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Two Things You Don’t Want to Hear from Your Listing Agent

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You’ve decided to sell your house. You begin to interview potential real estate agents to help you through the process. You need someone you trust enough to:

    • Set the market value on possibly the largest asset your family owns (your home)
    • Set the time schedule for the successful liquidation of that asset
    • Set the fee for the services required to liquidate that asset

An agent must be concerned first and foremost with you and your family in order to garner that degree of trust. Make sure this is the case. Be careful if the agent you are interviewing begins the interview by bragging about their success or their company’s success – these are red flags!

An agent’s success and the success of their company can be important considerations when deciding on the right real estate professional to represent you in the sale of your house. However, you first need to know that they care about what you need and what you expect from the sale. If the agent is not interested in first establishing your needs, how successful they may seem is much less important.

Look for someone with the ‘heart of a teacher’ who comes in prepared to explain the current real estate market to you and is patient enough to take the time to show you how it may impact the sale of your home. Not someone only interested in trying to sell you on how great they are.

You have many agents from which to choose. Pick someone who truly cares. Pick Coastal Realty Connections.

Why Getting Pre-Approved Should Be Your First Step

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In many markets across the country, the amount of buyers searching for their dream home greatly outnumbers the amount of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way to show you are serious about buying your dream home in coastal North Carolina is to get pre-qualified or pre-approved for a mortgage before starting your search.

But even if you are in a market that is not as competitive, knowing your budget will give you the confidence to know if your dream home is within your reach.

Freddie Mac lays out the advantages of pre-approval in the ‘My Home’ section of their website.

“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you with this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment and residential history.”

Freddie Mac describes the 4 Cs that help determine the amount you will be qualified to borrow:

      • Capacity: Your current and future ability to make your payments
      • Capital or cash reserves: The money, savings and investments you have that can be sold quickly for cash
      • Collateral: The home, or type of home, that you would like to purchase
      • Credit: Your history of paying bills and other debts on time

Bottom Line

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying and it often helps speed up the process once your offer has been accepted. Many potential home buyers overestimate the down payment and credit scores needed to qualify for a mortgage today. If you are ready and willing to buy, you may be surprised at your ability to do so as well. Contact Coastal Realty Connections to learn more!

The Benefits of Using an Agent When Selling Your Home

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When a homeowner decides to sell their house, they obviously want the best possible price with the least amount of hassles. However, for the vast majority of sellers, the most important result is to actually get the home sold.

In order to accomplish all three goals, a seller should realize the importance of using a real estate professional. We realize that technology has changed the purchaser’s behavior during the home buying process. According to the National Association of Realtors’ latest Profile of Home Buyers & Sellers, the percentage of buyers who used the internet in their home search increased to 94%.

However, the report also revealed that 96% of buyers that used the internet when searching for a home purchased their home through either a real estate agent/broker or from a builder or builder’s agent. Only 2% purchased their home directly from a seller whom the buyer didn’t know.

Buyers search for a home online, but then depend on an agent to find the home they will buy (50%), to negotiate the terms of the sale (47%) & price (36%), or to help understand the process (61%).

The plethora of information now available has resulted in an increase in the percentage of buyers that reach out to real estate professionals to “connect the dots.” This is obvious as the percentage of overall buyers who used an agent to buy their home has steadily increased from 69% in 2001.

Bottom Line

If you are thinking of selling your home, don’t underestimate the role that a real estate professional can play in the process. Contact Coastal Realty Connections and start the process with the help of a trusted and talented professional today.

What Do You Need to Qualify for a Mortgage?

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Fannie Mae’s “What Do Consumers Know About The Mortgage Qualification Criteria?” study revealed that Americans are quite misinformed about what is really required to qualify for a mortgage when purchasing a home.

To help correct these misunderstandings, let’s take a look at the survey results compared to the latest Ellie Mae Origination Insight Report, which focuses on recently approved loans.

Survey Results vs. What’s Really Required

    • 59% of Americans either don’t know (54%) or are misinformed (5%) about what FICO score is necessary to qualify.
    • Many Americans believe a ‘good’ credit score is 780 or higher. 53.9% of approved mortgages had a credit score of 600-749.
    • 76% of Americans either don’t know (40%) or are misinformed (36%) about the minimum down payment required.
    • Many believe that they need at least 20% down to buy their dream home. New programs actually let buyers put down as little as 3%.

You Can Save for a Down Payment Faster Than You Think

In a study conducted by Builder.com, researchers determined that nationwide, it would take “nearly eight years” for a first-time buyer to save enough for a down payment on their dream home.

Depending on where you live, median rents, incomes and home prices all vary. By determining the percentage of income a renter spends on housing in each state, and the amount needed for a 10% down payment, they were able to establish how long (in years) it would take for an average resident to save.
According to the study, residents in North Carolina are able to save for a down payment the quickest in just under 7.32 years.

What if we changed that percentage? What if you were able to take advantage of one of the Freddie Mac or Fannie Mae 3% down programs? Suddenly saving for a down payment no longer takes 5 or 10 years, but becomes attainable in under two years in many states. In North Carolina, you could save up a down payment in just 2.19 years. Suddenly, owning a home isn’t a far off dream – it’s a reality that’s just down the road.

Bottom Line

Whether buying your first home or moving up to your dream home, knowing your options will definitely make the mortgage process easier. It doesn’t matter if you’ve just started to save for a down payment, or have been putting away money for years – you may be closer to your dream home than you think! To find out how close, contact Coastal Realty Connections today. We’ll make sure you find the best home at the best price sooner rather than later.

Baby Boomers Are Finding Freedom in Retirement

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Within the next five years, Baby Boomers are projected to have the largest household growth of any other generation during that same time period, according to the Joint Center for Housing Studies (JCHS) at Harvard University. Let’s take a look at why…

In a recent Merrill Lynch study, “Home in Retirement: More Freedom, New Choices,” nearly 6,000 adults, ages 21 and older, were surveyed about housing.

Crossing the “Freedom Threshold”

Throughout our lives, there are often responsibilities that dictate where we live. Whether being in the best school district for our children, being close to our jobs, or some other factor is preventing a move, the study found that there is a substantial shift that takes place at age 61.

The study refers to this change as “Crossing the Freedom Threshold” – when where you live is no longer determined by responsibilities, but rather a freedom to live wherever you would like.

As one participant in the study stated: “In retirement, you have the chance to live anywhere you want. Or you can just stay where you are. There hasn’t been another time in life when we’ve had that kind of freedom.”

On the Move

According to the study, “an estimated 4.2 million retirees moved into a new home last year alone.” Two-thirds of retirees say that they are likely to move at least once during retirement.

The top reason cited for relocation was “wanting to be closer to family” at 29%, while a close second was “wanting to reduce home expenses.” See the chart below for the top 6 reasons broken down.

Not Every Baby Boomer Downsizes

There is a common misconception that as retirees find themselves with fewer children at home, they will instantly desire a smaller home to maintain. While that may be the case for half of those surveyed, the study found that three in ten decide to actually upsize to a larger home.

Some choose to buy a home in a desirable destination with extra space for large family vacations, reunions, extended visits, or to allow other family members to move in with them.

“Retirees often find their homes become places for family to come together and reconnect, particularly during holidays or summer vacations.”

Bottom Line

If your housing needs have changed or are about to change, let’s get together to discuss the options available to you now. Contact Coastal Realty Connections and embrace the next phase of your life!

The Benefits of Working with a Real Estate Agent

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Many people wonder whether they should hire a real estate agent to assist them in buying their dream home or if they should first try to do it on their own. In today’s market, the answer is clear: you need an experienced professional!

You Need an Expert Guide if You Are Traveling a Dangerous Path

The field of real estate is loaded with land mines. You need a true expert to guide you through the dangerous pitfalls that currently exist. Finding a home that is priced appropriately and ready for you to move in to can be tricky. An agent listens to your wants and needs, and can sift out the homes that do not fit within the parameters of your “dream home.”

You Need a Skilled Negotiator

In today’s market, hiring a talented negotiator could save you thousands, perhaps tens of thousands of dollars. Each step of the way – from the original offer, to the possible renegotiation of that offer after a home inspection, to the possible cancellation of the deal based on a troubled appraisal – you need someone who can keep the deal together until it closes.

Realize that when an agent is negotiating their commission with you, they are negotiating their own salary; the salary that keeps a roof over their family’s head; the salary that puts food on their family’s table. If they are quick to take less when negotiating for themselves and their families, what makes you think they will not act the same way when negotiating for you and your family? If they were Clark Kent when negotiating with you, they will not turn into Superman when negotiating with the buyer or seller in your deal.

Bottom Line

Famous sayings become famous because they are true. You get what you pay for. Just like a good accountant or a good attorney, a good agent will save you money, not cost you money. If you’re ready to begin the home buying journey, don’t embark on this difficult path alone! Contact Coastal Realty Connections and find a real estate agent that will guide you, fight for you, and serve you well. You won’t regret it!

The Great News About Rising Home Prices

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Recently there has been a lot of talk about home prices and if they are accelerating too quickly. In some areas of the country, seller supply (that is, the number of homes for sale) cannot keep up with the number of buyers out looking for a home. This has caused prices to rise.

At Coastal Realty Connections, we believe in silver linings. The great news about rising pricesis that according to CoreLogic’s latest US Economic Outlook, the average American household gained over $11,000 in equity over the course of the last year, largely due to home value increases.

The map below was created from CoreLogic’s report and shows the average equity gain per mortgaged home over the past year.

For those who are worried that we are doomed to repeat 2006 all over again, it is important to note that homeowners are investing their new found equity in their homes and themselves, not in depreciating assets.

The added equity is helping families put their children through college, and even invest in starting small businesses, allowing them to pay off their mortgage sooner or move up to the home that will better suit their needs now.

Bottom Line

CoreLogic predicts that home prices will appreciate by another 5% by this time next year. If you’re a homeowner looking to take advantage of your home equity by moving up to your dream home, contact Coastal Realty Connections today to discuss your options!

Buying a Home: Wants vs. Needs

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In this day and age of being able to shop for anything anywhere, the best way to start is to understand the difference between wants vs. needs. This will help you figure out what’s really important to you as you begin your search for the perfect home.

If you’ve been thinking about buying a home of your own for some time now, you’ve probably come up with a list of things that you’d LOVE to have in your new home. Many new homebuyers fantasize about the amenities that they see on television or Pinterest, and start looking at the countless homes listed for sale with rose-colored glasses.

Do you really need that farmhouse sink in the kitchen in order to be happy with your home choice? Would a two-car garage be a convenience or a necessity? Could the man cave of your dreams be a future renovation project instead of a make or break now? These questions will help you figure out the difference between wants vs. needs.

The first step in your home buying process should be to get pre-approved for your mortgage. This allows you to know your budget before you fall in love with a home that is way outside of it.

The next step is to list all the features of a home that you would like, and to qualify them as follows:

    • ‘Must Haves’ – if this property does not have these items, then it shouldn’t even be considered. (ex: distance from work or family, number of bedrooms/bathrooms)
    • ‘Should Haves’ – if the property hits all of the must haves and some of the should haves, it stays in contention, but does not need to have all of these features.
    • ‘Absolute Wish List’ – if we find a property in our budget that has all of the ‘must haves,’ most of the ‘should haves,’ and ANY of these, it’s the winner!

Bottom Line

Having this list flushed out before starting your search will save you time and frustration, while also letting your agent know what features are most important to you before starting to show you houses in your desired area. In other words, an experienced real estate agent should absolutely be on your ‘must have’ list. Luckily, finding one is easy – simply contact Coastal Realty Connections to get started!

The Time To Sell Your Home Is Now. Here’s Why

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Now that the housing market has stabilized, more and more homeowners are considering moving up to the home they have always dreamed of. Prices are still below those of a few years ago and interest rates are still around 4%.

What does this mean for sellers? That waiting to make the move while mortgage rates are increasing just doesn’t make sense. As rates increase, the price of the house you can afford will decrease if you plan to stay within a certain budget for your monthly housing costs.

With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5% (in this example, $10,000). Experts predict that mortgage rates will increase by at least half a point by this time next year.

Act now to get the most house for your hard-earned money. Contact Coastal Realty Connections now, before prices rise even higher!

Lack of Listings Slowing Down the Housing Market

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The housing crisis is finally in the rearview mirror as the real estate market moves down the road to a complete recovery. Home values are up. Home sales are up. Distressed sales (foreclosures and short sales) have fallen dramatically. This will be the year that the housing market again races forward.

However, there is one thing that may cause the industry to tap the brakes: a lack of housing inventory. While buyer demand looks like it will remain strong throughout the winter, supply is not keeping up. Here are the thoughts of a few industry experts on the subject:

Mark Fleming, PhD. Chief Economist at First American:

“Extremely limited supply is stopping the market from reaching its full potential, counteracting positive increases in market fundamentals, such as employment and wages.”

Jonathan Smoke, Chief Economist at realtor.com:

“Overall, the fundamental trends we have been seeing all year remain solidly in place as we enter the traditionally slower sales season, and pent-up demand remains substantial as buyers seek to get a home under contract while rates remain so low.”

Lawrence Yun, Chief Economist at NAR:

“Healthy labor markets in most of the country should be creating a sustained demand for home purchases. However, there’s no question that after peaking in June, sales in a majority of the country have inched backwards because inventory isn’t picking up to tame price growth and replace what’s being quickly sold… Inventory has been extremely tight all year and is unlikely to improve now that the seasonal decline in listings is about to kick in. Unfortunately, there won’t be much relief from new home construction, which continues to be grossly inadequate in relation to demand.”

Supply and Demand

The price of any item is determined by the supply of that item, as well as the market demand. The National Association of Realtors (NAR) surveys “over 50,000 real estate practitioners about their expectations for home sales, prices and market conditions” for their Realtors Confidence Index. Their latest edition sheds some light on the relationship between Seller Traffic (supply) and Buyer Traffic (demand).

Buyer Demand

The map above was created after asking the question: “How would your rate buyer traffic in your area?” The darker the blue, the more buyers are looking for homes in that area. As you can see, four states came in with a weak demand level.

Seller Supply

The Index also asked: “How would you rate seller traffic in your area?” As you can see from the map above, the majority of the country has weak Seller Traffic, meaning there are far fewer homes on the market than what is needed to satisfy the buyers who are out looking for their dream homes.

Bottom line?

There is a clear demand for homes, but the surplus isn’t there. Looking at the maps above, it is not hard to see why prices are appreciating in many areas of the country. Until the supply of homes for sale starts to meet the buyer demand, prices will continue to increase.

This means home prices are more competitive than ever, and that the best time to put your home on the market is right now. To take advantage of this moment in time, contact Coastal Realty Connection today. Your net worth will thank you!