Feb. 25, 2019

The Home Buying Process

Hey all, I put together a brief video series on the home buying process. All videos are under 5 min. Check it out at
 
https://www.origin.realestate/buying/home-purchase-process/
 
Who's ready to purchase for themselves or as an investment?
Posted in For Buyers
Feb. 15, 2019

The First Step in Buying a Home

The First Step in Buying a Home

 

Posted in For Buyers, Home Owners
Feb. 11, 2019

4 Questions to Ask Before Selling Your House

Posted in For Sellers
Feb. 4, 2019

February Market Report: 2018 is Fourth Best Year in Overall Home Sales, But Slowdown Likely

The Board of Realtors annual Forecast breakfast happened Friday, February 1.  James Woods, University of Utah economist, shared his forecasts based on the fundamentals he is seeing in the market.  Below is a snapshot of the 2018 market and the forecast for 2019. A further examination of causes for the forecast follows.

 

2018 Snapshot

Salt Lake County’s residential real estate market benefitted from another year of strong demographic and economic growth and favorable, but slightly higher, mortgage rates.

  • Single-family homes sold saw a slight decline of 1% (196 fewer sales)
  • The median sales price of a single-family home is at $355,000, up 9% from 2017
  • Condos, townhomes and twin home sales were up by 8%, the biggest year ever in sales
  • The median sales price of condos, townhomes and twin homes is at $248,257, up 10% from 2017

Forecast for 2019

Slightly slower economic and demographic growth along with higher prices and interest rates will dampen demand in 2019.  These conditions mean fewer single-family sales but more condominium and townhome sales as buyers seek affordable housing.  

  • Single family sales will decline by 8% while condominium and townhome sales will increase by 7%.
  • Total sales of residential housing units will be down about 4%.
  • The median sales price of a single-family home will increase 5-7% to around $375,000
  • The median price for condominiums and townhomes will increase by 10% to $275,000.

 Summary

While housing units sold will decline slightly, appreciation is still forecast to be a healthy 5-7% for single family homes and a very strong 10% for townhomes and condominiums.

 A slowdown does not mean a correction.  Slowing the appreciation growth helps keep us out of bubble territory.  We still have a very strong market going into 2019. The housing shortage has not been solved and fewer homes may be sold due to increasing home prices and mortgage rates.  Housing affordability is the main driver of the slowdown in appreciation.

 


Causes for 2019 Economic Forecast

 While the most recent economic forecast (October 2018) shows continued solid growth, most indicators point to a deceleration in the rate of growth.

 Some driving factors causing a slowing of growth:

  • Slightly slower job growth, employment growth will slow from 3.3% in 2018 to 3.1% in 2019, still an impressive growth rate
  • Slower demographic growth, Net in-migration is expected to be significantly lower due to the revised forecast
  • Labor Market Gets Tighter - Unemployment rate to drop to 3% in 2019.  In the past 70 years only two years, 2006 and 2007, have had lower rates of unemployment
  • Increase in Average Pay Not as Strong - The 3.8% increase in average pay in 2018 - the largest increase since 2006 - is projected to decline to 2.5% in 2019

Signs of a slowdown

  • Utah’s relatively strong economy will provide the Salt Lake County real estate market with a buffer to the anticipated slowdown in the real estate market.  
  • The first signs of a slowdown showed up in the last half of the year.  Year over year homes sales declined from September through the end of the year with a decline accelerating to 12% in December.
  • Price increases also weakened by November and December to 6%, which pulled the annual increase from double-digit territory to 9.2 percent
  • The underlying causes of a slowdown are higher prices and rising interest rates.  In other words, housing affordability
  • The median sales price of a home in Salt Lake County has increased from $245,000 in 2013 to $355,000 in 2018

 

Rising Monthly Payment

Mortgage payment for Median Home Price in Salt Lake County and Utah

The adverse impact of higher prices and the interest rate on a mortgage payment and housing demand is driving some of the slowdown. 

  • In 2013, the mortgage payment for the median price home ($245,000) was 1,299
  • In 2018, the mortgage payment for the median price home ($355,000) was $2,014
  • A 55% increase in just five years

 

 

Outlook for Mortgage Rates

Most experts agree that mortgage rates will move about 5% in 2019. The interest rate forecasts of some of the largest housing and mortgage-related groups are shown below.

 

 

Feb. 1, 2019

Why It Makes No Sense to Wait for Spring to Sell

Why It Makes No Sense to Wait for Spring to Sell

The price of any item (including residential real estate) is determined by the theory of ‘supply and demand.’ If many people are looking to buy an item and the supply of that item is limited, the price of that item increases.

The supply of homes for sale dramatically increases every spring, according to the National Association of Realtors (NAR). As an example, here is what happened to housing inventory at the beginning of 2018:

Why It Makes No Sense to Wait for Spring To Sell | MyKCM

Putting your home on the market now, rather than waiting for increased competition in the spring, might make a lot of sense.

Bottom Line

Buyers in the market during the winter are truly motivated purchasers and they want to buy now. With limited inventory currently available in most markets, sellers are in a great position to negotiate.

Jan. 31, 2019

Think You Should For Sale By Owner? Think Again!

Think You Should For Sale By Owner? Think Again! [INFOGRAPHIC]

Think You Should For Sale By Owner? Think Again! [INFOGRAPHIC] | MyKCM

Some Highlights:

  • For Sale By Owner (FSBO) is the process of selling real estate without the representation of a real estate broker or real estate agent.
  • According to the National Association of Realtors’ Profile of Home Buyers & Sellers, 36% of homeowners who decided to FSBO last year did so to avoid paying a commission or fee. But, homes sold with an agent net 6% more than those sold as a FSBO according to Collateral Analytics
    !
  • Before you decide to take on the challenges of selling your house on your own, let’s get together to discuss the advantages of having an agent on your side.
Jan. 30, 2019

3 Things You Need in a Shifting Real Estate Market

3 Things You Need in a Shifting Real Estate Market

3 Things You Need in a Shifting Real Estate Market | MyKCM

Whether you are thinking of selling your house or buying a home, today’s real estate headlines can be confusing – perhaps even concerning. What is actually happening with mortgage rates? Are home values dropping or are they just rising at a slower pace? What impact will the economy have on the housing market?

If you are either a buyer or seller (or both), you need to know what it will mean to your family if you go ahead with the move. You need to understand three things:

1. What is happening in the housing market right now?

Consumers must get past those fear-mongering headlines and gain a deep understanding of what is truly happening. How strong is buyer demand right now? How much competition do listings have today compared to what they will have in the spring? People want to make an educated decision on what is probably their family’s greatest financial asset.

2. Why is it happening?

Understanding the individual pieces that impact the sale or purchase of real estate is important. Understanding how those pieces impact each other is critical. How does the amount of a down payment impact the mortgage rate a buyer will be offered? Can you still price your house a ‘little ahead’ of the market and still be sure it will sell?

3. How do the first two affect your local market?

Basically, you want an understanding of the overall housing market and a simple and effective explanation of how it will impact your personal real estate goals.

Bottom Line

The best way to get all three is to work with a professional who understands this shifting real estate market and can expertly guide you on the journey to reach your housing goals. Let’s get together to discuss what today’s market means for you.

 

Jan. 29, 2019

Do You Prefer the Charm of an Existing Home?

Do You Prefer the Charm of an Existing Home?

Do You Prefer the Charm of an Existing Home? | MyKCM

When homebuyers begin their research, they want to see all their available options! In many cases, they will include both new construction and existing homes in their search; but is a new construction home really the house of their dreams?

According to a recent survey

 by Zillow, of the 38% of total buyers that added new construction to their list, only 11% ultimately purchased a newly constructed home!

 

They added that 71% of these buyers are repeat buyers who are financially secure, with 45% using the money from the sale of their previous homes to make a purchase.

Below are some reasons why buyers are interested in purchasing a new build:

  • Everything in the house is new/never used (49%)
  • To be close to family (41%)
  • The home is the best value for their money (37%)
  • Appealing home features (34%)
  • Desirable location (34%)

So, then why did most of the buyers surveyed choose not to purchase a new home?

1) Location

Buyers could not find new construction in the desired neighborhood, and some felt that new construction is not established (e.g., landscaping, community, neighbors).

2) Timing

Buyers face the end of a lease or sale of their previous property and could not wait for a house to be built.

3) Price

Some buyers felt that new construction base prices were deceiving. Adding upgrades and HOA fees no longer made the home fit in their price range.

4) Appeal

For some buyers, new construction homes are too “cookie cutter,” and models are limited. Others feel that the charm and uniqueness of an existing house trumps one that’s never been lived in.

Bottom Line

Not all buyers are looking for a newly built house! There are many buyers looking for “the charm and uniqueness” of an existing home. If you are considering selling your house, don’t wait! Let’s get together to come up with a plan to feature the charming details of your house to future buyers.

Posted in For Buyers, Home Owners
Jan. 28, 2019

Buying a Home this Year? Here Comes the Inventory!

Posted in For Buyers
Jan. 28, 2019

The Importance of Homeownership to the American Dream

The Importance of Homeownership to the American Dream

The Importance of Homeownership to the American Dream | MyKCM

For centuries, people in this country have seen homeownership as part of the American Dream. Whether they were born here or immigrated from another country, they wanted to own a piece of America. With so many prominent societal changes over the last few decades, it is fair to ask if people in America still feel the same way about owning a home. The answer was made abundantly clear in two separate reports released earlier this month.

In their market trends report, As Housing Trends Shift, So Does Renter, Buyer and Seller SentimentTrulia revealed that:

“After two years of no change, the share of Americans who say that homeownership is part of their personal “American Dream” ticked up from 72 percent to 73 percent of Americans.”

At the same time, the National Association of Realtors released their Aspiring Home Buyers Profile

. As the report explained:

 

“For both homeowners and non-homeowners alike, homeownership is strongly considered a part of the American Dream. For non-owners, roughly 75 percent reported that homeownership is part of their American Dream. For owners, nine in 10 believe it is part of their American Dream.”

Bottom Line

The belief among the vast majority of Americans, whether they rent or own, is that purchasing a home still remains a major step toward accomplishing the American Dream.

Posted in For Buyers, Home Owners