San Diego Real Estate Homes

San Diego Mortgage Broker- get the best assistance for your needs.

When you are planning to buy a home you have many options available to you but the best option is to seek the assistance of Hampton Mortgage a San Diego mortgage broker who will help you to refinance a mortgage o the property. But for this you will need to look for the right kind of professional who will help you to get this task done in an efficient manner without any kind of delays or inconvenience. Moreover, rather than visiting a bank for procuring a loan for your purchase, you should get help from an experienced and licensed mortgage broker who will help you with this entire process. This is also considered as a financially beneficial option because you can decide regarding the best mortgage terms and rates that are offered by multiple lenders.

There are many benefits of hiring the San Diego mortgage broker and the most important benefit is that you will get the assistance from a professional who is responsible for negotiating and processing the commercial and residential mortgage loans. Moreover, this broker will also work on your behalf so that you will get access to a large number of loan products because they have a wide network and experience for offering you the right guidance and assistance. Additionally, you can also select from a wide variety of loan products and its interest rates so that you can select a loan that will suit your budget and requirements. Moreover, when you work with a competent and skilled mortgage broker, you can easily find the best mortgage for yourself. This is the best way of relieving the stress and anxiety relating to the entire process of finding the best mortgage so that you will not face any kind of difficulties. You will get a lender who will offer the lowest interest rate and down payment so that you can easily purchase the property that you want to buy. You will also get the required funds with the help of the brokers when you want to make the final payment for the property. Even with poor credit score or history, you can always seek the assistance of a mortgage broker who will work on your behalf so that you don’t have to worry about carrying on negotiations for the property deals. There is an option available for you if you are looking for a no-fee mortgage broker so that you don’t have to worry about any hidden charges. These professionals will find the most profitable deal for you so that you will save a considerable amount of money. Since they have access to a large number of mortgage products; you will get the best deal in terms of loan products, repayment amounts, and interest rates. This is done by assessing your long as well as short term goals so that you will get the loan product that will be best for your situation. Moreover, you will also get the best flexibility by these professionals who has the skills and expertise for meeting your needs. Regardless of your present situation, the mortgage broker will offer you the best assistance and guidance so that you can get through all kind of situations easily.

Hiring San Diego mortgage broker will also save you from the legal work and procedures that you might have to face while refinancing a mortgage. They will also go through the contract papers carefully for making sure that there are no hidden charges or clauses that might not be beneficial for you. Moreover, the research will also be carried on by the mortgage broker who will look for the best lender for you. You will not have to put in any effort or hard work for this entire process because you will get the assistance of a professional who will offer you the convenience of getting the best loan according to your needs. Since the broker has better access to all kind of information regarding lenders and their payment terms. This makes it convenient for you to make the right selection based on your requirements so that you can get in touch with the right lenders for your mortgage needs. They also provide you with expert advice and valuable suggestions that can help you to make the right decision pertaining to the purchase of property.

Consulting Dry Wall Experts for Reliable Drywall Services

You’ve just found out a hole in your wall and obviously you don’t want it to remain for quite long. A wall hole can be quite obvious to notice and almost anyone who visits your home would easily see it. Fortunately there are quick methods to get rid of the same, but which is the most viable measure to completely get rid of the problem? Neglecting the issue will just create more trouble with gradual damage to your wall.

What is a dry wall?

Dry walls are high performance interior lightweight wall systems composed of GI steel framing and their one side is fitted with gypsum plasterboards. Later on gypsum attaching compounds are used for taping and finishing.

These are mostly used for interior partition and are mostly preferred for different applications in hotels, rooms, schools, hospitals, theatres and different industries. Without any alteration and abuse, these remain to be some of the most long lasting internal constructions.

Dry wall services offered by professionals

So whether you’re concerned about getting final touching for your current remodeling work or just need to patch out the wear and tear area, you can seek professional help through experts from dry wall services who mainly specialize in various dry wall repair and painting services.

Professional contractors from dry wall repair services generally perform a multitude of tasks and deal in drywall fishing as well for that error free look that you’ve always wanted. Typically you would get handy services from experts in the field such as:

  • Complete wear and tear fixes
  • Repair for moisture damage
  • Fixing holes in doorknobs
  • Fixing cracks with settling
  • Drywall damage done by kids
  • Anchor holes in drywall
  • Mice related drywall damage
  • Dart hole damage

Installation and repair for crown molding

The right installation of crown mold adds up great style and value for your house. With the right service for your dry walls you can make a considerable difference to the way your dry walls appear with a lot of appearance options.

Installation of dry wall can’t be done by self. There are a lot of tasks to be taken care of while installing drywalls such as removing damaged and old pieces for new dry wall hanging and professional contractors for handling projects from the very beginning to end.

Additional services

Some valuable services provided with dry wall installation are:

  • Installation for sheetrock, stucco, gypsum and green board.
  • Taping and muddling the drywall
  • Drywall hanging services (with ceiling installation)
  • Drywall painting services in addition to finishing touches
  • Expert repair and patching services for drywalls

Over the time, dry wall takes serious beating through day to day activities from home. Cracks and dents can form as items and make repeated contact through wall. There are different reasons that lead to formation of holes such as having hanging nails or repeated contact with door knobs. A common cause of dry wall cracking is water damage and this can result with trapped moisture or plumbing issues.

Another common drywall issue source is termite damage. Make sure that the repair experts from professional drywall contractors are ready to efficiently handle all such repairs in a professional and timely way.

Consulting experts

With dry walls you get the most reliable solutions for your homes and it becomes quite logical to have a consultation beforehand. However, one must always consider the quality and details regarding the consultation. A consultant from the drywall installation service can meet the client, present a few pictures for a brief idea and finalize a date.

Professionals will make sure to visit site, view the wall that has to be worked, listen to the client’s requirements and eventually get the desired concept. The overall consultation shouldn’t consume a lot of time, but some practical issues are always present that need to be addressed by making a site visit. Once the client finalizes on the actual wall appearance, the drywall installation expert can complete all installation works within the discussed time period.

All contractors aren’t specialists in drywall tasks like painting, decoration and repair and you must not hand your drywall tasks to anyone. While hiring painting professionals for drywall services you should be assured about their work portfolio and make sure that they treat your space with utmost respect and care. Regardless of the type of drywall you’ve installed in your home, licensed professionals from drywall services would help you in overcoming almost all types of drywall issues.

What To Consider When Building A Custom Home

Sometimes the construction of the custom house can be scary. In today’s local market, most households have a cookie startup plan for anyone else in their community. You may realized when driving or riding through the hip that all the houses look similar to the design and new subdivision. Maybe these houses also look almost identical from the inside too. Therefore, it is normal that we do not know how construction in custom homes works. Because the customs houses are just that, each construction process is different. However, these 7 tips should lead you to succeed in building a custom home.

Budget: Before you lose time or construction time, you must first establish your budget. Sum up your monthly cost, apart from home (since you are trying to find out), and the cash you have left to take advantage of your monthly income is exactly what should determine your budget. After you determine your budget, you can choose the design and type of the house you can afford to build.

Location: You should find out where you want to live. It sounds easy, but it is not. Keep in mind that there are always many things to remember when deciding on the location. To what extent will your location will be from social amenities like school, market, and work? Are you near the highway exit? Is the place noisy? Learn about the schools in your area, even if you do not have children. It means goods property value if the area has good schools. Will this area have grown in the 5-10 years to come? Will be there some development? Will the place be congested in the future? Will that place that you like can probably be a parking space?

List: after choosing your home location, you can create a list of building companies that mostly build in the selected area. How do you do this better? Searching from the internet can give you better results. For example, if you’re looking for custom construction companies, go to Google and type “Custom Home Builders.” You will get a set of search results of all the companies that are located in that area. You can also review these search results in Google Places. Once you get your list, start a full search. Request brochures/information, visit the site and even personal visit to some of the typical houses they have constructed. Try to identify the price range of the builders, the types of houses they build, their experience and their reputation

Decide: once you have completed an exhaustive search, it is time to identify and choose the best builder of the work. Take some time to make your final decision in selection.

Choosing your lot – then select your lot. This is an essential part of the process, since some factors often depend on the quantity, and not vice versa. For example, some housing plans only function with some types of lots. If you need a bungalow style cottage with a covered terrace, you may require a flat, large lot. Few builders like to move their dual-level or single-level homes around their communities.

The floor plan – This is the funny part. Here, you are required to select your floor plan for your new home. Depending on your constructor, you can get a standard ground plan on which you can work and then have the freedom to change the design as you wish. For example, you can begin with a standard plan of three bedrooms and two bathrooms, and determine that you require to construct another half bathroom. On the other hand, you can decide to completely create a custom plan with the help of architecture from scratch.

Negotiate – It is good to negotiate the contract fast before you sign it. Always remember to take proper precautions before you sign and take any contract. Always ensure that all the information regarding the deal are included explicitly and that the contract is verified by a lawyer. If there are changes to the contract, you must request an addition. Read the contract guarantee section carefully to make sure it meets minimum standards and meets your requirements.

The ins and outs of the process of custom home constructions

The construction of custom houses has undergone some pioneering and surprising changes in recent years. This is because the concept of housing construction has changed:

– Promoters and architects now use the latest ideas to design the house of their dreams. This changed the general view.
– The construction of houses now requires the use of precision techniques: steel bars resistant to earthquakes and the exclusive fine finish paints.

– Interior design also has undergone revolutionary changes. New home builders can now read your ideas so that they can design much better designs. This has been made possible with the advent of technology and the widespread use of the Internet.

Through this technological development, the new generation builders can achieve world-class ideas that can transform the design of their dreams into a great reality.

Key Reasons to Invest in Real Estate

5 Cheapest Ways To Start Investing In Real Estate - Ideal

The benefits of investing in real estate are numerous. With well-chosen assets, investors can enjoy predictable cash flow, excellent returns, tax advantages, and diversification—and it’s possible to leverage real estate to build wealth.

Thinking about investing in real estate? Here’s what you need to know about real estate benefits and why real estate is considered a good investment.

KEY TAKEAWAYS

  • Real estate investors make money through rental income, appreciation, and profits generated by business activities that depend on the property.
  • The benefits of investing in real estate include passive income, stable cash flow, tax advantages, diversification, and leverage.
  • Real estate investment trusts (REITs) offer a way to invest in real estate without having to own, operate, or finance properties.

Appreciation

Real estate investors make money through rental income, any profits generated by property-dependent business activity, and appreciation. Real estate values tend to increase over time, and with a good investment, you can turn a profit when it’s time to sell. Rents also tend to rise over time, which can lead to higher cash flow.

This chart from the Federal Reserve Bank of St. Louis shows average home prices in the U.S. since 1963. The areas shaded in grey indicate U.S. recessions.4

Average sales price of homes sold for the U.S.
Source: Federal Reserve Bank of St. Louis.

Build Equity and Wealth

As you pay down a property mortgage, you build equity—an asset that’s part of your net worth. And as you build equity, you have the leverage to buy more properties and increase cash flow and wealth even more.

Portfolio Diversification

Another benefit of investing in real estate is its diversification potential. Real estate has a low—and in some cases negative—correlation with other major asset classes. This means the addition of real estate to a portfolio of diversified assets can lower portfolio volatility and provide a higher return per unit of risk.

Real Estate Leverage

Leverage is the use of various financial instruments or borrowed capital (e.g., debt) to increase an investment’s potential return. A 20% down payment on a mortgage, for example, gets you 100% of the house you want to buy—that’s leverage. Because real estate is a tangible asset and one that can serve as collateral, financing is readily available.

Competitive Risk-Adjusted Returns

Real estate returns vary, depending on factors such as location, asset class, and management. Still, a number that many investors aim for is to beat the average returns of the S&P 500—what many people refer to when they say, “the market.” The average annual return over the past 50 years is about 11%.5

Inflation Hedge

The inflation hedging capability of real estate stems from the positive relationship between GDP growth and the demand for real estate. As economies expand, the demand for real estate drives rents higher. This, in turn, translates into higher capital values. Therefore, real estate tends to maintain the buying power of capital by passing some of the inflationary pressure on to tenants and by incorporating some of the inflationary pressure in the form of capital appreciation.

Mortgage lending discrimination is illegal. If you think you’ve been discriminated against based on race, religion, sex, marital status, use of public assistance, national origin, disability, or age, there are steps you can take. One such step is to file a report to the Consumer Financial Protection Bureau or with the U.S. Department of Housing and Urban Development (HUD).

Real Estate Investment Trusts (REITs)

If you want to invest in real estate, but aren’t ready to make the jump into owning and managing properties, you may want to consider a real estate investment trust (REIT). You can buy and sell publicly-traded REITs on major stock exchanges. Many trade under high volume, meaning you can get into and out of a position quickly. REITs must pay out 90% of income to investors, so they typically offer higher dividends than many stocks.6

The Bottom Line

Despite all the benefits of investing in real estate, there are drawbacks. One of the main ones is the lack of liquidity (or the relative difficulty in converting an asset into cash and cash into an asset). Unlike a stock or bond transaction, which can be completed in seconds, a real estate transaction can take months to close. Even with the help of a broker, it can take a few weeks of work just to find the right counterparty.

Still, real estate is a distinct asset class that’s simple to understand and can enhance the risk-and-return profile of an investor’s portfolio. On its own, real estate offers cash flow, tax breaks, equity building, competitive risk-adjusted returns, and a hedge against inflation. Real estate can also enhance a portfolio by lowering volatility through diversification, whether you invest in physical properties or REITs.

What Does a Real Estate Agent Do? Key Roles and Duties

The Benefits of an Experienced Real Estate Agent

Real estate agents work with clients to help them buy, sell or rent real estate, including office buildings, houses and land.
 

Do you need to hire a real estate agent? Here’s a breakdown of a real estate agent’s key roles and duties to help you understand what a real estate agent is, what they do and the benefits of hiring one for your business.

What does a real estate agent do? An overview

Real estate agents are licensed professionals who typically work under the supervision of a real estate broker. Whether you’re in the market to buy or sell a property, they are trained to guide you through every phase of a sale, from scouting out properties to closing the deal.
 

Though some of the responsibilities of a real estate agent change based on if they’re working with a buyer or a seller, the general duties of all real estate agents include administrative work, research and marketing.
 

Administrative:

  • Answer phone calls and emails
  • Schedule appointments and showings
  • Update property listings
  • Draft and deliver documents
  • Order supplies

Research:

  • Perform real estate market analysis
  • Stay current with real estate markets, trends and best practices
  • Search open listings to find properties

Marketing:

  • Create and distribute promotional material
  • Manage their online and social media presence
  • Network with potential clients and local businesses
  • Run advertising campaigns
  • Build a blog or website

What does a real estate agent do when selling real estate properties?

Top Benefits of Using a Real Estate Agent to Buy a House | Zillow

A real estate agent who helps owners sell a property may also be referred to as a seller’s agent or listing agent.
 

When a seller wants to put their property up for sale, they’ll generally contact a real estate agent to act on their behalf. With the seller’s best interests in mind, the real estate agent will use their knowledge of the market to accurately price the property, list it and market it to potential buyers.
 

In working with sellers, a real estate agent may perform the following key roles and duties:
 

  • Prepare comparative market research analysis to establish a realistic asking price (beyond what an online estimator can do)
  • Identify which assets are a property’s top selling points for that neighborhood, plus pinpoint the best places to invest money in improvements
  • Stage the property to make it appealing to buyers
  • Photograph the property, inside and out
  • List the property on the local Multiple Listing Service (MLS)
  • Advertise real estate properties to gain the attention of prospective buyers
  • Supervise and/or schedule property showings and open house events
  • Draft and prepare documents, such as offers, contracts and closing statements
  • Communicate with appraisers, escrow companies, lenders and home inspectors

What does a real estate agent do when working with buyers?

A real estate agent who helps clients buy a property is sometimes called a buyer’s agent or selling agent.
 

Buyers will often turn to real estate agents when they’re in the market to buy a property, such as a home or a new office space. Because real estate agents typically know the ins and outs of the real estate market, they can use their expertise to match the buyer with a property best suited for their needs and wants.
 

Here are some of the key roles and responsibilities of a real estate agent when working with buyers:

  • Coordinate and oversee open houses
  • Arrange meetings with prospective buyers
  • Interview buyers to understand what they’re looking for in a new property
  • Schedule property showings
  • Coordinate appraisals and inspections
  • Negotiate property repair requests and offers on behalf of the buyer
  • Draft and review documents and contracts
  • Guide buyer through the closing process

Benefits of hiring a real estate agent

Whether you’re looking to rent or buy an office for your business, sell a piece of property or build up your real estate staff, there are several benefits to hiring a real estate agent:
 

  • Real estate agents are qualified and licensed. Though requirements vary by state, becoming a professionally licensed agent involves taking courses and passing a state exam.
  • They have connections with others in the industry and community, such as title companies, appraisers, inspectors, landscapers and contractors. Because of this, real estate agents know who might be your best bet for your needs, and can get you in touch with the right contact.
  • Real estate agents understand the market and current trends, including property prices and the community. This insight can help you make the right decisions without extensive research on your part.

FAQs about real estate agents

Do real estate agents need a license?

Becoming a real estate agent generally requires a state license. While each state has different requirements for earning a real estate license, basic qualifications can include a high school diploma and passing a background check.
 

How do I find a good real estate agent?

Are you buying or selling a property? Or are you hiring a real estate agent for your business?
 

If you’re looking for a real estate agent, run an online search for agents in your area and read online reviews. Ask for recommendations from others who have recently worked with a real estate agent. When you find a potential match, meet with them in person to get a better feel for who they are and their experience.
 

If you want to hire a real estate agent, write a standout job description to attract the most qualified candidates. Some qualifications to look for include a real estate license, experience with CRM software and strong communication skills.
 

How do you interview a real estate agent?

4 Benefits of Fixed Fee Real Estate Agents Every Homeowner Should Know -  VerraTerra

Before interviewing a real estate agent – whether a phone screen or in-person interview – thoroughly review their resume and keep it on hand for easy reference.
 

When interviewing top candidates, ask a mix of common interview questions and questions specific to real estate. For help coming up with questions, explore our list of example real estate interview questions and answers.

How to Choose the Right Realtor for You: Tips for Finding a Real Estate Agent You Can Trust

Real Estate Agent Definiton

Finding the right agent is the key to a smooth transaction.

These days, choosing a Realtor can feel like picking a needle from a haystack. There are so many options to choose from that many buyers and sellers wonder how they can zero in on the professional who will best meet their needs.

In light of that, we’ve created a list of tips for finding a real estate agent you can trust. Read on below to get a sense of what qualities you should look for in a Realtor and what the process is for finding the estate agent that’s right for you. With any luck, these tips will help lead you to your perfect match.

What should you look for in a Realtor?

Before we get started discussing how to find the right real estate agent, it’s important to take some time to think about what qualities make for a good buyers agent or listing agent. That way, you’ll know what to look for when it comes time to narrow down your choices.

Licensing and certifications

The first thing to consider is what licensing and certifications each agent has under their belt. At the very least, everyone you consider should be licensed as a real estate agent in your state.

Beyond that, you may want to look for someone who is a Realtor, rather than simply being a real estate agent. Agents who are designated as Realtors are part of the National Association of Realtors (NAR). As a result, they have to adhere to a strict code of ethics during every transaction.

If you want to take things even further, some agents also have specialized certifications. For example, some are “senior real estate specialists,” meaning they have taken specific courses on how to guide senior citizens through housing transitions. Other agents have a Green designation, which means they have a focus on sustainability.

Experience level

How To Find A Real Estate Agent – Forbes Advisor

Next, you’ll want to consider the agent’s experience level. Particularly for first-time buyers and sellers, it’s important to have someone in your corner who’s familiar with the process, and that familiarity comes with experience. Typically, this information should not be hard to find. Many agents will highlight their experience level on their website and other marketing materials as part of their digital marketing strategy.

Local market knowledge

In addition, you should try to hire an estate agent who is familiar with the state of your local real estate market. Truthfully, the techniques behind buying and selling will differ depending on whether you’re in a buyer’s market or a seller’s market. Any agent worth their salt should be able to guide you through current market conditions and help you set yourself up for success.

Availability

The last criteria you should look toward is the agent’s availability. In most cases, real estate markets move very fast. When a property comes up that you think might be a good fit, you have to be ready to make an offer. With that in mind, you should focus on choosing a real estate agent with whom it is consistently easy to get in touch.

How can you find a Realtor you can trust?

Now that you know what to look for in a real estate agent, the next step is to work on finding one who is the right fit for you. This section will cover how to go about finding your top picks from a sea of possibilities.

Ask for referrals

Often, the first step to finding a buyer’s agent or listing agent is to ask around for referrals. While your family and friends who have recently gone through the process of buying a house are great places to start, your lender is also a good resource.

Whoever you end up asking, be sure to gather information on what they liked about their real estate professional, whether there was anything they didn’t like, and why they feel the agent is worth recommending.

Do your own research

From there, the next step is to do some research on your own. These days, most buyer’s agents and listing agents will have a fully fleshed-out internet presence. Take the time to go over their website, review their social media, and carefully read any online reviews or testimonials. Based on that information, you should be able to get some sense of whether you like what that particular agent has to say.

Interview your top choices

From there, you can start to work on putting together a shortlist of candidates. Ideally, you should be able to come up with two or three real estate agents you feel might be a good fit for you.

Once you have a few agents in mind, call them up or email them to ask to schedule a time to interview them. Any agent who’s been in the business for a while knows that interviewing is part of the hiring process, so most should be happy to talk to you and answer any questions you may have.

However, if an agent gives you push back on this, it’s generally a red flag. After all, odds are you’ll want to hire someone who will communicate with you throughout the entire buying or selling process. With that in mind, if you don’t get a positive response to your request, don’t hesitate to move on to other options.

How do you interview a potential Realtor?

Out of all the steps in the process of finding a buyers agent or listing agent, the interview is arguably the most important. This is where you’ll truly be able to get a sense of each agent’s personality and be able to determine which one is the right fit for you. With that in mind, follow the steps below to ensure a productive and enlightening interview:

Be honest about your needs

Start the interview by telling each real estate agent about who you are and what your needs may be. Think beyond the obvious issue of needing to buy or sell your home and get specific.

If, for example, you’re moving for a new job, mention that you’re on a semi-tight timeline. If, on the other hand, you’re specifically looking to sell your home as-is, you’ll want to be upfront about that as well.

Listen to their pitch

Real estate agents need to know how to sell themselves to potential clients, so most real estate professionals have perfected their sales pitch. The good ones, however, will know how to tweak their pitch to tailor it to your needs. Listen with an open mind, but evaluate how well the information seems to suit your needs.

Ask questions

After you’ve both had the chance to talk, take the time to ask questions and listen to the agent’s responses. Keep in mind how satisfied you feel with each answer.

If you aren’t quite sure what to ask, we’ve compiled a list of suggestions below:

  • How many years have you been in the real estate industry?
  • On average, how many transactions do you close per year?
  • Do you have any designations that set you apart?
  • Are you a full-time or a part-time agent?
  • Are you part of a team? If so, who will be my main point of contact?
  • How will you find properties that meet my criteria?
  • What is your plan for marketing my listing for sale?
  • How does your commission work? What do you typically charge?
  • How can I exit your contract if I’m not satisfied?

Review their contract and marketing materials

In most cases, your best bet is to wait to make your final decision until after the interview. The majority of agents will come with marketing materials in addition to their contract. You should take the time to review them all carefully before ultimately deciding who to use.

Making your final decision

Once it’s time to choose your real estate agent, our advice is simple: Go with your gut. At this point, you’ve done your research and should have a firm idea of how each of your top candidates handles their business. Ultimately, you should choose the one you trust the most, the one you believe will have your best interests in mind when selling your home or helping you buy a new one.

Keep in mind, too, that if it turns out you made the wrong decision, you can always switch, or buy a house without a real estate agent. Most real estate agency contracts have fairly simple exit clauses. Be sure to ask each agent you interview about theirs so you’ll know what your options are if you end up wanting to make a change.

The bottom line

How To Become a Real Estate Agent | Real Estate Career Guide

The process of picking the right real estate agent for you may feel overwhelming, but it doesn’t have to be that way. With a little legwork on your part, you should be able to streamline this process into a few simple steps. Use the tips above as your guide to help you along the way. With any luck, it won’t be long until you find an estate agent who will be on your side.

Contact us for more information.

10 Things You Absolutely Need To Know About Buying A Home

First-Time Home Buying Guide: Everything You Need To Know

Ready to buy a home? Buying a home is one of the most significant financial decisions you’ll make in your lifetime. From figuring out pricing to why you should consider a realtor, here are 10 Things You Absolutely Need To Know About Buying A Home:

1. Use a trusted realtor. We all know that realtors get a cut of the sales price of a home which makes some buyers hesitant to use a realtor: they believe it drives up the overall cost. Keep in mind that the seller, not the buyer, pays the commission. Brooke Willmes, real estate agent at SPACE & COMPANY in Philadelphia, says that potential buyers should keep in mind that a listing agent (the agent representing the seller) doesn’t protect your interests and “that agent would simply pocket both sides of the commission.” That means that you’re not saving money. A savvy realtor who works for you can protect your interests and guide you through the buying process – from negotiating a price to navigating home inspections.

2. Remember that a house purchase involves a contract. When you’re buying a house, there are papers to sign. And more papers to sign. Many of those papers – which are actually contracts – look like “standard” home buying contracts with no room for negotiation. That isn’t true. Contracts are meant to be negotiated. You don’t have to sign a standard agreement. If you want more time to review your inspection, wish to waive a radon test or want to make a purchase subject to a mortgage approval, you can make that part of the deal. That’s where a savvy realtor can help. See again #1.

3. Don’t necessarily buy for the life you have today. Chances are that buying a house will be one of the bigger financial commitments you’ll make in your lifetime. Before you agree to buy what you think might be your dream house, consider your long-term plans. Are you planning on staying at your current job? Getting married? Having kids? Depending on the market and the terms of your mortgage, you may not actually pay down any real equity for between five and seven years: if you aren’t sure that your house will be the house for you in a few years, you may want to keep looking.

4. Think about commitment. I’m not talking just about your mortgage. When you get married, the laws of your state generally determine how your assets are treated – and ultimately how they’re distributed at divorce. The same rules don’t necessarily apply when you’re not married. That means you need to think long term. When you buy a house with your significant other who is not your spouse, make sure you have an exit plan if things don’t go the way you hope. It’s a good idea to have an agreement in place with respect to titling, mortgage payments and liability, repairs and the like: it’s best to get it in writing (and yes, I’d recommend getting a lawyer).

Karnataka to roll out sale-of-agreement rules to insure homebuyers from  delays in project delivery

5. Look beyond paint. It’s often the case that your dream house has that one room that you’re already fantasizing about changing. Willmes says to remember that it’s fairly inexpensive to fix cosmetic issues (a bit of paint or some wallpaper) but making changes to kitchens and baths can be expensive. She says, “People tend to focus on the cost of cabinets, appliances and counters but sometimes forget about the cost of labor which can double to triple the cost.” That doesn’t mean that you should give up on a house in need of a significant fix but you should factor in those costs when determining whether you can afford to buy.

6. Buy the house you know that you can afford. This can be different from the price that your mortgage company believes that you can afford. When my husband and I bought our first house, we were approved for a mortgage of about three times more than we ultimately ended up spending. Fresh out of law school and working for established firms, our finances looked good on paper. But we dialed back our expectations because we weren’t convinced that our income and expenses would remain at those levels. We were right: two years later, we started our own business just as the economy turned south. The less expensive house meant that we could still make our payments even with less income in our pocket. So what’s the best ratio to use? Some lenders suggest that you can afford mortgage payments totaling about 1/3 of your gross income but others suggest closer to 28% for housing-related costs including mortgage, insurance and taxes. There are a number of factors including your projected income, interest rates, type of mortgage and the market. Ask your mortgage broker to help you understand what’s in play.

7. Don’t fixate on the purchase price. The purchase price is just one piece of owning a house: be sure to consider all of the costs associated with your potential new home. That includes the cost of insurance, homeowner association fees and real estate taxes – depending on where you live, those can quickly add up. And it’s not just home improvements that can cost money: maintenance costs dollars, too. It’s a good idea to ask questions about upkeep for extras like swimming pools, fancy heating and cooling systems and outbuildings. Finally, Willmes suggests that you make sure you’re comparing apples to apples: a condo with a large fee that’s priced low may be more costly than a higher-priced one with lower fees while a cheap home with high taxes may cost you more a month than a more expensive one with lower taxes.

8. Consider your student loan debt. Following the housing crisis, lending laws tightened. Student debt isn’t merely an annoyance: it’s treated like real debt. Jason Griesser, a licensed Prospect Mortgage Branch Manager in PA, explains that a major revision to FHA guidelines in 2015 negatively affects many first-time homebuyers with student loan debt. Prior to this change, a borrower with student loans deferred for more than 12 months could discount that debt from their liabilities: now, for purposes of determining purchasing power, a borrower is charged with 2% of the outstanding balance of the student loan regardless of deferment status (in a non-FHA, or conventional loan, it’s just 1%). If your student loan is in deferment and you’re planning on buying a home, Griesser suggests enrolling in a properly documented income-based repayment plan so you have the documents your lender will need to properly assess your ongoing liability.

9. Don’t get carried away by the home mortgage interest deduction. Many taxpayers are tempted to buy more houses than they can afford by figuring that they’ll save enough with the home mortgage interest deduction to make up for it. The mortgage interest deduction is only deductible if you itemize on your Schedule A: only about 1/3 of taxpayers claim the itemized deduction. You itemize if your deductions exceed the standard deduction: for 2015, the standard deduction rates are $12,600 for married taxpayers filing jointly and $6,300 for individual taxpayers (those rates stay put for 2016). Assuming that you do itemize, remember that your out-of-pocket will still be more than your tax savings (if you’re in a 28% bracket, paying $5,000 more in interest will only “save” you $1,400 in taxes). And you can’t count on the same level of savings forever: mathematically, the longer you own your house, the less you will owe in interest. That’s good for building your equity but it means a smaller deduction come tax time.

10. You don’t have to buy a house. There’s no rule that says you have to buy a house by the time you’re 35 – or ever. Buying a home is a big decision and while it can be a sound financial investment, it’s not for everyone. There is a lot to consider, including the housing market, interest rates, timing and your future plans. You might want more flexibility or mobility, or your career and family plans may be in flux. If you’re not sure about a neighborhood, consider renting as a test drive: a realtor can help you with that, too (see again #1). Even then, you don’t have to pull the switch: there are healthy rental markets throughout the country and in some areas, young professionals are choosing rentals over homebuying to preserve cash and remain mobile. That’s showing in the stats: last year, the U.S. Census Bureau reported that the homeownership rate was 64.9%, not counting borrowers in risk of default. In contrast, ownership in 2010 was nearly 69% (downloads as a pdf): for purposes of context, a one-percent change in the ownership represents well over a million homeowners. For more on the decision to buy versus rent, check out my book, Home, Sweet Rental: Busting The Hype Of Homeownershipavailable on Amazon.

10 Hidden Costs of New Homes That Surprise Homeowners

Contact us for more information.

WHY BUYING PROPERTY MAKES SENSE IN 2021

by Agnes Gaddis August 18, 2021

Are you on the fence about buying in 2021? This post will offer some clarity. If you’re looking for a comparison of renting vs buying that goes into detail about how buying vs renting a home will affect your finances in 2021, you should read to the end. We’ll look at what you should consider before buying a home or renting, and some stats on rent versus buy across US major cities.

Overview of Renting in 2021

The real estate rental market is an oddball. It is difficult to predict that in 2020 many millennial renters would take advantage of low mortgage rates to become homeowners, causing a strong imbalance between supply and demand. On the other hand, prices and intense competition for homes have driven some high income, would-be home owners into becoming renters out of necessity.

But high income renters snapping up single family rentals and multifamily apartments isn’t a new trend.

Based on a report by Rentcafe, between 2007 and 2017, more than 1.35 million people, earning $150,000 per year switched to renting – that is a 175% increase. During this ten year period, the number of renter-occupied households earning over $150K per year multiplied 7.4 times. Also, the number of high income tenants in Charlotte, NC grew by 400%.

In 2020, rental demand also took an unexpected curve as many people moved away from big cities like San Francisco and Seattle for more affordable housing. Before the Covid-19 pandemic, rents at these tech hubs were exorbitant with relentless demand. But with the adoption of remote work and telecommuting, the demand shifted to the suburbs closest to these big cities.

As companies open up fully and rental demand picks up in these cities, rent prices pick back up. Nationwide, rents have risen in almost all of the biggest metros. Zumper reports that in July, the National Rent Index rose 7 percent year-over-year for one-bedroom apartments and a staggering 8.7 percent for two-bedroom apartments.Rents are likely to continue to rise as new home construction has fallen well short of the 4.6 million units needed per year. Demand for rental properties, especially from high-income earners, is driving rent beyond the reach of low-income earners.

Let’s consider the case for renting:

1. While rent prices have increased, home prices have appreciated since 2020 at almost unbelievable rates. In some markets, home buyers are rushing foolhardy into deals because of bidding wars. Asides from that, buying a home requires that you have enough money to cover not only your down payment but closing costs, PMI, realtor fees, legal, inspection, and appraisal fees. You also need to spend money on property maintenance including HOA dues.

2. With renting, you aren’t tied to a particular place for years. This is one of renting’s appeals to young millennial professionals. The ability to work from anywhere has led to a number of millennials migrating to places like Honolulu for short term rental stays. Of course, you can also take long vacations if you own your own home, but it just doesn’t offer enough flexibility as renting.

Buying a Home – 2021 Overview

It is no news that home prices have appreciated above expert forecasts in 2020 and 2021. According to Zillow data, the typical seasonally adjusted value of a median single-family home in the United States in June 2021 is $293,349. This is up 15% from a year ago, and Zillow expects prices to appreciate even more, by 13.2%, in June 2022. Read more about what to expect in the 2022 real estate market.

Buying a home is part of the American dream. However, if you’re thinking about buying a home in 2021, you may want to be a bit more cautious, as mortgage rates are rising, homes are selling above fair market value and banks are demanding higher down payments.

So should you rent or buy in 2021? Let’s consider the pros of buying a home in 2021.

1. Mortgage rates are still low. Even though mortgage rates have been predicted to pass the 3.25 mark by the end of 2021, they are still currently low. In May 2021, according to Freddie Mac, interest rates on 30-year loans averaged 2.96%. But they won’t stay that way.

One of the disadvantages of waiting to buy a home is that price appreciation could slow, but mortgage rates could rise. However, in 2021, mortgage rates have gone up and down: there has not been a steady upward trend. Overall, a sharp rise in rates is unlikely.

2.  Home equity is strong. As home values rise, so do home values in many markets. Even for people who have defaulted and face the threat of foreclosure, home values may offer leverage. The possibility of gaining from home appreciation is one of the best arguments for buying a home in 2021.

3. Freedom. If you own your home, you are free to design and upgrade it any way you want. Whether you’re looking for more space, better insulation, or want to give the kitchen an upgrade – you can make your home fit your lifestyle – of course as long as you don’t break HOA rules. This sense of ownership and freedom to customize your home make owning a house more desirable than renting.

While these sound great, you should consider the current renting vs buying landscape. The fact is, if you were bidding on a house in any market in the US Right now, you probably aren’t the only one bidding on the house. Currently, there are more buyers than listings and this means there will be bidding wars. In many cases, you will compete with cash offers. ATTOM Data Solutions reports that cash offers account for over a quarter of all home purchases these days.

Is it Better to Rent or Buy in 2021? Considerations

One of the major factors driving the renting vs buying debate is affordability: Is buying really cheaper than renting?

There are no quick and fast answers. Attom Data’s 2021 rental affordability report showed that owning a median-priced three bedroom home is more affordable than renting a median-priced 3 bedroom home in 63 percent of 915 US counties. However, this research was conducted in 2020. Also. it does not take into account the fact that people who pay less than 20% down will pay more in mortgage payments each month.

Based on an article on TheMortgageReports, “In 2019, the National Association of Realtors found that the average down payment on a house or condo was just 12%. For first-time home buyers, that number drops to 6%. And many people put down even less money — or no money at all.”

If, according to the NAR, the median price of a home is $350,300, with a 6% down payment requirement, you’ll be paying $21,018 down. Conversely, a 20% down payment would offer you a better rate and an opportunity to forego PMI (private mortgage insurance). But you’ll need to have saved up to $70,060.

If you’ve been saving up to buy a home in 2021, how about first comparing the cost of owning versus the cost of renting? Nerdwallet has a renting vs buying calculator to help you compare which of renting vs buying will be the best fit for your situation.

In most cases, you need to consider some things as you examine renting vs buying pros and cons. You want to ask the following questions:

1. How long am I staying in the area?

2. What are the current mortgage rates? and what are the terms of the mortgage?

3. Are home values appreciating in the area? Will they continue to appreciate in the future?

4. Am I willing to spend money and effort on routine home maintenance?

5. How much of my taxes can I deduct as a homeowner?

Although you shouldn’t hinge your rent versus buy decision on cost – you want to consider convenience and lifestyle too. But the cost is an important consideration.

Ongoing costs for renters include; rent, renter’s insurance, utilities (electricity, gas, water, cable,…) – some landlords could include utility costs in the rent.

At the start of your tenancy, you have to pay a one time security deposit. The security deposit varies by state. In most states, it is usually one or one and a half month’s rent. Some landlords also charge additional fees for garbage pickup, pest control, and parking.

When buying a home, you’ll pay a one time closing cost, which will include your mortgage origination fee, plus a one-time down payment. Ongoing costs include your mortgage fee plus PMI (private mortgage insurance), property tax, HOA fee, utilities, and home insurance. You might also need to spend money on routine home maintenance and renovation tasks. Let’s look more closely at the questions above.

  • Home Equity

Are home values appreciating in the area? Will they continue to appreciate in the future?

Right now, there is a fear of missing out as low supply drives fierce competition for available homes. Economists have compared this to the 2006-2007 buying frenzy. But compared to 2007, when many people who rushed to buy a home due to attractive mortgage terms lost their homes to foreclosures and bankruptcies, home equity is currently strong.

A lending institution owns a portion-or the entire-of home if part or all of it was purchased via a mortgage loan. Equity refers to the portion of a home’s current value that an owner possesses at any given time. Note that larger down payments on a home confer a homeowner with more home equity than a smaller downpayment.

With consistent mortgage payments, every month and a strong market, the values of many homes have increased in 2021. With that, equity has risen much faster compared to the 2007 period.

As of the first quarter of 2021, CoreLogic’s Homeowner Equity Report indicates that the average homeowner has increased their home equity by $33,400.

Approximately 62% of all homeowners have mortgage loans, according to the report, and their equity increased by 19.2% between 2020 and 2021. Across the United States, the collective gain reached $1.9 trillion.

How is home equity calculated?

Most equity calculations are based on the current market value appraisal of the property and are largely dependent on demand and supply factors. let’s say you buy a house for $200,000 ten years ago with a 20% downpayment on your mortgage. For a 30 year mortgage, and at a 3.8% interest rate, you’ll be paying a $943 mortgage. If in 10 years $50,300 of payments are applied to the principal

Over those ten years, if property prices appreciate in your area by $200,000, you’ll have equity of:

Downpayment (40000) + mortgage payments (applied to principal) + home appreciation = $40000 + $50,300 + $200000

That is $290,300.

On the other hand, if you invest in the wrong location over a long stretch of time, homes may depreciate in value. This was what happened in 2007 when many people lost their homes as home values in many places depreciated. And people who defaulted on their mortgage payments had nothing to fall back on.

As a homeowner, you can use home equity in the form of an additional line of credit or home equity loan (second mortgage) to purchase other properties for investment or to finance large home renovations.

Renting gives you no equity. You contribute to your landlord’s equity by paying rent. However, there are arrangements like rent-to-own that provide the option to buy a property after your lease is over. But these deals can be risky, so you should proceed with caution.

  • Mortgage

What are the current mortgage rates? and what are the mortgage terms?

If you’re not buying a home with cash, you should definitely consider how current mortgage rates affect you and whether taking out a mortgage might be better than renting.

In 2020, a significant number of millennials bought new homes because interest rates were low. Interest rates are still low but definitely not as they were in 2020. And rates keep rising as the economy improves.

Currently, in 2021, homes are in short supply. This means you should expect to pay more for a home than fair market value in the face of competing offers and homes selling in 3 weeks.

Nerdwallet predicts that the 2021 fourth quarter rate for a 30 year fixed rate mortgage will average 3.3%. If you bought a home in January, the average mortgage rate for the same type of mortgage was 2.842%. Let’s compare how your payments will change in both cases if you were buying at the current median price of $329,000:

If you bought a home in January and could afford to pay a 20% downpayment, you’ll currently pay $1,370 monthly. But if you’ll be buying when mortgage rates hit 3.3%, under the same conditions you’ll pay $1,435 monthly. That’s a $65 difference – not much! But consider that you’ll pay this difference for the entire term of the loan (30 years).

Your mortgage payments will also vary by the type of mortgage you opt for. Across the board, 30 year fixed mortgages are the most popular and also the most recommended. With 15 year fixed mortgages and adjustable-rate mortgages, expect to pay more monthly.

ARMs allow you to pay a fixed rate for a specific introductory period, which can last for 7 to 10 years. During the introductory period, you typically get a lower interest rate than you would with a fixed-rate loan. Upon expiration of the introductory period, your interest rate will follow market rates. You can expect the interest rate on an ARM to rise or fall up to a certain limit over the course of the loan. There are also jumbo loans that do not conform to lending limits set by Fannie Mae. But these are usually tough to get.

Generally, whether for fixed rate or adjustable rate mortgage, Your loan’s principal is large at the beginning, and the majority of your payments go to interest. In return, you pay less in interest as you reduce your principal over time. An amortization schedule will reflect consistent monthly payments and will help you pay off your loan on time.

Another thing to know in 2021 is that lenders are going to take a closer look at your ability to pay. To get pre-approved for a mortgage, your income, debts, employment, and financial accounts will be scrutinized. With lingering Covid-19 uncertainty and the economy still recovering, lenders have imposed stricter mortgage standards. Therefore mortgage applications will usually require larger down payments and higher credit scores.

Renters do not have to worry about these. And it’s not uncommon for renters with bad credit scores who wish to buy homes, to rent for a while as they work on rebuilding their credit.

  • Home maintenance.

Am I willing to spend money and effort on routine home maintenance?

One of the advantages of owning a home is that you get to design and improve your home as you see fit (keeping with HOA rules). But, financially comparing renting vs buying, you might pay more than 2 months of rent on home maintenance and emergency expenses. According to Homeadvisor, every year, the average homeowner spends $3,192 on maintenance and another $1,640 on emergency expenses.

The rule of thumb is to budget between one percent and three percent of your home’s purchase price for typical maintenance each year. You should set aside three percent per year if you are thinking about renovating your home or if you have an older home. For a home priced at $300,000, you may need to set aside up to $9,000 if you were going to renovate.

If you are buying a fixer upper or have to waive the maintenance, you’ll need to budget a lot more to get the home in tip-top condition. Generally, the following are the most common types of home maintenance issues: air conditioning and HVAC (heating, ventilation, and air conditioning) issues, doors (not opening or closing), a clogged toilet, clogged or leaking sink pipes, bathtub issues.

Randomly, you may have to deal with unexpected emergencies like broken windows, paint peeling, etc. Your budget on home maintenance and renovation will therefore likely vary each year. The costs of home maintenance add up if you plan to stay in your home for ten or more years.

During winter especially, you need to be more proactive with home maintenance and routine checks. Your doors and windows should be draught-proof to prevent warm air from escaping and cold air rushing in, your heating system might also need to work overtime. It’s essential that you keep an eye on energy consumption during this time by installing an energy monitor. You’ll need to clear gutters and driveways and improve your home’s curb appeal.

Asides from these maintenance costs, there are also homeowner association dues which range from between $200 to $400 per month. For upscale buildings, expect to pay more in HOA fees. HOA dues could cover lawn care, sewage, trash removal, etc.  

As a renter, unless otherwise stated in the rental agreement, your landlord is responsible for handling property maintenance tasks and HOA fees. And if you’re a landlord, see this checklist for rental property maintenance.

  • Tax deductions

How much of my taxes can I deduct as a homeowner?

As long as you keep paying the mortgage on your home, you can take advantage of the mortgage interest deduction. Up until recently, home owners were able to deduct up to $1 million in mortgage interest. Due to the Tax Cuts and Jobs Act, however, this limit is reduced from $1 million to $750,000 for a single or married couple filing jointly. Married couples filing separately can deduct $375,000 each.

On a second mortgage, home equity loan, or home equity line of credit, you can also deduct interest payments. It is important to remember that you can only claim this deduction if you borrowed the funds to pay for a home improvement.

Other deductions for homeowners and property investors include:

  1. Property taxes: Married couples filing jointly can deduct up to $10,000 in property taxes; singles and married couples filing separately can deduct $5,000 in property taxes.
  2. Discount points: Sometimes lenders offer homeowners the option to reduce their interest rate by purchasing prepaid interest or discount points. Points purchased to reduce a mortgage’s interest rate are tax deductible.
  3. Home office: Depending on the size and functionality of your home office space, you can deduct some of the expenses that come with having a home office. However, the space should be used exclusively and regularly for business purposes.
  4. Home improvements:  If you make necessary medical upgrades to your home e.g. to improve accessibility by installing hand railings, you can deduct the cost of these upgrades.  

While not comparable to the tax benefits of buying a home, some states offer renters tax credit. For cost burdened renters, depending on your state, you may be able to claim a credit if your rent is above 30% of income. As an example, in New Jersey, you can either qualify for an 18% deduction from rent paid, up to $15,000, or a refundable credit of $50 on your tax return.

  • Length of stay

How long am I staying in the area for?

A 2013 statistic from the National Association of Home Builders (NAHB) showed that the average buyer stays 13 years in a home.This length of stay has remained the same through 2018, based on data from the 2018 1-year American community survey. A first-time buyer’s average stay in a single-family house is somewhat shorter (about 11 and a half years, compared to 15 years for buyers who have owned a house before).

But people spend more time in some neighborhoods than others. Based on a recent research by the NAR, homeowners spent up to 8 years in the following areas.

Buying vs Renting in 2021

These metro areas, in contrast, have homeownership duration of 16 years or more:

Buying vs renting in 2021

According to the data, the median length of homeownership in many of the fastest-growing metro areas was the lowest. On the other hand, places that have experienced slow population growth have longer homeownership durations.

What about renting? Recent research by Renterrated, a renter satisfaction survey program, puts the average length of stay for renters at 27.5 months (less than 3 years). There are also variations in stay length based on location. The average rental stay in the northeast is 32.9 months. The South has the shortest average rental stay at 24.3 months.

Nowadays, with the preponderance of short term AirBnB rentals and vacation rentals, renters are free to up and leave for months. So an important question to ask when you’re considering renting vs buying is, would I have to move a lot due to work or other reasons?

Is Buying Really Cheaper Than Renting? Rent vs Buy Stats

Now let’s look at the stats comparing buying vs renting a home costs in the nation’s biggest metros. Note that while home prices have risen in almost all the big metros, some slowly, renting have moved in both directions – rent has declined in some cities but appreciated at a fast pace in others.

But which is cheaper? to buy or rent?

A March 2021 report by Realtor.com’s research team sheds light on this. They compared renting vs owning in 50 of the nation’s largest metro areas to see where buying beats renting, and vice versa.

They found that only 15 of the 50 metros favored buying. In those metros, on average, the cost of buying a house is the same as or less than renting.

Renting beats buying in the majority of metro areas that they examined. In light of rising home prices in the U.S. in recent years, which have eroded purchasing power, such a trend is not surprising. The top 5 places where the math favors buying over renting include:

1. Cleveland-Elyria, OH

2. Pittsburgh, PA

3. Chicago-Naperville-Elgin, IL-IN-WI

4. Riverside-San Bernardino-Ontario, CA and

5. Miami-Fort Lauderdale-West Palm Beach, FL

In these metro areas, the median listing price as of Jan 2021 was 7.7% lower than the national average of $346,000 and the median rent was 0.7% higher than the top 50 average.In January 2021, the median monthly cost to buy a home in the 50 largest metro areas was $1,988, compared to the median monthly rent of $1,727.

Note that for most research covering renting vs buying costs, mortgage rates are usually based on 30 year fixed rate mortgages and 20% down payments. You will pay more in monthly mortgage if you put down less than a 20% down payment or opt for a 15 year fixed rate mortgage.

Also, mortgage rates in January were a bit lower than they are now. Conversely, in many cities, rent prices have appreciated rapidly from March 2021 to July 2021.

But based on the report by Realtor.com, the top 5 places where renting favors buying include:

1. San Jose-Sunnyvale-Santa Clara, CA

2. Austin-Round Rock, TX

3. Sacramento-Roseville-Arden Arcade, CA

4. Seattle-Tacoma-Bellevue, WA

5. San Francisco-Oakland-Hayward, CACompared to the January 2021 national listing price of $346,000, the median listing prices in these metros were 105% higher. On average, renters in these metros saved 30% compared to home buyers.  “It’s not surprising that buying makes more sense where real estate is affordable and the median sales price is lower than the national median price,” said Chief Economist of realtor.com Danielle Hale. We can conclude that affordability is the major reason why people opt for renting over buying.

A more recent survey by LendingTree showed that across the nation’s largest metros, renting is $606 cheaper than owning (if you’ve not paid off your mortgage). New York, San Francisco, and San Jose, Calif., are the metros with the greatest difference between renting and purchasing a home. For these three metros, renting is about $1,200 cheaper on average versus owning a home while paying off a mortgage. Florida’s Orlando and Tampa as well as Indianapolis have the narrowest gap between home buying and renting. Renters in these metros can save an average of $335 a month.

Should You Buy or Rent in 2021?

There is no right or wrong answer. If you believe that buying is better, then just buy a property. However, if you’re not sure and don’t want to make any decisions now, it’s better to rent.

Financially, there are both pros and cons to renting and buying, but you also need to consider your lifestyle needs. Do you want to be able to change things up easily, like painting and decorating? And do you prefer the sense of ownership that comes from knowing you have a place of your own? Then you should buy a house.

Do you travel a lot? And you don’t want to handle the stresses that come from home maintenance tasks such as repairing water damage? Then you should rent.

Here’s a summary of renting vs buying pros and cons:

  • When you rent, there is no need to worry about maintenance costs or upkeep. You always have a landlord who will take care of any repairs that may arise from time-to-time. Furthermore, with monthly payments and the freedom to move at all times without penalties, renting provides flexibility in your lifestyle choices should something change unexpectedly!
  • The tangible advantages of homeownership come from tax deductions for things like home-improvements which are used to lower taxable income (saving money on state/federal level), there’s more than just that! Owning your property means taking pride in fulfilling part of the American dream – a home that gives a sense of security and stability.

Now you know the costs of renting vs buying property in 2021. If you want to buy a home in 2021, you want to be financially prepared. Know that:

1. Your chances of repaying your mortgage are better if you have a stable job history, a steady income, and are able to save each month.

2. If you can’t afford a down payment, renting is a better option than buying. While renting, you can start saving up for a down payment.

3. You should be ready to compete for homes at higher price points. Competition among home sellers in a market with historically low supply has led to higher prices and faster sales.

And if you’re buying a home for vacation rental or as an investment property, you should be able to assess the profitability of your investment easily. You can do that with Mashvisor’s rental property calculator.

Sign up for Mashvisor now and get 15% off.

7 MAJOR BENEFITS OF INVESTING IN REAL ESTATE

Real Estate Investing Remains Promising Amid COVID-19

We all, to some extent, recognize the potential financial rewards we could attain from real estate investing.  It goes without saying that there are many benefits of investing in real estate that outweigh the costs, and you as a real estate investor could be earning a steady flow of income to secure financial freedom for the long haul.

Whether you want to quit your mundane 9-5 job and become a full time real estate investor and/or save up for your retirement, you are on the right path to fulfill your financial goals sooner than you might think. It takes one rental property to establish your real estate business and get yourself a reliable source of constant rental income.

This year definitely looks promising for investors, and your real estate investments will earn you high returns indeed. The real estate market and the housing conditions are in tip top shape and you can rest assured you will be making money if you invest in the right locations. It is a simple equation: if the economy is growing, the housing market will flourish and there will be an abundance of real estate opportunities to tap into across the country.

Before you set forth with buying your first rental property, make sure you conduct real estate market analysis and consult a real estate professional. If you want to reap financial rewards from investing, you have to make wise and calculated real estate investment decisions in order to grow and diversify your portfolio. Do not depend on luck to win you money in real estate, there is no magic formula, it is all about studying your potential investment before closing any deal. Moreover, if you want to succeed in this industry, you have to know everything about real estate including the benefits you will gain in the short and long term. So let us get started: we will give you 7 major benefits of investing in real estate today.

Note: Start searching for the best investment opportunities right now!

Related: Why Is Investing in the US Real Estate Market Better Than in International Real Estate?

The Benefits of Real Estate Investing

How to Plan, Start, & Grow a Real Estate Business: 22 Essential Tips

1. Steady Income

This is a no brainer! The majority of people invest in real estate for the steady flow of cash they earn in the form of rental income. This passive income is a huge incentive to get you started and buy your first rental property. Depending on the location, you could be earning significant income to cover your expenses and make you extra money on the side. Urban cities or towns with colleges and universities tend to reap higher income because the demand is always high in those areas. If chosen wisely, you can secure a steady flow of income for a long time and even save for retirement. And you do not have to stop at investing in one property at a time; you can pick up the pace and invest in multiple rental properties all at once to increase your positive cash flow and diversify your real estate investment portfolio. You can manage by hiring a professional property management professional if the workload becomes too much. One tip to keep in mind: location, location, location is key to smart real estate investing. Don’t forget to choose a prime location to reap off the benefits of investing in real estate.

2. Long Term Financial Security

The benefits of investing in real estate provide investors with long term financial security. When you have a steady flow of cash in succession, the rewards of this investment bring on financial rewards for a long time. Owning a rental property can afford investors a sense of security because of the property’s appreciation in value over time. This means that your property’s value is most likely going to increase because land and buildings are appreciating assets. With that said, however, there is no guarantee the value will increase indefinitely. That is why it is always recommended to thoroughly research the location before closing the deal on the house of choice.

Related: How To Start A Real Estate Business From Scratch

3. Tax Benefits

One of the benefits of investing in real estate is the tax exemptions investors get from owning a rental property. This is a major reason why many choose to invest in real estate. For example, rental income is not subject to self-employment tax. In addition, the government offers tax breaks for property depreciation, insurance, maintenance repairs, travel expenses, legal fees, and property taxes. Real estate investors are also entitled to lower tax rates for their long term investments. Icing on the cake!

4. Mortgage Payments Are Covered

The benefits of investing in real estate include your tenants as well. Simply put, the rental income you receive each month is more than enough to cover your expenses, including your mortgage payments. Essentially, your tenant is actually the one paying your mortgage. That is why it is important to keep your tenants happy and avoid or mitigate the negative repercussions of vacancy at all cost.

5. Real Estate Appreciation

If you already are in real estate investment or are just starting out, you do understand that real estate is not a short term investment plan. On the contrary, the benefits of investing in real estate include the appreciation of capital assets (aka land) over time. In other words, your property’s value will be worth way more 30 years from now, hence why investors are in it for the long run.

6. Inflation

One of the benefits of investing in real estate is a hedge against inflation. With high inflation, your rental income and property value increase significantly. Real estate investors welcome inflation with open arms because as the cost of living goes up, so does their cash flow.

7. You Are Your Own Decision Maker

Forget about your 9-5 boring job, the best part about real estate is becoming your own boss. Just like any other business, you have the complete autonomy and control over your real estate investment strategies as well as your failures and successes. You call the shots on which property to invest in, the tenants who will live under your roof, how much rental income to charge per month, and who will manage and maintain the property as a whole. The benefits of investing in real estate make you your own decision maker.

Note: Find properties based on readily available calculations! Click here to get started.

800 African real estate investors and developers meet to build a post  pandemic future – Politico Ghana

Related: When Is Buying A Second Home To Rent Out A Good Idea?

There is no doubt that the housing market is a lucrative business for many investors and entrepreneurs. Many recognize the benefits of investing in an income property to reap financial rewards as well as financial security for a long time. If you made up your mind after reading about the benefits of investing in real estate, head over to Mashvisor to find your next real estate investment.

The most expensive San Diego homes to sell in 2019

The Razor House in La Jolla sold for $20.8 million in August.

It was a strong year for luxury housing in San Diego County with 10 sales topping $10 million.

Oceanfront properties in Del Mar and La Jolla snagged the top sales, similar to the past few years where beachfront communities dominated the biggest purchases. In fact, three of the five top sales this year were on the same street.

There were no major records broken in 2019. The biggest sale in county history remains the 2007 sale of a 10,700-square-foot home on Ocean Front in Del Mar that went for $48.2 million, said the Greater San Diego Association of Realtors. The biggest sale in 2018 was $24 million for a property in La Jolla.

Musician Alicia Keys’ purchase of the iconic Razor House in La Jolla was the most high-profile of any home, but was not the most expensive in 2019.

Just 4 percent of homes in San Diego County were listed for more than $4 million in mid-December, said Reports on Housing.

Steven Thomas, founder of Reports on Housing, said a sluggish stock market, and uncertainty over an economic downturn, made for a slow luxury market at the start of the year. But, he said things picked up again as many high-end buyers became more confident in the economy.

“There’s a lot of capital out there and it looks like this expansion is going to continue,” Thomas said of the biggest sales. “It’s at the point where people are just shrugging it off and pulling the trigger on this stuff.”

1. 2720 Ocean Front, Del Mar — $23.25 million

2720 Ocean Front sold for $23.25 million

This 4,200 square foot home looks a bit like an East Coast house directly on the beach. It was built in 2009 and features seven bedrooms and nine bathrooms, as well as a detached guesthouse.

“This stunning 2009 classic Cape Cod flawlessly blends simple, elegant style with casual romantic ambiance,” read the listing from Ranch and Coast Real Estate.

2. 2936 Camino Del Mar, Del Mar — $22 million

2936 Camino Del Mar sold for $22 million in August.

This 7,625 square foot home was built in 1980 and is the largest Del Mar home to sell among the 10 biggest sales. It previously was owned by weight-loss entrepreneur Jenny Craig.

It has five bedrooms and seven bathrooms, 80 feet of ocean frontage, an interior courtyard with a pool and hot tub, an indoor-outdoor kitchen and two guest suites. There is room for 18 parking places.

Listing agent Zach Weinger of Willis Allen Real Estate said the property was unique because it was bigger than most homes in the area but it also had a private courtyard and kitchen area.

“It was probably as private as you could get on the beach,” he said.

The property was first listed for sale in March for $27.9 million and later sold for $5.9 million less. Property records say it was sold to a South Dakota limited liability company called Ocean Investments.

3. Razor House (9826 La Jolla Farms Road), La Jolla — $20.8 million

Profile view of the Razor house in La Jolla.

Architect Wallace E. Cunningham designed the structure, which hugs the side of a cliff and offers dramatic views. Other features include a subterranean garage, swimming pool and outdoor kitchen.

It is one of the biggest luxury homes on this list at 11,545 square feet. Keys has plenty of room for visitors with six bedrooms and eight bathrooms.

4. 1802 Ocean Front, Del Mar— $16 million

1802 Ocean Front, Del Mar sold for $16 million in March

This 3,500-square-foot home was built in 2004 and took 54 days to sell. It is one of the smaller homes in this year’s biggest sales but still has four bedrooms and four bathrooms.

The property has a storied history, for a time being one of the biggest sales in San Diego County history when it sold for $18 million in 2016. It later went back on sale for $17.9 million in January, later selling for a steep discount.

The home is directly on the beach in Del Mar and features a gourmet kitchen, a balcony overlooking the ocean, four bedrooms, a theater room, outdoor shower and a spa. The home was built in 2004.

Property records show the property was purchased by 51-year-old Jennifer A. Moores, likely the daughter of former Padres owner John Moores. The seller was a limited liability company called Coco California.

5. 2502 Ocean Front, Del Mar — $15.4 million

2502 Ocean Front, Del Mar sold for $15.4 million

This is the smallest home on the list at 2,519 square feet, and the oldest, built in 1968.

The home is directly on the beach and has six bedrooms, three bathrooms, a two-car garage, an oceanfront master bedroom with a fireplace. While the home might be on the smaller side for luxury homes, the lot is 4,000 square feet and gives more options for building out.

Best Places to Buy a Home in San Diego

Bungalow-style home in San Diego with a palm plant in the front yard.

Thinking about living in San Diego? America’s Finest City is known for its amazing weather, stunning beaches, and hot spots for outdoor recreation. Whether you’re a growing family looking for the perfect home, a young professional wanting a quick work commute, or a retiree looking for a laid-back neighborhood, this SoCal city has it all. Here are the five best places to buy a home in San Diego!

  • Carmel Valley
  • La Jolla
  • North Clairemont
  • Rancho Bernardo
  • South Park

Carmel Valley

Home with Spanish Style Influences in Carmel Valley, San Diego. Photo by Instagram User @janickeswanson
  • Home Price: $800,133 median purchase price
  • Crime Rate: Safer than 92% of San Diego neighborhoods
  • Perfect For: Singles, young professionals, families, retirees

Carmel Valley is a great place to buy a home in San Diego, and it’s one of the safest neighborhoods in the city, making it ideal for all kinds of households. If you’re a family with kids, there are top-rated schools in the area like Canyon Crest AcademyPacific Trails Middle School, and Torrey Pines High School. You also have easy access to I-5, so it’ll only take you about 20 minutes to head to Downtown San Diego—and a day trip to Los Angeles is only a 45-minute drive. As far as your housing options go, you’ll have no trouble finding Mediterranean-style homes and Southwestern Contemporary houses in this neighborhood!

Things to Do in Carmel Valley

Hike the many trails or relax on the beach at Torrey Pines State Natural Reserve. Go on a nice walk with amazing views at Carmel Mountain Preserve Loop. Play basketball, pickleball, and badminton or cool off in the swimming pool at Carmel Valley Recreation Center. Bring your furry friend to Torrey Hills Dog Park for some outdoor fun. Get brunch from Pacific Social and try the Spicy Chicken & Waffles with a Smoked Paloma. Have fresh Mediterranean food like Falafel and Beef Shish Kabob Plates at Kabob Lounge. Try Black Garlic Ramen, Dan Dan Noodles, and Tokyo Tots at Wokou Ramen & Yakitori. Or eat New York-style pizza like the Stephanie or the Arden at Crust Pizzeria.

La Jolla

Colorful home in La Jolla, San Diego. Photo by Instagram User @thesandiegodream
  • Home Price: $1,326,057 median purchase price
  • Crime Rate: Safer than 65% of San Diego neighborhoods
  • Perfect For: Families, retirees

Want to live close to the beach? Buy a home in La Jolla! Not only is this one of the most well-known neighborhoods in San Diego, but it’s also a perfect place if you want to be near the water and also within 20 minutes of Downtown San Diego. While home prices here are higher, La Jolla might be worth the investment, especially if you’re looking for your luxury dream home! In addition, this San Diego neighborhood is home to some of the best schools in the area, including Torrey Pines ElementaryLa Jolla High School, and University of California San Diego.

Things to Do in La Jolla

Go snorkeling, swimming, diving, or relax in the sand at La Jolla Cove. Take the kids to Kellogg Park and run through the open space or play on the playground. Spend an afternoon in the Birch Aquarium at Scripps Institution of Oceanography and see marine life exhibits like Shark Shores, Seadragons & Seahorses, and the Giant Kelp Forest. Discover amazing abstract and minimalist art dating back to 1950 at Museum of Contemporary Art San Diego. Grab a Brioche Breakfast Grilled Cheese or Salted Caramel Waffle for breakfast from Shorehouse Kitchen—and don’t forget to get a Brunch Bark Bowl for your pup! Sip on the Best Drink Ever, Mint Infused Iced Coffee, or a Rose Water Latte at Better Buzz Coffee. Head to Galaxy Cantina & Grill for Baja Fried Fish Tacos, Enchilada Fries, and Death Star Margaritas. Or order the Surf & Turf Burger with one of the local rotating craft beers at Public House, which is well-known for its burgers and ales.

North Clairemont

Renovated ranch-style home in North Clairemont, San Diego. Photo by Instagram User @gehovan_guzman
  • Home Price: $472,486 median purchase price
  • Crime Rate: Safer than 64% of San Diego neighborhoods
  • Perfect For: Singles, young professionals, families, retirees

Check out North Clairemont if you’re looking for a more affordable neighborhood in San Diego with newly renovated houses! This area is about 15 minutes from La Jolla and Pacific Beach, so you can still live by the ocean without breaking your budget on a home. North Clairemont is good for families, too, because there are great schools in the neighborhood like Hawthorne ElementaryInnovation Middle, and Madison Senior High. Nature lovers have plenty of outdoor recreation and hiking trails to enjoy here as well, and for those who commute for work, Downtown San Diego is only a 15-minute drive via I-805 and CA-52.

Things to Do in North Clairemont

Spend an afternoon at San Clemente Canyon hiking, biking, or enjoying a picnic in Marian Bear Memorial Park. Walk along the nearby Tecolote Canyon Trail to see some more amazing views. Play on the playgrounds, take tennis lessons, or join a basketball league at North Clairemont Recreation Center. Take a group fitness class or have a private training session at Being Fit Clairemont. Bring home French pastries like a Raspberry Turnover or Almond Tart from Arely French Bakery Cafe. Get drinks like Brown Sugar Boba Latte or Taro Black Bean Ice Blend and Vietnamese bites like the Banh Mi Baguette or Crispy Eggrolls from Tealightful Cafe. Try Korean dishes like a Kimchi Pancake, Bul Go Gi Box, or Spicy Braised Baby Back Ribs at Buga Korean BBQ. Or treat your tastebuds to the Carne Asada Burrito, Crispy Quesadilla, or Adobada Nachos at Carmen’s Mexican Food.

Rancho Bernardo

Single-family home in a gated community in Rancho Bernardo, San Diego. Photo by Instagram User @elitehomessandiego
  • Home Price: $553,456 median purchase price
  • Crime Rate: Safer than 94% of San Diego neighborhoods
  • Perfect For: Singles, young professionals, families, retirees

Craving a quieter lifestyle away from San Diego’s bustling downtown and beaches? Rancho Bernardo sits on the northern edge of San Diego and can give you just that! This safe, affordable San Diego neighborhood is nestled between rolling hills and canyons with plenty of surrounding outdoor recreation like Hodges Lake & Reservoir and Elfin Forest Recreational Reserve. And if you do want to make a trip into the city, you’re only about 30 minutes from downtown via I-15. Families will also appreciate having top schools nearby in the award-winning Poway Unified School District like Westwood Elementary School and Rancho Bernardo High School. Whether you want a spacious condo or custom-built home, Ranch Bernardo has it all!

Things to Do in Rancho Bernardo

Hike one of the many trails in Rancho Bernardo like San Dieguito River Park TrailFletcher Point, or Bernardo Bay Trail. Become a member at the The Country Club of Rancho Bernardo and perfect your golf game or enjoy dinner and drinks at the clubhouse. See the antique winemaking facility and order a wine flight of specialty wines at Bernardo Winery. Get your caffeine fix in with a Banana Cream Mocha, Nitro Cold Brew, or Cafe Viennese at Elmisa Cafe. Enjoy a meal on the patio at Urge American Gastropub and try the Peanut Butter Crunch Burger or The Apocalypse Tacos. Try Chinese food favorites like Peking Duck, Sweet & Sour Shrimp, or Mongolian Beef at Pearl Chinese Cuisine. Or have flavorful steakhouse dishes like the Whiskey Peppercorn New York Strip or Basil Mustard Salmon at Carvers Steaks & Chops.

South Park

Cute, blue bungalow in South Park, San Diego. Photo by Instagram User @aussiejoshsellssd
  • Home Price: $513,357 median purchase price
  • Crime Rate: Safer than 84% of San Diego neighborhoods
  • Perfect For: Singles, young professionals, families

South Park is a trendy neighborhood in the heart of San Diego that’s ideal for anyone who wants a cozy bungalow or modern condo close to the excitement of downtown! There are over 70 small businesses here, and there are fantastic schools nearby like Albert Einstein Charter ElementaryGolden Hill K-8 Dual Language Immersion School, and St. Augustine High School. Another huge perk of South Park is that it sits on the eastern border of Balboa Park, which is home to many popular San Diego attractions like the San Diego Zoo and San Diego Museum of Art, as well as some of the city’s best shopping and dining spots!

Things to Do in South Park

Take your pup out for some exercise at Grape Street Dog Park. Spend an afternoon at Golden Hill Park walking through the many paths or relaxing in the green space. Take in the amazing views while hiking Switzer Canyon and Juniper Canyon. Find a new vintage record at Vinyl Junkies! Record Shack. Fill up on a hearty breakfast like the BK Frittata or Whoopie’s Breakfast at Big Kitchen Cafe. Have date night at Buona Forchetta and order the Regina Margherita Pizza with a bottle of red wine. Drink unique cocktails like the Dream Reaper or Witching Hour with some vegan eats like Memphis BBQ Jackfruit at KINDRED. Or go for some playful Indian fare like Curry Mac & Cheese and Chicken Tikka Poutine at Curryosity.

14 Tips For Choosing The Right Real Estate Agent For Your Property Search Or Sale

7 Tips to Help You Become a More Successful Real Estate Agent — RISMedia |

Buying or selling a home is an exciting experience for anyone. There is the thrill of the hunt and the excitement of the deal. The whole process is enhanced by a good real estate agent who knows the ins and outs of the market. But with so many brokerages and agents out there to choose from, finding a perfect fit may be more of a challenge than you expected. Working with a top agent who is experienced and trustworthy can go a long way in ensuring your property sells at top dollar, or that you buy for the best price in the market.

To help with the selection process, 14 members of Forbes Real Estate Council weigh in on how prospective buyers or sellers can make sure the real estate agent they’re working with is the right one for them. Here is what they had to say:

10 Reasons Why You May Need a Real Estate Agent | Travelers Insurance

1. Choose The Person, Not The Experience

I am a firm believer in choosing an agent who works for you and with you. Don’t choose an agent based solely on experience. Although it’s good to have, it’s not everything. You will be spending a lot of time with that agent and you need to mesh. Choose someone relatable and real. Choose for you, not for the house. Choose someone good at talking and negotiating. – Kevin Taylor, Sand to City Real Estate Team

 2. Remember Chemistry Is Key

It’s best to interview at least three agents before picking the one you work with. Focus on neighborhood expertise; look for hyperlocal. Ask yourself, “Is their marketing about them or their properties?” Also, can you trust them, are they honest? Chemistry is the key. – Kevin Hawkins, WAV Group, Inc.

3. Seek Referrals From Other Homeowners

Despite the technology that seems to take over much of the searching for a home, the right real estate agent is still a human-to-human choice. Referral is best. There’s no bigger compliment to an agent than a referral from a past client. Ask homeowners who they would recommend. If you know the area you want to purchase in or sell your home in, there will be an expert in that area. – Eileen LacerteHawaii Beach and Golf Properties

4. Find Someone Who Has Your Best Interests At Heart

Ask yourself, “Does my real estate agent have my best interests at heart?” Be honest and transparent about what you’re looking for, and if an agent isn’t bringing you the right options, it’s likely they aren’t looking for houses for you but rather to benefit themselves. Ask questions upfront and don’t be afraid to move on to someone else if the relationship doesn’t feel right. – Joshua Hunt, TRELORA

5. Go With Your Gut Feeling

Your brain uses logic and emotion when making a decision, and that specific feeling you get when doing so is your intuition — your gut feeling. If you’re interviewing a real estate agent for the job, first look to see that they do a lot of business and have a lot of raving fans. Second, go with your gut feeling. If it feels right, he’s the guy or gal for the job. – Lucas Pinto, Lucas Pinto Real Estate Group, LLC

6. Find An Agent You Can Trust

As the client, you begin the dialogue — but pay close attention to the agent or broker and how he/she listens and asks YOU questions. Most successful agents have access to the technology it takes to make your property seen or to find options for purchase, but it takes a human being to understand and work to achieve your specific goals. Take time to find a human you respect and trust. – Beverly Serral, Beverly Serral Signatures

7. Look For Passion, Conviction And Honesty

Look at the agent’s work. The easiest and most valuable way is to review how they’re marketing other properties. Look at their listing materials, website, brochures and signage. Pay attention to their personal appearance. Look for passion, conviction and honesty. You want your agent to tell you what it’s going to take to get your home to sell faster and for the best price. – Brian Balduf, VHT Studios

8. Make Sure They Offer Adequate Support

Be sure to do your research first. Are they supported by a team? An agent who has support is able to offer a high level of customer service to every customer. Most agents work with several clients at a time. The logistics of buying/selling a home are complicated, and it’s easy to miss something or fall short without a support staff. – Will Featherstone, Featherstone & Co.

9. Check If They Mitigate Risk

Find a real estate agent who is honest about the risks of buying or selling. Throw out the flattery and fluffy agents. You want someone who is realistic and can proactively mitigate risk. When interviewing agents, pay attention to those using real data in their answers when it comes to investment analysis, neighborhood-level market performance, and long-term impact of your decision to buy or sell. – Chuck Hattemer, Onerent

10. Look For Strong Core Values

Whether it’s business or pleasure, finding a good person all comes down to core values. Core values are important because you want to work with someone that plays by the same rules you do. For example, if you are an honest person who tells the truth, would you not want someone to tell the truth to you? – Chris Ryan, Luxury Lifestyles Group / RE/MAX Crest Realty Westside

11. Find A Compassionate Agent Who Understands You

Let’s face it — buying a house is a stressful task, especially if you are facing a divorce, having a baby, mourning the death of a spouse, etc. You need an agent who is patient with you and your circumstances. Interview an agent or broker and see if they have the same emotions, outlook on life, personality, as you do. – Angela Yaun, Day Realty Group

12. Track Record And Inventory

Great real estate investment sales brokers never show up out of nowhere. It takes a long time to build a track record that attracts quality inventory. With single family houses, reciprocity is the rule, but in commercial it is definitely the exception. You need to be talking regularly with the top brokers in your target property type, size and region to get the best deals. – Michael Harris, CREModels

13. Seek Clear Lines Of Communication

First and foremost, you need to feel completely comfortable talking and communicating with the real estate agent. If it feels awkward or if there is undue pressure placed on you by a real estate agent, this is not the right fit. – Sarnen Steinbarth, TurboTenant

14. Scour The Web For Info

Just because you have a friend who has a friend who knows an agent doesn’t mean you should necessarily work with this person. If you are considering an agent, Google them or you can contact us for more information. Yelp them. Check out their website. Interview them. We are lucky to live in an age when there is so much information at our disposal, so use your resources. – Elizabeth Ann Stribling-Kivlan, stribling.com

Tips for First-Time Home Buyers

Like any big project, a successful homebuying experience is all about getting the details right from start to finish. These tips for first-time home buyers will help you navigate the process, save money and close the deal. We organized them into four categories:

  • Preparing to buy tips.
  • Mortgage selection tips.
  • Home shopping tips.
  • Home purchasing tips.

Preparing to buy tips

1. Start saving early

Here are the main costs to consider when saving for a home:

  • Down payment: Your down payment requirement will depend on the type of mortgage you choose and the lender. Some conventional loans aimed at first-time home buyers with excellent credit allow as little as 3% down. But even a small down payment can be challenging to save. For example, a 3% down payment on a $300,000 home is $9,000. Use a down payment calculator to decide a goal, and then set up automatic transfers from checking to savings to get started.
  • Closing costs: These are the fees and expenses you pay to finalize your mortgage, and they typically range from 2% to 5% of the loan amount. You can ask the seller to pay a portion of your closing costs, and you can save on some expenses, such as home inspections, by shopping around.
  • Move-in expenses: You’ll need some cash after the home purchase. Set some money aside for immediate home repairs, upgrades and furnishings.

2. Decide how much home you can afford

Figure out how much you can safely spend on a house before starting to shop. NerdWallet’s home affordability calculator can help with setting a price range based on your income, debt, down payment, credit score and where you plan to live.

» MORE: Learn about how to save for a down payment

3. Check and strengthen your credit

Your credit score will determine whether you qualify for a mortgage and affect the interest rate lenders will offer. Take these steps to strengthen your credit score to buy a house:

  • Get free copies of your credit reports from each of the three credit bureaus — Experian, Equifax and TransUnion — and dispute any errors that could hurt your score.
  • Pay all your bills on time, and keep credit card balances as low as possible.
  • Keep current credit cards open. Closing a card will increase the portion of available credit you use, which can lower your score.
  • Track your credit score. NerdWallet offers a free credit score that updates weekly.

Mortgage selection tips

4. Explore mortgage options

A variety of mortgages are available with varying down payment and eligibility requirements. Here are the main categories:

  • Conventional mortgages are not guaranteed by the government. Some conventional loans targeted at first-time buyers require as little as 3% down.
  • FHA loans are insured by the Federal Housing Administration and allow down payments as low as 3.5%.
  • USDA loans are guaranteed by the U.S. Department of Agriculture. They are for rural home buyers and usually require no down payment.
  • VA loans are guaranteed by the Department of Veterans Affairs. They are for current and veteran military service members and usually require no down payment.

You also have options when it comes to the mortgage term. Most home buyers opt for a 30-year fixed-rate mortgage, which is paid off in 30 years and has an interest rate that stays the same. A 15-year loan typically has a lower interest rate than a 30-year mortgage, but the monthly payments are larger.

5. Research first-time home buyer assistance programs

Many states and some cities and counties offer first-time home buyer programs, which often combine low-interest-rate mortgages with down payment assistance and closing cost assistance. Tax credits are also available through some first-time home buyer programs.

6. Compare mortgage rates and fees

The Consumer Financial Protection Bureau recommends requesting loan estimates for the same type of mortgage from multiple lenders to compare the costs, including interest rates and possible origination fees.

Lenders may offer the opportunity to buy discount points, which are fees the borrower pays upfront to lower the interest rate. Buying points can make sense if you have the money on hand and plan to stay in the home for a long time. Use a discount points calculator to decide.

7. Get a preapproval letter

A mortgage preapproval is a lender’s offer to loan you a certain amount under specific terms. Having a preapproval letter shows home sellers and real estate agents that you’re a serious buyer, and can give you an edge over home shoppers who haven’t taken this step yet.

Apply for preapproval when you’re ready to start home shopping. A lender will pull your credit and review documents to verify your income, assets and debt. Applying for preapproval from more than one lender to shop rates shouldn’t hurt your credit score as long as you apply for them within a limited time frame, such as 30 days.

Home shopping tips

8. Choose a real estate agent carefully

A good real estate agent will scour the market for homes that meet your needs and guide you through the negotiation and closing process. Get agent referrals from other recent home buyers. Interview at least a few agents, and request references. When speaking with potential agents, ask about their experience helping first-time home buyers in your market and how they plan to help you find a home.

9. Pick the right type of house and neighborhood

Weigh the pros and cons of different types of homes, given your lifestyle and budget. A condominium or townhome may be more affordable than a single-family home, but shared walls with neighbors will mean less privacy. Don’t forget to budget for homeowners association fees when shopping for condos and townhomes, or houses in planned or gated communities. Another option to consider is buying a fixer-upper — a single-family home in need of updates or repairs. Fixer-uppers usually sell for less per square foot than move-in ready homes. However, you may need to budget extra for repairs and remodeling. Renovation mortgages finance both the home price and the cost of improvements in one loan.

Think about your long-term needs and whether a starter home or forever home will meet them best. If you plan to start or expand your family, it may make sense to buy a home with extra room to grow.

Check out potential neighborhoods thoroughly. Choose one with amenities that are important to you, and test out the commute to work during rush hour.

10. Stick to your budget

A lender may offer to loan you more than what is comfortably affordable, or you may feel pressure to spend outside your comfort zone to beat another buyer’s offer. To avoid financial stress down the road, set a price range based on your budget, and then stick to it.

Look at properties below your price limit to give some wiggle room for bidding in a competitive market.

11. Make the most of open houses

Online 3D home tours have become more popular amid the COVID-19 pandemic. These tours let shoppers virtually walk through a home at any hour and observe details that regular photos don’t catch. They don’t supply all the information in-person visits do — like how the carpets smell — but they can help you narrow the list of properties to visit.

Open your senses when touring homes in person. Listen for noise, pay attention to any odors and look at the overall condition of the home inside and out. Ask about the type and age of the electrical and plumbing systems and the roof.

Home purchasing tips

12. Pay for a home inspection

A home inspection is a thorough assessment of the structure and mechanical systems. Professional inspectors look for potential problems, so you can make an informed decision about buying the property. Here are some things to keep in mind:

  • Standard inspections don’t test for things like radon, mold or pests. Understand what’s included in the inspection and what other inspections you might need.
  • Make sure the inspector can get to every part of the house, such as the roof and any crawl spaces.
  • Traditionally the buyer attends the inspection. By following the inspector around you can get a better understanding of the home and ask questions on the spot. If you can’t attend the inspection, review the inspector’s report carefully and ask about anything that’s unclear.

13. Negotiate with the seller

You may be able to save money by asking the seller to pay for repairs in advance or lower the price to cover the cost of repairs you’ll have to make later. You may also ask the seller to pay some of the closing costs. But keep in mind that lenders may limit the portion of closing costs the seller can pay.

Your negotiating power will depend on the local market. It’s tougher to drive a hard bargain when there are more buyers than homes for sale. Work with your real estate agent to understand the local market and strategize accordingly.

14. Buy adequate home insurance

Your lender will require you to buy homeowners insurance before closing the deal. Home insurance covers the cost to repair or replace your home and belongings if they’re damaged by an incident covered in the policy. It also provides liability insurance if you’re held responsible for an injury or accident. Buy enough home insurance to cover the cost of rebuilding the home if it’s destroyed.

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