Ringing in the New Year with New Goals

Happy New Year everyone (a couple days early)! We're almost ready to say good-bye to 2017 and usher in 2018 with a warm welcome. We hope you enjoyed a wonderful holiday and are as ready as we are to make 2018 the best year yet. We have so enjoyed a busy few weeks filled with festive gatherings, delicious meals, gifts, and a little work too! The cooperative winter weather (no snow/ice yet but goodness has it been cold this week), plus a busy local market set the stage for a fabulous December for ERA First Advantage agents. We have loved getting out and about with clients who were in town not only to celebrate the holidays, but also to find their new home. We have not missed a beat as our agents hosted busy open houses and continued listing properties. Real Estate never sleeps and we like it that way!

Our offices have been buzzing with such energy as we prepare to start the new year, so we decided to share some intentions for this fresh start. We all take time to make goals, and action plans to better ourselves and our business, and we encourage you to do a bit of the same whether personally or professionally. The following notes are just a few aspects of our business that we will be focused on in 2018 -- always improving and growing to meet the needs of our clients!

1. Attend agent training and conferences to better our business and bring the latest and greatest real estate knowledge back to the Tri-State. Our top priority is being the best in our field, and that means continuing education as much as possible because the real estate business is always evolving.

2. Continue to do volunteer work in the community. Our agents serve on many committees and boards for deserving non-profits, and everyone is ready to continue their involvement and of course try to do even more this year to help those in need.

3. Use our available technology to make the home buying and selling process as easy as possible for our clients. There is so much we can do digitally now, and we can get the deal done much quicker for the families we work for. We will also focus on learning and utilizing new technology that becomes available, including social media because it is clearly part of life now!

4. Cultivate lasting relationships with our clients. We know a real estate transaction is business, but as we've talked about many times, buying or selling a home is deeply personal and we really get to know the families we work with. We want to focus on staying in touch with all of you to see how things are going weeks, months, and even years after your big move.

What are some intentions or goals you're setting for yourself for the year? We'd love to hear all about them! And, if you're planning to buy or sell, check out this article for some "real estate resolutions"!

We hope you all have a happy & safe New Year's celebration! Cheers to 2018!

Home Financing Options You Might Not Know About

Today’s post is a little more business, and a little less "festive" than the past few have been. With the joyous holiday season also comes the promise of a new year and a fresh start. Many people around the Tri-State start to make plans for the upcoming year after the holidays conclude, and those plans often include a move. You will feel so much more empowered and confident buying or selling a home when you put your money matters first. So, today I'd like to share some general information about a few home loans that are not as commonly used or well-known. In fact, before my research for this piece, I had only seen their definitions in real estate licensing course work. 

The Jumbo Loan

If a borrower is requesting a loan amount that exceeds the mortgage industry’s conventional mortgage cap, the Jumbo Loan is a good option. Typically, this type of financing is secured to purchase a home above $500,000. The conventional mortgage is currently at $424,100 (it is reviewed and adjusted each year), so if a borrower needs to borrow more than that amount to purchase a home, he or she would need to look into a Jumbo Loan. At this level of lending, terms of the loan tend to be a bit more stringent because the lender is taking a higher risk in loaning a high amount of money, plus these loans are not secured by Fannie Mae or Freddie Mac. A Jumbo Loan usually requires at least a 5% higher down payment than a conventional loan, so borrowers should expect to have a down payment of 10%-25% depending on lender requirements. Additionally, a Jumbo Loan carries a higher interest rate, sometimes up to 1.5% higher than conventional rates. While that doesn’t seem like much, it can change the monthly mortgage payments on a $500,000 loan quite a lot, so be sure to work through your numbers carefully before committing.

The Bridge Loan

I have encountered many clients who have difficulty understanding the idea of a Bridge Loan. If you think about it as literally “bridging the gap” between financing options, that might help. The Bridge Loan is utilized while a person or company secures a permanent financing option or removes an existing financial obligation like an existing mortgage. For example, if a family finds a new home they want to purchase before they sell their current property, they can apply for a Bridge Loan to secure immediate cash flow. These loans are short term (typically one year) and have high interest rates compared to other types of loans. They also must be backed by some type of collateral such as a piece of real estate. Lenders require these additional guidelines because they are taking a risk in loaning to a borrower taking on two mortgages; they are just trying to protect their interests should the borrower lag in payments or default.  If you’re very well-established financially, this is a fantastic short-term option in many situations. Just be sure you have excellent credit, and a low debt-to-income ratio. Another consideration? A Bridge Loan only covers up to 80% of the combined value of the two properties, so it is in your best interest to build up significant equity and a well-padded savings account before securing this type of loan. Talk at length with your loan officer about this lending option.

The Balloon Loan

At first glance, the Balloon Loan looks very similar to a 30-year fixed rate loan. Interest rates remain low, comparatively speaking, as well. The monthly mortgage payments are calculated the same way, but after a period of five to seven years, the outstanding balance of the loan must be paid in full. That means low initial payments, but at the end of the term of the loan, a borrower could owe tens or hundreds of thousands of dollars. Who would ever apply for that type of financing? Well, if a buyer is incredibly self-disciplined and ready to make that large payoff payment at the end of the loan period, their mortgage is paid off and they own the home. While that scenario happens on occasion, a more likely setting involves a borrower using this loan when he or she anticipates a major cash flow, like an inheritance, stock cash out, or another sale of some magnitude. Generally, if someone secures a Balloon Loan, he or she can validate that a large sum of money is imminent, but if that doesn’t happen, some Balloon Loans carry the option to refinance at the end of the term. Just remember that refinancing does require some investment and closing costs. 

The mortgage process does not have to be overwhelming or scary with a little self-educating and the right local loan officer. Your ERA First Advantage agent can certainly help you with that! If you’re working through the preapproval process, best of luck and enjoy shopping for your new home sweet home!

Space Planning in a New Home

Walking into a new home for the first time can feel like heading into a foreign land. You love the home, or you wouldn’t have bought it, but it can still be a bit strange and unfamiliar. Where will everything go? How will you arrange each room? Will your furniture and décor look “right” in this new place? As agents, we understand these feelings. In fact, for your resident blogger, these exact thoughts have been on my mind for weeks as we look for our new house. If you'll indulge me this week, I'm going to write from a little more personal perspective because a move, and your "stuff" that goes with it, is...well...personal.

I assumed that a lot of other people have shared these feelings and asked themselves the same questions during a move, so thought I would share the ways I am preparing and planning, so our new space feels like home. I should also disclose that I am fighting the strong urge to get rid of most of our stuff and buy all new furniture to fit the new house. As tempting as it is, I’m not going to overhaul just yet and I’ll tell you why.

The first piece of advice I have is to walk through the house as much as possible. Once you decide it’s the one, carefully stroll through and try to envision how you will live in the house. How will you use each room? Where will large pieces of furniture fit and where will conveniences like TVs be hung or set up? Once you decide those basic elements, I recommend getting a bit more specific in your plans, meaning furniture placement and finally decor and finishing touches.

I like to see things laid out before I arrange a room, so I always sketch how I want furniture and important decorative pieces to be placed. I highly suggest trying this strategy before a move. Measure each room to be sure your pieces will fit, and then roughly draw the space including windows, doorways, and closets. You can look at your rooms with fresh eyes each day and change as you see fit. This strategy helped me realize we do not need to get a new entertainment center to replace the loss of our built-ins. I plan to use a buffet from our current dining room and open shelving to accomplish the same purpose. Allow yourself to be creative and consider multiple uses for your favorite pieces.

That thought leads me to discuss fighting the urge to buy all new stuff. Don’t get me wrong – I would love a fresh look for the new house, but that needs to wait. First, see what you can work out with existing pieces. Don’t buy without a plan. I know we will invest in a few key pieces down the road, but at first I really encourage editing what you already own and determine whether it will work long-term. Give yourself three months or so to get settled and decide whether you like your current room arrangements. At that point, if you feel like new items are the way to go, then you’ll be confident that you’re not just buying for the sake of buying. You’ll be investing in things that will create comfort and ease in your new home.

Another strategy I have embraced is cutting the clutter. This is critical whether you’re downsizing or upgrading. I am donating or selling items we don’t need or no longer love. In our next house, I want to be surrounded only by things we use, need, and love. Those old guest room dressers that were hand-me-downs? Gone. The ugly old chair my husband has had since college? Bye-bye. This is a chance for a fresh start, so embrace the opportunity to let go. Weeding out things that tend to just take up space will also help you take inventory of what you have and brainstorm how it can be used in your new house. It’s also incredibly liberating to be able to let go of stuff and have faith that you will be fine without it.

Finally, the strategy I am still working on myself is giving yourself a little grace and a little credit. Moving is hard and stressful, even when it is an exciting change. There is a lot to do and a lot to think about during the moving process, so please don’t worry about creating a magazine-worthy space within weeks of moving. In time, as you become settled and acquainted with your home, you’ll figure out what works, what doesn’t, and make changes accordingly. If you’re anything like me, it’s likely you’ll still be rearranging and adjusting your rooms several years after moving in, and that is quite alright!

Real Estate During the Holidays

Welcome back, everyone! Who else has had a busy couple weeks now that we are in the midst of the Christmas season? Like our ERA First family, you're likely staying very busy shopping, attending holiday gatherings and programs, decorating, cooking, and volunteering during this festive season. In addition to our holiday activities, we are staying busy around the office with clients who are buying and selling this season.

In the past, the holiday season (Thanksgiving through January) has been considered an unpopular time for many people to buy or sell a home. However, in the past five years or so, we have seen quite an increase in transactions during this time. It's not as busy as spring and summer was as the market has slowed a bit, but we are pleased to share that our wonderful clients are keeping us busy and jolly right through the holidays. We know people need to move 12 months out of the year, and typically the ones who are selling or buying right now truly need to do so for a variety of reasons.

If you're thinking of testing the waters and feel like you're ready to put your home on the market, we would like to share these helpful tips for you!

1. Go ahead and decorate for the holidays, but don't go overboard. Homes look so warm and cozy this time of year with the tree, garland, cheerful snowmen, etc, so you have the opportunity to showcase that as a selling point. However, don't put out so much extra holiday decor that it distracts from the features of the home that are lovely year round.

2. Hire a reliable, ambitious agent. There is definitely some truth to the notion that there are fewer buyers this time of year, as we noted earlier in the post, so your ERA First agent might have to network a bit and utilize some creative marketing to find the right buyer. You definitely want your agent to be willing to work for you!+++

3. Price the home to sell. This is another big perk of hiring the right agent. Be sure he or she does a comparative market analysis and be very realistic in your pricing. If your house is priced competitively, you won't need to do a bunch of little price reductions (which we know is frustrating for sellers!).

4. Ramp up your curb appeal. This time of year, we do not have the advantage of free-flowing greenery and leafy trees, nor can we put out potted flowers and showcase a lush, green yard. That's just not what winter in the Tri-State looks like! So our recommendation is to do all you can do make sure your home looks as great as possible and is as clean and spruced up as possible. A tasteful winter wreath, some potted evergreens or other hardy plants, plus a little garland make a very nice impression.

5. Create a cozy atmosphere. In addition to holiday decor, make your home feel as inviting as possible for showings and open houses. Light candles, turn on the fireplace, put out freshly baked goodies, place a nice blanket on the couch or a chair, and have some pleasant music playing when potential buyers come through. Make them feel like they could just curl up and stay awhile!

6. Be prepared to negotiate with motivated buyers. Like we mentioned, buyers who are looking at houses during the holidays need to find a home, sometimes quite quickly. Maybe they've been transferred for work or want to move closer to family, but they are likely moving out of necessity and potentially have a deadline, so be ready to work with them when an offer comes through.

7. Be flexible. Peoples' hours of availability vary during the holiday season because they are off work or only in town for a couple days. If you don't get your preferred notice before a showing or have a request for a showing a little earlier or later than usual, try to accommodate. It's likely those buyers are devoting an entire day to house hunting and might be pressed for time. Let them see your beautiful home -- it just might lead to an offer!

Please let us know if we can do anything to assist you with your winter real estate questions and decisions. ERA First Advantage agents are always very willing to take calls and answer emails throughout the holidays and will be happy to work with you and your schedule!