Excerpt On The Housing Market From “Summer Of The Speed Buyer” By Lawrence Yun, Chief Economist For The National Association Of Realtors – Nar Magazine July/August 2021 Issue
“Could it all crash as happened from 2008 to 2010? Not likely. The current housing cycle is fundamentally different. We thankfully don’t have risky subprime mortgages that overstretched buyers’ budgets. The gatekeepers at banks, mortgage brokers, and government regulators demand that loan-to- value ratios, debt-to-income ratios, and income documentation meet guidelines before a mortgage is approved. To be sure, even with soundly written mortgages, we know some defaults can occur. A second major difference is supply. Leading up to the housing bubble heyday, builders overbuilt. By my calculations, America had 2.1 million surplus housing units by 2006. Following the crash, underproduction steadily chipped away at the surplus, such that inventory normalized by 2011. Continuing under production led to the housing shortage. By 2015, the shortfall was 2 million homes. By the end of 2020, it totaled 4.8 million homes. The lack of inventory is why home prices are in no danger of falling sharply. Homebuilding activity in 2021 will be slightly above historical norms. But it will take at least a few years to correct the massive shortage. In the meantime, we expect the national median home price to rise 9% this year and another 3% in 2022.”
Words Matter When Selling Your Home
The Best Ways to Pay a Mortgage Off Early
In a research study conducted in the early 2000’s, a Canadian professor found that homes where the seller was “motivated” took 15 percent longer to sell, while houses listed as “handyman specials” flew off the market in half the time. “It surprised even me,” said researcher Paul Anglin, who teaches real-estate and housing trends at the University of Guelph in Ontario, Canada.
Paying your mortgage off faster makes you more secure, simply because you don’t have to worry about losing the home if you can’t make the payments. It’s ideal for retirement to have your home paid off, since your income will drop. And paying early will save you tens of thousands of dollars in interest.
Other findings from the study: Words that denoted “curb appeal” or attractiveness helped a property sell faster than those that spoke of “value” and “price.” Homes described as “beautiful” moved 15 percent faster and sold for 5 percent more. “Good-value” homes sold for 5 percent less than average. And “must see” didn’t make any difference.
Even if you only knock 5 years off your mortgage, that’s 5 years sooner you can retire, or 5 years’ worth of payments you can use to enjoy retirement. Here are six common approaches to making higher mortgage payments. The best is the one you can stick to based on your lifestyle, income, and budget.
I couldn’t find a more recent study, but I bet many words would be similar today...except perhaps for “granite,” which was one of the top selling words for the late 90’s. How would you describe your home in a listing? Call if you’d like help.
1. Make an extra payment quarterly to make 4 extra payments/year. 2. Divide one payment by 12. Add that to each monthly payment to make one extra payment a year. 3. Pay half of your payment every two weeks, also known as bi-weekly payments. 4. Round up your payments so you’re paying at least a few extra dollars a month. 5. Increase your payment when you get a raise, bonus, or other windfall. 6. Refinance your mortgage to a shorter term, which raises your payment amount, but reduces interest.
What Happens At A Listing Consultation? Getting information is the first step to selling your home. During a listing appointment, we’ll talk about how and when you might want to list your home, what to expect when you get an offer, how long it will take, and what price to list at. We’ll also cover how to prepare your home for the market and answer all your questions. It’s an informative session! Call for an appointment.
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September. 2021 • Issue No. 29
