Real Estate Weekly: March 24, 2023

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+14.5%

Existing-home sales rose 14.5% in February, representing the largest monthly percentage increase since July 2020.  Source:

Gorgeous views of Mt. Baker and Fidalgo Bay from this beautifully maintained home. View protected in CCR’s. Kitchen has stainless appliances, granite countertops, granite backsplash, and a walk-in pantry Great layout and main floor living with views from most rooms. Deck off of dining area. Primary bedroom has access to the deck as well and has a spa like primary bath. Large partially finished basement (360 sf) could be used for a shop, office, or work out space. Large room off of garage has electricity Steps away from trail access into the Anacortes Forest Lands, which provide over 50 miles of trails. The Orchards also has its own park and walking areas for residents. All of this and close to downtown Anacortes.

MLS #2038360

Why advertising matters

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The bottom line? Advertising really works. It’s a key component to building your brand, growing your earnings, and maintaining a successful real estate business. Our marketing solutions can help you get lots more eyes on your business with targeted online advertising.

Let us help you meet your marketing goals by advertising your listings in Real Estate Weekly.

Prioritize getting a mortgage loan preapproval

by Erik J. Martin

Dreaming of buying a home sometime soon? It’s important to separate fantasy from reality and to know what you’re getting into well ahead of time, which can avoid frustration, disappointment and you having to compromise on your desires for the right domicile.

One surefire way to ensure this is to pursue a mortgage loan preapproval as early in the process as you can, the pros agree.

“A loan preapproval involves a lender verifying income and other pertinent documents to decide whether or not an applicant will get approved for financing,” says Jason Gelios, a Realtor in Southeast Michigan. “Besides the fact that most sellers and listing agents require solid

approval from a reputable lender when a buyer presents an offer on a home, a preapproval ensures that the buyer will obtain the financing, provided nothing changes throughout the process such as a job or income loss.”

Many confuse loan preapproval with loan prequalification. But the former is far more important.

“Preapproval is a more in-depth evaluation of your financial situation. Prequalification is just a rough estimate of how much you might be able to borrow,”

Shri Geneshram, CEO of Awning.com, notes. “A loan preapproval provides a more accurate picture of your financial situation and gives you more bargaining power when making an offer on a home.”

To her last point, having a

letter in hand from a lender indicating that you’ve been preapproved, which can be presented to the seller when you make your offer, can go a long way toward assuring the seller that you’re a serious and qualified prospect who has their financial house in order.

But the benefits of getting preapproved don’t stop there.

“It lets you know exactly how much you can afford to borrow, giving you a clear budget for your home search,” adds Ganeshram.

Andrew Jurgens, real estate agent and owner of The Titan Trust, a real estate agency in Loxahatchee, Florida, echoes those thoughts.

“Being informed is the biggest advantage. Going into what is frequently the largest purchase you will ever make in your life without know-

ing what to expect can lead to so much heartache,” says Jurgens. “Having a lender go over a preapproval with you can not only help you find out what you can afford, but it can help you decide what you want to afford. If you don’t know what you want or can afford to spend, or what your payments will be, you can find yourself falling in love with a home that is simply beyond your means.”

The process of getting preapproved is relatively simple.

“Shop around for different mortgage lenders and choose one you trust. Be prepared to provide the lender with financial and personal information, which typically includes your employment history, income, assets, debts and credit history. Once the lender has evaluated this information, they will provide

you with a preapproval letter that states the maximum amount you are eligible to borrow and the interest rate you can expect to pay,” Ganeshram continues.

Jennifer Beeston, senior vice president of Mortgage Lending at Guaranteed Rate in San Francisco, advises asking for a “fully underwritten preapproval”, which she says is the strongest form of preapproval you can get.

“With our company, we start with a call to discuss your housing goals. We then have you fill out your online application based on our conversation. Once the application comes through, we phone to verify everything you entered and request income and asset documents to verify your application,” she says. “We will also request contacts at your employer so

we can verify employment. Our processors then put your file together and submit it to underwriting. The underwriter reviews your file and, if all is good, issues conditional loan commitment, which is a fully underwritten preapproval.”

Keep in mind that just because you’ve been preapproved by a given lender doesn’t mean you are obligated to work with that lender once you have chosen a property.

“Make sure you work with a lender who takes the time to go over expected closing costs, monthly payments and interest rates with you. If they just give you a letter and tell you to go home shopping with no other information or plan to talk, that is a red flag,” adds Beeston.

Ways to lower your insurance premiums

Question:

Mortgage loan limits increased at the start of the year. I may no longer need a jumbo loan. What does this really mean for real estate borrowers?

Answer:

Not only did loan limits go up as of January 1st, but they also went up 12.21% – an enormous increase that reflects recent inflation trends.

The higher loan limits are good news for large numbers of buyers, sellers and owners seeking to refinance. Zillow estimates that “more than 2 million homes across the country no longer require a jumbo loan.”

“For the majority of the country,” Zillow added, “the conforming loan requirement increased by $79,000 -- going from $647,200 in 2022 to a baseline of $726,200 in 2023. In the most expensive parts of the county (103 counties), the conforming loan limit was raised to $1,089,300, topping the $1 million mark for the first time. These counties are largely concentrated in the nation’s most expensive metro areas, along the coasts and in the Mountain West.”

Most loan products offered by lenders are designed for sale to Fannie Mae and Freddie Mac, huge buyers of residential mortgages. The catch is that Fannie

Mae and Freddie Mac will not purchase just any loan, instead they will buy only those mortgages that meet certain standards, so-called “conforming” loans.

For example, to have a conforming loan, a buyer will be required to have a certain credit score, an acceptable debt-to-income ratio (DTI) and an appropriate loan-to-value ratio (LTV). Another standard is that conforming mortgages cannot exceed a certain size. This is the conforming loan limit.

In addition to Fannie Mae and Freddie Mac, the FHA and USDA programs have separate loan limit requirements. The VA program does not have official loan limits, but lenders can establish maximum loan sizes based on a borrower’s financial qualifications.

What happens when home purchases require financing that exceeds standard loan limits? Instead of saying that such properties cannot be financed, lenders offer “jumbo” mortgages.

Jumbo mortgages are not conforming loans if only because of their size. Also, lenders can establish standards that differ from conforming loan programs. Jumbo loans may have requirements for higher credit scores, bigger down payments, and larger cash reserves.

For example, if you are in an area with a $726,200

ASK OUR BROKER

By Peter G. Miller

loan limit for a one-unit home, there may be properties that require $900,000 in financing. Without jumbo loan programs such properties would have to be purchased for cash. That means fewer potential buyers and – most likely – lower selling prices.

The 2023 loan limits for a one-unit property in most areas jumped from $647,200 in 2022 to $726,200 in 2023: a $79,000 increase. The other new limits in most areas include $929,850 for a twounit property, $1,123,000 for a three-unit property, and $1,396,800 for a single property with four units.

There are also new loan limits for “high cost” communities, big metro areas generally located along the coasts. These “high cost” limits include $1,089,300 for a one-unit property plus new limits for properties with two units ($1,394,775), three units ($1,685,850), and four units ($2,095,200). The “high cost” limits also apply in Alaska, Hawaii, Guam, and the U.S. Virgin Islands.

For conforming loan limits in your area – and for jumbo rates and requirements – speak with local loan officers.

Email your real estate questions to Mr. Miller at peter@ctwfeatures.com.

How Paying More Can Benefit Buyers Later

Marilyn Kennedy Melia

You found the home you love, priced at $515,000. You aim to bargain the seller down to $495, 000; but you wind up settling at an even $500,000.

To assuage your regret that you’re paying more than you hoped, consider this: You may recoup that $5,000 and more when you later sell. That’s “because the final price has a left-most digit of 5 instead of 4,” says Timothy Gubler, associate professor at Brigham Young University, who recently co-authored a study on the influence the left-digit number of a purchase price has on resale.

Earlier, researchers have confirmed the power of “charm pricing,” whereby buyers perceive a bargain if the left -most digit in a price is lower than the next higher whole round number. Whether it’s a loaf of bread at $1.99 vs $2.00 or a home at $399,000 instead of $400,000; it’s human nature to think there’s a significant savings.

Now, Gubler and his research associates looked at “whether perceptions of value are higher if a previous price was just over a round number, instead of below it.”

Paying a little more, “especially if it raises you above a round number price threshold can make a lot of sense” at resale, says Gubler.

Especially now that buyers can easily see prior sale prices online, a previous purchase amount that’s slightly more than a lower “charm price” tends to result in about 2 percent more on average at resale.

So, buying at $400,000 rather than $399,000 means it’s generally easier to sell in the future at $449,000. In fact, Gubler notes that “even sellers themselves perceive their own home to be worth more, so they list it for more.”

Here again, the inflated perception of a bargain from the slightly lower left digit is at play. Sellers keep in mind that they have a home that’s worth more than $400,000, and veer to a higher listing figure.

60102 State route 20, MarbLeMount $675,000

Mondo is a well- established and wellloved family-style restaurant at the foot of the Cascade Mountain Range. Locals and travelers make this par t of their Hw y 20 and Nor th Cascade National Park trip. Major ar terial choice to Newhalem and continue on to Winthrop; or cross the Skagit River bridge and continue up to Cascade Pass and hiking to Stehekin. The restaurant is warm and inviting, with incredible fare Ver y spacious dining area. Some outside seating available. Small gift shop area. The kitchen is beautifully remodeled. New flooring and ex terior lighting. MLS#2038466

24017 trinit y Lane, SeDro-wooLLe y $895,000

There are so many investment possibilities with this home and proper ty. Classic 4 bed/2.5 bath farmhouse style 2560 sq.ft. home with east facing deck on 1.7 acres

Home offers kitchen w/island and ceramic tile floors, office, bonus room, mud/laundr y room, living room with propane fireplace, built-in bookshelves, and beautiful laminate over hardwood floors. Studio cottage has own kitchen and bath. Proper ty also features a 16,000+ sq.ft pole building/barn with office space, shop, and room for RV storage Potentially 5K in rental income each month from the cottage, barn, and RV storage.

MLS#2028784

1760

burLington bLvD., burLington $3500/Month

Great visibilit y commercial proper t y: plent y of parking; small storage building/garage (20’ x 24’) in back.

1 Deerhaven Lane, FriDay harbor $350,000

Lovely 4.572 acre building trac t with views to the west Mossy knolls, Madrona and Fir trees Building site is fairly level Drilled well is close to building site. Road/ driveway to building site 3 Bedroom septic design. Geotech repor t Power adjacent to proper ty. Paved County Road to proper ty; located nor thwest corner of West Side Road and Deerhaven Lane. MLS#2047527 Danya Wolf (360) 708-8294

nhn S. 15th Street, Mount vernon $199,000

2XXX urban avenue, Mount vernon $600,000

Conveniently located corner building lot with available utilities. Build your dream home in this neighborhood that is close to schools, Hillcrest Park, and the 18th Street Water Park. Easy access to I-5, shopping, and medical facilities

MLS#2029949 Suzanne Jenkins (360) 941-2983 Carla Fischer (360) 982-0010

Kato Lane, Mount vernon $149,000

Prime commercial proper ty with utilities in street including P.U.D water, Puget Sound Energy electricity; Cascade Natural Gas, fiber optics; cable; and sewer. Subject To sur vey and shor t plat.

Proper ty is located between Chicago Title Company easterly parking lot and Max Dale Restaurant’s south easterly parking area. MLS# 1649968

Located just outside the Mount Vernon City limits, this wooded 1 acre plus lot could be a building site for a stick built, modular, or manufac tured home, with plenty of room. Trac t has been sur veyed and wetlands have been delineated. Power and PUD water are available at the street. Perc test per formed/3 bed septic possible, permit#SW22-0073

20787 buLSon rD, StanwooD $339,000

Beautiful wooded 4.98 acres situated on south side of Snohomish County/ Skagit County line

Ver y private 5 acres just off Mountain View Road.

Come check it out, a great neighborhood.

MLS#1880968

Elva Hunter (360) 202-3086

14903 ruStiC Lane, ConCrete $25,500

nooKaChaMP hiLLS Drive Lot 36, Mount vernon $210,000 Ready to Build with power, water, sewer and natural gas in the street. Build your dream home in Nookachamp Hills, a desirable community in the foothills near Big Lake Enjoy walking/biking the trails and swimming/fishing in the community s small private lake/ pond Trail leading to pond/lake nex t to proper ty.

MLS#1970452

whaLen Drive, Point robertS $250,000

Proper t y is set up for offices on main level with 1.5 baths; and basement *access (with washer dr yer hook up plus t wo additional rooms) *from both inside and outside. Second stor y offers t wo additional rooms, one with a sink. Just over 1/2 acre: .547 acre.

COMMERCIAL BUILDING FOR LEASE

MLS#2038424

Power is in street Solar power is also possible. Adjacent proper ty to the east of Subjec t Proper ty is fenced, open field Zoning allows for one building site Stanwood-Camano School Distric t; and just ten minutes to I-5. Great countr y living yet convenient for commuting MLS# 1841822

Two ver y well maintained, level lots Bring your camper, fifth wheel, RV or tiny home

Great location for year round residenc y or weekend / vacation getaways. Well shared with seller, power at street

Danya Wolf (360) 708-8294

MLS#1951005 Patricia Box (360) 941-9186

Magnificent views of Boundar y Bay and the mountains! Enjoy the lights of Vancouver BC, only 45 minutes away! Less than 20 miles o Vancouver in ernational Airpor t Point Rober ts is a quain community with forests, beaches (close to Maple Beach), and the ocean yet near o all that the big city has to offer This lot is ready for your dream home; power at the street water a the street (Point Rober ts Water District). MLS# 1863417

Danya Wolf (360) 708-8294

Suzanne Jenkins (360) 941-2983 CRS/SRES

Elva Hunter (360) 202-3086 CRS/SRES

Carla Fischer (360) 982-0010 CRS/SRES

Danya Wolf

Designated Broker/Owner (360) 708-8294

CRS/CBA/GREEN

1 Mountain view rD, Mount vernon $115,000

MLS#1861233

Danya Wolf (360) 708-8294

S

Danya Wolf (360) 708-8294

Danya Wolf (360) 708-8294

Danya Wolf (360) 708-8294

Danya Wolf (360) 708-8294