Avoid These 4 New Homeowner Mistakes

Four basic things to look for when searching for an investment property. Investment properties are being talked about all the time in our current real estate market. Many people are looking for great properties to invest in right now. Today I’m sharing the four basic things you want to look for when buying an investment property. These are the main things you need to understand before taking the first step toward investing in real estate. Feel free to watch the full message above or use these timestamps that will direct you to various points in the video: 0:00 — Introduction to today’s topic 0:55 — No. 1: Projected income 1:55 — No. 2: The current tenant situation 2:55 — No. 3: The condition of the property 4:15 — No. 4: Consider the utilities 6:00 — Wrapping up today’s topic If you have questions about investing in real estate or are considering doing so, reach out via phone or email. I can give you direction and plenty of advice.

Explaining inflation and how real estate is a good hedge against it. Inflation: what is it, and how can real estate hedge against it? I am no financial expert, but I have been doing some research recently, so I wanted to share what I know. Inflation is a currency’s loss of value over time. Experts track inflation by watching how the prices fluctuate for a group of goods over a specific period. According to Forbes, the inflation rate at the end of February 2022 was 7.9%. That’s the highest it has been since January 1982 when it was 7.5%. The only group that hates inflation more than we do is the Federal Reserve. They have two jobs: controlling inflation and maximizing employment. This time around, the Fed was a little slow to realize that our inflation wasn’t just because we were in a transitory period. However, they’ve realized that inflation is a problem over recent months and have taken a monetary policy approach to make sure it doesn’t impact the general economy. “Real estate can be a great place to put your money to hedge against inflation.” Inflation isn’t going anywhere, though. The rate of inflation in February was driven by gains in the food, gasoline, and shelter industries. This puts more pressure on the average American family. How does real estate hedge against inflation? As your home price rises, the loan-to-value ratio of your house decreases. Your equity will grow, but your mortgage payments will stay the same. When property prices rise, rents also tend to go up. If you’re collecting more rent, your profit margin might increase because your mortgage will stay the same. Home prices have also increased steadily over time. Even after the crash of 2007, home values returned to their pre-crash numbers after a decade. In the last two years alone, we’ve seen 33% appreciation. The value of your home will be there in the long run. Even as the value of the dollar goes down, your home will continue to grow in price.  Real estate can be a great place to put your money to hedge against inflation. If you’re interested in learning more, talk to your financial advisor. If you’re thinking about investing in real estate, contact your real estate advisor. Of course, I’m happy to answer any further questions you have. Just give me a call or send me an email. I’d love to hear from you.

Here are six things to watch out for when buying a flipped property. Are you looking to buy a flipped home? Because of our low inventory, it’s an increasingly popular option. However, not every flip is created equal. Some people may rush their renovations to turn a quick buck, while others may be new to the business and make some rookie mistakes. That’s why today I want to share six things you should pay attention to before you buy a flipped home.  You can watch my full explanation in the video above, or you can skip to each topic using the timestamps provided: 0:00 — Introduction  0:45 — No. 1: Look at the building permits 1:47 — No. 2: Check the paint job 2:38 — No. 3: Plumbing and electrical work 3:47 — No. 4: Check the cabinets 5:02 — No. 5: Flooring 6:51 — No. 6: Doors and windows 8:22 — Wrapping up  If you have questions about today’s topic, please call or email me. I am always willing to help!

Discussing four common mistakes new homeowners tend to make. Have you purchased your first home recently? Homeownership is exciting, but it’s easy to make mistakes when you’re first getting started. That’s why today I want to go over four common mistakes first-time homeowners make that you should avoid: Mistake No. 1: Ignoring your home inspection report. If you ignore your home inspection report or treat it like a list of chores you don’t want to do, it could cost you in the long run. Some issues are a matter of basic safety, while others are much cheaper to fix sooner rather than later. Talk with your Realtor to find out which items you need to address immediately. Mistake No. 2: Making improvements without checking the return. I’m not saying every upgrade you make needs to be made solely for return on investment, but check with your Realtor to make sure your renovations make sense. For example, you can build a full trampoline park in your backyard because you’re passionate about trampolines, but understand that this update probably won’t net you a great ROI. “Your Realtor can refer you to a great contractor for any job. ” Mistake No. 3: Choosing the lowest bid for a repair or upgrade. When you decide to change your home, don’t just pick the contractor with the lowest cost. Shop around and ask your Realtor for referrals. They’ve probably had clients make the same upgrade you want to make, so they can refer you to someone you know will get the job done well. Mistake No. 4: Submitting insurance claims too often. As issues come up, don’t get too excited about submitting claims. If you make too many small claims, there’s a good chance you could get dropped from your insurance. Save insurance claims for big problems that you can’t fix yourself. If you have any questions about today’s video, please call or email me. I look forward to hearing from you!

Here are four reasons why you shouldn’t wait to sell your home. Should you wait and sell your home in the spring? Absolutely not because doing so could cost you money. Today I want to share a couple of reasons why that is: 1. The selling season starts now. As soon as the holidays are behind us, people refocus on buying or selling their homes. The early parts of January and February are when the market starts to wind up. You don’t have to wait until June to maximize buyer activity. ​​​​2. ​​​​There is less competition. Not everyone is thinking about selling their home at the start of the year, but once you get into that May or June time frame, everyone is listing their houses. Competition rises, and prices flatten. Right now, there’s low inventory and high demand, so the earlier you list, the less competition and the higher the price. 3. Demand is still high. The buyer pool might have cooled off during the holidays, but people are still looking for homes. On top of that, the buyers right now are serious and highly motivated. In the spring, you might get twice as many showings, but they might just be looking at houses more for fun than in earnest.  4. Interest rates will probably go up. When rates go up even half a percent, it reduces the buying power of people in the market and puts downward pressure on prices. We still have low supply, so we’re not sure how it will affect prices. However, you want buyers to get the best possible rate for your home, and that’s only possible right now. If you have any questions about why you should sell now or real estate in general, feel free to call or email me or my team. We would love to help you.

Here’s what Rick Scherer expects for mortgage rates in 2022. Today we’re going to talk about the mortgage rate environment. We’re bringing in Rick Scherer, the CEO of OnTo Mortgage, to talk about where he thinks rates are heading in 2022. He doesn’t have a crystal ball, but he has the knowledge and experience to make some great predictions. You can watch the full episode above, or you can skip to each section using the timestamps provided below:  0:1 7— Introducing Rick Scherer 0:50 — Where do you see rates heading in 2022? 2:03 — What do climbing rates mean for the economy? 3:02 — What do the loan limit announcements mean for buyers? 4:24 — Using low-money-down programs 5:22 — Wrapping up I hope you learned as much from this conversation as I did. If you have any questions for Rick, call him at 617-778-0024 or email him at rick@ontomortgage.com. If you have any questions for me, feel free to call or email me as well. I’d love to hear from you.

Here are four home-buying costs that might catch you by surprise. This week, we’re talking about how expensive it is to buy homes, and I don’t just mean the price of homes in today’s hot market. There are a lot of additional costs that can creep up and shock you at the closing table, especially if you’re a first-time homebuyer. Let’s talk about the four costs you haven’t factored in while buying a home: 1. Home inspection. You have to pay for the inspection. Even if that inspection reveals something and you back out of the purchase, you don’t get that money back. It’s an expense for a service. Inspections aren’t cheap either; they can cost from $400 to $600, and if you need to get something like a well test, it could be as much as $800 to $1,000.  Don’t get me wrong; that money is the best money you’ll spend during any real estate transaction. It can save you thousands or hundreds of thousands of dollars, but it’s important to factor in those costs. 2. Additional closing costs. This includes a lot of different things. You need to bring more money to the closing table than just your closing costs and lender fees. Prorated taxes and prepaid taxes are good examples. If the homeowner has paid taxes for the next quarter, you’ll need to pay them for the time from the closing date to the end of that quarter. You’ll also need to prepay the taxes for the next quarter so that your mortgage company has enough in the escrow account to pay for them.  Most of the time, lenders will require you to buy homeowners insurance and pay the premium in full for the whole year before closing. You’re also going to have to pay the lender’s coverage for title insurance, but there’s also an optional owner’s coverage that you can buy. Hopefully, title insurance is never used, but it is money well spent in case there is a problem. Also, if the seller has paid ahead on condo or HOA fees, you may have to pay a portion of that back to them at closing.  “ Do your due diligence and factor these costs into your budget before you buy.” 3. Moving expenses. If you’re a first-time homebuyer, you might have a group of friends ready to help you move, and you plan to pay them in pizza and beer. If you’re like me, that’s no longer an option; you’ll have to pay for the move. This can be fairly expensive, especially if you hire a good company to make sure your items are taken care of. Moving across town can cost several thousand dollars, and it can cost even more if you’re moving across the country.  4. Immediate purchases. When you move into a new home, you may need stuff: curtains, blinds, or stuff for your kitchen. You’ll have to buy some things immediately. Think about cleaning supplies, bathroom supplies, groceries, cable, phone, and TV. Ask yourself what you might need right out of the gate, and budget for those items.

Here’s the conclusion to our contingency discussion with Arielle Cecala. Today we’re concluding our three-part discussion with Arielle Cecala on waiving contingencies. For the final installment of this series, we’ll focus on the pros and cons of waiving the home sale contingency and what you need to know about it. Feel free to watch the full message, or use these timestamps to browse specific topics at your leisure: 0:50 - The legal dangers of waiving a home sale contingency according to Arielle 2:40 - Lining up simultaneous transactions and using contingency leverage 3:58 - Advice for strengthening your offer while also protecting your interests 6:05 - Wrapping things up It’s always great having Arielle on, and I thank her for joining us to offer this important, insightful info. If you have any questions for her, reach out to her via phone at (781) 251-0541 or by email at acecala@crowleycummings.com. If you have any other real estate-related questions for me, don’t hesitate to reach out via phone or email. We look forward to hearing from you.

Here’s how our blazing-hot seller’s market is beginning to change. Some of my seller clients have been wondering whether they should hold off on listing their homes. They still want to maximize value, but if they can still afford to wait, they will. Though nobody has a crystal ball, we do know that things will likely be changing in the market soon. Additionally, these changes will make it more difficult to secure top dollar on a home sale. Here are three things you should be aware of: 1. Buyer fatigue: Buyers have been out there for months now, putting in offers and losing over and over again. There’s so much competition that it’s difficult to beat out all the other buyers, and it can easily lead to fatigue. Buyers are already starting to take a break from the market and wait until more inventory arrives. When the buyer pool decreases, there is less competition for your listing, and this leads to a lower price on your home. “These things will begin happening over the next few months—some are even happening now.” 2. Increase in inventory: Inventory is going to begin rising slightly for a few reasons. People who were worried about the pandemic, such as seniors and immunocompromised individuals, will begin easing into the market as vaccinations continue. More listings will appear as sellers become more comfortable, so inventory will rise and competition will calm down a bit. 3. Inflation: Inflation will occur due to government spending and relief packages, which will affect the prices of goods as well as mortgage rates. People lose buying power when mortgage rates rise, and some buyers will be pushed out of certain price points. This means the buyer pool will diminish and lead to less competition. These things will begin happening over the next few months—some are even happening now. As they occur, inventory will rise and prices will flatten out or even decrease slightly. For these reasons, now is the best time for sellers to jump into the market. If you’re ready to list your home or you have any questions, feel free to reach out to me. I look forward to hearing from you soon.

Here’s how to have a successful concurrent sale in our real estate market. Lately, a lot of clients have been wondering about doing concurrent sales—in other words, buying a new home while simultaneously selling the old one. However, many people get lost in the logistics; it means juggling two huge sales, after all. On top of this, today’s market is making things especially tricky, so it’s important to be well-prepared before trying to do a concurrent sale. Here are the five steps we usually take when helping clients buy and sell simultaneously: 1. Getting pre-approved. We want to make sure the client is approved to buy a home without first selling their current property. If the pre-approval process goes through, this is the best situation you can be in—however, it’s rare that someone is able to do this. If you get pre-approved, though, you’ll be able to write offers before even having to list your property. 2. Bridge loan. If the client can’t get pre-approved in the previous situation, we can try doing a bridge loan. In this situation, you use the equity in your current home as a down payment on your new home. This can also be tricky, however, as you must be approved for both the bridge loan and also to buy a home without first selling. This is perfect for people who can take out a new loan but don’t have the cash for a down payment. “Today’s market is making things especially tricky, so it’s important to be well-prepared before trying to do a concurrent sale.” 3. Finding somewhere to live in between. Another option to think about is living somewhere else temporarily if you sell before finding a new home. If you can, it will take a lot of pressure off of you when it comes to the timing situation. It’ll also remove the contingency that says your sale or purchase depends on you finding another home or selling your current one. 4. Short-term rental. If you can’t find a friend or family member to move in with temporarily, short-term rentals are always an option. This will allow you to sell your home and take your time when finding a new one. 5. Buy and sell traditionally. If no other options work for your situation, you may just have to do a contingent sale that says you won’t sell until you find a new home and vice versa. However, this can be a very difficult and stressful situation with today’s incredibly low inventory. It’s just hard to buy or sell a home with that contingency. If you have any questions or are thinking about making a concurrent sale in the future, feel free to reach out to me. I look forward to hearing from you soon.