Is Affordability Starting To Improve?

by Greg Weis

Over the past couple of years, a lot of people have had a hard time buying a home. And while affordability is still tight, there are signs it’s getting a little better and might keep improving throughout the rest of the year. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), says:

“Housing affordability is improving ever so modestly, but it is moving in the right direction.”

Here’s a look at the latest data on the three biggest factors affecting home affordability: mortgage rates, home prices, and wages.

1. Mortgage Rates

Mortgage rates have been volatile this year, bouncing around from the mid-6% to low 7% range. But there’s some good news. Data from Freddie Mac shows rates have been trending down overall since May (see graph below):

Mortgage rates have improved lately in part because of recent economic, employment, and inflation data. Moving forward, some rate volatility is to be expected. But if future economic data continues to show signs of cooling, experts say mortgage rates could keep going down.

Even a small drop can help you out. When rates decline, it’s easier to afford the home you want because your monthly payment will be lower. Just don’t expect them to go back down to 3%.

2. Home Prices

The second big thing to think about is home prices. Nationally, they’re still going up this year, but not as fast as they did a couple of years ago. The graph below uses home price data from Case-Shiller to illustrate that point:

If you’re thinking about buying a home, slower price growth is good news. Home prices went up a lot during the pandemic, making it hard for many people to buy. Now, with prices rising more slowly, buying a home may feel less out of reach. As Odeta Kushi, Deputy Chief Economist at First American, says:

“While housing affordability is low for potential first-time home buyers, slowing price appreciation and lower mortgage rates could help – so the dream of homeownership isn’t boarded up just yet.”

3. Wages

Another factor helping with affordability is rising wages. The graph below uses data from the Bureau of Labor Statistics (BLS) to show how wages have increased over time:

Look at the blue dotted line. It shows how wages usually go up in a typical year. On the right side of the graph, you’ll see wages are rising even faster than normal right now – that’s the green line.

This helps you because if your income increases, it’s easier to afford a home. That’s because you won’t have to spend as much of your paycheck on your monthly mortgage payment.

Bottom Line

When you put all these factors together, you see mortgage rates are trending down, home prices are rising more slowly, and wages are going up faster than usual. Though affordability is still a challenge, these trends are early signs things might be starting to improve.

This post was first published on Keeping Current Matters.

Market Stats • Real Estate • Tips for Buyers • Tips for Sellers • August 13, 2024

Greater KC area Fast Stats – July 2024

by Greg Weis

Market Highlights Kansas City Metro Area July 24′ vs July 23′

Home sales are ↗️ 4.9% to 3,539 closed sales.
Home prices are ↗️ 4.3% to $368,166 average sales price.
Home inventory ↗️ 7.8% to 6,590 total homes available.
Home monthly supplies are ↗️ 10.0% to 2.2 months supply.
Average days on market are ↘️ 3.0% at 32 days on market.
Percent of original list price ↘️ 1.2% to 98.7% of price received.
Pending sales are ↘️ 0.4% to 3,324 for the month.

If you have more questions about this information, feel free to reach out for more information.

Have a great day,
Gregory Weis
913-579-4106 Cell
913-631-2900 Office
gweis@cbregan.com

Oh, by the way^®… if you know of someone who would appreciate the level of service I provide, please call me with their name and contact information. I’ll be happy to follow up and take great care of them.

Real Estate • Tips for Buyers • Tips for Sellers • August 8, 2024

Mortgage Rates Down a Full Percent from Recent High

by Greg Weis

Mortgage rates have been one of the hottest topics in the housing market lately because of their impact on affordability. And if you’re someone who’s looking to make a move, you’ve probably been waiting eagerly for rates to come down for that very reason. Well, if the past few weeks are any indication, you may be getting your wish.

Mortgage Rates Trend Down in Recent Weeks

There’s big news for mortgage rates. After the latest reports on the economy, inflation, the unemployment rate, and the Federal Reserve’s recent comments, mortgage rates started dropping a bit. And according to Freddie Mac, they’re now at a level we haven’t seen since February. To help show the downward trend, check out the graph below:

Maybe you’re seeing this and wondering if you should ride the wave and see how low they’ll go. If that’s the case, here’s some important perspective. Remember, the record-low rates from the pandemic are a thing of the past. If you’re holding out hope to see a 3% mortgage rate again, you’re waiting for something experts agree won’t happen. As Greg McBride, Chief Financial Analyst at Bankrate, says:

“The hopes for lower interest rates need the reality check that ‘lower’ doesn’t mean we’re going back to 3% mortgage rates. . . the best we may be able to hope for over the next year is 5.5 to 6%.”

And with the decrease in recent weeks, you’ve got a big opportunity in front of you right now. It may be enough for you to want to jump back in.

The Relationship Between Rates and Demand

If you wait for mortgage rates to drop further, you might find yourself dealing with more competition as other buyers re-ignite their home searches too.

In the housing market, there’s generally a relationship between mortgage rates and buyer demand. Typically, the higher rates are, the lower buyer demand is. But when rates start to come down, things change. Buyers who were on the fence over higher rates will resume their searches. Here’s what that means for you. As a recent article from Bankrate says:

“If you’re ready to buy, now might be the time to strike. Home prices have been rising primarily because of a longstanding shortage of homes for sale. That’s unlikely to change, and if mortgage rates do fall below 6%, it’s possible buyers would enter the market en masse, further pushing up prices and resurrecting bidding wars.”

Bottom Line

If you’ve been waiting to make your move, the recent downward trend in mortgage rates may be enough to get you off the sidelines. Rates have hit their lowest point in months, and that gives you the opportunity to jump back in before all the other buyers do too. If you’re ready and able to start the process, reach out to a local real estate professional to get started.

This post was first published on Keeping Current Matters.

Market Stats • Real Estate • Tips for Buyers • Tips for Sellers • August 5, 2024

3 Reasons Why We’re Not Headed for a Housing Crash

by Greg Weis

**Sources: NAR, Census, ATTOM, Bankrate**

Some Highlights

Back in 2008, there was an oversupply of homes for sale. Today, there’s an undersupply. The three main sources of inventory show this isn’t like the last time.
Existing homes, new homes, and foreclosures are all way below the levels we saw during the housing crash.
Inventory data shows there just aren’t enough homes available to have a repeat of what happened back in 2008.
Lean on a real estate professional to help separate fact from fiction in today’s housing market.

This post was first published on Keeping Current Matters.

Real Estate • Tips for Buyers • Tips for Sellers • July 31, 2024

The Biggest Mistakes Sellers Are Making Right Now

by Greg Weis

The housing market is going through a transition. Higher mortgage rates are causing more moderate buyer activity at the same time the supply of homes for sale is growing.

And if you aren’t working with an agent, you may not realize that. Here’s the downside. If you’re not informed, you can’t adjust your strategy or expectations to today’s market. And that can lead to a number of costly mistakes.

Here’s a look at some of the most common ones – and how an agent will help you avoid them when you sell.

1. Overpricing Your House

Many sellers set their asking price too high and that’s why there’s an uptick in homes with price reductions today. An unrealistic price will deter potential buyers, cause an appraisal issue, or lead to your house sitting on the market longer. An article from the National Association of Realtors (NAR) explains:

“Some sellers are pricing their homes higher than ever just because they can, but this may drive away serious buyers and result in unapproved appraisals . . .”

To avoid falling into this trap, partner with a pro. An agent uses recent sales of similar homes, the condition of your house, local market trends, and so much more to find the price that’ll attract more buyers and open the door for multiple offers and a faster sale.

2. Skipping the Small Stuff

You may try to skip important repairs, thinking you can pass the task on to your buyer. But visible issues (even if they’re small) can turn off potential buyers and result in lower offers or demands for concessions. As Money Talks News says:

“Home shoppers like to turn on lights, flush toilets and run the water. If these basic things don’t work, they may assume you’ve skipped other maintenance. Homes that appear neglected aren’t likely to fetch top price.”

If you want to get your house ready to sell, the best place to turn to for advice is your agent. They’ll be able to do a walk-through with you and point out anything you’ll need to tackle before the photographer comes in.

3. Not Looking at Things Objectively

Buyers today are feeling the pinch of high home prices and mortgage rates. With affordability that tight, they may come in with an offer that’s lower than you’d want to see – especially if you didn’t stage, price, or market the house well.

It’s important you don’t take this personally. Getting overly emotional can put the sale at risk. As an article from Ramsey Solutions says:

“Remember, a buyer’s offer is not a reflection of their opinion of your home or your housekeeping abilities. . . The sale of your home is strictly a business transaction. If they start out with a low offer, don’t take it personally and get emotional. Instead, channel that energy toward negotiating. Work with your agent and make a counteroffer.”

4. Being Unwilling To Negotiate

The supply of homes for sale has grown. That means buyers have more options, and with that comes more negotiation power. As a seller, you may see more buyers getting an inspection, requesting repairs, or asking for help with closing costs today. You need to be prepared to have those conversations. As U.S. News Real Estate explains:

“If you’ve received an offer for your house that isn’t quite what you’d hoped it would be, expect to negotiate . . . the only way to come to a successful deal is to make sure the buyer also feels like he or she benefits . . . consider offering to cover some of the buyer’s closing costs or agree to a credit for a minor repair the inspector found.”

An agent will walk you through what levers you may want to pull based on your own goals, budget, and timeframe.

5. Not Using a Real Estate Agent

Notice anything? For each of these mistakes, partnering with an agent helps prevent them from happening in the first place. That makes trying to sell your house without an agent’s help the biggest mistake of all.

Real estate agents have experience and expertise in pricing, marketing, negotiating, and more. That knowledge streamlines the selling process and usually results in drumming up more interest and ultimately can get you a higher final price.

Bottom Line

If you want to avoid making mistakes like these, you need to work with a real estate agent.

This post was first published on Keeping Current Matters.

Real Estate • Tips for Buyers • Tips for Sellers • July 25, 2024

When You Need a Written Buyer’s Agency Agreement

by Greg Weis

Things consumers should know after 8/17/24.:

If you are a buyer and your agent is using an MLS, you will need to sign a written agreement with your agent before touring a home so you understand exactly what services will be provided, and for how much.
Written agreements are required for both in-person and live virtual home tours.
You do not need a written agreement if you are just speaking to an agent at an open house or asking them about their services.
Agent compensation for home buyers and sellers continues to be fully negotiable.
When finding an agent to work with, ask questions about their services, compensation, and these written agreements.

Can a Buyer still see homes without signing anything?

So, for a REALTOR® to tour a home with a buyer, they need a signed agreement with an agent prior to an in person or video viewing (FaceTime, Skype, Zoom, etc.) of a property. You do not need a written agreement if the buyer contacts the LISTING Agent directly, who works for the seller and not for you the buyer.

If a REALTOR® offers to show you a home WITHOUT a written agreement, and they are not representing the seller, they could be in violation of the rules.

What types of compensation will a Buyer owe their REALTOR®?

Compensation is ALWAYS negotiable. Some agreements will be written for compensation to be a percentage (X%) of final sales price paid at closing. Other agreements will be for a set dollar amount ($X) to be paid at the time of closing.

Alternative agreements could be “A La Carte” charging for each service they provide. Examples would be ($X) to show a home, ($X) to write a contract, ($X) to go to inspections, ($X) to write up a resolution, ($X) to go to closing, etc. Some agents will require those charges be paid in advance of or at the time the service is being provided.

Can you ask the Seller’s to pay the compensation a Buyer owes their REALTOR® ?

The short answer is yes. Compensation is ALWAYS negotiable. Contracts to purchase can be written asking the seller to pay part or all of a buyer’s compensation owed to their agent. Make sure you talk to your REALTOR® about what you owe and how that can be written into an offer with the seller.

Be sure to confirm what compensation you will owe when the offer is written, before you sign it. Confirm again, what compensation you owe to your agent when an agreement is reached on a contract, before you sign it. You don’t want any surprises when you get to the closing table.

Keep in mind, REALTOR® are providing a service to help a buyer with what could be the largest financial decision they make in their life. Make sure you choose an agent that will provide you with the best services that meet your needs.

Market Stats • Real Estate • Tips for Buyers • July 24, 2024

The Biggest Mistakes Homebuyers Are Making Right Now

by Greg Weis

Some Highlights

Want to know the biggest mistakes homebuyers are making today?
They include everything from putting off pre-approval for too long, holding out for the perfect home, buying more than they can afford, and skipping out on hiring a pro.
Connect with a real estate agent to make sure you have a pro on your side who can help you avoid these mistakes.

This post was first published on Keeping Current Matters.

Market Stats • Real Estate • July 12, 2024

Greater KC area Fast Stats – June 2024

by Greg Weis

Market Highlights Kansas City Metro Area June 24′ vs June 23′

Home sales are ↘️ 13.1% to 3,472 closed sales.
Home prices are ↗️ 4.2% to $382,567 average sales price.
Home inventory ↗️ 5.0% to 6,305 total homes available.
Home monthly supplies are ↗️ 10.5% to 2.1 months supply.
Average days on market are ↗️ 22.6% at 38 days on market.
Percent of original list price ↘️ 1.8% to 99.1% of price received.
Pending sales are ↘️ 2.0% to 3,530 for the month.

If you have more questions about this information, feel free to reach out for more information.

Have a great day,
Gregory Weis
913-579-4106 Cell
913-631-2900 Office
gweis@cbregan.com

Market Stats • Real Estate • Tips for Buyers • Tips for Sellers • July 11, 2024

The Price of Perfection: Don’t Wait for the Perfect Home

by Greg Weis

In life, patience is a virtue – but in the world of homebuying, waiting too long in hopes of finding the perfect home actually isn’t wise. That’s because the pursuit of perfection comes at a cost. And in this case, that cost may be delaying your dream of homeownership. As Bankrate explains:

“One of the most common first-time homebuyer mistakes is looking for a home that checks each of your boxes. Looking for perfection can narrow your choices and lead you to pass over good, suitable options for starter homes in the hopes that something better will come along.”

The Cost of Holding Out for Perfection

Nothing in life is ever perfect – and that’s true when you search for a home too. Unless you’re building a brand-new home from the ground up, chances are there are going to be some features or finishes you wouldn’t have picked yourself. It may be as simple as paint colors, a light fixture, or the tile in the bathrooms or kitchen. Or even that the backyard isn’t fenced in. It could also be that the home itself is great, but it’s not the ideal location you were hoping for.

But here’s the trade-off you’d be making without even realizing it. In all that time you’d spend searching for the perfect place, you’d overlook a lot of homes that would’ve worked for you. U.S. News explains:

“. . . you may miss opportunities if you enter the process with blinders on and aren’t open-minded . . . Countless potential buyers never buy because of this, and thus miss great investments or never move on to the next chapter of their lives.”

It’s Time To Redefine Perfection

Especially with affordability and inventory where they are today, buying a home that needs some updates, is a few neighborhoods away from your ideal location, or doesn’t have all your desired features can be a smart move. Here’s why.

For starters, these homes are usually more affordable, which is important at a time when some buyers are struggling to find options in their budget.

And they give you a chance to make the space your own or discover a whole new area of town. You may find out you actually love that neighborhood. Or, swapping out a feature here or there after move-in isn’t such a big deal. So, look past the green shag carpet and see the bones of the house. With a little vision and creativity, you can turn a good house into a fantastic home.

How an Agent Helps You Explore Your Options

If you’re open to a home that needs a little elbow grease or is a bit further out, let your agent know. They’ll be happy to show you how this can really open up your pool of homes to pick from. They’ll also help coach you through this process by:

1. Prioritizing Your Must-Haves: Your agent will want to revisit your wish list and separate your non-negotiables from your nice-to-haves. From there, they’ll focus on what’s really most important to you as they come up with a bigger list of options for you to choose from.

2. Coaching You To See the Potential: As you tour these added options, your agent will help you look beyond cosmetic flaws and imagine what the home could be with a little work. Simple updates like a fresh coat of paint or new flooring can make a big difference.

3. Connecting You with Local Pros: And an agent’s support goes one step further. If they know what you’re hoping to change after you move in, they can connect you with local pros who can get the job done. That way it’s less work for you, and you don’t have to worry about tracking down contractors.

Bottom Line

Remember, there is no perfect home. But with expert help and an open mind, an agent can find you the right home – even in today’s market. Connect with a local real estate agent to see what’s out there.

This post was first published on Keeping Current Matters.

Market Stats • Real Estate • June 27, 2024

Greater KC area Fast Stats – May 2024

by Greg Weis

Market Highlights Kansas City Metro Area May 24′ vs May 23′

Home sales are ↗️ 2.3% to 3,757 closed sales.
Home prices are ↗️ 2.8% to $368,471 average sales price.
Home inventory ↗️ 8.4% to 6,229 total homes available.
Home monthly supplies are ↗️ 16.7% to 2.1 months supply.
Average days on market are ➡️ 0.0% at 35 days on market.
Percent of original list price ↘️ 0.8% to 99.6% of price received.

If you have more questions about this information, feel free to reach out for more information.

Have a great day,
Gregory Weis
913-579-4106 Cell
913-631-2900 Office
gweis@cbregan.com