Monday, February 6, 2017

What to Do If You Buy (or Sell) A House in 2017

The Headlines:

If you're going to buy a house this year...

Or sell this year.

Read this first.

Many of you know I love houses.  Buying, selling, decorating and remodeling houses is something I love to do.  It really became my passion while I was still working as a journalist in the Phoenix, Arizona market.  Because of that, many years ago I got my Real Estate License.  I've used it over the years for home sales and property management.  But now I want to do more.  In the past month I've met with and discussed Real Estate with Industry professionals and here are my 5 biggest take aways.

1 - Know What You Want
This is the first issue.  It's a simple one.  The most fun one.  What do you want to buy?  Make a list.  How many bedrooms, bathrooms, garage spaces?  Your Realtor will want to know specifics.  What's important to you?  Mountain view.  Kitchen Island.  Dining Room.  Where do you want to live?  Particular Subdivision, zip code or city.  Then finally, what are you deal breakers?  Busy road, no pool, grass you have to maintain.

Same goes with selling.  What do you have to do/spend to get your home ready?  What do you need to make for it to be worthwhile?  How many homes are for sale in your zip code?  Not many... that's good for a sale.  Not a lot of inventory = higher sale price.   Sure, your Realtor can help out with some of this, but do your own investigating first to be more informed.

Write things down and communicate them with your Realtor.  Home buying and selling is time consuming.  But it won't be as bad if you know exactly what you need and want.

2 - Buy What You're Comfortable with... NOT What You can Afford 
These are 2 different things.  You may make $4,000 a month but you can't spend $3500 on your mortgage.  Your Loan Officer will help you decide what you'll be comfortable with paying.  It's typically about 40-45% of your gross income.  And that's being generous.  YOU need to honestly evaluate your lifestyle and that will help you choose the price range for the house you can buy.

3- Interview Your Realtor and Loan Officer to Find the Right one FOR YOU.
There's a difference between Mortgage Brokers/Bankers/Banks. The first two more or less shops your mortgage around to get the right deal for you.  The latter has their bank wheelhouse to shop in.  Which one is better?  That depends on your specific situation.  Get recommendations from friends to get contacts.  Then talk to them about your options.  If they want your business, and they should, they'll tell you what you need to know to make the right decision.

Realtors are a dime a dozen.  You ever notice that?  In Los Angeles, where I went to college, every where you turned there were actors.  In Phoenix, it seems like everyone's a Realtor.  So, find the one that fits your needs.  That does NOT mean the one whose wearing the shiniest watch, the guy at the biggest brokerage or the person who's going to sell your house at the price you think it should be.   It  means you need to find the Realtor who will be honest, work the hardest and have your best interest at heart.  Greed isn't always good in Real Estate.

4 - Ask Questions
I firmly believe, there is no dumb question.  Well, almost never.  That's what years of asking questions has taught me.  Trust me, you'll feel a lot more dumb if you don't get the answers you need.  Realtors and Loan Officers are here to help.  They may not know everything but, if they're good, they'll find the answers.

I talked to a gal the other day who firmly believed you needed 20% down to buy a house.  NOT TRUE, I said!  With Conventional loans these days, many are only putting down 10%, sometimes 5%.  An FHA loan only requires 3.5%.  And in some locations, like Metro Phoenix, there are programs where they COVER your down payment.  Meaning, you pay nothing.   For instance, the "Home In 5" Program.  Those making $88k or less a year can qualify to buy homes in certain designated areas.  As long as you meet the requirements, the right mortgage broker can help you get into something you may never have known existed.

You just need to ASK!

5 - Take Your Time (but not too much)
There's no crystal ball but people believe 2017 will be a banner year for Real Estate.  Mortgage rates will stay fairly steady... and while that may not be what drives people to purchase homes, this will.  Like him or hate him, with the newly elected President Trump in office, there's a general feeling of positivity in the economic department.  And many believe, the economy drives home sales, not rates.  With more jobs, less taxes, better business on the horizon - things are changing.  Regardless of people rioting, boycotting, saying the same sentence for 4 years in a row.  Seriously.  Actor Shia LaBeouf really tried to do this, until he got arrested outside the NY Museum in late January.

In 2017, people will want to buy their first home, move up or invest.  And that's good for real estate!

Who knows what 2018 will bring.

Finally tonight,  to write this post I met with 3 Loan/Mortgage professionals.  They know their stuff, word hard and are full of good information.  Not to mention, they're all guys I actively refer people to and trust with my own dollars.  If you're in the market to buy a home and need some help getting started, give them a call, their info is below and in no particular order.

Happy Housing!

Erik Goldenson
KS State Bank

Tom Maison

Greg Halvorson

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