93% Believe Homeownership Is Important In Attaining The American Dream

2/26/2018

93% Believe Homeownership Is Important In Attaining The American Dream

Buying a home in Chandler or the East Valley is still an important part of the American Dream | Troy Erickson Realtor

Americans continue to believe that homeownership is important in achieving the American Dream. A recent survey by NeighborWorks America reported that:

“Owning a home remains a core element of the American Dream.”

When asked “How important a part of the American dream is owning a home?”

18% of those surveyed said it was the most important part
53% of those surveyed said it was very important
22% of those surveyed said it was somewhat important

Homeownership and Financial Stability

The survey also revealed that 81% of Americans believe that owning a home leads to a family being more financially stable. This feeling was reiterated by Zillow Senior Economist Aaron Terrazas who, in a recent press release, explained:

“After about a two-year slowdown, rent growth is starting to pick back up across the nation…
  Looking into 2018, rent is expected to continue gaining.

  More widespread rent growth could mean home buying demands stay high, as renters who can
  afford it move away from the unpredictability of rising rents toward the relative stability of a
  monthly mortgage payment instead.” (emphasis added)

Bottom Line

Owning a home always has been, and always will be, a crucial part of attaining the American Dream.

If you have any questions about the home buying process, or how to qualify for a home loan, just call/text me at 602-295-6807 and I can help evaluate your ability to purchase your dream home!

"Real Estate is not just a job for me, it's about making a difference in the lives of others"

Troy Erickson Realtor
Call/Text: 602-295-6807
[email protected]
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Troy Erickson has been blogging about Arizona real estate since 2006. He is a residential real estate agent who specializes in helping home buyers, sellers, and investors in Chandler and the East Valley. He has been recognized for his local market expertise, and frequently volunteers within his community.

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2 Ways To Get The Most Money From The Sale Of Your Home

2/23/2018

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2 Ways To Get The Most Money From The Sale Of Your Home

How to get the most money from the sale of my Chandler home | Home Pricing Strategy | Troy Erickson Realtor

Every homeowner just like you wants to make sure they maximize their financial reward when selling their home, and I don't blame you because I would want the same thing. But how do you guarantee that you receive the maximum value for your house?

Here are two keys to ensure that you get the highest price possible.

1. Price it a LITTLE LOW

This may seem counter-intuitive, but let’s look at this concept for a moment. Many homeowners think that pricing their homes a little OVER market value will leave them with room for negotiation. In actuality, this just dramatically lessens the demand for your house (see chart below), and I have seen this happen to home sellers on many occasions.

Home pricing strategy to sell my Chandler home fast | Troy Erickson Realtor

Instead of trying to ‘win’ the negotiation with one buyer, as the home seller, you should price your home so that demand for the home is maximized. By doing this, you will not be fighting with a buyer over the price, but will instead have multiple buyers fighting with each other over the house.

Realtor.com gives this advice:

“Aim to price your property at or just slightly below the going rate. Today’s buyers are highly
informed, so if they sense they’re getting a deal, they’re likely to bid up a property that’s
slightly under-priced, especially in areas with low inventory.”

2. Use a Real Estate Professional

This, too, may seem counter-intuitive. You may think you would make more money if you didn’t have to pay a real estate commission. With this being said, studies have shown that homes typically sell for more money when handled by a real estate professional.

A study by Collateral Analytics, reveals that FSBOs don’t actually save any money, and in some cases may be costing themselves more by not listing with an agent.

In the study, they analyzed home sales in a variety of markets in 2016 and the first half of 2017. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases
below the average differential represented by the prevailing commission rate.”

The results of the study showed that the differential in selling prices for FSBOs when compared to MLS sales of similar properties is about 5.5%. Sales in 2017 suggest the average price was near 6% lower for FSBO sales of similar properties.

Bottom Line

Price your house at or slightly below the current market value and hire a professional like me. This will guarantee that you maximize the price you get for your house.

If you have any questions about what it takes to get your home sold quickly, and for the highest price, just give me a call/text at 602-295-6807 and I can help answer all of your questions!

"Real Estate is not just a job for me, it's about making a difference in the lives of others"

Troy Erickson Realtor
Call/Text: 602-295-6807
[email protected]
Linkedin Profile
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Bidding Wars Abound… How Long Will They Continue?

2/20/2018

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Bidding Wars Abound… How Long Will They Continue?

Low inventory of homes is causing a bidding war | Troy Erickson Realtor

Just like with any product or service, the law of supply and demand impacts home prices. Any time that there is less supply than the market demands, prices increase.

In many areas of the country, the supply of homes for sale in the starter and trade-up home markets is so low that bidding wars have ensued, and the busy spring-buying season is just around the corner.

CoreLogic recently conducted an analysis on national home prices at the time of sale for their January 2018 MarketPulse Report and found that a third of homes sold for at least list price.

“The share selling above list price was almost three times the trough in January 2008 and
represented more than one-fifth of total sales.”

Many markets in the western part of the country and around major cities are experiencing higher shares of homes selling above list price.

“San Francisco had the largest share of homes — 76 percent — that sold for at least the list price, and
Seattle and Los Angeles followed with 63 and 51 percent, respectively. Miami had the lowest share,
16 percent, of homes selling at or above the list price.”

Increased demand during the spring and summer months, the traditionally busier seasons for real estate, will no doubt influence how many homes continue to sell over list price.

This should not be seen by sellers as permission to overprice their homes, though. Buyers are becoming more and more educated, especially those who have been searching for their dream homes for a while now while waiting for new inventory to come to market.

Realtor.com gives this advice:

“Aim to price your property at or just slightly below the going rate. Today’s buyers are highly informed,
so if they sense they’re getting a deal, they’re likely to bid up a property that’s slightly under priced,
especially in areas with low inventory.”

Bottom Line

Without a large wave of new listings coming to market, buyers will continue competing with each other for the homes that are available.

If you are thinking of selling, now may be the time. Demand for your house will be strong at a time when there is very little competition. That could lead to a quick sale for a really good price. Meet with me today, and I can explain to you exactly what’s going on in your local area!

If you have any questions about how to list and sell your home for top dollar, just call/text me at 602-295-6807 and I can help answer all of your questions!

"Real Estate is not just a job for me, it's about making a difference in the lives of others"

Troy Erickson Realtor
Call/Text: 602-295-6807
[email protected]
Linkedin Profile
Facebook Page

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2 Major Myths Holding Back Home Buyers

2/12/2018

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2 Major Myths Holding Back Home Buyers

Home Buying Myths that hold back buyers in Chandler and the East Valley | Troy Erickson Realtor

Urban Institute recently released a report entitled, “Barriers to Accessing Homeownership,” which revealed that “eighty percent of consumers either are unaware of how much lenders require for a down payment or believe all lenders require a down payment above 5 percent.”

Myth #1: “I Need a 20% Down Payment”

Buyers often overestimate the down payment funds needed to qualify for a home loan. According to the same report:

“Consumers are often unaware of the option to take out low-down-payment mortgages. Only 19% of consumers
believe lenders would make loans with a down payment of 5% or less… While 15% believe lenders require a
20% down payment, and 30% believe lenders expect a 20% down payment.”

These numbers do not differ much between non-owners and homeowners; 39% of non-owners believe they need more than 20% for a down payment and 30% of homeowners believe they need more than 20% for a down payment.

While many believe that they need at least 20% down to buy their dream home, they do not realize that programs are available that allow them to put down as little as 3%. Many renters may actually be able to enter the housing market sooner than they ever imagined with programs that have emerged allowing less cash out of pocket.

Myth #2: “I Need a 780 FICO® Score or Higher to Buy”

Similar to the down payment, many either don’t know or are misinformed about what FICO® score is necessary to qualify.

Many Americans believe a ‘good’ credit score is 780 or higher.

To help debunk this myth, let’s take a look at Ellie Mae’s latest Origination Insight Report, which focuses on recently closed (approved) loans.

What FICO Score do I need to buy a home in Chandler and the East Valley | Troy Erickson Realtor

As you can see in the chart above, 53.5% of approved mortgages had a credit score of 600-749.

Bottom Line

Whether buying your first home or moving up to your dream home, knowing your options will make the mortgage process easier. Your dream home may already be within your reach.

If you have any questions about the home buying process, or new home buyer loans, just call/text me at 602-295-6807 and I can help evaluate your ability to purchase your dream home!

"Real Estate is not just a job for me, it's about making a difference in the lives of others"

Troy Erickson Realtor
Call/Text: 602-295-6807
[email protected]
Linkedin Profile
Facebook Page

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Homeownership: “The Reports Of My Death Have Been Greatly Exaggerated”

2/10/2018

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Homeownership: “The Reports Of My Death Have Been Greatly Exaggerated”

Homeownership in Chandler and the East Valley is growing | Troy Erickson Realtor

The famous quote by Mark Twain in the title of this article can be used to describe homeownership in America today. Last week, the Census revealed that the percentage of homeowners in the country increased for the first time in thirteen years.

Rate of home ownership increases for first time in 13 years | Troy Erickson Realtor

A story in the Wall Street Journal gave these new homeownership numbers some context:

“The annual increase marks a crucial turning point because it comes after the federal government
reined in bubble-era policies that encouraged banks to ease lending standards to boost
homeownership. This time, what’s driving the market is a shift in favor of owning rather than renting.

‘This is market, market and market…There’s no government incentive program in sight that is having
this effect,' said Susan Wachter, a professor of real estate and finance at the Wharton School at the
University of Pennsylvania, ‘This is back to basics.’”

In a separate report comparing the rental population in America to the homeowner population, RentCafé also concluded that the gap is now shrinking.

“Undoubtedly, the recession had a great impact on homeownership…However, it looks like it takes
more to discourage Americans from buying a house than that.

As the years go by, it seems more and more certain that the fact that renting has seen a sudden gain
in popularity is more a reaction to the economic crisis than a paradigm shift in the Americans’
attitude toward housing.”

America’s belief in homeownership was also evidenced in a recent survey by Pew Research. They asked consumers “How important is homeownership to achieving the American Dream?”

The results:

43% said homeownership was essential to the American Dream
48% said homeownership was important to the American Dream
Only 9% said it was not important

Bottom Line

Homeownership has been, is and will always be a crucial element of the American Dream.

f you have any questions about the home buying process, just call/text me at 602-295-6807 and I can help evaluate your ability to purchase your dream home!

"Real Estate is not just a job for me, it's about making a difference in the lives of others"

Troy Erickson Realtor
Call/Text: 602-295-6807
[email protected]
Linkedin Profile
Facebook Page

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Where Are Mortgage Interest Rates Headed In 2018?

2/8/2018

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Where Are Mortgage Interest Rates Headed In 2018?

How do interest rates impact your home mortgage payment | Troy Erickson

The interest rate you pay on your home mortgage has a direct impact on your monthly payment. The higher the rate the greater the payment will be. That is why it is important to know where rates are headed when deciding to start your home search.

Below is a chart created using Freddie Mac’s U.S. Economic & Housing Marketing Outlook. As you can see, interest rates are projected to increase steadily over the course of the next 12 months.

Where are mortgage interest rates going | Troy Erickson

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.

According to CoreLogic’s latest Home Price Index, national home prices have appreciated 7.0% from this time last year and are predicted to be 4.2% higher next year.

If both the predictions of home price and interest rate increases become reality, families will wind up paying considerably more for their next home.

Bottom Line

Even a small increase in interest rate can impact your family’s wealth.

If you have any questions about the home buying process, new home buyer loans, or where interest rates are heading, just call/text me at 602-295-6807 and I can help evaluate your ability to purchase your dream home!

"Real Estate is not just a job for me, it's about making a difference in the lives of others"

Troy Erickson Realtor
Call/Text: 602-295-6807
[email protected]
Linkedin Profile
Facebook Page

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Whether You Rent Or Buy, Either Way You’re Paying A Mortgage!

2/5/2018

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Whether You Rent or Buy, Either Way You’re Paying A Mortgage!

Rent vs Buy. You are either paying a mortgage for yourself or for your landlord | Troy Erickson Realtor

There are some people who have not purchased homes because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize, however, that unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.

As Entrepreneur Magazine, a premier source for small business, explained in their article, “12 Practical Steps to Getting Rich”:

“While renting on a temporary basis isn’t terrible, you should most certainly own the roof over
your head if you’re serious about your finances. It won’t make you rich overnight, but by renting,
you’re paying someone else’s mortgage. In effect, you’re making someone else rich.”

Christina Boyle, Senior Vice President and head of the Single-Family Sales & Relationship Management organization at Freddie Mac, explains another benefit of securing a mortgage as opposed to paying rent:

“With a 30-year fixed rate mortgage, you’ll have the certainty & stability of knowing what your
mortgage payment will be for the next 30 years – unlike rents which will continue to rise over the
next three decades.”

As a home owner, your mortgage payment is a form of ‘forced savings’ which allows you to build equity in your home that you can tap into later in life. As a renter, you guarantee the landlord is the person building that equity.

Interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.22% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home in the mountains, now is a good time to buy.

If you have any questions about the home buying process, new home buyer loans, or where interest rates are heading, just call/text me at 602-295-6807 and I can help answer all of your questions!

"Real Estate is not just a job for me, it's about making a difference in the lives of others"

Troy Erickson Realtor
Call/Text: 602-295-6807
[email protected]
Linkedin Profile
Facebook Page

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The Impact Of Tight Inventory On The Housing Market

2/2/2018

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The Impact Of Tight Inventory On The Housing Market

How inventory impacts the housing market and home prices in Chandler and the East Valley | Troy Erickson Realtor

The housing crisis is finally in the rear-view mirror as the real estate market moves down the road to a complete recovery. Home values are up, home sales are up, and distressed sales (foreclosures and short sales) have fallen to their lowest points in years. It seems that the market will continue to strengthen in 2018.

However, there is one thing that may cause the industry to tap the brakes: a lack of housing inventory. While buyer demand looks like it will remain strong throughout the winter, supply is not keeping up.

Here are the thoughts of a few industry experts on the subject:

National Association of Realtors:

   “Total housing inventory at the end of November dropped 7.2 percent to 1.67 million existing homes
available for sale, and is now 9.7 percent lower than a year ago (1.85 million) and has fallen
year-over-year for 30 consecutive months. Unsold inventory is at a 3.4-month supply at the
current sales pace, which is down from 4.0 months a year ago.”

Joseph Kirchner, Senior Economist for Realtor.com:

   “The increases in single-family permits and starts show that builders are planning and starting new
construction projects, that’s a good thing because it will help to relieve the shortage of homes on
the market.”

Sam Khater, Deputy Chief Economist at CoreLogic:

   “Inventory is tighter than it appears. It’s much lower for entry-level buyers.”

Bottom Line

If you are thinking of selling, now may be the time. Demand for your house will be strong at a time when there is very little competition. That could lead to a quick sale for a really good price. Meet with me today, and I can explain to you exactly what’s going on in your local area!

If you have any questions about how to list your home and buy a new home simultaneously, just call/text me at 602-295-6807 and I can help answer all of your questions!

"Real Estate is not just a job for me, it's about making a difference in the lives of others"

Troy Erickson Realtor
Call/Text: 602-295-6807
[email protected]
Linkedin Profile
Facebook Page

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