Housing market will be slower, steadier in 2019

Source: Housing market will be slower, steadier in 2019

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NEW YORK – Jan. 4, 2018 – Forget fevered bidding wars and snap home-buying decisions. Slower and steadier will characterize next year’s housing market.

That follows a 2018 that started off hot but softened into the fall as buyers – put off by high prices and few choices – sat out rather than paid up.

Affordability issues will remain a top concern going into 2019, exacerbated by rising mortgage rates. But some of 2018’s more intractable issues will begin to loosen up. The volume of for-sale homes is expected to rise and diversify, while the number of buyers is forecast to shrink.

“For home sellers, they need to recognize those days of frenzied market are over. They must price competitively to sell their home,” said Lawrence Yun, the chief economist at the National Association of Realtors. “For buyers, there will be challenges when it comes to rising interest rates, but they don’t have to make hurried decisions anymore.”

Still, some cash-strapped first-time buyers will simply be priced out, while a cohort of potential move-up buyers will decide to stay in their existing home, make renovations and enjoy their current low mortgage rate. Price increases will moderate, and everyone in the market will need to adjust.

Finally, more homes to choose from

One of the biggest complaints among buyers in the last several years is that there weren’t enough homes for sale. In fact, the supply of houses hit historic lows in the winter of 2017 and has yet to rebound substantially. That fueled bidding wars, price increases and frustration.

The supply crunch is expected to ease some in 2019 with inventory rising 10 percent to 15 percent, according to Yun.

But the increase will be skewed toward the mid-to-high end of the market – houses priced $250,000 and higher – especially when it comes to newly built houses, said Danielle Hale, chief economist of realtor.com. That’s good news for move-up buyers, but not so much for the first-time millennial buyer. “There’s still a mismatch on the entry-level side,” she said.

Houses in all shapes and sizes

If you’re a first-time buyer, you won’t be completely out of luck if you stay open-minded. If a single-family home is out of the question, consider a mobile home or townhouse as a starter home, both of which are on the rise.

The volume of shipments for manufactured houses – also known as mobile homes – is expected to finish above 100,000 this year, up from 93,000 in 2017, according to Robert Dietz, chief economist of the National Association of Home Builders. The trend is expected to continue next year.

These homes are also significantly cheaper than other home types. Not including land costs, the cost to buy a mobile home averages $70,600, compared with $257,900 for an existing single-family home and $309,700 for a new home.

You may also consider a townhouse, an attached single-family home located in a community of homes. Construction of townhomes also is experiencing year-over-year growth and is outpacing the single-family detached home market, Dietz said.

“The market is being supported by millennials moving from renting to their first-home purchase,” he said. “If you’re in a high-cost area with wage and job growth, townhouses are appropriate for entry-level. And they still get that suburban feel with their own front door.”

Affording a home remains hard

Housing values are still expected to increase next year, but not at the gang-buster pace seen in recent years. NAR’s Yun forecasts modest price growth between 2 percent and 3 percent, down from close to 5 percent this year and over 5 percent in 2017.

At the same time, mortgage rates are expected to hit 5.5percent by the end of 2019. Both factors make it more expensive for buyers to purchase a home. Hale estimates that the expected increase in prices and interest rates translates to an 8percent rise in the average monthly mortgage payment.

Interest rate trap

Shrinking affordability will convince some buyers – especially first-timers – to sit out the market altogether next year because they can’t make the numbers work. Homeowners considering selling their home may also stay put because of rising mortgage rates – a so-called interest rate trap. Most outstanding mortgages have an interest rate of 4.5 percent or less, according to a report this year from Black Knight, a data analytics firm.

“They have a nice low mortgage rate, lower than the current rate, so there’s no reason to move,” said Mark Fleming, chief economist of First American Financial Corp.

Tax worries linger

The first few months of 2019 will reveal how the new tax changes affect homeowners. One key rule is the new cap on the mortgage interest deduction.

Before, homeowners could deduct interest they paid on up to $1 million in mortgage debt – including interest on home equity loans and lines of credit – reducing their taxable income.

Now, you can only deduct interest on up to $750,000 in mortgage debt. Interest paid on home equity loans and lines of credit is deductible only if the funds were used to pay for home improvements or renovations.

The only taxpayers who will exceed those limits are high-end homeowners and buyers and those with multiple homes with mortgages.

The bigger question mark is if and how the $10,000 limit on state and local taxes deduction – known as SALT – will affect housing markets in high-tax states such as New Jersey, New York, Connecticut and California.

Buyers may be reluctant to purchase homes in those states – or choose a smaller house – if they calculate they will pay too much in non-deductible taxes. “These states may see softer housing markets compared to the rest of the country,” said Yun, if the SALT cap hurts enough homeowners.

The bottom line

If you’re a seller: Price realistically and be ready to cut the listing price or offer other incentives to get a deal done. “It’s still a seller’s market, but not like it was,” Hale said. “Sellers need to be mindful of competition, especially for more expensive properties.”

If you’re a buyer: Don’t worry about going slow when making decisions. “There is less buyer competition and more inventory,” Yun said. “Buyers can take time to find the home that fits into their budget.”

Copyright 2019, USATODAY.com, USA TODAY, Janna Herron

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10 Amazing Vinegar Cleaning Hacks All Homeowners Should Know

Video

Vinegar is basically the Swiss Army knife of fermented products. Not only does it have various medicinal and disinfectant properties, but it has a number of potent uses around the home. These range from drain cleaning, to wrinkle removal, to trashcan deodorizing, and even repelling cats from scratching up your furniture!

Whether you’re a homeowner simply wanting to keep your place in better shape, or a real estate agent that needs a quick fix before showing a house, vinegar is a definite ally to keep around!

Making happy home owners one sale at a time! Call me today for a free home market analysis.

Jennifer Bailey, REALTOR® e-PRO®
Dale Sorensen Real Estate
772-559-5524 • veroluxuryhomes.comsearchinvero.com

TOP TIPS FOR STAGING YOUR HOME

A recent survey from the National Association of Realtors® revealed that 77 percent of buyers’ agents said staging a home makes it easier for potential buyers to visual it as their own. That’s why here at Breakthrough Broker, we believe staging is not to be overlooked! Here are our top tips.

  1. Dress up your yard. First impressions count, and the first one your home gives comes from the exterior. Mow the lawn, clean up shrubbery, rake any leaves, clean the walkway and driveway, plant in-season flowers, and pull up any unsightly weeds.
  2. Reduce personal items. Make it easier for buyers to imagine themselves making your house their home by removing personal photos and knick-knacks from shelves, walls, and counters. Instead replace them with clean, simple décor, such as abstract paintings, nature images, vases, plants, and more.
  3. Organize your storage areas. Storage is a huge selling point. Tidy up and clear out the accessible closets and cupboards in the home and make sure to point them out during an open house or showing.
  4. Appeal to the senses. Consider ways you can appeal to potential homebuyers’ other senses. During a viewing or open house, bake some fresh cookies or burn delicious smelling candles and play light, relaxing music in the background.
  5. Consider turning to an expert. With their knowledge of current trends and great eye for design, professionally certified stagers can transform a home in a variety of ways and have a keen sense of what homebuyers want and expect in a home. Investing in hiring a pro may pay off in dividends.

Locally Known… Globally Connected!
Jennifer Bailey, REALTOR® e-PRO®
Dale Sorensen Real Estate
772-559-5524 • veroluxuryhomes.comsearchinvero.com

House Hunting and Renovation TV Shows – Fun Facts and Dirty Little Secrets

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Television channels like HGTV and DIY have truly changed residential real estate for the better. Thanks to these channels, buyers and sellers today are more educated about their homes’ structures, décor, and remodeling costs. Everybody’s expectations are higher and most buyers and sellers’ creativity is too. Have you wondered about how these shows are made? What is real and what is not? Here are some fun facts.

First, for the remodeling or fix and flip shows, the remodeling budget is truly the homeowners’ remodeling budget. If the homeowners have wanted more than their budget will allow, the producers usually bring the buyers back to reality long before the remodel is started. If there is some unforeseen cost, other changes are omitted or downscaled.

The inspections are real inspections, too. When you see a show host presiding over a sewer inspection (yuk!), they are really checking it out.

The programs need true action in addition to just on-camera interviews. (Ever notice how each of these shows has at least one homeowner hitting a wall with a sledge hammer?) When you see a show host or a new owner actually doing work, they are not faking it – they are really doing the work that you are seeing. Those are real nails in those nail guns. All of the show hosts and all of the buyers get involved in at least some portion of the decorating or remodel.

Now for the dirty little secrets. Here is the big one for the house hunter shows. Although it is really fun to try and guess which house a buyer will pick, these programs are shot in reverse. That means the show is filmed after the buyers buy – and close on – their home. The other homes are “decoys” that are filmed after the transaction concludes and were never seen by the buyers during the actual search.

Ever notice how much the buyer or house remodeler couples argue and disagree? A lot of the drama on the shows is fake. Conflict, like action, makes a more interesting television show. The producers will encourage the magnification of buyers’ and sellers’ fears and dilemmas because it is believed – correctly or incorrectly – that it makes for better ratings.

And even though the host and home owners get involved in some of the work, most of the work is done off-camera by professional contractors and (sometimes) large crews. The projects can take much longer than they usually would as well; the contractor’s schedules and stages have to work with the production crew’s schedules and availability.

Nevertheless, these shows are really fun to watch, and offer lots of general education about homes and house hunting.

MUST-HAVE TOOLS FOR HOMEOWNERS

When you own your home, things are going to break and, unless you want to spend your money on visits from a neighborhood handyman, you’re going to need to fix them yourself. Luckily, you don’t need an arsenal of tools to handle most home maintenance fixes. These five tools will cover most of your basic projects.

  1. Cordless drill. A cordless drill is a must-have for installing cabinets, drawer pulls, hinges, picture frames, shelves and hooks, and more. Whether it’s for do-it-yourself projects or repairs, you’ll use your cordless drill just about every month.
  2. Drain cleaners. Shower and bathroom sink drains are susceptible to clogs because of the daily buildup of hair and whisker clippings. You can use chemical clog removers like Drano, but they’re expensive and the lingering chemical scent is unpleasant. Instead, buy some plastic drain cleaners that can reach into the drain to pull out the clog of hair and gunk. You can purchase them on Amazon or at a local hardware store for a low price.
  3. Shop-vac. No matter how careful you are, spills and accidents will happen and there are some tasks that just can’t be handled with paper towels or a standard vacuum, like pet messes or broken glass.
  4. Loppers. Even the minimum amount of care for your landscaping will require some loppers to remove damaged branches, vines, thick weeds, and any other unruly plants in your yard.
  5. Flashlight. You’re going to want something a little more powerful than your iPhone flashlight when you’re in the crawlspace!

6 ways to prepare now for hurricanes

Source: 6 ways to prepare now for hurricanes

eye of the storm image from outer space

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MIAMI – June 8, 2018 – The worst thing that people who live along coastlines can do is not to prepare for tropical storms and hurricanes.

According to the National Hurricane Center, the two key factors contributing to weather safety during hurricanes are preparing in advance for the risks and to act on those preparations when alerted by emergency officials.

The director of the National Hurricane Center, Rick Knabb, and AccuWeather Hurricane Expert Dan Kottlowski, outlined certain precautionary steps that people in areas impacted by hurricanes and tropical storms should take.

1. Evacuation planning
The main reason people have to evacuate during hurricanes is from a storm surge, which is an abnormal rise of water generated by a storm’s winds that can reach heights well over 20 feet and can span hundreds of miles of coastlines, according to the National Hurricane Center.

“Evacuation planning is number one on the list,” Knabb said.

Knabb urged that people find out today if they live in a hurricane evacuation area, which is an area in which residents must leave their homes in the event of a hurricane.

Local governments provide the public with information about evacuation areas and the evacuation plans, and Knabb recommended that people review this information in advance.

“Some people will actually test the evacuation route in good weather,” Kottlowski said. “Waiting until the day of the hurricane isn’t a smart idea since everyone will be in a heightened state of anxiety.”

While people who live in storm surge areas fall within areas that are urged to evacuate during a hurricane, people who live outside of these zones should still look into safety precautions during a hurricane.

Those who live in mobile homes and high rises may also have to evacuate even if they do not live in an evacuation area, Knabb said.

“It’s not just a beach front problem,” he added.

Pet owners should also have an evacuation plan for their pets. Many shelters offer places to keep pets.

2. Buy supplies
The most important thing that both Knabb and Kottlowski stressed was buying supplies well in advance and keeping those supplies on hand should evacuation be required.

“If you wait until the hurricane is on your doorsteps, you are going to be waiting in long lines and they could even be out of the stuff you need,” Knabb said.

Those living in evacuation areas should keep a hurricane kit handy that is stored in a way that is easy to grab and bring to an evacuation shelter.

While evacuation shelters do provide supplies, Kottlowski said, “Shelters can get overrun and may not have enough supplies.”

These kits should include water, food, blankets and clothing, as well as a first aid kit, battery-powered or hand-crank radio, flashlight and batteries, whistle to signal for help and local maps.

Kottlowski said he recommends that residents have their kits bagged up in a suitcase or plastic tub.

3. Check insurance coverage
Property owners and renters should be sure to insure their homes against flooding, something that Knabb said many people do not realize is not a part of standard home and renters insurance.

Tenants and home owners can contact their renters or home insurance provider to buy flood insurance, and they should do so even if they do not live right along the coastline.

“People might think that if they don’t live on the coast, then they won’t have a flooding problem,” Knabb said. “But if it can rain, it can flood.”

Car owners should also contact auto insurance companies and move their cars into an off-site location or secured building.

“You won’t be able to take every vehicle you own to the shelter, but if you leave the vehicle outside, it could be seriously damaged,” Kottlowski said.

4. Make copies of important documents
Those living in or near hurricane areas should make copies of proof of ownership documents of any property not limited to their homes, cars and boats. These documents can be stored in the hurricane kit or in any safe location that does not risk being damaged during the hurricane.

“If a hurricane levels your house, you have to prove that it is your house,” Kottlowski said.

5. Protect your home
Residents and tenants should inspect their homes to confirm that there is no damage that a hurricane could increase. Any issues with the overall structure should be repaired, including loose shingles or damaged roofs.

“Any possible compromises to the roof or house will become an open avenue for strong and gusty winds,” Kottlowski said.

Residences with yards should also make a list of anything laying on the ground outside that could get tossed into the air and become debris during high winds.

Kottlowski also said residents should purchase supplies, including plywood to cover windows and extra security to keep doors from blowing open, in advance, to secure their homes from damaging winds.

6. Back up your electronics
Aside from keeping extra batteries and chargers around during a hurricane, people are also encouraged to backup any electronic devices.

Knabb said data should be stored at an off-site location so that data can be recovered if something were to happen to the physical computer or device during a hurricane.

Businesses should take particular caution in backing up information and sending that information to a remote site.

© Copyright, 2018, Highlands News-Sun, All Rights Reserved.