Category Archives: Buying A Home

Buying Your First Home – Advise

Shop around to avoid missing red flags or regretting your decision

Buying the first house you look at it is kind of like marrying the first person you go on a date with — not necessarily a good idea. The average homebuyer looks at least 10 homes over an eight-week search before making an offer. While you don’t need to visit every home in the neighborhood, you should compare at least three homes before making a decision.

Here are the top 4 reasons to shop around:

You might find similar features in another home. When you go on your first showing, you have nothing to compare the home’s pros and cons with. You might love the steam shower in the master bathroom, but another listing nearby might have a better — with a lower asking price.

You’ll learn more about each home’s resale value. Shopping around can help you get a sense of the neighborhood, and can help you gauge which homes have been over-developed for the area. If you buy the nicest home on the block, your property won’t appreciate at the same rate that the surrounding homes do, and you might have trouble selling when you choose to move on.

You’ll catch red flags before you rush in. Rushing to the closing table can also cause you to miss serious maintenance issues. Finding “the surprise behind door number three” is only exciting onThe Price is Right, so make sure you look in every room in the house. If any rooms are “off limits” during the showing, arrange to see them later and have your home inspector examine them carefully.

You won’t wonder if “the grass is greener” across the street. Surveying your options will also help you avoid buyer’s remorse. If you buy without looking at several homes, you could end up feeling as though you’ve made a mistake. If you still love the first house you saw after visiting a few more listings, you can be confident in your decision to make an offer.

First Time Buyers Move Towards Tier II Cities

As per a recent survey conducted by Magicbricks.com, all first time property buyers among the respondents (60 per cent) said they would want to invest in a tier II city.

brevard nc mls searchFor long term property investments, there is definitely no reason to turn to metro cities alone. That too, at a time when real estate prices across all tier-1 cities have crossed all limits of capital appreciation. Thus, willingly or unwillingly, the property buyer is shifting focus towards the tier-II cities of the country that offer them a fair chance at having a property in their name.

This trend was clearly reflected in a recent survey conducted by Magicbricks.com entitled ‘Investing in tier Ii cities’. As per the results of the survey nearly 60 per cent of the respondents were first time home buyers. What came as a surprise was that nearly 68 per cent of them were sure that they wanted to invest in a tier-Ii city while around 30 per cent said they might invest in a tier-II city.

This largely echoes a rising phenomenon wherein under the pressure of burgeoning realty prices across developed cities, property buyers are compelled to target tier-II cities. The unparalleled growth in realty prices has pushed even the first time home buyers to the second-rung cities.

Earlier, first homes were generally bought in the same city where one worked or resided on rent. However, in a situation where the salaries have not seen an exponential growth as the realty prices, the property buyer is not left with much option but to buy outside their city.
Apart from the lower values, investing in new areas also promise a faster capital appreciation, felt majority (40 per cent) of the first time property buyers. Nearly 37 per cent of them stated budget constraints as the reason for moving to tier II cities. The importance of budget for a first time home buyer was also highlighted in recent poll conducted by Magicbricks.com.

Poll of the week: Budget still drives first time home buyers

The survey further revealed that nearly half of these first time property buyers had a budget of up to Rs 20 lakh only. Further, more than 50 per cent of the respondents wanted to invest in a multi-store, independent house or a builder floor as against a plot or a commercial property. This again is an indication that a growing number of property buyers are purchasing homes outside their city of residence even when they live on rent.

Some of the popular tier-II cities among the first time buyers were Lucknow, Nagpur, Vadodara and Ahmedabad.

Thus, if this spill over demand to tier-II cities continues in the absence of any probable reduction in housing prices across the country, it is no long before these too become unaffordable. Then would the demand shift to tier-III cities? Would rented accommodation become the norm for the common man just because they cannot afford to buy a home in their own city? We would have to wait and watch.

Sruthi Kailas, Magicbricks.com Bureau

Americans Cautious But Still Want To Buy

hendersonville real estateAmericans are feeling cautious about their money and the housing market as 2013 comes to an end. Surveyed for Fannie Mae’s November National Housing Survey, nearly two-thirds of Americans said they believe the economy is headed in the wrong direction and that their personal finances will worsen in the next year. Despite the pessimism, however, the housing market is still expected to improve. Doug Duncan, senior vice president and chief economist at Fannie Mae, said caution is the defining feature of Americans’ attitudes toward the economy. In this environment, according to Duncan, the housing market is likely to improve but only at a gradual pace. Still, a majority of Americans said they would buy, rather than rent, if they were to move and 64 percent feel that now is a good time to buy a home. The number of respondents who felt it would be easy for them to obtain a home mortgage rose 4 percentage points to 50 percent. More here.

It’s Not A Good Time To Rent

U.S. in ‘Worst Rental Affordability Crisis’ Ever

DAILY REAL ESTATE NEWS | TUESDAY, DECEMBER 10, 2013

As rental demand grows, soaring rents are taking a bigger bite out of households’ pocketbooks.

About half of renters spend more than 30 percent of their income on rent, up from 18 percent a decade ago, according to newly released research by Harvard’s Joint Center for Housing Studies. Twenty-seven percent of renters are paying more than half of their income on rent.

“We are in the midst of the worst rental affordability crisis that this country has known,” says Shaun Donovan, U.S. Secretary of Housing and Urban Development.

Rising rents mixed with a stunted wage growth has created an affordability problem, the study notes. Between 2000 and 2012, real median rents rose nationwide by 6 percent. However, over that same time period, the real median income of renters fell by 13 percent.

A shortfall in affordable units is particularly troublesome as low-income renters struggle to find a place, the study notes.

“Over four years, [there’s been] a 43 percent increase in the number of Americans with worst-case housing needs,” says Donovan. “Let’s be clear what that means: They’re paying more than half of every dollar they earn for housing.”

Young professionals are also turning to renting and finding higher rents to be a hurdle to getting ahead. Many have plans for home ownership one day: Nineteen out of 20 people under the age of 30 say they intend to buy a home in the future.

“There is no question that the will toward home ownership remains there — [the problem is] the way,” says Eric Belsky, director of Harvard’s Joint Center for Housing Studies. However, rising home prices and mortgage rates, high student loan debt, and tightened credit is holding many back and forcing them to continue to rent.

Source: The Harvard Joint Center for Housing Studies and “Skyrocketing rents hit ‘crisis’ levels,” CNBC (Dec. 9, 2013)

New First Time Home Buyer Program

New program offers big savings to first-time homebuyers
Provides federal tax credit for life of their loan

First-time homebuyer Derek Benedict was shopping around for a loan when his mortgage planner, Tom Kowalchik, told him about the newly introduced Mortgage Credit Certificate Program.

Launched by the Pennsylvania Housing Finance Agency this past July, the program allows qualified purchasers to claim a federal tax credit of up to $2,000 annually — for the life of the loan — on the mortgage interest they pay.

Benedict, a storage and systems engineer in the insurance field, just bought a house in Manheim Township.

“While I am not exactly positive on the savings,” he wrote in an email, “I am estimated to save $125 a month on the tax credit alone. That would be $1,500 a year.”

Kowalchik, of Fairway Independent Mortgage Corp.’s Lancaster office, said this PHFA tax credit program is “flying under the radar” compared with the $7,500-$8,000 federal tax credit of several years ago.

“But when you start adding up the numbers, it’s better than” that one-time credit, he said.

Homeowners can claim as a tax credit as much as 50 percent of the mortgage interest they pay each year, not to exceed $2,000. Also, the remaining mortgage interest paid can be claimed as a deduction.

To claim the credit, homeowners must complete and submit IRS Form 8396 with their federal tax return.

“We’re excited about this new home loan product that gives our customers another attractive mortgage option,” PHFA Executive Director and CEO Brian A. Hudson Sr. said in a press release when the program was announced.

“During the past 18 months, PHFA has responded to changing market opportunities with a variety of new mortgage programs. Our Mortgage Credit Certificate Program is yet another initiative by PHFA to help Pennsylvanians achieve their dream of homeownership.”

Mark Pontz, a loan officer with Mortgage Network’s Lancaster office, said the program “is going to make things more affordable” for first-time purchasers by reducing their tax burden.

Knowing they’ll be able to claim the credit on their federal tax return, Pontz said, homeowners may choose to reduce their amount of withholding during the year, meaning a bigger paycheck.

The credit can’t be greater than the borrower’s annual federal tax liability, after all other credits and deductions have been taken into account.

First-time homebuyers or those who haven’t owned a house in the past three years are eligible for the program. Veterans are exempt from this requirement.

The benefit will expire if the home is sold or is no longer used as the borrower’s primary residence.

In Lancaster County, the purchase price limit for the program is $354,000, except in certain targeted census tracts in Lancaster city, where it’s $385,000. The limits vary across the state, ranging from $250,000 in several counties, including Dauphin, Lebanon and Adams, to $417,000 in Philadelphia County.

To be eligible for the credit in Lancaster County, an individual or couple can’t earn more than $83,400 in gross household income and a family of three or more can’t exceed $97,300 in income.

People can apply for the Mortgage Credit Certificate Program through PHFA’s network of participating lenders, which is found at phfa.org/forms/participatin….
Help us improve: suggestions, corrections, clarifications, added information welcome

Read more: http://lancasteronline.com/article/local/927028_New-program-offers-big-savings-to-first-time-homebuyers.html#ixzz2mvJWYCj5

Should You Buy A Home Now?

Hendersonville nc mortgage loanAre you looking to buy a home in Asheville NC? Is it the right time for you to purchase a home? Before you contact a real estate agent, you should consider your motivations for wanting to buy a home. Is it your dream, or is it something you think you should do because it is touted as a milestone for every adult? Buying a home is a huge commitment that requires careful thought and planning. There are many factors to consider when deciding to purchase a home.

Budget

Buying a home is the greatest expense for most adults. You should look realistically at your budget to see if you can afford the monthly expenses of owning a home. In today’s market owning a home can be more affordable than you think.

Savings

How much money do you have in savings for down payments, closing costs and emergency expenses? If your savings are low, then you may have to develop a plan to build adequate savings. You may also choose a Realtor who offers a commission rebate to help with your closing costs.

Creditworthiness

Banks have developed stricter standards for home loans within the past 5 years. Most lending institutions require a credit score of 620 or higher in order to qualify for a loan. Check your credit standing to see if you are eligible to purchase home. If your credit is not up to par, spend time correcting prohibitive credit issues.

Employment Status

Many lenders require that a person have at least two years in their current position before qualifying for a home loan. This is not a hard and fast rule. Many new college graduates may not need to meet this requirement.

Maintenance Requirements

Owning a home requires a person to be responsible for the upkeep of the property. Do you have the ability to make repairs around the house? If not, will you be able to afford to hire a maintenance person to fix items that need repair? Most of the home improvement stores today can be a great help with the do it yourself type homeowners.

Length of Ownership

How long do you want to stay in the home? Knowing the answer to this question will help you to determine if homeownership is your best option. If your current position requires constant relocation, then it might not be the best time to purchase a home.

If you are confident that you are ready to buy a home in Asheville NC, then it is time to take the next step. Find a reputable real estate agent who can assist you. A good agent can make home-buying an enjoyable process.

Please feel free to contact John Abshire today at 828-699-4894 for all your real estate needs!

The Benefits Of A Home Inspection

Hendersonville NC Home InspectionWhenever you buy a home it’s important to have it inspected by a professional, reputable home inspector. If you have the home inspected you will know what kind of shape the house is in, and what problems the house may have. An inspection will tell you the condition of the roof, furnace, pipes, and wiring, as well as give you an idea of how long they have before they need to be fixed or replaced.

They will also check for dangers you might not see, such as mold, lead-based paints, and asbestos. An inspector can also detect damage caused by termites, or carpenter ants. They can can tell you anything you need to know about building codes in the area in case you plan to build a deck or a patio, and since inspectors can also be contractors or pest control experts many of them can help you to fix the problems that they see, but some will not do so on grounds of conflict of interest. All of these things are important to know before buying a home, and will help you make an informed decision.

The process takes just a few hours and prices range from $250-500. Reputable inspectors will let you take the tour with them, and you’ll have a report within just 24 hours.