Do You Really Need To Put 20% Down?

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The days of having to put 20% down are gone! There are a variety of borrowing options, some begin with as little as 3% down. If you want to own your own home, now is as good a time as any to jump into the market!

In September:

  • 70% of first-time buyer loans had down payments <5%
  • The median FICO score was 708
  • 27% had DTIs greater than QM limit of 43%

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Know the Facts: Buying a Home vs Renting

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The Facts About Renting:

According to the 2015 Rent.com Rental Marketing report:

  • 88% of property managers raised their rent in the last 12 months, there does not appear to be any signs of stopping.
  • 66% of property managers predict that rental rates will continue to rise in the next year by an average of 8%.
  • 53% of property managers said that they were more likely to bring in a new tenant at a higher rate, than negotiate and renew a lease with a current tenant they already know.

Why Buy Your Own Home:

Making the leap to purchase your own house can be scary, we know that. Buying a home doesn’t have to be a terrifying experience. Renting can be tiring and stressful, year to year not knowing where you are going next or how much you will be paying per month. We are here to help guide you to the home of your dreams and the security you deserve. Remember the top three reasons to own a home are:

  1. The opportunity to build equity
  2. A stable and safe environment
  3. The freedom to choose your own neighborhood

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Fannie Mae’s Housing Forecast [INFOGRAPHIC]

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Some Highlights:

  • 30-year fixed mortgage rates are projected to increase steadily over the next year.
  • Housing Starts will well surpass 2015 numbers.
  • Home Sales will reach an annual rate of over 6 million by the fourth quarter of 2016.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Applying For A Mortgage: Why So Much Paperwork?

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We are often asked why there is so much paperwork mandated by the bank for a mortgage loan application when buying a home today. It seems that the bank needs to know everything about us and requires three separate sources to validate each and every entry on the application form.

Many buyers are being told by friends and family that the process was a hundred times easier when they bought their home ten to twenty years ago.

There are two very good reasons that the loan process is much more onerous on today’s buyer than perhaps any time in history.

  1. The government has set new guidelines that now demand that the bank provebeyond any doubt that you are indeed capable of affording the mortgage. During the run-up in the housing market, many people ‘qualified’ for mortgages that they could never pay back. This led to millions of families losing their home. The government wants to make sure this can’t happen again
  2. The banks don’t want to be in the real estate business. Over the last seven years, banks were forced to take on the responsibility of liquidating millions of foreclosures and also negotiating another million plus short sales. Just like the government, they don’t want more foreclosures. For that reason, they need to double (maybe even triple) check everything on the application.

However, there is some good news in the situation. The housing crash that mandated that banks be extremely strict on paperwork requirements also allowed you to get a mortgage interest rate probably at or below 4%.

The friends and family who bought homes ten or twenty ago experienced a simpler mortgage application process but also paid a higher interest rate (the average 30 year fixed rate mortgage was 8.12% in the 1990’s and 6.29% in the 2000’s). If you went to the bank and offered to pay 7% instead of <4%, they would probably bend over backwards to make the process much easier.

Bottom Line

Instead of concentrating on the additional paperwork required, let’s be thankful that we are able to buy a home at historically low rates.
Sit down with Jo Anne or Tony Rizza (843-301-5825) to better understand the process and find your dream home in Hilton Head / Bluffton real estate market today!

With over 25 years of experience, let our team help you find your new home!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

New Construction, New Home Sales Surge

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According to the latest report from the US Census Bureau and the Department of Housing and Urban Development, newly constructed home sales jumped 5.7% month-over-month and 21.6% year-over-year to an annual pace of 552,000.

Many buyers are looking to the new homes market to make up for the lack of existing home sales inventory. National Association of Home Builders Chief Economist David Crowe explains:

“Today’s report indicates the release of pent-up housing demand as the overall economy strengthens, consumer confidence grows and mortgage interest rates remain low. The housing market should continue to move forward at a modest but more persistent pace throughout the rest of 2015.”

Regionally, the Northeast led the way with a 24.1% increase in new home sales, followed by the South (7.4%) and West (5.4%). Sales in the Midwest declined by 9.1%.

The inventory of new homes for sale currently sits at a 4.7-month supply down slightly from July (4.9) and significantly from August 2014 (5.4).

Buyers who purchased a new home were willing to spend more to get the amenities that they wanted. The median home price for new homes was $64,000 higher thanexisting homes in August at $292,700!

Approved applications for building permits increased 3.5% over July and 12.5% over this time last year. Permit applications are seen as a strong indicator of builder confidence in the market.

Bottom Line

Buyer demand continues to outpace inventory of homes for sale. If you are thinking of selling your house this year, now may be the time to list before builders have a chance to replenish the supply of new homes.

For more information on new construction or available properties in the Bluffton/Hilton Head Island area, give Jo Anne or Tony Rizza (843-301-5825) today to find out more about new construction in the Bluffton/Hilton Head Island area.

With over 25 years of experience, let our team help you find your dream home!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Buying a Home Remains 35% Less Expensive than Renting!

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In the latest Rent vs. Buy Report from Trulia, they explained that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage throughout the 100 largest metro areas in the United States.

The updated numbers actually show that the range is from an average of 16% in Honolulu (HI), all the way to 55% in Sarasota (FL), and 35% Nationwide!

The other interesting findings in the report include:

  • Interest rates have remained low and even though home prices have appreciated around the country, they haven’t greatly outpaced rental appreciation. “In the past year, these two trends have made homeownership even more affordable compared with renting.”
  • Some markets might tip in favor of renting if home prices increase at a greater rate than rents and if – as most economists expect – mortgage rates rise, due to the strengthening economy.
  • Nationally, rates would have to rise to 10.6% for renting to be cheaper than buying – and rates haven’t been that high since 1989.  

Bottom Line

Buying a home makes sense socially and financially. Rents are predicted to increase substantially in the next year, lock in your housing cost with a mortgage payment now.

If you are debating buying a home this year, sit down with Jo Anne or Tony Rizza (843-301-5825) to better understand the Hilton Head / Bluffton real estate market. We can help you evaluate what opportunities available in the Hilton Head / Bluffton area would best fit your budget!

With over 25 years of experience, let our team help you find your dream home!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Is Qualifying for a Mortgage Getting Easier?

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There has been a lot of talk about how difficult it is to get a home mortgage in today’s lending environment. However, three recent reports have revealed that lending standards are beginning to ease. This is great news for both first time buyers and current homeowners looking to move or buy a second vacation/retirement home. Let’s look at the three reports:

The MBA’s Mortgage Credit Availability Index

This index, issued by the Mortgage Bankers’ Association, measures the availability of credit available in the home mortgage market. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of a loosening of credit. We can see that the index has been increasing nicely this year:

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Fannie Mae’s latest Mortgage Lender Sentiment Survey

This survey revealed that more lenders report that mortgage lending standards across all loan types are easing. The survey asked senior mortgage executives whether their company’s credit standards have eased, tightened, or remained essentially unchanged during the prior three months. The gap between lenders reporting easing as opposed to tightening over the prior three months jumped to approximately 20%. This represented a new survey high of “net easing.” In addition, the share of lenders who expect their organizations to ease credit standards over the next three months also ticked up this quarter.

Doug Duncan, senior vice president and chief economist at Fannie Mae, addressed this easing of standards:

“For the first time in seven quarters, we see a pronounced increase in the share of lenders, particularly medium- and larger-sized lenders, reporting on net an easing of credit standards … This is a significant result in light of public discourse on credit availability and standards … Overall, we expect that lenders’ tendency toward easing credit standards, together with relatively low mortgage rates and a strengthening labor market, will continue to support the housing market expansion.”

Ellie Mae’s latest Origination Insights Report

The easing of credit standards is also confirmed in this report which showed that the average FICO score on a closed loan fell to its lowest point in well over a year. Here is a chart of average FICO scores on closed loans so far in 2015:

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Just keep an eye on interest rates…

Although this is all great news, there was one challenge in the recently released data.Ellie Mae reported that the average interest rate on closed loans is beginning to inch upward:

 

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What this means to you…

If you are a first time buyer or a current homeowner thinking of moving up to a bigger home or buying a vacation home, now may be the time to act. Mortgage lending standards are beginning to ease and interest rates are beginning to inch up.

Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the Hilton Head / Bluffton real estate market and see the latest available properties.

With over 25 years of experience, let our team help you find your dream home!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Feature Community: The Haven at New Riverside

The Haven_NRThis month we are happy to feature another great gated community in Bluffton, S.C. which offers residents the best of town and country life is The Haven at New Riverside.

Minutes away from historic downtown Savannah, Old Town Bluffton, and Hilton Head Island’s beautiful beaches, this active-adult community by Del Webb offers 8 different two and three bedroom ranch home models on wooded or lagoon view lots to choose from.

Haven-Hillcrest Room

Built on over 340 acres, residents of The Haven at New Riverside have access to the community’s clubhouse (complete with zero entry pool, bocce ball court, walking trails, and tennis courts), lounge, fitness center, art studio, lending library, computers and meeting spaces.

Additionally, The Haven at New Riverside employs a full-time Activities and Lifestyle Director who organizes additional social events for residents throughout the year.

 

 

Haven-ClubhouseAmenities

  • Outdoor Pool
  • Clubhouse
  • State-of-the-Art Fitness Center
  • 4 Clay Tennis Courts
  • 2 Pickle Ball Courts
  • 2 Bocce ball Courts
  • Hobby room
  • Billiards
  • Dog Park
  • Gated Community
  • New Riverside bike and walking trails

Haven-Fitness

Current Social Clubs: 

  • Book Club
  • Bridge
  • Walking
  • Golf Club
  • Sewing
  • Train Dominoes
  • House of Cards
  • Tennis
  • Aqua Golf
  • Lunch Bunch
  • Coffee Talk
  • Yoga 101
  • Bunco

To view current listings in The Haven at New Riverside, click here or for additional information on this great community, contact Jo Anne or Tony Rizza at 843-301-5825 to view available properties today!

 

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Home Equity: How Much Do You REALLY Have?

CoreLogic recently released their 2015 2nd Quarter Equity Report which revealed that 759,000 properties had regained equity in the last quarter. That means that 91% of allmortgaged properties (approximately 45.9 million) are now in a positive equity position. Anand Nallathambi, president and CEO of CoreLogic, reported:

“For much of the country, the negative equity epidemic is lifting. The biggest reason for this improvement has been the relentless rise in home prices over the past three years which reflects increasing money flows into housing and a lack of housing stock in many markets.”

Obviously, this is great news for the financial situation of many homeowners.

But, do they realize their equity position has changed?

A recent study by Fannie Mae suggests that many homeowners are unaware that their equity position has changed…in some cases dramatically. For example, their study showed that 23% of Americans still believe their home is in a negative equity position when, in actuality, only 9% of homes are in that position.

The study also revealed that, though 69% of homes had “significant equity” (greater than 20%), only 37% of Americans realize it.

Equity

This means that 32% of Americans with a mortgage fail to realize the opportune situation they are in. With a sizeable equity position, many homeowners could easily move into a housing situation that better meets their current needs (moving to a larger home or downsizing).

Fannie Mae spoke out on this issue in their report:

“Homeowners who underestimate their homes’ values not only underestimate their home equity, they also likely underestimate 1) how large a down payment they could make with their home equity, 2) their chances of qualifying for mortgages, and, therefore, 3) their opportunities for selling their current homes and for buying different homes.”

Bottom Line

Every homeowner should be aware of the true equity in their house and realize the opportunities that go along with it. If you are unsure of the savings you currently have built up in your home, call Jo Anne or Tony Rizza (843-301-5825) to help ascertain how much you have really accrued. You may be surprised!

 

Hilton Head Real Estate Partners
Partnering with you every step of the way.

 

Finding your Dream Home: The Cost of Waiting

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As a seller, you will be most concerned about ‘short term price’ – where home values are headed over the next six months. As either a first-time or repeat buyer, you must not be concerned only about price but also about the ‘long term cost’ of the home.

Let us explain.

There are many factors that influence the ‘cost’ of a home. Two of the major ones are the home’s appreciation over time, and the interest rate at which a buyer can borrow the funds necessary to purchase their home. The rate at which these two factors can change is often referred to as “The Cost of Waiting”.

What will happen over the next 12 months?

According to CoreLogic’s latest Home Price Index, prices are expected to rise by 4.7% by this time next year.

Additionally, Freddie Mac’s most recent Economic Commentary & Projections Tablepredicts that the 30-year fixed mortgage rate will appreciate to 4.7% in that same time.

What Does This Mean to a Buyer?

Here is a simple demonstration of what impact these projected changes would have on the mortgage payment of a home selling for approximately $250,000 today:

Cost-of-Waiting

 

Bottom Line

If you are ready to move forward with finding your dream home in the Hilton Head and Bluffton SC area, give Jo Anne or Tony Rizza a call at 843-301-5825. Great Hilton Head / Bluffton properties are available & waiting for you!