Roderick Mann’s Post

A Newly Built Home May Actually Be More Budget-Friendly!!! If you’re in the market to buy a home, there’s some exciting news for you. Many people assume that newly built homes are more expensive than existing ones (houses that have already been lived in), but that’s not always the case. In fact, exploring newly built homes can sometimes lead to more cost-effective options, especially today. Hard to believe, right? But the data doesn’t lie. Here are two key reasons working with your agent to look into new home construction could help you find a more budget-friendly option. Reason 1: Lower Median Prices for Newly Built Homes The median sales price for newly built homes is lower than the median sales price for existing homes today. This might seem surprising, but it’s true according to the latest data from the Census and the National Association of Realtors (NAR): Why is that? Builders are focused on building what they can sell. And right now, there’s a very real need for smaller and more affordable homes – so that’s what they’ve been bringing to the market. At the same time, there are also more newly built homes already on the market than there have been over the past few years, so builders are motivated to make sure they’re selling what they’ve got available before adding more. Reason 2: Attractive Incentives from Home Builders Another big reason to consider a newly built home is the range of incentives that many home builders are offering. Again, since builders are aiming to sell their current inventory, some are providing special deals to sweeten the pot for homebuyers. HousingWire explains today’s trend: “Overall, the usage of sales incentives was up to 61% in June, compared to 59% in May.” One of the most appealing incentives right now is how builders are able to offer competitive mortgage rates. They may also provide other incentives, such as covering closing costs, or offering free upgrades. Why This Matters to You... Considering a newly built home could open up opportunities you hadn’t thought of before. With competitive pricing and attractive incentives, you might just find that a brand-new home is the most appealing option for you. Bottom Line Buying a home is a big decision, and it’s essential to consider all your options. By looking into newly built homes, you might find a perfect fit for your needs and your budget. Let’s explore the possibilities together. If you have any questions or want to see what’s available, feel free to reach out today @ 630-881-8655 #justcallwilliam

How Rising Costs Affect Home Affordability NAHB recently updated its 2024 priced out estimates, showing how higher prices and interest rates affect housing affordability. The new estimates show that affordability is a serious problem even before any further price or interest rate increases. Already in 2024, 103.5 million households are not able to afford a median priced new home ($495,750). This is because their incomes are insufficient to qualify for the required mortgage under standard underwriting criteria. If the median new home price goes up by $1,000, an additional 106,031 households would be priced out of the market. The underwriting criterion used to determine affordability is that the sum of mortgage payments, property taxes, homeowners and private mortgage insurance premiums (PITI) during the first year is no more than 28 percent of the household’s income. Key assumptions include a 10% down payment, a 30-year fixed rate mortgage at an interest rate of 6.5%, and an annual premium starting at 73 basis points for private mortgage insurance. The 2024 priced-out estimates for all states and the District of Columbia and over 300 metropolitan statistical areas are shown in the map below. This map shows detailed information, including the projected 2024 median new home price estimates and the minimum income to secure a mortgage, and the percentage of households unable to afford the new homes. It also shows how a $1,000 increase in price could impact the number of households. Vermont stands out as the state with the highest share of households unable to afford the median-priced new home before any price changes, with approximately 92% of its households falling short on the income needed for a mortgage to buy a median-priced new home. Connecticut and Hawaii follow closely, with 89% and 88.5% of households respectively, facing similar affordability challenges for new homes at the median prices. On the other hand, Virginia is the state with much better affordability, where the median new home price is $462,000, however, around 66% of households still find these new homes unaffordable. San Jose-Sunnyvale-Santa Clara metro area in California stands out due to its exceptionally high median new home price of $1,685,593, requiring a minimum household income of $487,773. This makes it the metro area with the highest percentage of households unable to afford the median-priced new homes. In contrast, the Washington, DC metro area presents a more accessible market, where around 37% households are capable of purchasing new median-priced homes. This indicates a relatively higher level of affordability compared to San Jose metro area.

A Newly Built Home May Actually Be More Budget-Friendly! If you’re in the market to buy a home, there’s some exciting news for you. Many people assume that newly built homes are more expensive than existing ones (houses that have already been lived in), but that’s not always the case. In fact, exploring newly built homes can sometimes lead to more cost-effective options, especially today. Hard to believe, right? But the data doesn’t lie. Here are two key reasons working with your agent to look into new home construction could help you find a more budget-friendly option. Reason 1: Lower Median Prices for Newly Built Homes The median sales price for newly built homes is lower than the median sales price for existing homes today. This might seem surprising, but it’s true according to the latest data from the Census and the National Association of Realtors (NAR) - See graph. Why is that? Builders are focused on building what they can sell. And right now, there’s a very real need for smaller and more affordable homes – so that’s what they’ve been bringing to the market. At the same time, there are also more newly built homes already on the market than there have been over the past few years, so builders are motivated to make sure they’re selling what they’ve got available before adding more. Reason 2: Attractive Incentives from Home Builders Another big reason to consider a newly built home is the range of incentives that many home builders are offering. Again, since builders are aiming to sell their current inventory, some are providing special deals to sweeten the pot for homebuyers. HousingWire explains today’s trend: “Overall, the usage of sales incentives was up to 61% in June, compared to 59% in May.” One of the most appealing incentives right now is how builders are able to offer competitive mortgage rates. They may also provide other incentives, such as covering closing costs, or offering free upgrades. Why This Matters to You Considering a newly built home could open up opportunities you hadn’t thought of before. With competitive pricing and attractive incentives, you might just find that a brand-new home is the most appealing option for you. Bottom Line Buying a home is a big decision, and it’s essential to consider all your options. By looking into newly built homes, you might find a perfect fit for your needs and your budget. Let’s explore the possibilities together. If you have any questions or want to see what’s available, reach out to us! ☎(305) 904-9066

While buying a house is already expensive, high price tags don't simply end after closing. That's the story of Alex Marrero, 33, who bought his first home with his wife in Florida this spring. Up until June, the couple has already spent almost $17,000 in back-to-back maintenance projects and repairs. And he's not alone: Roughly 1 in 5 of homeowners found the cost of home improvement projects to be the most surprising element in the first six months of homeownership, according to a new report by Angi. According to a separate report, annual "hidden costs" of homeownership can tally over $18,000 on average in the U.S., Bankrate found. “It’s just important to understand that you’re buying a lot more than a mortgage payment,” said Jeff Ostrowski, an analyst at Bankrate. “You’re also buying all these additional costs that you’re gonna have to figure out how to pay for.” While owning a home can sound like a dream come true, make sure you're able to both afford and manage the realities that come with it. Otherwise, you could end up living a nightmare. Here are my latest pieces on home care: https://lnkd.in/g2k_wb3B

Did you know that rent payments don't necessarily contribute to your credit score? Not only does Bilt already enable you to report your rent payments to the three major credit bureaus—we've just launched an industry-first program that lets you earn points on the purchase of a home when you do so with an eXp Realty agent. This first-of-its-kind program awards one point for every $2 of a home's purchase price—meaning a $400,000 home purchase could earn up to 200,000 valuable Bilt Points—which are redeemable for travel, fitness classes, and more. Through Bilt’s app, renters can monitor their credit score and track their progress toward mortgage qualification, and view available homes based on best estimates of an all-in monthly payment—making it easier to compare the monthly cost of homeownership to their current rent. Read more about it on Fox Business: https://bit.ly/3CBwoVR

This one I am very excited for…. Buy a home. Get points. With this new feature, bilt members earn 1 point per $2 of purchase price. $500k home =250k points. $1mm = 500k points. No extra cost. Our new “buy a home” tool takes everything we know about you: your credit profile, income, location, rent amount and shows you homes you can afford for the same monthly payment as your rent. All in. No more calculations or estimates. It’s personal to you and to where you live down to your local tax rates and insurance rates. ++ earn the most valuable rewards points. So when you go from renting to buying a home with Bilt Rewards you can travel the world in style on more airlines and stay at more hotels than any other program. Or you can take fitness classes at any of a dozen leading studio chains. Shop on Amazon or at dozens of other merchants. And so much more. It’s free to join at bilt.com. And anyone, renter, homeowner or anything in between can earn points no matter where you live or what card you use.

Newly Built Homes Could Be a Game Changer This Spring Buying a home this spring? You’re probably navigating today’s affordability challenges and dealing with the limited number of homes for sale. But, what if there was a solution that could help with both? If you’re having a hard time finding a home you love, and mortgage rates are putting pressure on your budget, it may be time to look at newly built homes. Here’s why. New Home Construction Is an Inventory Bright Spot When looking for a home, you can choose between existing homes (those that are already built and previously owned) and newly constructed ones. While the number of existing homes for sale has increased this year, there are still fewer available than there were in more typical years in the housing market, like back in 2018 or 2019. So, if you’re looking to expand your pool of options even more, turning to newly built homes can help. As Danielle Hale, Chief Economist at Realtor.com, explains: “The shortage of existing homes For Sale has opened up the possibility of new-home construction to more buyers who may not have once considered it.” And the good news is, there are more newly built homes to pick from right now. The graphs below use data from the Census to show how new home construction is ramping up in two key areas (see most recent spike in green): Starts, or homes where builders just broke ground, have seen a big increase lately. And completions, homes that builders just finished, are also up significantly. So, if you want a new, move-in ready home or you want to get in early and customize your build along the way, you have more options right now. Builders Are Offering Incentives To Help with Affordability And to sweeten the pot, builders are offering things like mortgage rate buy-downs and other perks for homebuyers right now. This can help offset today’s affordability challenges while also getting you into your dream home. Mark Fleming, Chief Economist at First American, explains why you may find builders have more wiggle room to offer more for you than the typical homeowner: “Builders aren't rate locked-in. They would love to sell you the home because they're not living in it. It costs money not to sell the home. And many of the public home builders have said in their earnings calls that they are not going to be pulling back on incentives, especially the mortgage rate buydown, so that will help the new-home market continue to perform well in the spring home-buying season.” An article from HousingWire also says this about what builders are offering right now: ". . . the use of sales incentives still shows some momentum as 60% of respondents reported using them, up from 58% in February. " Bottom Line If you’re struggling to find a home to buy, or with today’s affordability challenges, let’s connect @ 630-881-8655 to see if newly built homes could be the solution you’re looking for. #justcallwilliam

NEWLY BUILT HOMES COULD BE A GAME CHANGER THIS SPRING! Buying a home this spring? You’re probably navigating today’s affordability challenges and dealing with the limited number of homes for sale. But, what if there was a solution that could help with both? If you’re having a hard time finding a home you love, and mortgage rates are putting pressure on your budget, it may be time to look at newly built homes. Here’s why. New Home Construction Is an Inventory Bright Spot When looking for a home, you can choose between existing homes (those that are already built and previously owned) and newly constructed ones. While the number of existing homes for sale has increased this year, there are still fewer available than there were in more typical years in the housing market, like back in 2018 or 2019. So, if you’re looking to expand your pool of options even more, turning to newly built homes can help. As Danielle Hale, Chief Economist at Realtor.com, explains: “The shortage of existing homes For Sale has opened up the possibility of new-home construction to more buyers who may not have once considered it.” And the good news is, there are more newly built homes to pick from right now. Starts, or homes where builders just broke ground, have seen a big increase lately. And completions, homes that builders just finished, are also up significantly. So, if you want a new, move-in ready home or you want to get in early and customize your build along the way, you have more options right now. Builders Are Offering Incentives To Help with Affordability And to sweeten the pot, builders are offering things like mortgage rate buy-downs and other perks for homebuyers right now. This can help offset today’s affordability challenges while also getting you into your dream home. Mark Fleming, Chief Economist at First American, explains why you may find builders have more wiggle room to offer more for you than the typical homeowner: “Builders aren't rate locked-in. They would love to sell you the home because they're not living in it. It costs money not to sell the home. And many of the public home builders have said in their earnings calls that they are not going to be pulling back on incentives, especially the mortgage rate buydown, so that will help the new-home market continue to perform well in the spring home-buying season.” Just remember, buying from a builder is different from buying from a home seller, so it’s important to partner with a local real estate agent. Builder contracts can be complex. A trusted agent will be your advocate throughout the process. I will be your go-to resource for advice on construction quality and builder reputation, reviewing and negotiating contracts to get you the best deal, helping you decide on which customizations and upgrades are most worthwhile, and a whole lot more. Call me, 706-936-7796(c) or 706-291-4321(o). #hardyrealty #newconstruction #homebuyer #realtor

$1 MILLION STARTER HOMES IN 200+ U.S. CITIES: CBS News and other national news outlets reported this week that "...In more than 200 U.S. cities, $1 million only gets you a starter home."(1) So that got me wondering: How much would it cost per month for you to buy a $1 million house with 20% or $200,000 down? I used Merchant Bank's Mortgage Calculator (3) which estimated a Monthly Payment of approximately $6,225 per month assuming a 6.5% 30 year fixed rate mortgage (the present national average), plus North Carolina (my state's) estimated taxes and insurance (but excluding HOA and Maintenance fees). How much would you need to make in order to afford this $1 million starter home? According to Jack Kammer, Vice President of mortgage lending for the nationwide mortgage company OriginPoint (2), "In order to qualify for a mortgage in this scenario, you would need to make between $195,000 and $210,000 annually or $16,300 per month in gross W-2 income." What factors are causing home prices to be so elevated? Thoughts include: - Low supply of new housing - New household formation is outpacing new construction and demand. - Rate Lock Phenomenon (4): According to a yahoo!finance article titled "Why are home prices so high", "The most noteworthy feature of the housing market right now is the rate lock phenomenon — the fact that all these homeowners have low-interest-rate mortgages," Dr. Paul Willen, senior economist and policy adviser with the Federal Reserve Bank in Boston Research Department. In January 2024, nearly half (47.9%) of homeowners with a mortgage backed by Fannie Mae or Freddie Mac had an interest rate of 3.5% or lower, according to research by the Urban Institute. At the same time, the average interest rate for a new 30-year fixed-rate mortgage was 6.6%. To get an existing homeowner with a low interest rate to sell, "you would need to pay them a lot more. So that's locked up the market for all but the people who are kind of forced to move," Dr. Willen says. - Real Estate Investors, including Private Equity firms, are buying up homes and renting them which further reduces supply for individual home buyers. - Additional factors include the pandemic, inflation and rising interest rates, among other factors. *****Sources***** (1) CBS News: "In more than 200 U.S. cities, $1 million only gets you a starter home", by Megan Cerullo on July 26, 2024 https://lnkd.in/eYFtStk2 (2) Fortune News: "What your salary needs to be to afford a $1 million dollar home", by Mia Taylor on July 22, 2024 https://lnkd.in/emfhqyqy (3) Merchants Bank- Mortgage Loan Calculator for Purchase Price and Down Payment https://lnkd.in/ep9tTZAS?": (4) Why are home prices so high? Hal Bundrick on April 2, 2024 high? - As reported on yahoo!finance ***** So my question now is, how do Americans afford homes in these 200 cities? Thoughts?

Builder confidence continues its downward spiral: NAHB https://ift.tt/pL7kYbB Homebuilder confidence continued to decline in August as builders contend with a lack of consumer affordability that is tied to stubbornly high interest rates and home prices. The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) fell two points month over month to a reading of 39 in August. This is the lowest reading for the index since December 2023. The NAHB noted, however, that the majority of survey responses were collected during the first week of the month when the 30-year mortgage rate averaged 6.73%, according to Freddie Mac data. It took a steep dive after that, plummeting to 6.47% as of Aug. 8. “Challenging housing affordability conditions remain the top concern for prospective home buyers in the current reading of the HMI, as both present sales and traffic readings showed weakness,” NAHB Chairman Carl Harris said in a statement. “The only sustainable way to effectively tame high housing costs is to implement policies that allow builders to construct more attainable, affordable housing.” The HMI report is based on a monthly survey of NAHB members — typically regional and local homebuilders — in which respondents are asked to rate both current market conditions for new-home sales and expected conditions for the next six months, as well as the traffic of prospective new-home buyers. Scores for each component of the homebuilder confidence survey are then used to calculate an index, with a number greater than 50 indicating that more homebuilders view conditions as favorable than not. As builders and homebuyers contend with tough macroeconomic conditions, 33% of builders reported cutting prices in August to bolster sales, up from 31% in July. Despite this increase, the average price reduction remained at 6%, the same as it has been for the past 14 months. But the use of sales incentives rose to 64%, up from 61% in July, and the highest level of sales incentives usage since April 2019. Additionally, the NAHB reported that homebuilders’ gauge of current sales conditions fell two points to 44. The gauge measuring traffic of prospective buyers also fell two points to 25, while the component charting sales expectations over the next six months posted a one-point gain to 49.  The three-month moving averages for the HMI fell month over month in three of the four regions tracked by the index. The Midwest dropped four points to a reading of 39, the South decreased by two points to 42 and the Northeast lost four points for a reading of 52. Month over month, the West held steady at a reading of 37. Despite the disappointing results in August, NAHB chief economist Robert Dietz remains optimistic. “With current inflation data pointing to interest rate cuts from the Federal Reserve and mortgage rates down markedly in the second week of August, buyer interest and builder sentiment should improve in the months ahead,” Dietz ...