Renting a Home is Getting More Expensive

Many people assume that renting is always going to be cheaper than buying a house. Mostly, this is because of the upfront costs associated with buying. Having to come up with closing costs and a down payment, in addition to taking on a monthly mortgage payment can be intimidating for someone who wants to buy but feels it’ll be easier and more affordable to rent.

New data shows this is particularly true right now and it’s driving up the costs of renting a single-family home. Dr. Svenja Gudell, Zillow’s chief economist, says the current environment is causing the increase. “Those who want to buy are finding it difficult to find the right one, or may need a bit more time to come up with a down payment, but still want the advantage of space that single-family residences often provide,” Gudell said. “This, coupled with the foreclosure crisis turning millions of homeowners into renters, is a big reason why demand for single-family rental homes has risen over the last few years.”

What this means is that, if you hope to buy but aren’t sure you’re ready, it’s important to research your options. In many markets, buying is still more affordable than renting, and may be especially so if you’re looking to rent a single-family home rather than an apartment.

 

 

This advertisement was provided by Jennifer Bixby, the broker for Don Peterson and Associates Real Estate, 100 E 6th St. Jennifer can be reached at 402-721-9700 for answers to questions regarding your real estate needs.

Cash Sales Are A Sign Of A Competitive Market

Most people don’t buy their house with cash. In fact, historically cash sales account for just 10 percent of all home sales. But, according to Freddie Mac’s most recent monthly outlook, the fact that the number of homes for sale remains lower than normal has caused a higher than normal number of cash sales.

“Usually, not many people like to invest a lot of cash into real estate, which is illiquid and has high transaction costs,” Freddie Mac’s chief economist, Sean Becketti, says. “However, in the current, highly competitive housing market, a cash offer is an effective way to gain an advantage over other bidders.” Still, cash sales are well below their peak of 35 percent, with a share closer to 18 percent according to the most recent data.

Overall, Freddie Mac expects mortgage rates to remain low through the end of the year and home sales to surpass last year’s numbers. However, low inventory remains an issue. The outlook says home sales would have been much higher if not for the fact that many markets have fewer homes for sale than is typical. Locally here in Fremont, we are still experiencing a lower than average number of homes for sale. If you are considering a change, it’s still a great time to sell!

 

This advertisement was provided by Jennifer Bixby, the broker for Don Peterson and Associates Real Estate, 100 E 6th St. Jennifer can be reached at 402-721-9700 for answers to questions regarding your real estate needs.

Is Buying a Home Still an Affordable Choice?

These days, determining the affordability of buying a home isn’t such a simple calculation. There are always a lot of variables to consider – including prices, mortgage rates, wages, and local factors – but today’s housing market contains a number of contradictions that may make it even more difficult for potential buyers to figure out.

For example, home prices have recently been making a lot of news, mostly because they’ve regained much or all of the value lost following the housing crash. At the same time, though, mortgage rates have remained just above historic lows for the past several years. In other words, if you live in an area where home prices have been slower to rebound, low mortgage rates likely mean homes are still a good deal in your neighborhood. On the other hand, in some areas – where home prices have pushed beyond previous highs and low inventory is limiting available choices – favorable mortgage rates make less of an impact.

Here in Fremont buying is affordable for the average household, though challenges remain. Thanks to very low mortgage rates, monthly mortgage payments are affordable for the average household despite currently high house prices. Nevertheless, hurdles to homeownership arise from the difficulty of finding a house.

 

This advertisement was provided by Jennifer Bixby, of the Bixby & Sorensen Team and the broker for Don Peterson and Associates Real Estate, 100 E 6th St. Jennifer can be reached at 402-721-9700 for answers to questions regarding your real estate needs.

INTEREST RATE MATTERS

With the recent rise in mortgage rates, many Americans who were thinking of  buying a home this year may be feeling concerned about how much house they’ll be able to afford. If that describes you, there are a couple of things to remember. First off, even though rates have moved higher over the past several weeks, they still remain low by historical standards. In other words, you’re still getting a better rate than you would have 10 or 15 years ago and locking it in now with a fixed-rate mortgage means you’ll be protected should they move closer toward their historical norm in the future. There are also things you can do to ensure that, when you apply for a loan, you are getting the best rate possible.

Number one on that list is doing whatever you can to raise your credit score. Your credit history plays a large role in determining the rate you will end up paying. So it is always a good idea to check your score before beginning the buying process. If possible, fix any errors, pay down any debts, and – as always – make sure to pay your bills on time each month. Though you don’t have to have perfect credit to be qualified for a loan, the higher your score, the better.

 

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This content is provided by Jennifer Bixby, the broker for Don Peterson and Associates Real Estate, 100 E. 6th St.  Jennifer can be reached at 402-721-9700 for answers to questions regarding real estate.