lake county real estate. and then some…

selling homes…a family tradition


Leave a comment

Renting isn’t always the cheaper alternative…

The Cost of Renting vs. Buying in the US [INFOGRAPHIC]

The Cost of Renting vs. Buying in the US [INFOGRAPHIC] | MyKCM

Some Highlights:

  • Historically, the choice between renting or buying a home has been a tough decision.
  • Looking at the percentage of income needed to rent a median-priced home today (29.2%) vs. the percentage needed to buy a median-priced home (15.8%), the choice becomes obvious.
  • Every market is different. Before you renew your lease again, find out if you can put your housing costs to work by buying this year!


Leave a comment

Want to build greater personal net worth? Studies show that owning real estate will help you achieve that goal faster than people who don’t own real estate….

Do You Know the Cost of NOT Owning Your Home?

Do You Know the Cost of NOT Owning Your Home? | MyKCM

Owning a home has great financial benefits, yet many continue renting! Today, let’s look at the financial reasons why owning a home of your own has been a part of the American Dream for as long as America has existed.

Zillow recently reported that:

“With Rents continuing to climb and interest rates staying low, many renters find themselves gazing over the homeownership fence and wondering if the grass really is greener. Leaving aside, for the moment, the difficulties of saving for a down payment, let’s focus on the monthly expenses of owning a home: it turns out that renters currently paying the median rent in many markets could afford to buy a higher-quality property than the typical (read: median-valued) home without increasing their monthly expenses.”

What proof exists that owning is financially better than renting?

1. The latest Rent Vs. Buy Report from Trulia pointed out the top 5 financial benefits of homeownership:

  • Mortgage payments can be fixed while rents go up.
  • Equity in your home can be a financial resource later.
  • You can build wealth without paying capital gain.
  • A mortgage can act as a forced savings account
  • Overall, homeowners can enjoy greater wealth growth than renters.

2. Studies have shown that a homeowner’s net worth is 45x greater than that of a renter.

3. Just a few months ago, we explained that a family buying an average priced home at the beginning of 2017 could build more than $42,000 in family wealth over the next five years.

4. Some argue that renting eliminates the cost of taxes and home repairs, but every potential renter must realize that all the expenses the landlord incurs are already baked into the rent paymentalong with a profit margin!!

Bottom Line

Owning a home has always been, and will always be, better from a financial standpoint than renting.


Leave a comment

According to Gallup – real estate remains the best long-term investment…

Gallup: Real Estate is Best Long-Term Investment 4 Years Running

Gallup: Real Estate is Best Long-Term Investment 4 Years Running | MyKCM

Every year, Gallup surveys Americans to determine their choice for the best long-term investment. Respondents are given a choice between real estate, stocks/mutual funds, gold, savings accounts/CDs, or bonds.

For the fourth year in a row, Real Estate has come out on top as the best long-term investment! This year’s results showed that 34% of Americans chose real estate, followed by stocks at 26%. The full results are shown in the chart below.

Gallup: Real Estate is Best Long-Term Investment 4 Years Running | MyKCM

The study makes it a point to draw attention to the contrast of the sentiment over the last four years compared to that of 2011-2012, when gold took the top slot with 34% of the votes. Real estate and stocks took second and third place, respectively, while still in recovery from the Great Recession.

Bottom Line

As the real estate market has recovered, so has the belief of the American people in the stability of housing as a long-term investment.


Leave a comment

Knowing real estate “lingo” comes in very handy when you are involved with buying a home. Here is a list, and definitions, of the most popular terms in real estate transactions…

Buying a Home? Do You Know the Lingo?

Buying a Home? Do You Know the Lingo? | MyKCM

Buying a home can be intimidating if you are not familiar with the terms used during the process. To start you on your path with confidence, we have compiled a list of some of the most common terms used when buying a home.

Freddie Mac has compiled a more exhaustive glossary of terms in their “My Home” section of their website.

Annual Percentage Rate (APR) – This is a broader measure of your cost for borrowing money. The APR includes the interest rate, points, broker fees and certain other credit charges a borrower is required to pay. Because these costs are rolled in, the APR is usually higher than your interest rate.

Appraisal – A professional analysis used to estimate the value of the property. This includes examples of sales of similar properties. This is a necessary step in getting your financing secured as it validates the home’s worth to you and your lender.

Closing Costs – The costs to complete the real estate transaction. These costs are in addition to the price of the home and are paid at closing. They include points, taxes, title insurance, financing costs, items that must be prepaid or escrowed and other costs. Ask your lender for a complete list of closing cost items.

Credit Score – A number ranging from 300-850, that is based on an analysis of your credit history. Your credit score plays a significant role when securing a mortgage as it helps lenders determine the likelihood that you’ll repay future debts. The higher your score, the better, but many buyers believe they need at least a 780 score to qualify when, in actuality, over 55% of approved loans had a score below 750.

Discount Points – A point equals 1% of your loan (1 point on a $200,000 loan = $2,000). You can pay points to buy down your mortgage interest rate. It’s essentially an upfront interest payment to lock in a lower rate for your mortgage.

Down Payment – This is a portion of the cost of your home that you pay upfront to secure the purchase of the property. Down payments are typically 3 to 20% of the purchase price of the home. There are zero-down programs available through VA loans for Veterans, as well as USDA loans for rural areas of the country. Eighty percent of first-time buyers put less than 20% down last month.

Escrow – The holding of money or documents by a neutral third party before closing. It can also be an account held by the lender (or servicer) into which a homeowner pays money for taxes and insurance.

Fixed-Rate Mortgages – A mortgage with an interest rate that does not change for the entire term of the loan. Fixed-rate mortgages are typically 15 or 30 years.

Home Inspection – A professional inspection of a home to determine the condition of the property. The inspection should include an evaluation of the plumbing, heating and cooling systems, roof, wiring, foundation and pest infestation.

Mortgage Rate – The interest rate you pay to borrow money to buy your house. The lower the rate, the better. Interest rates for a 30-year fixed rate mortgage have hovered between 4 and 4.25% for most of 2017.

Pre-Approval Letter – A letter from a mortgage lender indicating that you qualify for a mortgage of a specific amount. It also shows a home seller that you’re a serious buyer. Having a pre-approval letter in hand while shopping for homes can help you move faster, and with greater confidence, in competitive markets.

Primary Mortgage Insurance (PMI) – If you make a down payment lower than 20% on your conventional loan, your lender will require PMI, typically at a rate of .51%. PMI serves as an added insurance policy that protects the lender if you are unable to pay your mortgage and can be cancelled from your payment once you reach 20% equity in your home. For more information on how PMI can impact your monthly housing cost, click here.

Real Estate Professional – An individual who provides services in buying and selling homes. Real estate professionals are there to help you through the confusing paperwork, to help you find your dream home, to negotiate any of the details that come up, and to help make sure that you know exactly what’s going on in the housing market. Real estate professionals can refer you to local lenders or mortgage brokers along with other specialists that you will need throughout the home-buying process.

The best way to ensure that your home-buying process is a confident one is to find a real estate professional who will guide you through every aspect of the transaction with ‘the heart of a teacher,’ and who puts your family’s needs first.


Leave a comment

Real estate experts are still convinced that owning a home is a great investment, as long as you do these two things…

Real Estate Mogul: Here’s Why You Should Buy

Real Estate Mogul: Here’s Why You Should Buy | MyKCM

Real Estate mogul, Sean Conlon, host of The Deed: Chicago on CNBC, was recently asked the question, should you buy? Or should you rent a house?

Conlon responded:

“I am a true believer that you save every penny and you buy your first house… and that is still the fastest path to wealth in this country.”

Conlon went on to suggest that first-time buyers put down 10-20% “if they can make it work,” and to remain in their home at least 4-5 years to see a return on their investment.

Who is Sean Conlon, and why should you listen to his advice?

Within a few years of working in the real estate industry, Conlon had established himself as one of the leading agents in the United States and has founded 3 billion-dollar brokerages dealing in residential, commercial and investment sales. Since immigrating to America from the United Kingdom in 1990, he believes very strongly in the American Dream and the role that homeownership plays in achieving it. Conlon is quoted on his website as saying:

“I treat people the way I would like to be treated if I went in to buy a house and I work harder than anybody I know. I think if you do that in America, you will always succeed.”

Bottom Line

Homeownership is an investment you can leverage against in the future that not only provides shelter and safety but also helps you build your family’s wealth. If you are debating whether or not to purchase a home this year, let’s get together to discuss the opportunities available in today’s market!


Leave a comment

Housing inventory remains low. Buyer interest remains high. Thinking of selling? It’s time to take action!

3 Charts That Shout, ‘List Your Home Today!’

3 Charts That Shout, ‘List Your Home Today!’ | MyKCM

In school, we all learned the theory of supply and demand. When the demand for an item is greater than the supply of that item, the price will surely rise.

SUPPLY

The National Association of Realtors (NAR) recently reported that the inventory of homes for sale stands at a 3.8-month supply. This is considerably lower than the 6-month supply necessary for a normal market.

3 Charts That Shout, ‘List Your Home Today!’ | MyKCM

 

DEMAND

Every month NAR reports on the number of buyers out in the market looking for homes, which is also known as buyer traffic. As seen on the map below, buyer demand in March was strong or very strong in 45 out of 50 states nationwide, and Washington, DC.

3 Charts That Shout, ‘List Your Home Today!’ | MyKCM

Many buyers are being confronted with a very competitive market in which they must compete with other buyers for their dream homes (if they are even able to find a home they wish to purchase).

Listing your house for sale now will allow you to capitalize on the shortage of homes for sale in the market, which will translate into a better pricing situation.

HOME EQUITY

Many homeowners underestimate the amount of equity they currently have in their homes. According to a recent Fannie Mae study, 37% of homeowners believe that they have more than 20% equity in their homes. In reality, CoreLogic’s latest Equity Report tells us that 78.9% actually do!

3 Charts That Shout, ‘List Your Home Today!’ | MyKCM

Many homeowners who are undervaluing the equity they have in their homes may feel trapped, which may be contributing to the lack of inventory in the market.

Bottom Line

If you are debating selling your home this year, let’s meet up to evaluate the equity you have in your home, as well as the opportunities available in your market.


Leave a comment

65% of first-time homebuyers put down 6% or less, during the month of January. Low down payment programs are bring Millennials to the closing table. Great news if you are a seller who is looking to upgrade!

Millennials Flock to Low Down Payment Programs

Millennials Flock to Low Down Payment Programs | MyKCM

A recent report released by Down Payment Resource shows that 65% of first-time homebuyers purchased their homes with a down payment of 6% or less in the month of January.

The trend continued through all buyers with a mortgage, as 62% made a down payment of less than 20%, which is consistent with findings from December.

An article by DS News points to the new wave of millennial homebuyers:

“It seems that the long-awaited influx of millennial home buyers is beginning. Ellie Mae reported that mortgages to millennial borrowers for new home purchases continued their ascent in January, accounting for 84 percent of closed loans.”

Among millennials who purchased homes in January, FHA loans remained popular, making up 35% of all loans closed. Ellie Mae’s Executive Vice President of Corporate Strategy Joe Tyrrell gave some insight into why:

“It is not surprising to see Millennial borrowers leverage FHA loans because they typically offer lower down payments and lower average FICO score requirements than conventional loans. Across the board, we’re continuing to see strong interest in homeownership from this younger generation.”

Bottom Line

If you are one of the many millennials who is debating a home purchase this year, let’s get together to help you understand your options and set you on the path to preapproval.