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Will the Housing Market Bloom This Spring?

Spring is almost here, and many are wondering what it will bring for the housing market. Even though the pandemic continues on, it’s certain to be very different from the spring we experienced at this time last year. Here’s what a few industry experts have to say about the housing market and how it will bloom this season.

Danielle Hale, Chief Economistrealtor.com:

“Despite early weakness, we expect to see new listings grow in March and April as they traditionally do heading into spring, and last year’s extraordinarily low new listings comparison point will mean year over year gains. One other potential bright spot for would-be homebuyers, new construction, which has risen at a year over year pace of 20% or more for the last few months, will provide additional for-sale inventory relief.”

Ali Wolf, Chief Economist, Zonda:

“Some people will feel comfortable listing their home during the first half of 2021. Others will want to wait until the vaccines are widely distributed. This suggests more inventory will be for sale in late 2021 and into the spring selling season in 2022.”

Freddie Mac:

“Since reaching a low point in January, mortgage rates have risen by more than 30 basis points… However, the rise in mortgage rates over the next couple of months is likely to be more muted in comparison to the last few weeks, and we expect a strong spring sales season.”

Mark Fleming, Chief Economist, First American:

“As the housing market heads into the spring home buying season, the ongoing supply and demand imbalance all but assures more house price growth…Many find it hard to believe, but housing is actually undervalued in most markets and the gap between house-buying power and sale prices indicates there’s room for further house price growth in the months to come.”

Bottom Line

The experts are very optimistic about the housing market right now. If you pressed pause on your real estate plans over the winter, reach out to a local real estate professional to determine how you can re-engage in the homebuying process this spring.

Reposted from KCM.

Did You Outgrow Your Home in 2020?

Family in living room

It may seem hard to imagine that the home you’re in today – whether it’s your starter home or just one you’ve fallen in love with along the way – might not be your forever home.

Many needs have changed in 2020, and it’s okay to admit if your house no longer fits your lifestyle. If you’re now working remotely, facilitating virtual school, trying to exercise at home, or simply just spending more time in your own four walls, you may be bursting at the seams in your current house.

According to the latest Home Price Insights from CoreLogic, prices have appreciated 7.3% year-over-year. At the same time, the National Association of Realtors (NAR) reports that inventory has dropped 22% from one year ago.

These two statistics are directly related to one another. As inventory has decreased and demand has increased, prices have been driven up.

This is great news if you own a home and you’re thinking about selling. The equity in your house has likely risen as prices have increased. Even better is the fact that there’s a large pool of buyers out there searching for the American dream, and your home may be high on their wish list.

Bottom Line

If you think you’ve outgrown your current home, reach out to a real estate professional to discuss local market conditions and determine if now is the best time for you to sell.

Reposted from KCM.

Is Buying a Home Today a Good Financial Move?

House

 

There’s no doubt 2020 has been a challenging year. A global pandemic coupled with an economic recession has caused heartache for many. However, it has also prompted more Americans to reconsider the meaning of “home.” This quest for a place better equipped to fulfill our needs, along with record-low mortgage rates, has skyrocketed the demand for home purchases.

This increase in demand, on top of the severe shortage of homes for sale, has also caused more bidding wars and thus has home prices appreciating rather dramatically. Some, therefore, have become cautious about buying a home right now.

The truth of the matter is, even though homes have appreciated by a whopping 6.7% over the last twelve months, the cost to buy a home has actually dropped. This is largely due to mortgage rates falling by a full percentage point.

Let’s take a look at the monthly mortgage payment on a $300,000 house one year ago, and then compare it with that same home today, after it has appreciated by 6.7% to $320,100:

Compared to this time last year, you’ll actually save $87 dollars a month by purchasing that home today, which equates to over one thousand dollars a year.

But isn’t the economy still in a recession?

Yes, it is. That, however, may make it the perfect time to buy your first home or move up to a larger one. Tom Gil, a Harvard trained negotiator and real estate investor, recently explained:

“When volatile assets are facing recessions, hard assets, such as gold and real estate, thrive. Historically speaking, residential real estate has done better compared to other markets during and after recessions.”

That thought is substantiated by the fact that homeowners have 40 times the net worth of renters. Odeta Kushi, Deputy Chief Economist for First American Financial Corporation, recently said:

“Despite the risk of volatility in the housing market, numerous studies have demonstrated that homeownership leads to greater wealth accumulation when compared with renting. Renters don’t capture the wealth generated by house price appreciation, nor do they benefit from the equity gains generated by monthly mortgage payments, which become a form of forced savings for homeowners.”

Bottom Line

With home prices still increasing and mortgage rates perhaps poised to begin rising as well, buying your first home, or moving up to a home that better fits your current needs, likely makes a ton of sense.

(Reposted from KCM.)

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How Is Remote Work Changing Homebuyer Needs?

Woman in Home Office

With more companies figuring out how to efficiently and effectively enable their employees to work remotely (and for longer than most of us initially expected), homeowners throughout the country are re-evaluating their needs. Do I still need to live close to my company’s office building? Do I need a larger home with more office space? Would making a move to the suburbs make more sense for my family? All of these questions are on the table for many Americans as we ride the wave of the current health crisis and consider evolving homeownership needs.

According to George RatiuSenior Economist for realtor.com:

“The ability to work remotely is expanding home shoppers’ geographic options and driving their motivation to buy, even if it means a longer commute, at least in the short term…Although it’s too early to tell what long-term impact the COVID-era of remote work will have on housing, it’s clear that the pandemic is shaping how people live and work under the same roof.” 

Working remotely is definitely changing how Americans spend their time at home, and also how they use their available square footage. Homeowners aren’t just looking for a room for a home office, either. The desire to have a home gym, an updated kitchen, and more space in general – indoor and outdoor – are all key factors motivating some buyers to change their home search parameters.

A recent realtor.com-HarrisX survey indicates:

“In a June poll of 2,000 potential home shoppers who indicated plans to make a purchase in the next year, 63% of those currently working from home stated their potential purchase was a result of their ability to work remotely, while nearly 40% [of] that number expected to purchase a home within four to six months and 13% said changes related to pandemic fueled their interest in buying a new home.

Clearly, Americans are thinking differently about homeownership today, and through a new lens. The National Association of Home Builders (NAHB) notes:

“New single-family home sales jumped in June, as housing demand was supported by low interest rates, a renewed consumer focus on the importance of housing, and rising demand in lower-density markets like suburbs and exurbs.”

Through these challenging times, you may have found your home becoming your office, your children’s classroom, your workout facility, and your family’s safe haven. This has quickly shifted what home truly means to many American families. More than ever, having a place to focus on professional productivity while many competing priorities (and distractions!) are knocking on your door is challenging homeowners to get creative, use space wisely, and ultimately find a place where all of these essential needs can realistically be met. In many cases, a new home is the best option.

In today’s real estate market, making a move while mortgage rates are hovering at historic lows may enable you to purchase more home for your money, just when you and your family need it most.

Bottom Line

If your personal and professional needs have changed and you’re ready to accommodate all of your family’s competing priorities, reach out to a local real estate professional today. Making a move into a larger home may be exactly what you need to set your family up for optimal long-term success.

(Reposted from KCM.)

New Practices in the Time of Covid-19

Due to the spread of Covid-19, Delap Real Estate has cancelled office hours until further notice. During this time, our agents will be working remotely and will continue to provide a high level of service to our clients while staying committed to everyone’s health and safety. We have provided some basic information below, and encourage you to contact us with any questions. Our agents’ phone numbers and email addresses are available here.

Open Houses

In accordance with state and federal guidelines limiting group gatherings, we are not scheduling open houses at this time.

Social DistancingShowings

We are still showing properties both virtually (through FaceTime/video tours) and in person. For in-person showings, our agents will wash/sanitize their hands before and after entering the property, keep at least 6 feet of distance from others, and will ask prospective buyers do the same. Agents will open bathroom, closet, and other doors in advance, so that prospective buyers not need to touch anything as they move through the space.

Appointments

We will be happy to “meet” with you by video or phone conference, and spend as much time as necessary to develop a plan to find your dream home—or get your property on the market. We are also available to meet in person, using the same safety measures described above for showings.

Everything Else

Whether you are in the middle of a closing, just embarking on a house search, or looking to put your property on the market, we know that many questions are likely to arise. Please feel free to contact us about any aspect of your current or future real estate endeavors. We will do our best to supply the information and resources you need to move forward now or formulate a plan for later.

As of today, everyone at Delap is healthy. We will continue to exercise an abundance of caution to preserve the health of our agents, clients, and the community at large. We are sending good wishes to all of you and your families in this difficult time. Please stay safe—and practice as much social distancing as you possibly can. We will do the same!

It's the Time of the Season for … Hygge

Cozy reading nook on couch with lamp and bookshelvesEight Tips for Adding Warmth and Coziness to Your Home

With Thanksgiving behind us and a fresh blanket of snow on the ground here in the Pioneer Valley, it feels like time to settle in by the fire, curl up with a good book, pour a cup of tea and luxuriate in the coziness of home. The Danish call this feeling of coziness hygge (pronounced h(y)oo), which the Oxford Dictionary defines as “a quality of coziness and comfortable conviviality that engenders a feeling of contentment or well-being.”

There are parts of our homes that tend to spark feelings of coziness naturally; A breakfast nook with the morning sun slanting in, a comfy couch with a blanket draped over the back, or any spot near a fireplace. If your home contains these things, congratulations—hygge slam dunk! But if not, never fear. There are plenty of other ways to infuse your house with a feeling of warmth and comfort this winter.

Boost your home’s coziness factor by adding any of these elements:

  1. Rugs. Not only are they kind to your feet on chilly winter mornings, rugs can really soften the vibe of a room and create defined and inviting areas within a larger space.
  2. Blankets and throws. They’re great for warmth, of course, but also for adding a touch of softness to more modern, angular furniture.
  3. Pillows. Well…what’s cozier than a pillow?
  4. Plants, flowers, or fruit. Anything organic, really—even a piece of beautiful driftwood—will bring softness and a sense of comfort to a room.
  5. Texture. Whether achieved through fabrics, prints, or objects with different surfaces, texture can make a space feel more inviting.  
  6. Books. Stacks of them. Preferably somewhere near an overstuffed chair and a reading lamp.
  7. Soft, warm light. So break out those candles, fairy lights, or Edison bulbs for an instant feeling of warmth and comfort.
  8. Good smells. Whether its from bread baking in the oven or a woodsy-scented candle, the right smell will trigger a sense of “home” like nothing else.

 

Mortgage Rates Drop to 2-Year Lows

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Good news for homebuyers: The June 6th results of Freddie Mac’s Primary Mortgage Market Survey® (PMMS®) show that the 30-year fixed-rate mortgage rate has fallen to 3.82 percent, the lowest level since September 2017, and these rates are holding this week.  If you are considering buying, now is the time to take advantage of these low rates.

Freddie Mac Primary Mortgage Market Survey

Sam Khater, Freddie Mac’s chief economist, says, “While the drop in mortgage rates is a good opportunity for consumers to save on their mortgage payment, our research indicates that there can be a wide dispersion among mortgage rate offers. By shopping around and getting a single additional mortgage rate quote, a borrower can save an average of $1,500.”

  • 30-year fixed-rate mortgage (FRM) averaged 3.82 percent with an average 0.5 point for the week ending June 6, 2019, down from last week when it averaged 3.99 percent. A year ago at this time, the 30-year FRM averaged 4.54 percent. 
  • 15-year FRM averaged 3.28 percent with an average 0.5 point, down from last week when it averaged 3.46 percent. A year ago at this time, the 15-year FRM averaged 4.01 percent. 
  • 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.52 percent with an average 0.4 point, down from last week when it averaged 3.60 percent. A year ago at this time, the 5-year ARM averaged 3.74 percent.

Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Borrowers may still pay closing costs which are not included in the survey.  

Source: Freddie Mac

If you have any questions about the local market, or if you're thinking about buying a home in the Greater Amherst and Northampton Area, contact Delap Real Estate.

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Help for First Time Homebuyers

Do you think that a home of your own is beyond your reach?  Many potential home buyers are unaware that there are resources that can assist in making the dream of owning a home a reality. Valley Community Development (Valley CDC)  is an amazing organization right here in Western Massachusetts.  Their team has guided scores of people through their home buying experience.

Valley Community Development

The Valley CDC offers First Time Homebuyer workshops every month at a different location, rotating between Easthampton, Northampton, & Amherst. Each workshop series meets 4 times, once per week, from 6 p.m. – 9:00 p.m. Classes are always held on weekday evenings. The workshops are open to anyone, regardless of where you live or work, or whether or not you are a First Time Homebuyer. Topics including budgeting, home inspections, closing procedures and more are covered. See the workshop schedule here. And of course, we at Delap are here for you and always delighted to help! If you are not yet in the market, or just starting out, or have questions-stop by our office, give us a call, or contact us by email. We can begin the journey with you to find a new home. It is nearer than you think!

 

Home Buyers

 

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Win the Bidding War and Get the House You Want

By Holly Young, Co-Owner

Shopping for a home can be fun and rewarding as well as frustrating and discouraging. Finding the home you love only to have your offer edged out by another buyer can be heartbreaking, but in this market it’s almost a rite of passage. In a hot market, where the supply of homes is low and the demand high, you may find yourself in a bidding war with multiple offers.

Here are 6 tips to making a winning offer:

Buying a Home

1. Include a preapproval letter with your offer

Don’t prohibit a seller from taking your offer seriously by not including a preapproval letter or proof of funds (in the case of a cash offer). The seller will be assured of your financial viability with a letter from your lender that corroborates your ability to make a purchase. Getting preapproved before looking at homes will ensure you can pounce quickly when you find the home you want. You will also avoid the stress of submitting preapproval paperwork and writing an offer at the same time.

2. Make a clean offer

Put yourself in the seller’s position: if you were presented with two identical offers but one was firm and binding and the other conditional upon inspection, upon financing, or upon anything, which one would you choose? Sellers want offers that are clean and concise. If you know other bids are coming in and you really want a home, avoid putting in too many contingencies or making too many demands. That being said, one contingency you should think twice about before waiving is the home inspection. Should the inspector discover a major problem at the home, you may want to protect your right to back out of the purchase.

3. Have the best terms

In a bidding war situation, the seller is reviewing more than one offer to determine which the best fit is for them. The terms of the offer, not just the price, may determine which offer they choose. A good agent will give you the edge by finding out what the seller’s desired close date is so you can marry your offer to that date. A sizable deposit may also help sweeten the impression of your offer over another. If it comes down to a few thousand dollars, an offer with more attractive terms may win the day.

4. Write a letter to the seller

While this won’t overcome a large difference in your bidding price, it will definitely help at the margin. Let the seller know who you are and why you love their house. A heartfelt and sincere letter that includes a picture of yourselves, children, or pets will make you stand out as more than just a number on a page and build rapport with the seller.

5. Use an escalation clause

An escalation clause is a term in an offer that states you will pay x price for the home, but if the seller receives another offer that's higher, you will increase the offer by some increment up to y price. In theory, an escalation clause is fairly simple. In practice, there are a lot of details involved, especially if there are two or more offers submitted that contain escalation clauses. Some sellers don’t like escalation clauses and prefer that buyers submit exactly what they're willing to pay. Your agent can find out whether an escalation clause will be favorably received.

6. Work with an agent who knows the market

Working with a real estate professional who is an expert in the market is crucial in a multiple offer situation. There are countless strategies and details that an experienced agent can navigate to give you the competitive edge. That edge may determine whether you will be on the winning or losing end of a bidding war.

Are you thinking about buying a home in the Pioneer Valley of Massachusetts? Contact Delap Real Estate or start your home search today!

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