it appears.

Always Move Before The Baby Is Born

There is a choice when upgrading a home for children: moving beforehand and settling down in advance of having kids or waiting until after having the child and dealing with a move later on.

It may be tempting to wait until the stress of a pregnancy is over to move into a larger home. After all, selling and buying houses can be a tiring process for anybody, let alone expectant parents. Just remember, no matter how difficult or stressful the move is it will be one hundred times worse after having kids.

Work With A Professional To Help Coordinate The Move

There is nothing wrong with rushing through a purchase or the sale of a home, as long as everything is done correctly. A situation like this is never the right time to assume control and responsibility for every aspect of the move.

A real estate professional, once told of the situation, will know exactly how to handle everything. From preparing a current home for sale to finding a larger house in the right price range, a professional will have experience in coordinating the process.

Prepare For The Move In Stages

The best way to go about facilitating a quick move is to go in steps. Everything in the house that is not necessary to the staging should be boxed up and moved into temporary storage before the home is shown.

This is beneficial because it removes all clutter from the house and helps to make a quick sale and also allows for many personal items to be moved into the new house without having to wait for the current home’s sale to close. Instead of one gigantic move, the process can be broken down into several smaller moves to relieve some stress.

When there is a deadline on a move, you can increase your chances of selling your current home and buying a new one by using the services of a real estate professional. When things are done fast they need to be done right and a professional with experience can facilitate the entire process while making sure nothing slips through the cracks.

A number of economic reports released last week indicate mixed economic progress. The 20-City Home Price Index released by S&P Case Shiller showed that August home prices rose, but New Home Sales dropped in September. The Federal Open Market Committee of the Federal Reserve indicated that it may reserve the target federal funds range at its next meeting in December.

Case-Shiller Reports Higher Home Prices in August

August’s 20-City Home Price Index issued by S&P Case Shiller showed that average home prices rose in 18 of 20 cities with Denver, Colorado and San Francisco, California posting year-over-year increases of 10.70 percent. Portland, Oregon closely followed with a year-over-year gain of 9.40 percent. Cities lagging in home price gains were Chicago, Illinois and Washington, D.C. with year-over-year gains of 1.90 percent and New York City with a year-over-year gain of 1.80 percent.

Higher home prices were seen by analysts as contributing to a lag in New Home Sales in September. The Commerce Department reported that pending home sales dropped by -2.30 percent as compared to August’s reading of -1.40 percent. Fewer home sales in September were consistent with the winding-down of the peak spring and summer home buying season, but analysts cited higher home prices and concerns about cooling economic trends as factors contributing to slowing home sales.

Federal Reserve Hints at December Rate Hike

Economists and media have been trying to predict when the Federal Reserve will raise its target federal funds range, which is currently set at 0.00 to 0.25 percent. The Federal Open Market Committee of the Fed indicated in its post-meeting statement that rates could be raised in December, when the committee meets for the final time in 2015. While no specifics were given, eyes and ears will be paying close attention for precursors of a December rate hike. When the Fed does raise rates, mortgage rates and other consumer lending rates can be expected to increase as well.

October Consumer Sentiment decreased to a reading of 97.6 as compared to an expected reading of 101.6 and September’s reading of 102.6; this suggests that consumers are increasingly wary of economic conditions as well as potentially higher interest rates.

Mortgage Rates Mixed, Jobless Claims Rise

Freddie Mac reported that the average rate for a 30-year fixed rate mortgage fell by three basis points to 3.76 percent. Discount points were unchanged at an average of 0.60 percent. The average rate for a 15-year fixed rate mortgage was unchanged at 2.98 percent. The average rate for a 5/1 adjustable rate mortgage was also unchanged at 2.89 percent. Average discount points were 0.60 for fixed rate mortgages and 0.40 percent for a 5/1 adjustable rate mortgage.

Jobless claims were slightly higher with a reading of 260,000 new claims filed against expectations of 265,000 new claims and last week’s reading of 259,000 new claims filed.

What’s Ahead

This week’s scheduled economic reports include reports on Construction Spending, ADP Payrolls, the Non-Farm Payrolls report and the National Unemployment report. These reports are will provide information related to general economic conditions and labor trends.