The Power Is Now Magazine | December, 2022

Sandra L. Thompson

Director of the Federal Housing Finance Agency

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CONTENTS DECEMBER 2022

REAL ESTATE NEWS

Pg. 14. How the Housing market lost trillions of dollars in equity in the third quarter!

MORTGAGE NEWS

Pg. 16. Industry experts express pessimism saying mortgage rates won’t fall for at least another year!

LENDING NEWS

Pg. 18. Navigating the complex lending market! Know where your money is coming from.

TECHNOLOGY NEWS

Pg. 20. Devising creative and innovative solutions to deal with the affordability crisis in the country.

HEALTH NEWS

Pg. 24. Re-examining the newly revised Covered California Program.

GREEN NEWS

Pg. 8. States can lead the way toward a future powered by 100% clean, renewable energy.

ECONOMIC NEWS

Pg. 12. State’s Stimulus Checks: Are they inflationary or not?

LEGAL NEWS

Pg. 28. How FICO 10T and VantageScore 4.0 Adoption by FHFA will change the industry lending and mortgage landscape vamping of the 203k plan.

FROM OUR VIP AGENTS:

Pg. 31. Looking to Invest in Texas?Here’s a Simple Guide, by Sharon Bartlett.

Pg. 35. Buyers In Maryland: Here’s how to Build a Rapport and Negotiate with Sellers for a great deal, by Emerick Peace.

Pg. 41. Housing Market Predictions for Florida 2023, by Adriana Montes.

Pg. 45. A Condo or a Townhouse in Arizona? Which is the right one for you?, by Yvonne McFadden.

Pg. 49. Want to Get The Most out of your Home? Here are some 5 tips to Improve your Home by Tamra Lee.

Pg. 53. Thinking FSBO? Read This First, by Walter Huff.

Pg. 55. The Dangers of aHomeowner’s Association, by Heith Mohler.

Pg. 59. Is Making Your Curb More Appealing Underrated?, by Ruby Frazier.

Pg. 62. Sandra L. Thompson. RE-envisioning, The Housing Industry, Promoting Equity and Equality and Removing Regulatory Barriers

Pg. 69. Key considerations when looking for a neighborhood, by Jenny Gonzalez.

Pg. 73. The State of Silicon Valley Real Estate Market Trends: What Does 2023 look like, by Ian Batra.

Pg. 77. Simple Steps Minorities in LA can take before buying a home, by Briana Frazier. Pg. 81. Minnesota Real Estate Appreciation & Housing Market Trends, by Francine Marsolek.

Pg. 85. The Power of Credit Scores in the Homebuying Process, by Janet Petrozelle.

Pg. 89. Feeling Stressed About Homeownership?Here Are some Downpayment And Closing Cost Assistance in El Cajon, CA, by John Costigan.

Pg. 95. Is Your San Francisco Home Accurately Valued?, by Norman Green.

Pg. 99. First-time home buyers Guide: 10 househunting mistakes for first-time homebuyers, by Steven Rivkin.

Pg. 103. Costa Mesa Real Estate Appreciation & Housing Market Trends, by Decira Pimental.

Pg. 107. Buying a Home In Menifee This Fall, by Monica Hill.

Pg. 111. Why you need to get your deal in writing In A Digital Currency World!, by Jamar James.

Pg. 117. Veterans: Want to Make homeownership work for you? Here’s how you can do it easily, by Dolores Golden.

December 2022 FROM THE EDITOR

To Our Valued Readers,

The final month of the year is upon us. The excitement to bid goodbye to 2022 is already filling the air. This year has been very challenging for many people and businesses in the country, but if you are reading this letter, congratulations, you made it!

It is time for us to brief you on what’s been happening in our industry. Certainly, there are some exciting news and developments that are happening, therefore settle down with some hot chocolate; let us take it from here!

As we prepare to usher in the new year, I must say that we are excited about what the new year holds for us. During this last month of 2022, I would like to reflect on what an incredible year 2022 has been. I am looking forward to the possibilities and opportunities in 2023 I challenge you to live your best and pursue your life’s passion.

For more than a decade now, we’ve been talking about how to increase the black homeownership rate and the situation seems to be getting out of hand! A recent report from NAR shows that black homeownership rate is on the decline. This is an issue that now needs attention. We do not just need to be talking about it, we need to see actions, and I hope that in 2023, stakeholders will gather efforts to address this problem. Speaking of solutions, technology might have some answers. To that effect, we feature an article exploring creative and innovative solutions to deal with the affordability crisis in the country.

Inflation is sky high and while the government is trying its best to control it, the efforts have not translated to much in the ground. In response, states have issued stimulus checks to help their citizens afford the necessities. Some experts argue that these checks are inflationary in nature, but are they? Read on to find out more.

In this December issue of the Power Is Now Magazine, we have a variety of articles that will educate, motivate and inspire your holiday. It is our special way of getting you ready for the new year. Are you thinking of purchasing your first property in the new year? Is that advisable with the mortgage rates rising? Well we debunk some of those fears in this issue as well as tell you how the new FICO 10T and VantageScore 4.0 might be a game-changer for the way the industry looks at

credit scores.

I am excited to bring you interesting and useful information to aid your real estate journey. Look at the power is now as your real estate and financial coach. We invite you to join us online for invaluable blog posts, engaging conversations, and the latest issue of our magazine to enhance your learning in the field of real estate, finance and success. You have the power to change your life because The Power Is Now!

ERIC L. FRAZIER MBA President and CEO The Power Is Now Media, Inc.

clean, renewable energy

Environment, clean energy, and sustainability are some of the popular jargon being thrown around every so often, especially as the year comes to a close. This year also, we’ve seen so many states join in the race to become carbon neutral, each with its timeline and rules to get there. For instance, on June 29, 2022, Rhode Island Gov. Daniel Mckee signed into law a bill that seeks to transition the state to 100% renewable electricity by 2033, which is the fastest timeline of any state in the country; this brings the state in at least the 10th state to codify its commitment to 100% clean energy.

Although there seems to be a competition of who gets there first in terms of taking their populations 100% solar, one of the potential pitfalls that not so many states are considering is the policies backing the transition. In addition, it would seem that the Federal government is still stuck with the same old energy sources that are disastrous to the climate and public health. Policies like the standards of renewables, net metering, tax incentives, and commitment to attain 100% clean energy the states and local governments will continue to drive energy costs

down. But all these policies need to be relooked at and carefully examined for it not to be a race to the top without considering the people who are the biggest beneficiaries so some of these policies and rules.

States, in particular, have a significant role to play. When the California legislature passed Senate Bill (SB) 100 in 2018, it paved the way for new momentum in the nation. A movement for 100% clean and renewable energy. Essentially, the bill set an ambitious plan for the state of California to power its electricity needs with 100% clean energy by 2045. Codifying a 100% clean energy goal into law sent a message to the world of the state’s intention to transition to clean energy.

Many states are now joining in making this a reality. In fact, clean energy today is off the charts, with the country producing 3 times more clean energy than it did a decade ago. Surprisingly, on May 8, California produced 103.5% of its energy from renewable sources.

States leading the march towards clean energy:

PHOTO FROM 123RF

States can lead the way toward a future powered by 100%

State 100% Commitment to? Timeline

California Clean Energy 2045

Key Benchmarks

44% renewable by 2024, 50% renewable by 2026, 52% renewable by 2027, 60% renewable by 2030, 90% clean by 2035, 95% clean by 2040, 100% clean by 2045

Connecticut Clean Energy 2040 100% clean by 2040, 40% renewable by 2030

Hawaii

Renewable energy 2045 100% renewable by 2045, 40% renewable by 2030, 70% renewable by 2040

Illinois Clean Energy 2050 100% clean by 2050, 40% clean by 2030, 50% clean by 2040

Maine Clean Energy 2050 100% clean by 2050, 80% clean by 2030

Nevada Clean Energy 2050 100% clean by 2050, 50% clean by 2030

New Mexico Clean Energy 2045 100% clean by 2045, at least 80% renewable by 2045, 40% renewable by 2025, 50% renewable by 2030

New York Clean Energy 2040 100% clean by 2040, 70% renewable by 2030

Oregon Clean Energy 2040

Rhode Island

Renewable Energy 2033

80% emissions reductions for power sold in-state by 2030 compared to 2010 baseline, 90 percent by 2035, 100 percent by 2040, 50% renewable by 2040

100% renewable by 2033, annual increases in renewables through 2033

Virginia Clean Energy 2050

100% clean by 2050. Some utilities are required to achieve a renewable target of 14% by 2025, 30% by 2030, 65% by 2040, and 100% by 2050. Other utilities have a renewables requirement of 26% by 2025, 41% by 2030, and 100% by 2045.

Washington Clean Energy 2045 100% renewable or zero-emitting by 2045.

SETTING 100% RENEWABLE ENERGY GOALS

• States can devise legislatures to codify 100% goals and bring all parties together towards a common goal.

SETTING SOME INTERIM GOALS

• 100% renewable energy goals effectively drive growth towards clean energy best when there are interim goals and benchmarks. Interim goals act as a guide star for the state agencies overseeing energy in the state. The interim goals ensure that states promptly hit their 100% clean energy goals.

SET GOALS FOR CLEAN ENERGY TECHNOLOGIES

• It is important for states to set targets for key technologies like solar power, offshore wind energy, and the storage of these energies to spur innovation of these technologies.

REGULARLY REVISIT GOALS AND READJUST

• It is important to recognize that renewable energy is growing rapidly to ensure states align with their goals; they must do regular revisits and adjust their commitment where necessary.

What are some of the ways states can lead a future powered by 100% clean, renewable energy?

State’s Stimulus Checks Are they inflationary or not?

About 23 million California residents will benefit from the ‘inflation relief checks,’ which began to be sent to the residents in the first week of October and will be through midJanuary. The relief funds are part of California’s governor Gavin Newsom’s plan to offer financial assistance to many working families that have been highly affected by the rising fuel costs in the state.

in California are paying the highest amount for a gallon of gas on average. The average price for a gallon of gasoline in California now stands at $5.423 compared to the average of $3.759 nationally.

The state’s disbursement of the inflation relief checks began on October 7, but it could take a few days or weeks for the money to arrive in people’s banks.

The relief package sent out to the residents is part of a $17 billion relief package that has also suspended the state’s sales tax on diesel fuel and provided additional help to people with rents and utility bills.

Many states also join to help their middle-class citizens through this tough economic period. At least 20 states are also offering the same aid to their citizens, and while the fuel prices have been declining from their record high in June, drivers

ARE INFLATION RELIEF CHECKS GOOD?

States are spending billions of dollars out the households in one form or another. The US government recently spent a total of $2.2trillion in economic stimulus to deal with the ravaging effects of the covid-19 virus. The primary responsibility of any government is to its people and what the government is going is good. Still, we have to ask whether these checks are only increasing the effects of inflation.

PHOTO FROM

COULD IT BE THAT THESE STIMULUS CHECKS COULD BE INFLATIONARY, BUT ARE THEY?

The most straightforward answer to this is; they could be, but not significantly! Economists argue that these checks result in a surge in consumer spending, which is bad for inflation as it increases the inflation rather than cools it down. Therefore, giving residents more money to spend only increases inflation’s effects, which is theoretically impractical.

If the CARES ACT stimulus check led to our current situation in the country, will another stimulus package soften or minimize our current economic crisis?

One of the arguments put forward is that any extra infusion of cash could aggravate inflation. The government is trying to help middle-class citizens easily afford the necessities such as petrol and gas. Still, the problem is that if many people jump into consumables simultaneously, they may increase prices.

While the argument put forward by these experts could be true, it doesn’t hold!

First of all, we have to understand better what causes inflation in the first place.

Three basic causes cause inflation; an increase in the general price level, not just the prices of a single good or service; it could also result from an increase in the money supply without any real economic growth, and the third and final reason could be from the total demand of goods and services surpassing the supply which is classified as cost-push or demand-pull inflation too much money chasing just a few goods and services in an economy.

Let’s consider these causes; states do not print their own money or control the supply. The arguments being thrown around so often related to the cost-push dimension closely linked to the supply chain has nothing to do with these stimulus checks. The government services the state provides to their economies are usually

priced at zero except for the user fees, which are incidental and immaterial in the big picture. The key thing to understand is that there is no inflation when the price is zero. The one dimension that the state’s disbursement could impact is the demand-pull kind of inflation.

The stimulus checks are good, and the war waged against them is just political and ideological. And while there are cases where the injection of these stimulus bills into the economy could result in stimulating the aggregate demand by consumers, most of that could, in one way or the other could, have found its way back into the local and national financial coffers through government spending by the same states. None of the 20 states offering the relief checks has done so by borrowing money from the central bank, which the federal government does so often.

Therefore, the arguments against the stimulus checks are just overblown!

has melted away! A new report from Black Knight highlighted that the average borrower had lost $30,000 in equity.

Sales have been slowing down for the last couple of months, with the mortgage rates now double what they were at the beginning of the year. At the same time, home prices have dropped 0.77% from June to July and while it may seem insignificant, it is the largest monthly decline since January 2011 and the first monthly drop of any size in 32 months.

How the Housing market lost trillions of dollars in equity in the third quarter!

Saying that the housing market has been frantic would be a great understatement.

about this, but they are not! Many wonder if buying a home during a recession is a wise investment.

It hasn’t been frantic; chaotic would be the word after a prolonged increase in housing prices, and now all roads point to a cool-off period. You would expect buyers to be excited

Home prices have had a historic run-up in the last two years, giving many homeowners record amounts of new home equity since May; about $1.5 trillion of that equity

Home equity peaked last May, recording a $17.6 trillion gain collectively. This was after home prices jumped 45% since the pandemic’s start. Although equity has dropped, as of September, prices were still up 41%, and equity was still strong. Many borrowers who bought their homes before the pandemic collectively have $5trillion more than they did before the pandemic hit, which equals $92,000 more equity per borrower than in February of 2020.

“While additional declines may be on the horizon, homeowner positions remain broadly strong,” noted Ben Graboske, Black Knight’s president of data

and analytics.

As mortgage rates began to rise, home prices started to weaken, making it much less affordable to buy properties. In fact, with the current conditions, the average monthly mortgage payment on an average home with a 20% down payment is up nearly $1,000 since the start of the year.

The report also indicates that in 10% of the major US Real Estate Markets, including Las Vegas, Miami, LA, Phoenix, and San Diego, many homeowners have to contend with their new reality where they are being forced to spend nearly twice as much in the long-term average amount of median household income to make their monthly payments. Still, roughly 85% of the major markets have seen prices drop from established peaks through July. About one-third of these came down more than 1%, and about 1 in 10 have fallen by 4% or more. Consequently, many homeowners are starting to lose equity after gaining so much in the first 2 years of the pandemic.

According to Black Knight, Tappable equity- which is the amount a homeowner can borrow against while keeping a 20% stake in the property hit its 10th consecutive quarterly high in the second quarter of 2022 at $11.5 trillion.

July, San Jose, CA lost 20% of its tappable equity, Seattle lost 18%, San Diego 14%, San Francisco 14%, and Los Angeles 10%.

The declining equity witnessed in June and July brought the total amount of tappable equity down 5%. Given that the market is weakening, this equity might see a sizable drop before the year’s end.

“Some of the nation’s most equity-rich markets have seen significant pullbacks, most notably among key West Coast metros,” noted Graboske.

Looking at the individual markets, from April through

It is important to highlight that homeowners are still far more flush than when the market had a major correction. In fact, during the subprime mortgage crash, which began in 2007, home values had plummeted by nearly half in some of the major markets. Millions of homeowners went underwater on their mortgages, owing more than the value of their homes.

Looking at the current market, this is not the case; current borrowers, on average, owe just 42% of their home’s value on both first and second mortgages. This is the lowest leverage on record.

A noteworthy point to mention is that there are about 275,000 borrowers who would fall underwater if their homes were to lose 5% of their value. 80% of these borrowers purchased their homes in the first six months of this year, which was the top of the market. “This is obviously a situation that demands careful, ongoing monitoring, but to put that into context, just 3.6% of nearly 53 million U.S. mortgage holders are either underwater or have less than 10% equity in their homes, roughly half the share coming into the pandemic,” Graboske said.

Industry experts express pessimism saying mortgage rates won’t fall for at least another year!

Mortgage rates have more than doubled this year, and there is hope that the current upheaval will retreat in 2023, according to a recent forecast from the Mortgage Bankers Assocation. The result of this sudden rise in mortgage rates is that many buyers have paused their buying until the rates have cooled. The problem with this is that no one can predict with certainty when the rates will stop rising, and clearly, many experts are divided on this issue due to economic uncertainty.

On the one hand, we have the mortgage bankers Association experts who are pessimistic about the economic outcome of the country saying that there is a high likelihood of the country entering a recession in the first quarter of next year. The FED will drive this recession as it enacts tighter financial conditions, which will hamper business investment, and another contribution factor will be slowed growth by most economies all over the world. This will, in turn, result in high unemployment rates up from their current level of 3.5% to 5.5% by the end of 2023.

Next year will be particularly challenging for the US and global economies,” said Mike Fratantoni, chief economist and senior vice president for research and industry technology. “The sharp increase in interest rates this year – a consequence of the Federal Reserve’s efforts to slow inflation, will lead to an equally sharp slowdown in the economy, matching the downturn that is happening right now in the housing market.”

WHAT THIS MEANS FOR THE INDUSTRY

While expressing pessimism about the economy, the real estate market, in general, might look good because the upshot for the homebuyers is that the rates might come down. According to forecasts by MBA, the rates might end at around 5.4% by the end of next year. The average 30-year, fixed mortgage rate at the beginning of the year was around

3.2%, and by late October, the rate had jumped to 7.08%- a 20-year high, according to Freddie Mac. Meanwhile, the average 15-year fixed mortgage rate rose sharply to 6.36%, while the average 5/1 ARM mortgage was 5.96%.

While that might be the case, it is important to note that the path ahead is murky; there is high volatility in the market in the coming months as the FED is expected to continue to raise the interest rates before the year ends. Ultimately, the decision by FED to hike the interest rate is a good move as it is intended to tame inflation. That in itself is slowing the buyer’s demand for mortgages in 2023.

“The Fed has reiterated its commitment to keeping the monetary tightening course, warning that consumers and businesses can expect more ‘pain’ ahead,” says George Ratiu, Realtor.com’s director of economic research.

At the same time, originations are expected to decline steadily to $2.05 trillion in 2023 from $2.26 trillion expected before the year’s end. Additionally, the refinance volume is anticipated to decline by 24%.

A FLAT REAL ESTATE MARKET IN 2023 AND POSSIBLY 2024

The rise in rates has made it hard for buyers to acquire properties in the market. According to MBA, we are experiencing a slowdown in housing activity, and the continued rise in mortgage rates will cut the pace of home price growth. If the situation remains unchanged, the forecast projects national home prices to be roughly flat.

“This will allow household incomes some muchneeded time to catch up to elevated property values,” said Joel Kan, vice president and deputy chief economist at MBA. “However, many local markets will see home price declines, even if national price measures remain largely unchanged.”

A unique set of characteristics will shape the market next year. First, it is highly likely that homebuyers will account for the largest portion of housing demand for the next few years. That

said, many owners are unwilling to let go of their properties just to capitalize on the ultra-low mortgage rates they may have acquired their properties within the previous years, which means the market is already constrained as there are few starter homes. A combination of low inventory and a slowing new construction activity means that there will be a supply imbalance.

As people get laid down and unemployment rises during the recession, mortgage delinquencies at the moment are at a low point and will rise. “The national mortgage delinquency rate reached a record low in the second quarter of 2022 but will likely increase with the uptick in unemployment and the destruction caused by Hurricane Ian in Florida, South Carolina, and other nearby states,” said Marina Walsh, vice president of industry analysis.

Walsh also expressed concern that the mortgage industry will take a hit during the recession. “Origination volumes have declined, revenues have dropped, and expenses continue to rise,” said Walsh. “Lenders have started to shrink excess capacity by reducing staffing levels, exiting less profitable channels or exiting the business entirely.”

WHAT WE KNOW RIGHT NOW

The current state of the mortgage market is that there is a tug-of-war between inflation and the FED’s activity to tame it. Since the first hiking activity in March, the FED has continued to do this a total of five times through September. When writing this article, the FED had plans to raise interest rates again before the year ends in a meeting in early November.

Some experts are still optimistic that the mortgage rates have reached their peak and have gotten used to the fluctuations.“I would be surprised if [rates] would [go] up from here - but I’ve been saying that for the past couple of months, and I keep being surprised,” says Daryl Fairweather, chief economist at Redfin. “But even if rates stay at 7% for another couple of months, it’s going to really slow down the housing market.”

Navigating the complex lending market!

Know where your money is coming from

The real estate market is changing rapidly so is every facet of this diverse market.

The l; ending market has seen gradual changes over time in terms of policy, criteria, affordability, and accessibility to the mortgage market. The pandemic also played a huge role in expediating several changes across a range of borrowing needs, personal finances, employment statuses, and income-generating opportunities. Factoring all these issues, you find that the lending landscape has become extremely complex and the mortgage market even more so.

In retrospect, the pandemic has changed the normal course of our lives over the last two years, and the lending landscape was not spared. In fact, during this period, many investors familiarized themselves with many concepts of the lending market- loan processes and muchmore than they ever did before the pandemic. Ever since the new reality, banks seem to be

pushing their goalposts more frequently in response to the recent actions by the FED, and even before the FED stepped in, the market was already somewhat unique- due to the nearhistoric low rates. This increased demand for loans, and the banks had to adjust appropriately; now that we are experiencing increased rates, lenders are forced to cope with this new reality.

In the spring season of 2020, some lenders felt that the market was headed to the rocky ground, so most did ‘abandon ship,’ leaving active investors in a bind and closing their doors. Some even stopped lending just to understand the complexities of the market. Two years down the road, the market is still experiencing some dynamic changes, which is making many investors cautious, not to experience what they experienced in 2020. While we do not expect the rates to increase, many investors have taken their eyes off the real question: the possibility of

PHOTO FROM 123RF

closing on a loan.

One thing that has changed quite rapidly is the underwriting criteria. Many lenders are not making many or any exceptions to the lending guidelines and lowering the loan to value midstream in the escrow process. Before the pandemic hit, capital wasn’t the main issue for many investors; the concerning part was getting through the underwriting process and getting approved to close. In fact, many investors were uninterested in what happened in the lending process as long as the money made it to the closing tables.

This was the case for a while until lenders decided to suddenly turn off the spigot to cheap capital. This has since seen many investors struggle to save deals in any way, shape or form. In our last month’s issue (November Issue of the Power Is Now Magazine), we featured an article where we sought to answer the question of why many buyers and investors are preferring riskier loans, which is a trend we’ve seen pick momentum mostly in the second half of the year. Investors today are trying their luck with private lenders with their own capital to lend to the forefront in the hunt for leverage.

What you need to understand is that private lenders have more control. Many have strings attached to the capital they lend out, which are pulled by forces outside the lender’s control.

usually get their money from (oftentimes) lines of credit from banks or sell their loans on the secondary market. In both cases, an entity usually sets the rules of engagement, clearly dictating to them what they lend and the prices of the loans. These private lenders require a line of credit to stay open or the capital markets to continue purchasing loans. Hence, they have enough liquidity to keep new loans coming into the pipeline.

Large institutional lenders

So what does this mean for the buyer? It means that at any one time, the rates and the terms you get may suddenly change, or the funding, in general, may be stopped at a moment’s notice. The only way that you can protect yourself from this chaos is by start asking questions about how the lender acquires their capital and diversifying lending sources based on where they get their capital.

Devising creative and innovative solutions to deal with the affordability crisis in the country

It’s an undeniable fact that many people today crave homes, which can be shown by looking at the current trends in the real estate market and the frenzy we witnessed in the last two years. Buying a place to call home and making memories will forever be a significant milestone in one’s life. You could own a home, but you would like to make a few upgrades to accommodate a larger family. Whatever your plans, you probably have noticed that securing property has become a big challenge.

Indeed, Americans are struggling not just to make a living but to find somewhere to live. The market has high demand, but very few houses are being constructed to meet that demand. In addition, the market cannot supply affordable housing across the country, which has left many buyers in limbo.

Numerous factors have contributed to this persistent housing shortage, exacerbating the country’s housing crisis. With every challenge comes to an opportunity for creativity and innovation, and the current market is forcing tech companies, entrepreneurs, and developers to think outside the box. Looking

at the west coast, for instance, Tech companies are largely responsible for the high cost of properties as entire communities have become so gentrified that the average person is forced to look elsewhere for affordable properties.

Another factor we must consider is that the FED kept interest rates so low, which pulled in many buyers, ultimately pushing the prices higher. These two forces, among others, created a ‘crazy’ imbalance in the market, leading to the situation we are grappling with today- the affordability crisis.

Still on the west coast, because it seems California is the epicenter

of the affordability crisis in the country, a report by Mckinsey concluded that the state needed to add about 3.5 million more homes by 2025, which means each year the state must add 350,000 units for the next seven years. But there are unique challenges that will make this

reality a nightmare. First, the current zoning laws do not support such a move, and second, there is land scarcity in the urban areas. These are some of the challenges that make achieving 350,000 units a year an insurmountable task. To move forward, California and the nation must look towards new innovative ideas.

REMOVING ALL BARRIERS AT THE LOCAL, STATE, AND FEDERAL LEVEL

This will allow the country at large to add more homes and apartments. To progress on this front, the local, state, and national governments must remove the barriers, especially regulatory barriers to building homes. On that front, there are several policies being looked at in the private and public sectors to achieve better regulatory policies for housing affordability.

A case to mention is Symbium, a tech company in San Francisco that has developed

a computational law platform that mechanizes the rules and regulations of planning code to assist all stakeholders in quickly establishing an Accessory Dwelling Unit (ADU) is allowed on a property. This is important and extremely helpful; it helps the industry automate the legal analysis for the planning code, and anyone can access what is possible in certain jurisdictions or on a given parcel which cuts the processing time from months to immediate response.

The computational capacity delivered through this platform helps break the administrative and regulatory barriers and demonstrates the potential for other processing innovations related to planning and zoning.

Other states like Minneapolis and Oregon have eliminated single-family zoning by breaking down the regulatory barriers that initially made this a challenge. Although 75 percent of the housing in Minneapolis was previously zoned single-family, now up to three units are allowed on any residential plot of land throughout the entire city.

“By rezoning lots that currently accommodate only one single-family house to allow duplexes and triplexes,” says Andrea Brennan, Minneapolis’s Housing Policy and Development Director, “Minneapolis effectively triples the housing capacity of some neighborhoods.”

In June 2019, the State of Oregon passed HB2001 with bipartisan support- legislation that effectively ended single-family zoning in the state. In fact, it gave power to the state to determine the legal authority to establish parameters for zoning at the local level. So far, the state of Oregon has made a bold move to assert that authority to encourage the local jurisdictions to allow more units to be built in their state.

TECHNOLOGIES TO BOOST THE SPEED OF PRODUCTION, INCREASE

PRODUCTIVITY, AND LOWER

COSTS

Another innovative firm in Silicon Valley called Entekra is focused on off-site framing. It is on a mission to increase home building productivity and reduce the time and the costs it takes to build a single unit.

Stick-built framing for a typical 2,500-square-foot house would generally take about five workers and 15 days to complete, but with the firm’s Fully Integrated Off-Site Solution and a crane, the framing can be done in just four days by a crew of four people. Effectively, this reduces prices by $25,000, saves an average of 30+days, and increases overall productivity by more than 500 percent. In addition, this system reduces errors and reduces on-site skilled labor needs.

Regarding multi-family units, another company- FullStake Modular in New York, merges modular housing with new construction technologies to bring a higher level of control, predictability, and scalability to multifamily development. This is the same company that built the modules for 461 Dean Street in Brooklyn, New York, which is the tallest modular building in the world.

CREATIVE FINANCING

Financing is one of many people’s biggest hurdles to homeownership. To that effect, Rhino, a company located in New York, partners with building owners in all 50 states to offer low-cost insurance as an alternative to cash security deposits. When a renter inquires

about a unit and says Rhino is an option, they can choose between low-cost insurance or a traditional security deposit. The transaction is made directly with the renter. The renter will receive information about the premium immediately, and then they can decide whether to pay the premium in lieu of a security deposit. Although the cost of insurance varies, it ranges between $4-7/monthly.

In addition, it is important to highlight that several companies have developed several approaches to help future buyers. One of the most popular approaches is crowdfunding to seek investors. A good example is HomeFundIt in Baltimore, an online crowdfunding platform allowing homebuyers to use gifts from family and friends for home payments. Still as a crowdfunding platform but using a different approach, Small Change in Pittsburgh connects investors with developers to build better cities . As long as you are 18+ Small Change allows you to invest in projects that involve affordable housing, community centric projects, transit oriented projects and any project that essentially makes better places for everyone.

Additionally, one of the markets that we have to look at and carefully consider is the renter’s market. These are the people getting groomed to become buyers and availing financial assistance and removing barriers to financing, especially for the minorities and the people with lower incomes is essential to ensure housing affordability. A tech company called Till, located

in Alexandria, Virginia has set a platform that transforms a renter’s ability to pay, stay and thrive in their homes through realtime data to develop payment solutions to address their needs.

What Till offers is personalized structures that reduce the avoidable costs of delinquency and evictions. Understanding that the biggest costs that many renters face is rent payment , Till helps to drive meaningful improvements across a renter’s entire financial landscape.

It is also estimated that less than 1 percent of credit reports include rent, yet, for many people, it is their largest and most consistent payment. In light of this, another tech company, ESUSU in New York offers the renters data reporting services that includes rents as a factor of credit scores. The company builds the reports for clients by partnering with property managers and public housing authorities or even working directly with landlords. By using rent payments to establish creditworthiness, ESUSU significantly lowers the cost of capital for renters who want to become buyers.

Housing affordability is not a oneoff problem that can be solved by a blanket solution. However, it is a problem to keep talking about the problem and not offering any real practical solutions. Focusing on ways to solve the problem through innovation, it will be possible to come up with multiple marvelous and creative solutions focused at the grassroot level.

Re-examining the newly revised Covered California Program

Before the new rules, many people with access to an employer-based health insurance plan through family members were not eligible for the covered California Program. In most cases, employer-issued health insurance coverage for family members is usually expensive, which ultimately drives up the costs of the coverage for these family members. This was an error termed as a ‘family glitch,’, and it had carried a lot of people with it, leaving the affected members with limited choices to either buy the expensive plan, try to buy the bare-bones plan separately, or alternatively go without any health coverage.

This ‘family glitch’ issue is a decade-long problem, and in April, the Biden administration ordered a revision to fix this problem. In October, the Federal government adopted the regulation. Starting in January 2023, if a family’s premium costs more than 9.12% of the household income, the family could qualify for federal government subsidies or discounts through the Covered California Program.

This glitch in Covered California effectively affected an estimated 615,000 people in California. The majority of these were women and children from low to middle-income families, according to the UC Berkeley Labor Center. Additionally, the center estimates that about 400,000 of these people would be eligible for financial assistance through Covered California based on their incomes.

“For the people impacted, it could be worth hundreds of thousands of dollars,” said Anthony Wright, executive director of Health Access California, a consumer rights group. “It really does have an impact on the health and wellbeing of the family and their finances.”

A California family of four with $53,000 annual earnings would likely save about $4,340 a year in health insurance premium costs, according to an analysis by Third Way published on April 2022. The analysis further found that lower-income households would see the most significant savings.

The Federal government intends to directly inject subsidies into the health plans based on Covered California’s marketplace prices. According to the Congressional Budget Office, this would cost the taxpayer $44 billion over the next ten years to cover the families left out by Covered California. The program has a $109 million annual budget for marketing, and much of this money is spent during the open enrollment to outreach Californians to sign up and renew the program, according to Jessica Altman, executive director of Covered California.

California legislators have been trying to solve this glitch at the state level for the year, but the cost was too much for the government to bear. The Federal government had to come in, fix the problem, and fund it.

Effectively, the revised changes to the program will reduce the number of uninsured people in California. So far, the state has recorded the steepest decline in the number of people with no coverage since the Affordable federal Care Act, also known as Obamacare, launched in 2013. Since then, about 35 million people have enrolled in health plans nationwide, according to the US Department of Health and Human Services.

In California, the rate of uninsured residents has dropped from 17% in 2013 to 7% in 2021. According to data from UCLA Center for Health Policy Research and UC Berkeley Labor Center, more than half of the three million still uninsured in the state qualify for some coverage. The remainder, which is about 1.2 million, are undocumented immigrants.

“This is a big deal toward the goal of a government guarantee that everybody has access to affordable health coverage,” Wright said of the policy change. “The more we get rid of asterisks and exclusions the better.”

These changes to the program come at a time

when employers continue to shift insurance costs to families, according to a survey by Kaiser Family Foundation that found that premiums for family coverage increased 22% between 2016 and 2021.

going to the doctors or prefer not to use the coverage as they will still have to pay out of pocket.

Looking at the national data, about 5 million people are eligible only for unaffordable employer-provided insurance. More than half of these people are children, and among the adults, more women than men are caught up in that glitch.

“It created an unaffordable situation for a small but meaningful group of people,” said Christine Eibner, a senior economist focused on health care at RAND. This nonprofit research organization published a report about the issue in 2015. “Most of them were enrolling anyhow and paying the higher premium. They could be paying 15% to 20% of their income.”

As previously mentioned, California has about 615,000 people who are currently caught up in this mesh of expensive employer insurance plans and their only option. It is estimated that about 87,000 are uninsured. 35,000 are in the individual market paying full rates, and the majority are paying for that expensive employer coverage.

“There are families that can save thousands of dollars — middle-income families, lower-income families — that it’s going to make a significant change for,” Altman said. “There is value in helping people who have coverage to connect with lower-cost coverage.”

The people who might end up preferring the employer-based plans, with no other option, might choose the least expensive plans with higher deductibles or even have catastrophic coverage. This means the majority could avoid

“We believe it’s important to have the whole family covered,” Wright said. “There is a real result of not having coverage. The uninsured live sicker, die younger and are one emergency away from financial ruin.”

The ACA requires that employers with more than 50 employees provide insurance to the employees and their dependents. Spouses are included but are not a requirement by the law. In California, about 47% of people enrolled in an employer-provided plan. A study published in the Health Affairs Journal found that families spend an average of 16% of their household incomes on employer-based premiums.

ABOUT COVERED CALIFORNIA

Covered California is the state’s health insurance marketplace, where Californians can find affordable, high-quality coverage from private, brand-name insurance carriers. It is the only place qualified individuals can get financial help to reduce their monthly premiums. Depending on their income, some people may qualify for California’s low-cost or no-cost Medi-Cal program.

Covered California’s mission is to increase the number of insured Californians, improve healthcare quality, lower costs, and reduce healthcare disparities through an innovative, competitive marketplace that empowers consumers to choose the health plan and providers that give them the best value. The organization is an independent part of the state government and is overseen by a five-member board appointed by the governor and the Legislature. For more information about Covered California, please visit www.CoveredCA.com.

How FICO 10T and VantageScore 4.0

Adoption by FHFA will change the industry lending and mortgage landscape

Last month, the Federal Housing Finance Agency (FHFA) announced that it had approved two new credit scoring models, the FICO 10T and the VantageScore 4.0, for use by the GSEs or the Enterprises. This effectively means that lenders all over the country will have a few years to roll out these two new models into their processes before being expected to report both scores on loans sold to the GSEs.

Enterprises, along with maintaining safety and soundness,” said FHFA Director Sandra L. Thompson. “While implementing the newer credit score models is a significant change that will take time and require close coordination across the industry, the models bring improved accuracy and a more inclusive approach to evaluating borrowers.”

In a fact sheet, the FHFA notes that these two new credit scoring models will accurately determine the credit scores, and not just that, they are also inclusive than the classic FICO because the new payment history and other factors have gone through a rigorous and extensive testing process to ensure accuracy while also expanding the datasets relied upon for measuring creditworthiness.

These two new models will certainly bring soundness to the housing market by improving accuracy and creating better ways to calculate risks.

For the past 20 years, GSEs have failed to incorporate new technologies in reporting and solely relied on the Classic FICO Credit Scores. But, the breakthrough came in 2014 whereby FHFA, in coordination with the Enterprises and other key stakeholders, began to develop new credit score requirements that would factor in more histories of a person’s financial activities to accurately reflect the creditworthiness of a borrower with thinner credit files. To that end, FHFA has been fairly successful, resulting in improved credit scoring models that consider a borrower’s payment histories, for instance, payments for rent and utilities.

“Today’s decision will benefit borrowers and the

In a remark by Sandra Thompson, she adds; “The new models bring the benefits of innovation to the table in two ways:

FICO 10T and VantageScore 4.0 provide more accurate credit scores than Classic FICO. We believe the market, including investors, will be provided an improved understanding of risk from not just one but two different credit score models.

FICO 10T and VantageScore 4.0 are more inclusive than Classic FICO. While the Enterprises have already taken steps to expand equitable access to credit, such as enhancements to their underwriting systems, both FICO 10T and VantageScore 4.0 factor in new payment histories for borrowers when

available, such as rent, utilities, and telecom payments.”

She also noted that requiring these scores “will result in more borrowers that can be evaluated by the Enterprises than a single score alone, which will improve their management of credit risk while also responsibly and sustainably expanding access to credit for borrowers with less robust credit histories.”

In addition to all these changes, FHFA announced that the GSEs would require two rather than three credit reports from consumer reporting agencies. This is a move that will dramatically reduce costs to the industry to encourage further innovation.

WHAT THESE NEW CHANGES MEAN FOR HOMEBUYERS

When it comes to buying properties, consumer credit scores become an extremely critical element in qualifying for a mortgage. Furthermore, lenders use credit scores to check whether a borrower can repay the mortgage they are applying for, which means borrowers with excellent scores can potentially qualify for the most competitive rates. Therefore, if you are a borrower looking for a mortgage lender with the lowest rate, then it is important that you familiarize yourself with how credit scores are determined and understand how they are

calculated.

There are several ways through which the scoring companies arrive at a credit score. Still, generally, credit reporting agencies like Experian, TransUnion or Equifax will look at your payment history, the amount of outstanding debt, the percentage of credit lines being utilized, how many credit inquiries you have made, and the type of credit that has been extended.

An important note is that each scoring model will assign different weights to these factors (although the weights are insignificant) when calculating the overall credit score. What the new credit scoring model adopted by FHFA does is that it will take a wider range of payment data than what the Classic FICO model took into account.

These changes will revolutionize the industry for people looking to get a mortgage, and the majority that will benefit from these are lowincome and marginalized families. An Urban Institute research in 2021 found that Black people and Hispanics are more likely to have no credit history or low credit scores and are also more likely to become renters. Using a credit score that’s more expansive could allow these families to build credit scores faster and ultimately qualify for a mortgage.

Looking to Invest in Texas? Here’s a Simple Guide

By Sharon Bartlett

The Texas housing market has always been a favorable investment opportunity, especially when buying rental properties. For a long time now, investors all over the country have been interested in Texas income properties, and of course, it’s for a good reason. Texas State has a large population, with laws that are welcoming and friendly to investors, without forgetting the many great areas you can choose from for investing in real estate. To top all that up, the lone Star State is huge. It’s the second-largest state in the U.S. in population and geographical terms.

Here are some of my top reasons why you should consider investing in the Texas Housing market.

AFFORDABILITY

As the housing market recovered in most large U.S. cities, house prices in those cities rose above affordability for most buyers. For Texas, the case was different. Although the house prices have inclined in Texas over the past years, they remain affordable in many areas.

The Texas housing market appreciation rate also holds a good upward trend. According to Zillow, Texas home values have gone up 3.3% over the past year, and the predictions hold that the values will rise 3.8% within 2020. In general, Texas features a cool housing market, making it an excellent buyer’s market.

STRONG ECONOMY

Texas has had a remarkable economic growth throughout the years. In 2020, its economy is estimated to be worth $1.6 trillion and still growing. Texas economy is supported by a wide range of successful industries and leading institutions of higher learning. The state’s economic growth is also attributed to its diverse economic base that features agriculture, mining, and energy industries, without forgetting its further economic diversification through bringing in new jobs from technology, financial and healthcare services companies.

Texas also has a business friendly environment and favourable tax laws, which play significant roles in attracting large companies in the area,

such as the 50 Fortune 500 companies. For any investor, this are critical factors that come with positive influence to the real estate investments.

STRONG POPULATION GROWTH

Population growth in most parts of the U.S is mainly due to economic factors. Therefore, with steadily growing economy and diverse job opportunities in Texas, people are largely moving to Texas. On top of it, Texas features affordable housing, falling mortgage rates, and no state income tax. Most people who move there are job seekers who will also need housing. This means that Texas rental properties will ever be in high demand.

Another reason to buy investment property in Texas is that the state is already known as the most landlord-friendly state in the U.S. Also, most first time buyers end up buying investment properties in the wrong market or neighbourhood. To get the most out of your real estate investment, you must invest in a good market or neighbourhood.

SO HOW TO GO ABOUT INVESTING IN TEXAS MARKET

Conduct a Market Analysis

When making any investment, the goal is usually to make profit. Before diving into an investment blindly, conduct an investment analysis that will give you a clear picture of how much you stand to make when you put money into a property. There are online resources such as Mashivor. com that will give you cash on cash returns of an investment, the expected rental income, the expected cash flow among other metrics. Additionally, conduct a comparative market analysis (CMA). This will make comparisons of the property against similar properties.

FINDING YOUR INVESTMENT OPPORTUNITY

Finding an investment property in Texas is one of the easiest tasks. With the help of a local agent, these properties can be easily identified. You can as well check with banks in Texas and find properties in which they have failed to follow after foreclosures and have abandoned them.

If that does not work, you can liaise with the local postal office, and they can alert you on buildings whose mail is piling up. You can also opt to advertise; the local neighbors’ can be very resourceful and point you toward abandoned properties. The local realtor inventory can also be very useful; you might find an ideal vacant property there.

FINANCING THE INVESTMENT PROPERTY.

The method you choose when financing the property relies heavily on the purpose you intend to use the building. Your credit score will also come into play when deciding on the best financing method. Make sure you rank highly before applying for any mortgage. You could finance using a traditional mortgage, FHA loan, renovation loan, or loan equity home. Select the one that offers you the best deal.

When investing in properties, it is important to remember that it’s a costly venture with great rewards if done correctly. Before investing in any, do your due diligence. It would be disappointing to find surprises along the way.

Buyers In Maryland:

Here’s how to Build a Rapport and Negotiate with Sellers for a great deal

By Emerick Peace

Building a rapport with a seller is one of the most important aspects of any negotiation. First, it reduces the tension between you and the seller, and second, it improves collaboration.

In addition, Active listening is one of the skills that will get you what from the seller fast and easily. Moreover, it is your ability to understand what the seller needs and actively look for ways to remove doubt and concerns in their mind.

SO HOW DO YOU BUILD RAPPORT?

As a homebuyer, you need to look for any personal connections that you may have with the seller. While it is good to get straight into the business, a conversation should not only pertain to conversations about the home getting sold. Taking a personal approach to negotiations is often a better tactic that will increase your chances of your offer getting accepted. Always remember that rapport building relies on connections with others on a more personal level and that the seller, apart from selling you the

PHOTOS FROM 123RF

home has a life outside of that.

A good place to start would probably be looking at their LinkedIn or any social media site they may be active on and trying to find some commonalities. If any, ask them about it and right away strike up a conversation.

The point is to get your seller to talk about something other than selling the property and start that conversation. This way, they will feel more comfortable and will trust you.

ASK QUESTIONS

When meeting the seller for the first time, I recommend that

you remember one thing in particular: sellers are looking for top money for their property! This means most won’t care about you, especially if you want to lowball. Instead of talking about yourself, how you will take care of the property, or how much you need the property, ask questions about the seller. Ask them questions, find out how long they’ve been in the property, what made them choose that property, and what are some of the memories they have and will miss of the property once it is sold. Take your time to learn about their background and their interests.

Listen More, Speak Less!

Listen more and speak less if you want the best deal when negotiating for a property. Here, apply the 80/20 rule, where 80 percent of your success comes from 20 percent of your efforts. When talking to sellers, this rule holds. Aim for the 20 percent and let the other 80 percent do the talking.

One of the best quotes I like states, “He who names the price first loses.” many negotiations will always arrive at a certain middle-ground or the split difference mentality. This is the compromise between two prices, and your main job as the buyer is to find the middle ground. Usually, in negotiations, people do not want to give away more than they have to or give less than they get. Being an active listener will help you negotiate better and help you understand better what is needed in every situation.

Negotiating is an art that is learned and honed by realworld experience. Not many people are gifted in this skill, and learning it will help you develop skills that will benefit you throughout your life. Therefore, build a rapport, gain confidence and trust and go on to solve problems.

Where Starting Over happens every day!

We’re Starting Over, Inc. - a 501(c)(3) organization dedicated to supporting and uplifting people experiencing the effects of mass incarceration, systemic racism, housing insecurity, substance addiction, and mental health issues. We believe that people impacted by these issues are the ones closest to the solutions, which is why we are a Black-led and criminal justice-impacted organization engaged in this work. From experience, we’ve learned that housing is critical, but alone, it is not enough to support those exiting prisons or the streets. We not only provide transitional housing, but also include holistic services such as peer support, case management, employment, wellness, and reentry services. We also work to address the root causes of our houseguests’ difficult situations, leading grassroots organizing and policy initiatives in the Inland Empire region and statewide. Established in 2009, we’ve served over 1,400 men, women, and families in Riverside and Los Angeles Counties through the reentry and transition process.

We believe that the past does not define our future. We’re invested in creating safe and equitable opportunities for all members of our community, and especially those with past convictions. Housing opportunities are crucial for our community members and directly affect their ability to thrive.

Starting Over, Inc. is committed to reducing and eliminating the many barriers to life after incarceration. We have a deep commitment to identifying and implementing evidence-based approaches to strong communities and families. We seek to creating program/project solutions where the need exists in our community. We do lots of things at Starting Over, Inc. - but our primary goal is to address the immediate effects and root causes of incarceration, be it through housing, employment, legislation, or community organizing.

T t i l d ith i itiatives, access our services, or support our work through donations, you can or office@startingoverinc.org.

programming and projects include, but are not limited to:

We currently operate eight homes in LA and Riverside Counties open to men, women, and children, with options for sober living or harm-reduction housing All of our services are available to our houseguests, many of whom have been unable to obtain housing after being released due to their conviction histories

Our Case Management specialists provide support to our guests with obtaining necessary documents/identification and accessing insurance, education, healthcare, clothing, food, & more.

Transitional Housing Case Management Peer Support

Our houseguests are not alone - our support specialists, having experienced incarceration, addiction, and homelessness themselves - understand our guests' needs and the barriers they face. We’re here to meet our guests wherever they are in their journeys and to support them moving forward through empowerment, support with recovery, referrals, and mentorship

Family Reunification, Equity, & Empowerment (FREE) Project

Mass incarceration affects not just individuals, but families - many of our community members and guests experience family separation at the hands of the child welfare system. The FREE Project is system-impacted led and organizes parents and family members in a non-judgemental space, advising on best practices and dependency court procedures We recently sponsored and passed statewide bill that eliminates major barriers to child placement and allows family members with criminal convictions unrelated to caring for children to be considered as placement options allowing for suitable family members with criminal convictions to step up in times of crisis

Through our Path to SEED program, we connect guests and community members with employment opportunities and provide training & support regarding obtaining and retaining employment, often a major hurdle for formerly incarcerated individuals

Marshall Legal Clinic

Our free clinics provide relief for expungements, wills/trusts, immigration, and more with the support of local legal organizations

Employment Policy Advocacy

In the past year, we’ve co-sponsored and/or supported nearly a dozen statewide bills to reduce the scale of mass incarceration and its collateral consequences We’ve also worked locally to influence Riverside County to reduce criminal history look-back periods from 7 years to 3 years in 2017 and to enable youth coming out of probation to be able to stay with their family members in subsidized housing

Grassroots Organizing & Civic Engagement

Our Participatory Defense organizing model (based on Silicon Valley De-Bug) empowers family and community members in the courtroom to positively impact their loved one’s outcome and to bring them home. As fiscal sponsor and start-up organization of Riverside All of Us or None (a chapter of a national initiative of formerly incarcerated people, family members, and allies advocating for the rights of the currently and formerly incarcerated people) we ensure that system impacted leadership remains at the center of the fight to keep our community together and address the social problems that incarceration purports to solve Our community outreach team also disseminates voter registration and public health information regarding COVID-19, and we organize food and clothing relief for community members in need.

Housing Market Predictions for Florida 2023

By Adriana Montes

At the time of writing this article, the median price of the average home in Florida was around $406,876, according to Zillow.

This means that the median home price for homes in Florida is lower than the national average of $454,900, according to data from the U.S. Census Bureau. This is one factor that pulls many people to the sunshine states. In addition, the cost of living in Florida is incredibly low, making it a perfect place to live and invest.

The last few years have been a ‘wild run’ for most real estate markets, characterized by biddings wars, low-interest rates, which ultimately drove prices higher and higher each quarter. Florida was no exception.

In January 2019, the median home price was $242,508. A year later, the price rose to $249,408, and while not much of a change, dramatic increases started to happen in 2021. At the start of the year, the median price was at $271,190, and by the end of that year, it had risen to $339,577, reaching its peak in October 2022 at $406,876.

All signs point to prices rising further, and the market doesn’t show any signs of slowing down anytime soon. Therefore, if you are looking for a property in Florida, whether a place to live, a vacation home or a property to invest in, now is the right time to buy.

PREDICTIONS FOR THE MARKET GOING

INTO 2023

Many experts argue that we are currently in recession; if we are not, that’s where we are headed. Economic activity has slowed quite significantly around the country. Over the next several quarters, property values are expected to drop significantly, given that the FED is desperately trying to control the current inflation.

But will this affect Florida in any way? Not particularly. Looking at this market from a different angle, you realize that prices have continued to grow even though the economy was slowing down. This could be explained partly by the fact that so many people are still flocking to the sunshine state to take advantage of the massive tax breaks and a relatively low cost of living. Therefore, the demand has remained relatively stable.

Many people are looking to move to Florida as a safe financial gamble, and if this is true, the property market will continue to grow in 2023.

The housing market, in general, has seen some massive spikes over the last two years, as previously mentioned. While different places and cities will differ in price greatly, the average home in the state sits well below the national average. However, that gap will quickly close moving forward.

ORLANDO REAL ESTATE MARKET

Looking at the Orlando 2022 market, an article published by USA Today noted that the yearly listing price for this market has risen 21% in the last year, which makes this city at least one of the top five places that have seen an increase of 18% or more.

In September, the median price had risen to $459,142, and interestingly, Orlando properties sell in two weeks on average, compared to 10 days in 2021.

In addition, what makes Orlando real estate grow and perhaps continue to grow in 2023 is the fact that people are flocking to the city from high-tax and high-cost-of-living places like California and not just people but companies too. A recent trend we are seeing is bigger companies preferring less crowded places with lower living and favorable business costs and low housing prices.

In addition, if we look at Orlando as a whole, the city benefits from long-term economic and demographic benefits and developments. The housing market stands to gain a lot from the influx of people coming into the state. Although a recent report by Realtor.com shows that home sales in Orlando fell by 7.3% compared to March 2022 and 6.9% looking to last year.

Nevertheless, as interest rates keep rising, Orlando Market will likely begin to cool down. For some buyers, it may become difficult as their monthly property payments would also be greater.

Given the city’s essential investment factors like Cashflow, affordable housing, a growing population, and a stable employment market, Orlando was named as one of the best areas to buy a rental property in 2022, and going; this will be the case in 2021.

A case to point out would be in August 2022, when prices were 19% higher year-overyear and had a median price of $400,000.

Also, note that the sunshine state receives a lot of sunny days and does not impose a state income tax, making the local real estate market even more appealing. These are just some of the numerous reasons why people come to Orlando from other cities.

A Condo or a Townhouse in Arizona?

Which is the right one for you?

By Yvonne McFadden

Urban and rural dwellers can choose among many living accommodations. Two popular ones are condominium apartments and townhomes. Before you buy either in Arizona or, to be more specific, in Scottsdale, it is important to understand how they differ and the pros and cons of each.

CONDOS

A condo is always an apartment within a residential building. The connecting areas between apartments, as well as the lobby and grounds, are commonly owned by all the residents of the condo building. As a condo owner, the apartment’s interior belongs to you. You do not own the surrounding land.

The HOA also called a condominium association, takes care of the building’s maintenance,

including common areas and the exterior. They use your dues to do this; therefore, expect fluctuations in your HOA dues that could cause personal financial disparity. A new pool in the building could mean spiked prices.

The association can bring litigation due to faulty construction, roof leaks, cracks in the foundation, and more building-wide problems. The litigation may prevent any financing on the property until it is resolved. This can also result in special assessments that will skyrocket your dues.

Many condominium buildings also have doormen and video camera setups, which may make this option less private than a townhome. Having common areas will limit your privacy significantly.

You will also have a problem in selling your condo if more than forty percent of the occupants are renters. In addition, you will see the rapid deterioration of the entire complex. That simply results from tenants not caring about the facility as much as a buyer would. It is impossible to see the future; you could move in with an empty condominium complex, and the following year it could be filled with renters that have destroyed the building and your resale value.

The condo’s resale will also be difficult if it is not FHA or FNMA/FHLMC approved for financing or loses its approval from these entities. You will need a cash buyer, a rarity, or a buyer with non-prime financing. Because of this, the market price is hard to come by. The buyer will need to find a new low to the selling price. Cash buyers want a deep discount, and non-prime financing is expensive that the buyer will have to make a low offer.

TOWNHOMES

Townhomes are attached houses that sit side by side and share walls with adjacent townhomes unless you live at the row’s end. Both options are equity investments, usually involving a mortgage, and both are subject to homeowner association (HOA) fees. Townhomes also offer a property tax write-off and an interest write-off, giving you more flexibility with your funds come tax season. Because townhomes are also on the less expensive side of homeownership, you will be able to save money for that single-family home

without having to rent.

Equity appreciation is another great perk to living in a townhome you cannot get in a condo or a home you rent. This allows the townhome to become an investment instead of simply a secure, permanent place to live.

Often, adjacent townhome units are identical in design, which may be a drawback or benefit, depending on your taste. They all start on the ground floor and may have multiple floors and a basement. You own the surrounding land, which may be tended to by the HOA.

The lack of common hallways and lobbies means you have more privacy entering and leaving your home, and it will not take nearly as long to get to the door of your home. You usually pay a lower HOA fee in a townhome. Townhome HOAs may take care of certain chores like lawn care and garbage pickup. The cost comes out of your pocket if you need a new roof for your townhome.

This contrasts with a condo, where the HOA fees and perhaps a special assessment would pay for the new roof. The townhome’s HOA may have strict rules concerning any changes to the front exterior and landscaping, even down to mailbox styles and paint colors. Pets may be restricted in both condos and townhomes; however, there is a higher chance of allowing pets in a townhome over a condo.

Want to Get The Most out of your Home?

Here are some 5 tips to Improve your Home

By Tamra Lee Ulmer

Most people tend to go overboard with what they can do to improve their home’s appeal. It is easier than you think. Smart people do not see their homes as just a place to go about their everyday living; they see it as a way to build wealth hence constantly doing things to improve the value and appeal of their homes.

Homeowners who constantly work on their homes sell at 30% more than they purchased. Therefore, in this article, I have prepared a list of five simple things you need to do to improve the value of your home in Arizona.

MAKE IT ATTRACTIVE!

This is the first thing you need to do to improve the value of your home. Make it more beautiful, appealing, and attractive to potential buyers and onlookers. If you are considering selling the home, you must work on the interior décor, which

will help you with home staging.

Some sellers or homeowners do not pay much attention to staging their homes correctly. In a survey, about 22% of agents stated that properly staging a home increased the home value by 5% compared to similar homes. This highlights the importance of staging and making your home more attractive.

That said, however, make sure you do not go overboard with this to increase the dollar value of your home. Make changes that you are comfortable with, the ones you know will be comfortable with in the long run, such that, even when you do not raise the home’s value, it would still be a win for you.

When it comes to remodeling, what space should

you remodel to improve the home’s value?

• Living room

• Kitchen

• Bedrooms (master bedroom)

• Dining room

Let’s take a case to illustrate this. Suppose you decide to remodel the kitchen in Arizona. In that case, simple modifications will cost you about $23,000, and that will cater to things like modernizing appliances, cabinets and counters and sink, among others. This simple modification will add about 80% of the space you spent modifying.

SPEND LESS ON ENERGY

Cutting the energy costs for your home will pay off. The amount of money you spend every month on energy alone to many homeowners in Arizona might seem like a fixed expense. Still, it isn’t. in Phoenix, Arizona, Alternative Energy, LLC is the only energy company to offer a free home energy audit. The contractor will do an in-depth energy analysis and use the data to develop a customized energy package for you.

With this package, you will know how to maximize energy efficiency for your home. In today’s world, we all are looking for ways to save money on energy, and if your home has these facilities, you can be sure to scoop good money for it in the market.

ADD MORE ROOM

Basically, the bigger the home, the higher the value. With your home, look around to see if there are places you can add more rooms to it. Adding an extra bathroom to your home will make things easier for the buyer. Thus, they will pay more for it. However, even as you do the home renovations, remember that home renovations will cost you more than what you probably sell the home for. The amount of money you will spend on renovation might not be recouped in the resale value. While that is a bad thing, with a simple renovation, you could still

get more than a 60% return on your investment. A 60% return for a simple renovation is not that bad, assuming that you are planning to stay in the home for a while before making the selling decision.

Regularly keep your home well-maintained. This might sound like an obvious point but stay with me. Occasionally, take a walk around your house and make a list of the things you need to repair. The things that are broken and need a quick fix. Single, small repairs might seem unimportant, but collectively, they can give potential buyers the feeling that the home has been neglected.

If you are uncomfortable making the room changes, you can hire a pro to fix things for you. If you can stay on top of all the repairs and regularly maintain the home, you will end up improving the value of the home in the long run.

TECH WINS EVERY TIME

Smart technology in homes is a trending thing; you have to get your hands on it if you want to improve the value of your home. More people today are interested in purchasing smart homes or smart gadgets. According to a recent survey, homebuyers tend to be more inclined to homes that are preinstalled with;

• Smart thermostats.

• Smart fire detectors.

• Smart carbon monoxide detectors.

• Smart cameras.

• Smart locks.

• Smart lighting systems.

If you can switch from the traditional way of doing things in your home to smart technology, that would be a big win for your home.

Thinking FSBO? Read This First

By Walter Huff

Is selling your home all by yourself worth it?

This is a growing trend that I see, and while it has been a practice for many years in this industry, especially given the fact that real estate agent fees keep rising, making the FSBOs popular by the day, the question you need to ask yourself is, ‘will saving a few dollars really worth it?’

Who does not like saving a few dollars? A real estate agent’s commission may be a bit high, and you might be tempted to go the route of FSBO. However, like many who have tried and failed, you may be unsuccessful. Some of the reasons that will make you fail to include the following:

FAILURE TO RECOGNIZE POTENTIAL BUYERS

You may not know the difference between those buyers who are supposed to be preapproved and those who should be prequalified. This will result in you letting unqualified buyers waste your time on inspections.

FAILURE TO UNDERSTAND CONTRACT PROCEDURES

You may not be aware of the procedures involved in buying a house, which may make you agree even to things you do not understand. Interpreting some clauses in the law may be difficult for you, and you will need the help of an expert.

LACK OF UNDERSTANDING OF “GOLDEN TIME.”

Golden time refers to the concept that you are most likely to sell your house in the first weeks

after it goes up for sale. The more time it spends on the market, the less you earn. This means that when you sell your home by enlisting an agent and the home has been on the market for a while; it may not sell even with an agent’s help.

POOR PREPARATION OF THE HOME FOR SELLING

You may fail terribly if you fail to paint your house, replace broken panes, update outdated fixtures, clean the carpets, and perform necessary repairs.

POOR HANDLING OF THE INSPECTION FINDINGS

You may have replaced and updated everything in your house, but your buyer may still notice a problem during the inspection and request that it be fixed. If you decide your home is up to par, you risk losing the sale.

LACK OF EXPOSURE TO YOUR HOME

Most people buy what they see. If you fail to put your home on a website, you deny some potential buyers the chance to bid on your home. Remember, the majority of buyers are doing an online search before their purchase.

CONCLUSION

In conclusion, as an FSBO, you should know how to close the whole process by ensuring the whole home inspection process takes the stipulated time, reviewing the title work, making sure the contracts have been approved by the attorney and ensuring your buyer has his mortgage commitment. However, it is often a good idea to hand over your home to an agent to sell it efficiently on your behalf.

The Dangers of a Homeowner’s Association

By Heith Mohler

Be warned if you are getting into a homeowner’s association by buying a townhome or a condo. Their rules are extremely strict, causing the quest for approval from the association for any landscape changes or painting to be contentious and result in fines or legal action by the association.

Even though the neighbors have no problem with the swing set, the HOA threatens to bring the family to court. These rigid yet vague rules allow HOAs to take advantage of their residents.

Besides being irritating, homeowner’s associations can also take action that could make you and your family homeless. The association can foreclose on your home if you fail to pay your dues or violate any of the

bylaws’ covenants, conditions, or restrictions. The defaulted dues of the HOA can become a super lien and survive bankruptcy. That means that even if you lose the home or file bankruptcy and walk away from home, you will still owe the association dues; they will come after you. This is terrifying for any American, no matter how financially stable you are.

Another issue with HOAs is that there can be strife within the board of directors. Officers such as the President or treasurer can steal money. This can result in collusion, a lack of corporate governance, and poor record-keeping.

The HOA will simply state that their books are not in order. There is the failure to manage the associations’ legal, financial, and contractual

obligations, which may result in fines from governmental agencies and additional assessments to resolve the issues. You will have to pay more to cover the officers stealing your money.

If you are living with a homeowner’s association, you should also be prepared to spend a lot of time in HOA meetings. While you will not be monetarily penalized, changes in the bylaws, adjustments in the organization, and other elements that will affect you will be discussed. You do not want to be unaware of critical changes to your HOA’s bylaws.

THE SOLUTION TO HOAS

Single-family homes are the best option. You avoid a homeowner’s association and all problems that come with it. The resale value is higher; there is more room to grow your family, and a single-family home is more desirable. If you cannot afford a single-family home and do not want to rent, then townhomes are the better option in this case, especially compared to condos. They are better for young couples and

new families because they are less expensive than single-family homes. The best course of action here is to look for that single-family home to get the most for your dollar; however, many cannot afford such a costly mortgage initially.

If you want to take care of your property personally, take advantage of more privacy, and are willing to sacrifice a little convenience, then a townhome is the better choice. If you live in a more upscale townhome complex, amenities such as a pool, gym, and laundry room may be nearby. It may also be easier to sell your townhome due to the lower HOA fees. Whichever you choose, make sure you research the neighborhood thoroughly before jumping into a new home.

The only reason that validates buying a condo is that you are deciding between buying one and renting for the rest of your life. At least with a condo, you will own it after you pay it off; however, a townhome is the better choice, and a single-family home is even simpler for the resale value and lack of a homeowners association.

Is Making Your Curb More Appealing Underrated?

By Ruby Frazier

When selling homes, it is not just what is inside that counts; the exterior is just as important. Homeowners heavily invest in creating the best curb appeal for their homes. It is no doubt that a drab curb appeal can make a buyer cringe before he or she even walks through the front door, while a handsome, well-planned design could get you that offer that will sell your home.

In reality, curb appeal can be achieved through multiple methods such as exterior decorations installation, repainting of the exteriors, and extensive landscape.

Adding eye-catching elements to the home exterior, such as staging charming benches and subtle art, is a modern way of creating an appealing impression. Allowing the buyer the opportunity to picture his or her family playing in the yard or swinging on the porch-swing could mean the difference between an offer and waiting another week on the market. It is imperative that the seller gives the impression that he or she takes care of the home, and a pristine front yard is a fantastic way to do that.

A great option may include adding concrete steps to offer a clear path through lush but not

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overgrown landscaping. Alternatively, the exterior can be livened using vegetation such as bright annual blooms lined with dark mulch. Other curb appeal options include the introduction of gravel pathways, tying the house’s neutral tones with its landscape.

Additionally, letting the front yard be overrun by vegetation such as ivy or weeds can prove to be a major eyesore. Maintain your lawn’s grass, shrubs, and other vegetation, so there is an adequate ground cover but not excess. You must be careful that your grass is mowed when prospective buyers come to look at your home. Nothing looks worse than an overgrown lawn. The buyer then begins to wonder what else you have not been taking care of.

In some cases, a winding stone walkway can be provided as an inviting path to the front entrance if you have more foliage.

Clearing overgrown plants create a strong statement for your home. In reality, while evergreens provide a great way to have all year-round color enhance your curb appeal, if not planned and consistently trimmed, they can grow too long and large, compromising the curb appeal.

You want the buyer to be able to see your home from the street, and if there are too many

overgrown trees, then you may want to consider trimming the dense branches. Be sure to have this professionally done to avoid harming the trees.

Another way to maintain great curb appeal is by keeping the front door clean and attractive. This can mean anything from a fresh coat of paint to new hardware. The little aspects of your home like this can be overlooked. Additionally, it is advisable to ensure that the driveway and property are free of trash, poorly packed cars, or other non-essential objects.

Keeping freshly mulched front garden beds or planting colorful flowers that create an interesting look is another aspect of maintaining premium curb appeal. It is necessary to add color using perennial flowers that do not require yearly replanting and annuals that reflect the work you did in the flower bed that season. Flowers such as Shasta daisies and lavender are great places to start, especially because of the pleasant aroma that lavender emits.

It is not exceedingly difficult to maintain a beautiful exterior in your home. All it takes is some new mulch, a coat of paint, a bench, and a well-manicured lawn. Making sure that the grass is mowed and the leaves are raked can be tedious; however, selling your home for more money will more than makeup for it.

Sandra L. Thompson

RE-envisioning, The Housing Industry, Promoting Equity and Equality and Removing Regulatory Barriers

Sandra had been interim director of the FHFA for almost a year. With her confirmation as the new Director, one of her primary goals in office is to increase homeownership in low to moderate-income and underserved communities, especially those of color.

APPOINTMENT AS THE NEW DIRECTOR OF FHFA

The Senate confirmed her by a 49 to 46 vote, and President Biden appointed her as the acting Director of the FHFA towards the end of the second quarter.

Federal Housing Finance Agency (FHFA) was established by the Housing and Economic Recovery Act of 2008 (HERA) and is responsible for the effective supervision, regulation, and housing mission oversight of the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan

Mortgage Corporation (Freddie Mac), and the Federal Home Loan Bank System, which includes the 11 Federal Home Loan Banks (FHLBanks) and the Office of Finance (OF). The Agency’s mission is to ensure that Fannie Mae and Freddie Mac (the Enterprises) and the FHLBanks (together, “the regulated entities”) fulfill their mission by operating safely and soundly to serve as a reliable source of liquidity and funding for housing finance and community investment. Since 2008, FHFA has served as Fannie Mae’s and Freddie Mac’s conservator.

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As the new Director, Sandra will ensure that the regulated entities fulfill their mission by operating safely and soundly to serve as a reliable source of liquidity and funding for the housing finance market throughout the economic cycle.

After her nomination, she said, “I appreciate the support I received, and I look forward to continuing to work with Congress and other stakeholders as I fulfill my new role,” Thompson said in a statement.

“I congratulate Director Sandra L. Thompson, who will be the first Black woman to serve as FHFA Director,” states Congresswoman Maxine Waters (D-CA), chairwoman of the House Committee on Financial Services. “Our nation continues to face a worsening housing crisis that falls disproportionately on communities of color and threatens to lock future generations out of stable, equitable homeownership. Now more than ever, it is imperative that we have an FHFA director who will work to find equitable and innovative solutions to expand access to homeownership and affordable housing for every community and prospective homebuyer.”

Before being appointed as the director, Sandra served as the deputy director of the Division of Housing and Goals (DHMG). Since 2013, she has overseen FHFA’s housing and regulatory policy, capital policy, financial analysis, fair lending, and all GSE mission activities.

“As a seasoned financial regulator, I understand how critical a time it is to serve in this role,” said Thompson. “I am committed to ensuring our nation’s housing finance systems and our regulated entities operate in a safe and sound manner. There is a widespread lack of affordable housing and access to credit, especially in underserved communities of color. It is FHFA’s

duty, through our regulated entities, to ensure that all Americans have equal access to safe, decent, and affordable housing.”

Before joining FHFA, Thompson worked at the Federal Deposit Insurance Corporation (FDIC) for more than 23 years in various leadership positions, including the Division of Risk Management Supervision’s director. During her time at FDIC, Thompson led the agency’s examination and enforcement program for risk management and consumer protection at the height of the financial crisis. She also led the FDIC’s outreach initiatives in response to a crisis of consumer confidence in the banking system. Her experiences range from supervision to consumer protection, risk management, and consumer outreach activities.

RE-ENVISIONING FHFA

Ever since Sandra came into the picture, first as the interim Director of FHFA, the agency has seen some radical changes. Under her guidance, the agency published a final rule amending the Enterprise Regulatory Capital Framework (ERCF) by refining the prescribed leverage buffer amount (Leverage buffer) and the risk-based capital treatment of retained credit risk transfer (CRT) exposures for the GSEs.

In addition, the Agency also drafted its strategic plan for 2022-2026, which serves as a transparent roadmap to guide the agency in its role as a regulator of the Federal Home Loan Bank System and as regulator and conservator of the GSEs. In its strategic plan, Thompson named three major objectives to guide the agency in its business: to secure the regulated entities’ safety and soundness, foster housing finance markets that promote equitable access to affordable and sustainable housing, and responsibly steward FHFA’s infrastructure.

“We look forward to continuing our important work with Director Thompson, FHFA, the GSEs, and other stakeholders to provide affordable housing opportunities for all Americans while protecting

taxpayers and ensuring a robust secondary mortgage market for single-family and multifamily lenders of all sizes and business models,” added Bob Broeksmit CMB, President and CEO of the Mortgage Bankers Association (MBA) who also noted the following about Sandra’s appointment, “Since being appointed Acting Director in June 2021, she has repeatedly demonstrated leadership, expertise, and a strong commitment to sound risk management principles, while safely expanding access to mortgage credit and creating equitable and sustainable housing solutions for homeowners and renters.”

“U.S. Mortgage Insurers (USMI) and our member companies congratulate Sandra Thompson on her bipartisan Senate confirmation to serve as the next FHFA Director,” said Lindsey Johnson, President of USMI. “Thompson has been serving as the agency’s Acting Director since June 2021 and understands the importance of ensuring the safety and soundness of the GSEs, Fannie Mae and Freddie Mac, and the housing finance system. We are confident that she will continue to help instill strength into the housing finance system as families face barriers to homeownership due to severely limited supply and record home price appreciation. We look forward to continuing to work closely with Director Thompson in seeking ways to establish a more collaborative, transparent, and consistent housing policy that ensures homebuyers have affordable and prudent options for low down payment mortgage finance credit, while also protecting taxpayers and the U.S. government from undue risk.”

EASING THE REGULATORY HURDLES

Soon after being appointed as the acting director of the agency, one of the first steps Sandra took was to remove the Adverse Market Refinance Fee, a fee put in place to shield pandemic-related losses. When the fee was eliminated, many borrowers could take advantage of the low-interest rate environment.

“That was one of the first actions we took, and it was a winwin: a win for the Enterprises and a win for borrowers because sellers were able to pass through the savings to borrowers.”

Under her leadership, FHFA has also successfully pursued the GSEs to submit their Equitable Housing Finance PLans. These plans aim to ensure that FHFA knows the barriers to fair and sustainable housing opportunities and gets ahead of them.

We asked the Enterprises to focus on providing liquidity in additional areas that are hard to serve. As you all know, it’s easy to do the daily bread-and-butter loans. But we want to focus the Enterprises on providing liquidity in areas that are harder to serve, especially targeting low- to moderate-income communities, underserved communities, and particularly communities of color. We already

have the Duty to Serve plans focusing on rural areas, preservation of affordable housing, and manufactured housing. And we have the Enterprise Affordable Housing Goals that focus the Enterprises on low- to moderate-income purchases and refinances and low-income areas.

Although the Equitable PLans are something new, Sandra noted that the agency is excited about having an opportunity to have the GSEs look into these issues and take advantage of some of the lessons learned from the last crisis, apply that information to to provide liquidity in additional areas that are hard to serve.

respect.”

The one thing TPIN Loves about these Equitable Housing Plans is that they help detail how the GSEs can promote equity within housing finance, specifically the re-emphasis on closing the racial homeownership gap and supporting formerly redlined communities. A house remains to be the single most significant asset to many people. To that end, a huge equity gap can only be closed through homeownership. “We’re hoping that the Equitable Housing Plans will be helpful in that

“One other thing I’d like to highlight is the announcement that Fannie Mae is considering including rental payment history in their risk assessment underwriting processes. With this update, borrowers are going to have the benefit of positive rental payment history being included in underwriting decisions. It’s groundbreaking because, as you know, in many households rent is the single largest monthly expense. There isn’t any reason for someone who’s making timely rent payments to not have those included in the underwriting calculations. Certainly, I think the way we are assessing the ability to repay and the willingness to repay ought to be taken into consideration. I do want to make clear that rental payment consideration is not going to be the only factor, it’s going to be an additional factor.”

THE LEGACY SANDRA HOPES TO LEAVE

One of her top priorities is securing the safety and soundness of regulated entities. “I worked at the FDIC for about 23 years, and in my last seven years there, I served as the head of risk management supervision.”

Sandra’s goal is to ensure that she restores public confidence in the GSEs. she continues to add that the GSEs have evolved from what they looked like back in 2008 when they were placed into conservatorship. At the time, there were a lot of questions about housing finance and the mortgage market. “We had loan products that were predatory. There were loans the borrowers didn’t understand and couldn’t afford.” the borrower’s ability was not just questionable but severely compromised with all the associated delinquencies and foreclosures. Restoring confidence in the mortgage market and the mortgage system is more important now than ever. “And I do believe that if we have a sound regulatory structure in place and we’re executing against that as regulator, that goes a long way towards building public confidence, and that’s important to me.”

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“I want the Enterprises to be as financially strong as they possible. I would love to see them continuing to retain earnings and build capital and be in a strong position by the time that my tenure as Acting Director or Director (if confirmed) ends. We’re working towards that goal every day.”

Sandra hopes to achieve the second most important goal of ensuring a sustainable and equitable housing finance system. She notes that for years, there have been conversations about underserved communities.

“There are many challenges, ranging from appraisals and valuations to making sure that certain areas have liquidity and that borrowers can have a level playing field and broad access to the programs that Fannie Mae, Freddie Mac, and the Federal Home Loan Banks offer. We need to make sure we are making adjustments because one size does not fit all. It is important to note that equity is different from equality. When you are equal, everybody gets the same thing. But when you have equity, solutions can be tailored for the particular problem that needs to be addressed. Equitable housing is important to me; sustainability is important to me.”

“After going through the 2008 crisis—and even the savings and loan crisis before that—I believe affordability and sustainability are one and same. You certainly want to make sure that borrowers can afford to repay their loans, that they understand those loans, and that those loans will be sustainable over the long haul.”

KEY CONSIDERATIONS

when looking for a neighborhood

By Jenny Gonzalez

Many people have mistakenly fallen in love with a home without even checking out the neighborhood. A home is not the same as buying a television or a computer. You cannot return a mortgage once you realize it’s not what you want. Finding a new place to live by itself is stressful, and while you may be lost trying to find that perfect home, do not forget to check what surround’s it- your new neighborhood. Here are some of the things that you need to pay close attention to:

FIRST IMPRESSIONS

Many homeowners buy their homes because of a good first impression. Did you have a good first impression when you first saw the neighborhood? Are the houses well-maintained, and do the streets have good appeal? You want to feel good about where you buy your home.

GOOD SCHOOLS

Do you have children, or do you plan to have children? Many parents are concerned about the availability of good school systems in their neighborhoods. Good schools ensure consistent demand for properties and higher resale prices. Even if you don’t have kids, it would be nice to know that you have that option in the future.

RECREATION

Families would want to know if the parks are clean and if recreation centers are in good condition. Retired couples may be more interested in social clubs that host weekend parties. A young single person might be interested in bike trails or nearby dog parks. Different amenities hold different importance to many people. Find activities that interest you the most.

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CONVENIENCE

Imagine picking up groceries, filling prescriptions, and buying a last-minute birthday gift. Will it be convenient to get several errands done in a day? It would also help to know where the nearest hospital and police station are located to know their proximity in case an emergency happens.

AVAILABILITY OF PUBLIC TRANSPORTATION

Not everyone has a car, so knowing about the availability of public transportation should be considered. How far are you willing to commute? Would you be willing to get a car? Hopping on a bus or train may be a better option considering today’s rising fuel costs.

ANNOYING SOUNDS AND SMELLS

Notice sounds from nearby airports, highways, train tracks, or hospitals. It won’t be very relaxing to hear trains screech while your drink your coffee every morning. Although you can’t experience any unpleasant smells on the Internet, ask around for any bad odors that might affect your decision to live in an area.

FORECLOSURES & RENT SIGNS

Many foreclosures and rent signs may be signs of trouble. When a community goes down, the value of your house goes down with it. If you find yourself in a neighborhood with too many empty houses, find out whether the area is financially stable.

LOW CRIME RATE

Many real estate websites offer zip code crime rate statistics compared to the national average. Most of the time, your real estate agent should also be able to provide this information. Living in a safe neighborhood will undoubtedly help you sleep better at night. Try looking up your future address at www.crimereport.com. You might be surprised who is next to you and what is happening in the neighborhood.

CULTURE

Since you’ll be living with these people for years, it would be good to find out what it would be like living there. Talk to potential neighbors or start a conversation with the waitress at the nearby coffee shop. Ask yourself if it would be the kind of community you could be a part of. If the neighborhood does not fit your lifestyle, you probably won’t be happy living there.

FUTURE PLANS

Do you see yourself living in the same neighborhood 10, 20, or 30 years from now? An outdated kitchen can easily be remodeled, but a neighborhood is more difficult to change. You can find out about future houses in your area with the city planning department homeowner’s association. Future plans in the area will most likely affect your decision.

Figure out what you are looking for and what remains important to you and your family. You would probably need to make some compromises but make sure to put the “must-haves” at the top of the list. Although it may not be possible to learn everything there is to know about a neighborhood before moving in, a thorough investigation will help you make the right decision. I have been to many pleasant neighborhoods. But just because it’s a nice neighborhood does not mean it’s the one for you. If an area you choose makes a list but still feels wrong, trust your gut feeling. You’d live there for most of your life, so make sure you like what you see daily.

The State of Silicon Valley Real Estate Market Trends:

What Does 2023 look like

By Ian batra

SILICON VALLEY HOUSING MARKET

According to C.A.R., Bay Area’s housing price growth in November last year, the Silicon Valley saw one of the largest price increase in the state of California. Although the pandemic took a huge toll on other economic sectors (services, retail, etc.), technology was and continues to be one of the biggest contributors of growth in the region. San Francisco is a city that is mainly driven by tech, therefore the urgent demand for vacancies have doubled as a lot of people are working from home, and there is an urgent need for more offices as so many transactions have been taken online.

Moving forward, industry experts expect the Silicon Valley’s residential real estate market to grow even stronger. There has been a strong demand to upgrade to a larger property mainly caused by the pandemic as many people are now working from home. This is a trend happening all ove the country, where we see people desiring the suburban bliss causing a resurgence in most of the country.

An article published by Mercury News shows that the San Francisco Bay Area boasted of an increase in growth during the pandemic as high-income-earning tech workers who were steadily employed, leveraged on the lockdown by saving their money (which may have been used for traveling and other leisure activities) and purchasing real estate properties.

THE AVERAGE HOME PRICES

While Silicon Valley is known for its notoriously high prices of homes, this hasnt stopped people from buying. In the current hot market, Silicon Valley houses are getting snatched from every corner and as soon as homes enter the market, the bidding wars start.

While affordability may not be a problem of homeownership in Bay Areas, availability is. Considering the popularity of San Francisco and the rat race for accommodation, it is almost a task for someone to find a house of their choice. This is because there is an increase in demand for houses, so the competition for who owns and rents a place automatically skyrockets, leaving little space for neophyte investors and homeowners to tussle.

APPRECIATION RATES HAVE WORSENED HOUSING OPPORTUNITIES FOR LOWINCOME EARNERS

The extreme competition for housing units has hiked prices, thereby making it even harder for low-income earners to meet up with the cost of living in the area. Even if they manage to secure a place for the meantime, with the increase in demand and consequent increment in the cost of living and properties, they may not be able to maintain their standard of living in the area and might be forced to migrate to where their finances can be accommodated.

The National Foundation for Credit Counseling is the largest and longest-serving network of nonprofit financial counselors. Our mission is to help everyone gain control over their finances through free access to financial education. Credit.org, one of our premier member agencies, understands the need for financial safety, so there is no shame in asking for help. Get back on track today.

Simple Steps Minorities in LA Can Take Before Buying a Home

By Briana Frazier

Owning a home is considered by many to be the defining characteristic of the American dream. Homeownership can ignite feelings of pride regardless of race, and there is nothing more permanent than owning a home. Everyone should own a home. Unfortunately, getting on the homeownership ladder is not as easy as it used to be, especially for minorities. Buying a house requires planning, research, and effort to make the best decision possible.

Prospective homeowners must take time to save money and get their finances in order. They must also take the time to acquire the right mindset, which will come from reading, attending classes, and researching real estate markets, financial planning principles, and real estate finance. Buying a house is usually one of the

largest purchases a person will achieve in their lifetime.

Therefore, one should ensure they are doing it correctly and fully prepared for what is next. Ignorance is not an excuse under the law; it is the same in real estate. You must know what you are doing and be financially prepared to do it.

Buying a home should be a blessing and not a curse brought upon by the financial burden that should have never been incurred in the first place. Why does it happen? The most recent real estate statistics regarding minorities suggest that many minorities were unprepared for homeownership and made an unwise decision about the size of the home they bought and the

type of financing they obtained. Today the struggle to own property for minorities is even more difficult, not because they cannot afford to buy it, but because of the impact of the Great Financial Crisis and their financial literacy.

Planning to buy a home should start even before you start looking to buy a home. Every person should take some simple steps before buying a home.

GET AN EDUCATION

Being a homebuyer starts with getting educated. You do not need a bachelor’s degree to be a homeowner since you can self-educate. The easiest and cheapest way to get educated is to read books and a lot of them.

PAY OFF ALL CREDIT CARD DEBT

Use credit as a convenience for cash. Never buy anything with a credit card that you cannot pay for in cash immediately. This is how you incur debt. If you can’t afford it today, chances are you will not be able to afford it tomorrow. Keep the plastic in your pocket.

PAY OFF ALL INSTALLMENT DEBT, ESPECIALLY CAR LOANS

Pay cash for your car or use short-term financing for 6 months or less. Debt is a monkey on your back. No one needs a monkey on their back. The goal is to be debt free and keep zero balances on your credit cards. Final note: Buy used cars and buy them at the auction for cash.

OBTAIN THE RIGHT TYPE OF CREDIT

Stay away from unsecured or secured finance company loans, auto loans, and payday loans. This is the worst type of credit you can obtain. These companies were created to exploit poor people. Stay away from check cashing centers and rent-to-own companies, and open a bank account immediately. Credit is a tool of convenience and not a bonus income to live on.

USE CREDIT AS A TEMPORARY EMERGENCY FUND/BACKUP

Until you have achieved your goal for your emergency savings plan, use credit as a backup. You should have no less than 24 months of your income in open and available lines of credit. Obliviously you need good credit to do this. These lines of credit should not have an annual fee and must maintain a zero balance at all times because the line is for emergencies. You may not be able to avoid the annual fee. If not, consider the fee, the price you pay for not having an established emergency fund. Once your emergency fund is established, you can reduce your open lines of credit to no more than 12 months of your monthly income because you have to save that equal to 24 months of your household income to survive in case of an emergency.

Minnesota Real Estate Appreciation & Housing Market Trends

By Francine Marsolek

In the last probably two years, Minnesota has received alot of attention from the public eye mainly because of the unfortunate killing of George Floyd.

Well, that hasnt stopped the state from experiencing a rapid growth in the real estate sector attracting thousands of investors yearly. If you are a keen investor, or if you are looking for your next residence, the future is in the Minnesota real estate market.

The Minnesota by far is following the national

trend of home appreciation. The home prices in the region continue to rise in lieu of the constrained supply of new housing starts. Although the country is experiencing a drop in demand largely because of inflation, Minnesota home values have risen 4.2% over the past year according to data from the Redfin. The Data further reveals that homes in the state were selling for a median price of $325,000. But on average, the number of homes was down 29.6% year over year with about 5,925 homes being sold in October this year, down compared to the same period last year.

Here are some top ten metros with the fastest growing sales Price in Minnesota.

1. Hugo, MN - 26.2%

2. Waconia, MN - 25.1%

3. Winona, MN-22.6%

4. Chanhassen, MN- 18.5%

5. Ramsey, MN - 15.2%.

6. Shakopee, MN - 15.0%

7. Forest Lake, MN- 13.6%

8. Hopkins, MN - 13.3%

9. St. Michael, MN - 13.0%

10. Farmington, MN - 12.5%

HOUSING SUPPLY

One of the question investors and buyers ask themselves is whether the current supply of homes in Minnesota is enough to meet the demand.

was a 99.3% sale-to-list price, down 1.6 points year over year.

Basically, the homes that sold above the list price likely received multiple offers. With a high or growing percentage of homes selling above the list price is a strong indication that the housing market is competitive and the bidding war are become more common. A low percentage of homes selling above the list price shows that the market is becoming less competitive.

MINNESOTA REAL ESTATE APPRECIATION RATE

Going by the latest data from Redfin, there were 18,503 homes for sale in October 2022, which is down 5.1% year over year. The number of newly listed homes was 5,606 and down 25.0% year over year. On average, the states months supply is 2 months up 0 year over year.

The direction and pace at which homes are being listed for sale indicate how active and confident home sellers are, and how fresh the options are for buyers.

HOW COMPETITIVE IS THIS MARKET?

According to Redfin, there were 33.7% homes sold below the list price which is down 13.8 points year over year in October. There were only 36.7% of homes that had price drops, up from 30.0% of homes in October last year. There

Minnesota’s median home value is said to be about $297,269, according to Neighborhood Scout. Minnesota’s real estate appreciation between Q4 2021 and Q1 2022 was 2.28%, while between Q1 2021 and Q1 2022, the appreciation rate was 2.28%. On the other hand, cumulative appreciation in the last decade was around 127.11%. Minnesota’s cities with the highest appreciation in previous years are Newfolden, Clinton, Brown valley, Plummer, Oklee, and Angle Inlet.

Home prices both in Minnesota and other states are directly affected by demand. Experts in real estate say that demand will continue to increase and not lower anytime soon. Although the rise is steady, home prices are seen to level or slightly increase in 2022-2023, primarily due to the highinterest rates.

Six months’ supply usually follows appreciation in history. Due to the pandemic, construction lowered due to a shortage of labor and supply chain issues which made acquiring various building materials difficult. Housing supply lacks a balanced real estate market in Minnesota.

The Power of Credit Scores in the Homebuying Process

By Janet Petrozelle

Credit scores and reports can confuse most people, especially first-time home buyers. When preparing to purchase a home, it is important that you first understand your credit score and how it affects your mortgage application.

Regularly reviewing your credit report should be on top of your financial habits. A credit report reveals your financial background, helping you assess your personal payment history. Your score is more than just a number, it determines a lot more than the loans you can get and the interest rates you will pay.

Most insurance companies use credit scores to set auto and homeowner coverage premiums. In addition, landlords use credit scores to determine who will stay in their homes. Therefore, if you don’t take your credit score seriously, you better

start doing it. Credit scores are a financial tool; however, they can be a hammer or a lever, it depends on how good they reflect.

If you are considering buying a home now or in the next few years, your credit score will play a significant role, so I suggest you start working on them. According to a Federal Reserve Report, 90% of the U.S. mortgages taken out in the first quarter of 2019 were by home buyers with a credit score of at least 650, and 75% had a score higher than 700. The report further notes that only 10% of the mortgage borrowers had a credit score under 647.

The median credit score this year sits at 759. Here are the minimum credit score requirements for the conventional, FHA, VA, and USDA mortgage programs;

MORTGAGE TYPE CREDIT SCORE

500 (with 10% down payment)

FHA

580 (with 3.5% down payment)

VA No set minimum (entire loan profile reviewed instead)

USDA 580 (if eligible for a credit exception)

640 (for automatic approval)

Conventional 620

The national average stands at 704. And any score falling between 700 and 749 is deemed as “good,” while scores falling between 650 and 700 are “Fair.” Scores that are 750 and above are excellent scores.

In most cases, the lenders will not issue you a mortgage if your credit score falls below the minimum threshold of the above scores. Most lenders work with a finite budget; therefore, it is very common for them to sell the loans they make t another company. They do not have unlimited funds to grant loans to every new applicant as they wait 30 years for you to repay them. Most lenders will package their loans and sell them on the secondary mortgage market to avoid this. Large companies such as banks or government-sponsored enterprises purchase these loans and resell them.

It is still possible to qualify for a home loan with a rate lower than the median; a higher credit score means better interest rates and loan options. Other factors can also influence the mortgageapproval process. This includes the home’s cost, the down payment’s size, and your income.

MORTGAGE AFFORDABILITY

there are so many factors that go into play when deciding on mortgage affordability; it isn’t just about the credit score. Most lenders want to see if you can afford your mortgage before lending you money. Therefore, to minimize risk on their

part, aside from looking into your credit history, they will also look at how much money you earn and how much you spend. And not just the credit repayments but also the regular, fixed costs like childcare and other outgoings you have every month.

IMPROVING YOUR CREDIT SCORE

The first step towards building and improving your credit score is to pay all your bills on time and in full. Your payment history makes up 35% of your FICO score. Most lenders will look if you have paid your bills on time for each account on your credit report. It is important to set your bills on auto-pay and keep a tab on your payments to ensure that you make routine and on-time payments.

Paying all your debts in time is a good start, but what if you have reached the breaking point? FICO scoring considers your credit utilization ratio, which measures how much debt you have compared to the available credit limits. Here, the system looks at how much of your total available credit you have used, and as a precautionary measure, do not assume that you have to have a $0 balance on your accounts to score higher. Nonetheless, less is better, but owing a little debt can be much better than owing nothing at all. Lenders will want to see if you borrow money if you are responsible and financially stable enough to pay the money back. The amount you owe could earn you up to 30%.

Another important factor you must consider, and I emphasize this is the length of the credit history. The credit score also considers how long you have been using credit. For how many years have you had obligations? How old are your oldest account and such considerations? Long credit history will streamline the numbers, and if not marred by late payments, it could boost your credit score. That’s not to say that a short one is disqualified altogether; if you have been paying your debts on time and don’t owe much, your credit score will improve.

Feeling Stressed About Homeownership?

Here Are some Downpayment And Closing Cost Assistance in El

Cajon, CA

By John Costigan

Being a first-time homebuyer in EL Cajon has never been easy, especially when it comes to putting money into a down payment. But with the down payment assistance programs currently in every region of the country, being a first-time homebuyer doesn’t have to be stressful anymore. Utilizing down payment assistance always brings massive benefits to the home buyer, from saving time to money.

As such, down payment assistance would be a welcome move for many people. Statistics prove that many people still do not know that it is possible to get down payment assistance, and of the few that know about these programs, many believe that down payment assistance is for the disadvantaged. When purchasing a home, making a downpayment is a must! But with the current hefty price tags of homes in Corona, CA,

raising the money for the down payment seems impossible.

That’s not all that a new homebuyer has to worry about; closing costs are another factor that has to be considered. This means that even if you have saved up some cash to cover your downpayment, closing costs can drain your efforts; you might just realize that you still owe some thousands of dollars in closing costs, which you might not afford at that particular point in time.

So, is there any help for you? Well, suppose you are in the state of California. If you meet certain criteria, you might qualify for a forgivable loan down payment and closing costs through down payment and closing cost assistance programs.

PHOTOS FROM 123RF

WHAT IS DOWN PAYMENT AND CLOSING COST ASSISTANCE PROGRAMS?

Although some mortgage programs require no down payment, a vast majority of others require that you make a down payment. The down payment is a substantial amount of cash equal to a certain percentage of the home’s price.

Every state has its assistance programs for first-time homebuyers. Most times, the state housing commissions under the HUD offer these assistance programs to low and middle-income homebuyers. Non-profit organizations and private mortgage lenders also offer assistance. Forgivable loans, deferred-payment, and lowinterest loans are called second mortgage loans and are usually offered to the homebuyer once the first mortgage is concluded.

HOW TO QUALIFY FOR A FORGIVABLE LOAN DOWN PAYMENT AND CLOSING COSTS ASSISTANCE PROGRAMS

The requirements to qualify for a forgivable loan down payment and closing costs differ from state to state. Some states have less strict requirements than others. For example, to qualify for a forgivable loan in cities like New York, you must earn considerable income.

Aside from the income, you must also meet the credit score. These assistance programs require you to have a minimum FICO score of 620 and above. Other requirements include the following;

• You must be a first-time homebuyer.

• You must reside in the home for several years.

• The home must be situated in a particular place according to the program

• The borrower must complete their classes in finance and homeownership

• The property chosen must be a single-family home

• You must choose a suitable lender ready to work with the program.

Interestingly, there are about 2,000 DPA programs available countrywide. However, choosing the best from this figure can be confusing. Also, it’s important to note that these programs vary by location. Different programs are located in different areas and come with different requirements or terms and conditions. But if you’re looking for the best DPA program around California, I highly recommend you consider using the Golden State Finance Authority program.

WHAT IS GOLDEN STATE FINANCE AUTHORITY (GSFA)?

GSFA is a public agency/entity providing affordable housing programs. As a public entity in California, GSFA has distinguished itself as a leader in affordable housing finance. Over the last two decades, it has helped over 80,000 individuals and families purchase a home.

Moreover, the entity has provided more than $859 million in down payment assistance. It has financed over $13.7 million in first and second mortgages, according to Carolyn Sunseri, the

GSFA has two affordable housing programs, the GSFA Platinum Program and the GSFA Open Doors Program, which are accompanied by down payment assistance of up to 7% of the mortgage loan amount.

to note is their flexibility and accessibility. In most other programs, you do not qualify if you aren’t a first-time homebuyer. But at GSFA, you do not have to be a first-time homebuyer to qualify for a DPA.

“You don’t have to be a first-time homebuyer to qualify,” Carolyn states. “So, it could be someone returning to the housing market that owned a home in the past and wants to purchase a primary residence, or it could be somebody who’s first-timer buying a home, or maybe even leaving a home today and want to buy a home they’re going to be moving into as their primary residence.”

Additionally, GSFA allows the FICO score, which goes as low as 620, further demonstrating its flexibility and another reason why I highly recommend it. “I think this is very flexible and allows a lot of people who may have perfect credit to be able to qualify with a mortgage loan with mortgage fund assistance,” Carolyn adds.

CONCLUSION

Coming up with a down payment is the most difficult thing when purchasing a home. However, you need not rack your head about how to raise funds to purchase that expensive home in Corona, CA, with plenty of options available.

“What that looks like is that on a $300,000 mortgage loan, 7% assistance is $21,000. So, by utilizing a program through GSFA, you’re getting a mortgage loan at a competitive interest rate, and then you’re being provided with $21,000 to put towards your down payment,” Carolyn explains. “Most of the time, that’s going to cover all of what you need in down payment money, and possibly even give you some assurance towards your closing cost.”

WHAT MAKES GSFA UNIQUE

You might be wondering why I’m highly recommending GSFA programs to you. There are many legitimate reasons, but the most important

With assistance programs, you can get help raising funds for the down payment and closing costs. You can qualify for a forgivable loan and avoid paying closing costs once you fulfill all the requirements.

If you are unsure if you would qualify for a forgivable loan down payment and closing cost, or don’t know where to look for the right one, don’t hesitate to reach out to us. We are experienced real estate advisors that will act in your best interest. We will also help you to get the best house deal in Corona, even with the rising home prices.

Marketing Director of the Golden State Finance Authority (GSFA).

Is Your San Francisco Home Accurately Valued?

By Norman Green

Ioften see people valuing their homes based on estimates provided by some websites.

Well, there is nothing wrong with that; in some cases, it might work, but what if you overpricing your home? Which may cause your home to stay on the market longer than usual? Or what if you are underpricing your home?

Using online calculators is good, but there are limitations. And even before your value your home, it is important always to understand that a home’s value or worth is whatever someone is willing to pay for it.

That is important; how much would you be willing to buy the home you sell? You need to have this conversation with yourself before even looking to see what others are saying or selling their homes. The long version of that answer would depend on many factors, including the market conditions, the average selling price of other homes in the neighborhood, and such factors. Also, it may depend on what other people or entities have to say about the value of that particular home, for instance, your lender, your agent, or the tax assessor.

ANALYZE YOUR MARKET

This is the first step you must take to accurately value your home in San Francisco.

Most people want to get a feel of what the market looks like before they can put a price tag on their homes. No one wants to go along with their good intuition. Knowing the market is the smart thing to do.

We know that San Francisco is an expensive market, and the median sales prices of homes in this market shot up for 83 consecutive months from April 2012 until March 2019.

That is one fact you have to keep in mind. Therefore, assuming that you bought your current home in 2011, you are likely to bag a reasonable profit for the sale of that home.

Secondly, looking at other metrics, the average median home value in San Francisco rose 90% between 2009 and 2019, from $715000 to $1.36 million, but that’s just for the Metro. Looking deeper into the data, you’ll find that areas such as Oakland shot up 77% in the same period while in some other neighborhoods, home’s value shot up more than 100%, including Bayview (116%), Forest Knoll (112%) Bernal Heights (111%), Mission (109%) and so many others.

I am trying to make sure that the location will also influence the home’s value by a great margin.

Have you ever heard of the old saying that real estate is the location? Well, it is a fact that has been stood the test of time.

BUT WHAT CAUSING SAN FRANCISCO TO BE SO EXPENSIVE?

Mainly, the past decade has experienced an influx in tech industries. The tech boom in San Francisco was largely due to the tax incentives that aimed to attract companies to silicon valley.

In return, the city had a high price to pay- the cost of living. It attracted a large force of skilled workers while neglecting its nonskilled workers, and the result is quite evident - Skid Row.

The cheapest neighborhoods in San Francisco were suddenly “flooded with a tremendous amount of new money, and prices have gone up exponentially” as people were craving affordability and convenience.

Anyway, where am I getting with this? First, you must understand the local economy influences so much the valuation of your home.

Were there cheap homes in San Francisco? Yes, a lot of them, but because of the local economy boom, everything became so expensive.

So is your home; depending on where your home is located and the status of the local economy, you might be forced to value your home relatively higher than you would in other places.

These are the two main points I wanted to drive home before showing you how to value your home in San Francisco accurately.

HOW DO YOU VALUE YOUR HOME ACCURATELY?

Comparative market analysis (CMA)

This might sound complicated, but all I mentioned above was part of the market analysis that you should first do before giving your home a price tag.

When you are ready to value your home, give me a call today! Real estate agents are your best resource if you want to understand better how the market looks like and what value to place on your home.

Even though the CMAs may not be as detailed as a professional appraiser would be in most cases, they provide you with an evaluation of the home and market, which will ultimately help you determine an estimate of value for your home.

THE FHFA HOUSE PRICE INDEX CALCULATOR

This is another valuable resource at your disposal. The FHFA house price index (HPI) calculator applies a scientific approach to help you determine the value of your home.

Basically, the FHFA is an aggregator of transactions gathered since the 1970s, and therefore what its HPI Calculator does is that it determines the value of your home using the repeat sales method. This method tracks the change in value from one sale to the next and then uses that information to estimate how the values fluctuate in a given market.

HIRE AN APPRAISER

As a homeowner or a property owner, you can hire an appraiser to estimate the home’s value at any time. This, I think, is the most popular method because about 28% of U.S homeowners determine their home’s value using an appraiser.

“As an appraiser, my job is to give a value based on the needs of my clients,” says Ryan Lundquist, owner of an appraisal company based in Carmichael, California. “Sometimes clients want the value for a date in the past, and other times it’s a current market value for a refinance or purchase.”

One of the things that the appraisers will look at is the overall market condition. They will look at the region, the city, and the neighborhood where the home is located. In addition, they have to assess the house’s condition, including improvements and the land it sits on. Lastly, appraisers will look at comparable properties.

First-time home buyers Guide:

10 house-hunting mistakes for first-time homebuyers

By Steven Rivkin

House hunting can be very serious and exhausting at the same time. More often than not, buyers in the market for the first time have issues deciding what to do and not to do while trying to get the house they desire. Here are some common mistakes new homebuyers make and how to avoid them.

1. TOO LITTLE DOWN PAYMENT

The 20% rule for a mortgage is a law nearly everyone knows about. Yet, only a small percentage of people pay up to 20% on their first mortgage. This error, as little as I may seem, has caused lots of people to lose out on their mortgages as they couldn’t afford to make the right payments.

2. CONSIDERING ONLY ONE LENDER

The options are limitless, and still, people go for one option. Maybe this may be because they obviously cannot keep up the stress of having to fill out paperwork or asking and reasking questions. Still, homebuyers should always make sure they have options when buying.

3. CREDIT SCORE? IGNORED

No matter what, ignoring your credit score while buying a home or making a mortgage payment is the worst decision you can ever make. Your finances are important. Stay updated.

PHOTO FROM 123RF

4. TOO LITTLE, TOO BIG

Homebuyers often discover too late that the house is too big or too small for their needs. When this happens, they are faced with the problem of creating space or filling up excess space.

5. ADJUSTABLE AND NOT FIXED MORTGAGES

Adjustable mortgages are usually based on market indexes. They may appear low for the first few years, but a sudden leap in the market will automatically increase your mortgage. This is unlike a fixed mortgage, where the interest is just what it is: fixed.

6. MISINFORMATION

Knowledge is power, and information is key. When you talk to the wrong people about buying a home or taking a mortgage, be sure that you set yourself up for an epic fail.

7. CHOOSY

Some homebuyers are very picky when hunting. They either don’t like this or want this

or want that and in the long run, settle for the worst kind of house available on the market. The deepest regret comes later when they discover that they had settled for less while thinking they had the best.

8. MORTGAGE NOT PRE-APPROVED

If your mortgage has not been approved and you venture into house hunting, you may get one that’s too much or too little for your mortgage payment power.

9. IGNORING MONTHLY PAYMENT

The deadliest mistake here is to ignore payment dates. You’ll be out on the street in no time if you do this. You must always be updated about your mortgage plan, changes, and payment schedule.

10. NO KNOWLEDGE ABOUT HOW MUCH TO AFFORD

You should always be aware of what you can do with your credit score. Don’t take a mortgage that you can never afford to pay off.

C o s t a M e s a

DECIRA PIMENTAL

Costa Mesa Real Estate Appreciation & Housing Market Trends

By Decira Pimental

Costa Mesa is a medium-sized city in California with a population of roughly 110,750 people, according to the most recent U.S. Census Bureau Data of 2021. With about 25 Constituent neighborhoods, Costa Mesa is the 58th largest community in California.

OVERVIEW OF COSTA MESA

Centered right in the heart of Orange Cunty is one of the most eclectic, vibrant, and thriving suburban cities. It is known for its diverse art culture, including the Segerstrom Center for the Arts and the South Coast Plaza, which is one of the largest shopping complexes in the U.S.

Regarding geography, the city is located in the southern part of the state, west of Huntington Beach, east of Irvine, South of Santa Ana, and North of Newport Beach. The one thing you’ll love about this city is that it offers a wealth of outdoor activities, beach attractions, numerous restaurants with top cuisines, splendid nightlife, and so much more.

Costa Mesa are among the highest, not just in California but also in the country. So much so that the city has consistently ranked among the most expensive areas to live in America.

In addition, the city could be categorized as a white-collar city as 85.41% of the available workforce is currently employed in white-collar jobs, which is higher than the national average. Digging deeper, you will find that many people are in sales and office or administrative positions. There are many people in Costa Mesa working in Management occupations- at 13.49%, followed closely by sales at 13.32% and finally, office and administrative support at 9.12%.

Interestingly, the city has more artists and designers, and people working in media than 90% of the communities in America. This high concentration of artists shapes the true characteristics of the city.

REAL ESTATE PROFILE

Costa Mesa is a city very distinct from others surrounding it. First, it’s a fashion and arts hub, making it vibrant with endless possibilities. Although it sits well on the most expensive cities to live in, you can be definitely sure that you’ll get what you paid for and more. But considering its surrounding cities like Newport Beach, Costa Mesa is relatively less expensive.

LIVING IN COSTA MESA

As previously mentioned, the home prices in

Going by the most recent data from Redfin, the median sale price of homes in Costa Mesa was $1,169,500 in September, up 9.6% compared to last year. On average, homes in the city sell for a median price of $1.2 million.

On average, homes sell after 40 days on the market compared to 34 days, the same period last year.

Currently, the market could be described as extremely competitive, with multiple homes

getting multiple offers all at once.

In terms of appreciation, the city has experienced some of the highest home appreciation rates of any community in the country. With an appreciation rate of over 102.53% over the last ten years and an annual home appreciation rate of 7.31%, Costa Mesa is in the top 20% nationally for real estate appreciation. If you want to invest in real estate properties, Costa Mesa definitely has a track record of being one of the country’s best long-term real estate investments.

In the last 12 months, the appreciation rate for the city has been at 13.22%, slightly higher than the national average. In the latest quarter, Costa Mesa’s appreciation rate has been 3.55%, which annually totals 14.98%.

LIVING IN COSTA MESA

Costa Mesa is one of the best places to live in the United States, especially if you like living in a city with 24-hour entertainment options, recreational facilities, nightlife, and a healthy dose of sunshine daily. In all honesty, the fact that Costa Mesa receives more sunny days makes the city one of the best cities in the United States, adding to the many other advantages.

Additionally, you’ll realize that the city has wellgroomed beaches that offer stunning views and plenty of restaurants, theatres, and museums to visit.

Buying a Home In Menifee This Fall

By Monica Hill

The Menifee Housing market has been somewhat competitive, and typically, homes in this region are receiving 2 offers on average and sell in around 39 days. The average sales price of homes in the region was $548K, while the average sale price per square foot in Menifee is $270, up 2.3% since last year. In October 2022, Menifee home prices were up 6.0% compared to last year’s period. On average many homes in the region are selling after about 39-42 days in the market compared to 27 days last year. About 115 homes sold in October this year, down from last year.

It is perfectly normal to enter the housing market with trepidation; it has been very competitive.

The Menifee housing market has been very hot, scoring 83 out of 100 on the Redfin Compete Score, surpassing the nearby cities of Corona and Temecula. The market is a seller’s market, meaning more buyers than the housing market can service.

With these figures, it might seem impossible to buy a home for first-time homeowners. Here’s how to navigate this seller’s market.

1. EXPAND YOUR SEARCH!

This is not the time to be rigid, and of course, there is a specific neighborhood you have been eyeing, with low crime rates and quality of life. But hot neighborhoods such as these

PHOTO FROM 123RF

are considerably more expensive than other neighborhoods. They face stiff competition, and you will likely pay well over the asking price to get a home there. That is if you are not priced out of the market. Adjust your expectations and find a home that meets your needs even though it is outside your desired zip code.

2. TAILOR YOUR OFFER TO MEET THE SELLER’S NEEDS

Houses are receiving multiple offers; to stay on top, you must stand out. To do so, you will have to compromise a little. If a seller is looking to sell a home without a hustle, make the process stress-free by offering to close early, waiving some contingencies such as mortgage insurance, or reducing the contingency time frame. That may be risky in the long run, but it will give you an edge over your competition.

3. MAKE AN OFFER IN CASH

Cash offers are by far preferred to mortgage financing. Cash offers make closing a home much faster and eliminate the risk of mortgage financing failing to make the payments. Therefore, consider making a cash offer that any seller will have difficulty passing up.

4. GET PRE-APPROVED

It is tempting to get carried away with buying

a home and forget to bring your paperwork in order. A preapproval beats a prequalification letter at any time. Preapprovals act like a safety net for the seller’s “proof of funds,” the letter gives the sellers the confidence to take their homes off the market since the letter shows that they will buy the house. Therefore, give yourself time before entering the market and getting the paperwork ready!

5. ADJUST YOUR DEMANDS

You might have your sight set on existing homes, but new constructions have better pricing and are more available. You may also want to refrain from making demands regarding the houses; in a competitive market, compromise is vital. Accept what is offered upfront; you can always make changes.

Buying a home in a seller’s market is no walk in the park. A lot of compromises will have to be made to accept an offer. It would be an idea to make lowball offers in the Menifee market; the Competition will thwart your bid, and as hard as this may be to understand, it will be a waste of time for you and your agent. To make the dream a reality, be flexible and adjust your demand, even though it means settling for a cheaper neighborhood. The process is daunting, but having a real estate agent who will walk you through the process will save you time and headaches.

Why you need to get your deal in writing In A Digital Currency World!

By Jamar James

Buying and selling a home is an act of faith from each involved. From the seller’s perspective, they are giving away a precious investment, a treasured part of their lives, hoping to receive something almost equal value in return. From the buyer’s point of view, they trust that the brokers handling their case are to protect their interest. Finally, brokers need to trust they will receive the proper payment for their services and that ill-intention people will not damage their reputation. With everything seemingly being transacted in some sort of a coin, home buying, and selling transactions soon follow suit.

BUT HOW SAFE ARE CRYPTOS?

As you may have already known or heard, Bitcoin was founded in 2009 by a mysterious man named Satoshi Nakamoto. Soon after launching this mystery to the world, the man or the woman disappeared!

Ever since, the world of digital currencies has evolved so much that counting all coins is almost impossible today. This makes this world hard to trust, and while many people have adopted some cryptocurrency into the business payment method, the real estate field is slow to respond to these radical changes, which can be a good and bad thing at the same time.

While these coins often make headlines for the massive swings in their value beyond the intrigue of skyrocketing and plummeting prices, the rising popularity of cryptocurrencies poses serious questions for financial institutions and monetary policy. Bitcoin does not only offer accountability to users; it offers transparency as well. Digital currency impacts different sectors, especially property ownership, by bridging the financial gaps by increasing financial inclusion.

The future of digital currencies has remained

PHOTO FROM 123RF.COM

uncertain due to their fluctuating prices and value, which makes them unsuitable for daily transactions. However, it has become crucial to users as an alternative to traditional fiat currency. Users won’t have to be subjected to the complexities of the bank, high transaction fees, or high return rates. Undoubtedly, Bitcoin is an option for low-income individuals and the entire finance sector.

In an ideal world, a simple verbal agreement would be enough for all parties to be satisfied. Still, the truth is that people change their minds constantly, and adding the uncertainty of cryptocurrencies complicates things even more!

Buyers can be outsold from one moment to the other; sellers can promise to pull out their homes from the market just to find out that the buyer bought another property. This is why proper brokerage in written agreements is important, as they protect all parties from unscrupulous deals, which is quite common in this digital world.

CAN YOU TRUST CRYPTOCURRENCIES?

Yes! I firmly believe that digital coins are the future of the financial world. Bitcoin boost accountability and transparency in all transactions, including property ownership. As a financial asset, bitcoin allows

more people to own property very transparently.

Accountability is considered one of the issues hindering the underserved from owning a property. However, bitcoin’s blockchain technology has encryptions that ensure transparent ownership and transfer ledger.

The ability of bitcoin to give the less fortunate property ownership is one way of ending poverty. Blockchain technology only requires one to have a smartphone, which is plenty in developing countries today. That means even low-income families can quickly sign up with bitcoin to acquire property.

In any transaction, not just the one involving cryptocurrencies, there must be proper documentation and agreements written and sealed! This does not mean that verbal agreements are to be completely discouraged.

After all, they are often the first contact between the parties, and before writing down the contract, there must have been a previous handshake.

In the case of brokers and their clients, once a verbal agreement has been reached, the broker can start acting on behalf of the clients. They can start acting as fiduciaries and may carry out the initial representation.

However, to collect their fees be it fiat money or cryptocurrencies, brokers and clients must sign a written agreement. In other words, if there is no written agreement, brokers do not have a guarantee that they will receive payment, as there is no proof of a business relationship.

While you are wondering how Bitcoin will bridge the financial gap, it starts by offering relatively Lower Transaction Fees. Traditional financial institutions and even credit companies are rapidly adopting blockchain technology.

There is increased financial inclusion as the value of Bitcoin keeps surging. The underserved have always been excluded from opportunities and employment. Bitcoin does not require high technical skills except a digital device like a smartphone and internet access and can be accessed by any individual regardless the financial status.

Besides, today, there are plenty of platforms, such as the Bitcoin Prime App, that the public can join to learn online trading. That supports financial inclusion, ensuring that even the less-educated and unemployed can access capital and trade. The real estate sector is a fast digitalized sector that explores the benefit of digital currency like Bitcoin.

PHOTO FROM APPDUPE.COM

HOUSING DISCRIMINATION UNMASKED.

Don’t let housing discrimination get covered up.

“ When I went looking for an apartment, I wore a mask. But they could still see I’m Black. I was told that they wouldn’t rent to me because they heard Black people were disproportionately getting COVID-19.”

COVID-19 inequity is real, and it shouldn’t be made worse because of housing discrimination. If you suspect housing discrimination because of your race, color or national origin, file a complaint with HUD or your local fair housing center so we can investigate it.

For more information, go to: hud.gov/fairhousing or call 1-800-669-9777 Federal Relay Service 1-800-877-8339

FAIR HOUSING: THE LAW IS ON YOUR SIDE.

A public service message from the U.S. Department of Housing and Urban Development in cooperation with the National Fair Housing Alliance. The federal Fair Housing Act prohibits discrimination because of race, color, religion, national origin, sex, familial status or disability.

B U Y I N G O R S E L L I N G A H O M E ?

L i c e n s e d R e a l E s t a t e B r o k e r w i t h o v e r 3 5 y e a r s e x p e r i e n c e w o r k i n g w i t h b u y e r s a n d s e l l e r s o f s i n g l e - f a m i l y h o m e s , l a n d , d u p l e x e s , t r i p l e x e s a n d f o u r p l e x e s . W a s f i r s t B r o k e r i n W a s h i n g t o n S t a t e t o o f f e r h o m e w a r r a n t i e s f o r b u y e r s o f e x i s t i n g h o m e s a n d f i r s t b r o k e r i n W a s h i n g t o n S t a t e t o o f f e r g u a r a n t e e d h o m e s a l e s b a c k e d b y a N a t i o n a l F r a n c h i s e .

T ' S W O R K T O G E T H E R !

Veterans: Want to Make homeownership work for you?

Here’s how you can do it easily

By Dolores Golden

Did you know that about 19 million people are veterans in the U.S?

Did you also know that about 8% of the nation’s homeless population are veterans? That means about 1.5 million veterans at any given point in time are experiencing homelessness.

In addition to these facts, Black Veterans account for about one-third of the veterans experiencing homelessness, and nearly a third of all veterans experiencing homelessness are in the state of California. Although much awareness has been

made to combat veterans’ homelessness, much must be done. About 28 states have successfully decreased the number of veterans experiencing homelessness from 2019 to 2020.

The real estate industry is a capital-intensive business involving a combination of debt and equity, which to the average veteran, can be overwhelming, which is one of the facts that has pushed so many veterans away from homeownership. Therefore, to build wealth through homeownership, you need to be patient and accept the fact that this will be a gradual

process.

To that end, Veterans Affairs offers a variety of housing benefits to qualifying veterans and service members, including some VA loans that do not even require a downpayment, grants with service-related disabilities, and rental assistance for veterans in need.

Although in the paper, this seems simple, sometimes it can be a bit confusing. A variety of resources available can help prevent cases of homelessness for veterans and families at imminent risk due to a housing crisis.

This is where the VA loans come in. The VA mortgage program allows Veterans and service members to buy property, sometimes with no down payment. The best thing about these types of loans is that they come with favorable interest rates, more flexible qualifications, and repayment terms than traditional mortgages, which makes them an affordable option.

If you feel you need additional information help, you could try the emergency assistance programs. All branches of the military have emergency housing assistance options, and there are also many nonprofits that have stepped up to provide mortgage or rental assistance or even temporary housing. Therefore you are not alone.

After you’ve bought your home, how do you turn it into a wealth-generating opportunity for you and your family?

HOUSE HACKING

House hacking is a way that you can generate income from your home. For many people, house hacking is one of the easiest ways to make money and build wealth, and the best thing is that anyone can do it. Supposing as a veteran, you bought a four-bedroom house; you could rent out the three rooms while living in the fourth, and that’s a powerhouse hack. If you bought a duplex, you could live in one unit and rent out the other. That, too, is a house hack.

According to HUD, the average American Household spends close to 33% of its income on housing expenses. What if you could keep all that money instead, or better yet, turn a profit? This is what all house hacking is all about.

GETTING YOUR FIRST RENTAL PROPERTY

Now you have your first property. And now that you’ve discovered some house hacks that will turn a profit for you at the end of the month, the mortgage payment is now easier. Probably, you’ve even cleared it! It is time to start saving. You can start doing this by saving $1,000-$2,000 per month (this could be the portion of your income going towards mortgage payments). After 6-12 months, you’ll save enough money for a downpayment on your first rental property.

There are a few financing options at your disposal, and one of these options is the debt service coverage ratio which means that your rent covers the mortgage payment. Although you’ll find out that the DSCR lenders may not care as much about your income, banks and credit unions will care deeply about it, and having a military income is one excellent signal to the lender that you are a good credit risk. It also means you qualify for a low-interest rate. The most important thing here is to make sure that your rental charge will cover the debt payments plus all other costs, such as insurance, taxes, and repairs.

The real estate industry is flush with opportunities, and as a veteran, you have some advantages in acquiring real estate relatively quickly. Take advantage of all these opportunities, start building wealth, and enjoy some fruits of financial freedom.

Home Ownership

by Eric Lawrence Frazier MBA

Home ownership brings stability to individuals and families who have never had a dwelling place that they could call their own. There is something special about owning real estate that is unlike anything else on earth you can own.

Real Estate you own is not like cars that decay over time and you have to replace them.

Real Estate you own is not like clothes that go out of style and you have to buy new ones.

Real Estate you own is not like expensive vacations or experiences that only last a moment in time.

Real Estate you own is not like an apartment where the landlord may increase the rent until it’s no longer affordable.

Real Estate you own is not like staying at your parents house where you know can’t stay forever.

Home ownership is the beginning of wealth that increases over time and becomes your estate & legacy

Home ownership is the pride of a mother nurturer and the kitchen her domain

Home ownership is the pride of a father provider and protector of his territory and family.

Home ownership is the foundation of permanence and the place where life happens, birthdays celebrated, deaths mourned.

Home ownership is the place you build memories that can never be taken from you.

Memories etched in walls and concrete, experienced in rooms and floors, Memories living in trees and shrubs planted by your hand.

Howe ownership is the manifestation of you - your style, your colors, your smell, your stuff, your junk, your memories, your yard and your spaces, your life.

It’s the height markers on your first child’s bedroom wall. It’s the hearts drawn in the concrete slabs when you pour your patio floor

It’s the birthday parties, and anniversaries in the living room and kitchen.

It’s the back yard barbecue with friends, neighbors and family contentions

it’s the high school and college graduation, and wedding receptions

Its’ the family nights and block parties and the fellowship of family connections

Home ownership

It’s more than real estate. Land, brick and mortar, wood frame construction and chicken wire.

It’s more than money saved, gifts recieved and grants obtained

It’s more than the debt you incur to buy it.

It’s more than the payments you make to own it. It’s more than the appreciation that comes with keeping it over time.

It’s memories, it’s family, and it’s life that can happen in one place

Until you say it’s time to move.