• January 17, 2018
    61% of First-Time Buyers Put Down Less than 6%

    61% of First-Time Buyers Put Down Less than 6% | MyKCM

    According to the National Association of Realtors’ latest Realtors Confidence Index, 61% of first-time homebuyers purchased their homes with down payments below 6% from October 2016 through November 2017.

    Many potential homebuyers believe that a 20% down payment is necessary to buy a home and have disqualified themselves without even trying. The median down payment for all buyers in 2017 was just 10% and that percentage drops to 6% for first-time buyers.

    Zillow Senior Economist Aaron Terrazas’ recent comments shed light on why buyer demand has remained strong,

    “Looking into 2018, rent is expected to continue gaining. More widespread rent growth could mean home buying demands stay high, as renters who can afford it move away from the unpredictability of rising rents toward the relative stability of a monthly mortgage payment instead.”

    It’s no surprise that with rents rising, more and more first-time buyers are taking advantage of low-down-payment mortgage options to secure their monthly housing costs and finally attain their dream homes.

    Bottom Line

    If you are one of the many first-time buyers who is not sure if you would qualify for a low-down payment mortgage, let’s get together and set you on your path to homeownership!




    January 16, 2018
    Wondering If You Can Buy Your First Home?

    There are many people sitting on the sidelines trying to decide if they should purchase a home or sign a rental lease. Some might wonder if it makes sense to purchase a house before they are married and have a family, others might think they are too young, and still, others might think their current income would never enable them to qualify for a mortgage.

    We want to share what the typical first-time homebuyer actually looks like based on the National Association of REALTORS most recent Profile of Home Buyers & Sellers. Here are some interesting revelations on the first-time buyer:

    Wondering If You Can Buy Your First Home? | MyKCM

    Bottom Line

    You may not be much different than many people who have already purchased their first homes. Let’s meet to determine if your dream home is within your grasp.




    January 15, 2018
    Thinking of Selling? Now is the Perfect Time

    It is common knowledge that a great number of homes sell during the spring-buying season. For that reason, many homeowners hold off on putting their homes on the market until then. The question is whether or not that will be a good strategy this year.

    The other listings that do come out in the spring will represent increased competition to any seller. Do a greater number of homes actually come to the market in the spring as compared to the rest of the year? The National Association of Realtors (NAR) recently revealed the months in which most people listed their homes for sale in 2017. Here is a graphic showing the results:

    Thinking of Selling? Now is the Perfect Time | MyKCM

    The three months in the second quarter of the year (represented in red) are consistently the most popular months for sellers to list their homes on the market. Last year, the number of homes available for sale in January was 1,680,000.

    That number spiked to 1,970,000 by May!

    What does this mean to you?

    With the national job situation improving, and mortgage interest rates projected to rise later in the year, buyers are not waiting until the spring; they are out looking for homes right now. If you are looking to sell this year, waiting until the spring to list your home means you will have the greatest competition amongst buyers.

    Bottom Line

    It may make sense to beat the rush of housing inventory that will enter the market in the spring and list your home today.




    January 12, 2018
    The Impact Staging Your Home Has on Sales Price [INFOGRAPHIC]

    The Impact Staging Your Home Has on Sales Price [INFOGRAPHIC] | MyKCM

    Some Highlights:

    • The National Association of Realtors surveyed their members & released the findings of their Annual Profile of Home Staging.
    • 50% of staged homes saw a 1-10% increase in dollar value offers from buyers.
    • 77% of buyer’s agents said staging made it easier for buyers to visualize the home as their own.
    • The top rooms to stage in order to attract more buyers are the living room, master bedroom, kitchen, and dining room.




    January 11, 2018
    93% Believe Homeownership Is Important in Attaining the American Dream

    93% Believe Homeownership Is Important in Attaining the American Dream | MyKCM

    Americans continue to believe that homeownership is important in achieving the American Dream. A recent survey by NeighborWorks America reported that:

    “Owning a home remains a core element of the American Dream.”

    When asked “How important a part of the American dream is owning a home?”

    • 18% of those surveyed said it was the most important part
    • 53% of those surveyed said it was very important
    • 22% of those surveyed said it was somewhat important

    Homeownership and Financial Stability

    The survey also revealed that 81% of Americans believe that owning a home leads to a family being more financially stable. This feeling was reiterated by Zillow Senior Economist Aaron Terrazas who, in a recent press release, explained:

    “After about a two-year slowdown, rent growth is starting to pick back up across the nation…Looking into 2018, rent is expected to continue gaining.

    More widespread rent growth could mean home buying demands stay high, as renters who can afford it move away from the unpredictability of rising rents toward the relative stabilityof a monthly mortgage payment instead.” (emphasis added)

    Bottom Line

    Owning a home always has been, and always will be, a crucial part of attaining the American Dream.




    January 10, 2018
    FICO® Scores on Approved Home Loans Drop Again

    FICO® Scores on Approved Home Loans Drop Again | MyKCM

    According to Ellie Mae’s latest Origination Report, the average FICO® Score on all closed loans dropped to 722 which is its lowest mark since April. The average includes all approved refinance and purchase loans.

    FHA and VA loans showed the most opportunity for millennials looking to enter the market with low down payments and even lower FICO® Score requirements.

    Ellie Mae’s Millennial Tracker revealed that those who purchased homes in December with an FHA Loan were able to do so with an average down payment of 4% and a FICO® Score of only 684.

    Joe Tyrell, EVP of Corporate Strategy at Ellie Mae commented on the opportunity this brings to buyers,

    “With the average credit score dipping, lenders are extending credit to borrowers who may have had no previous access to the housing market.”

    Bottom Line

    More and more potential buyers are able to qualify for a mortgage loan now! If you are debating a home purchase, let’s get together and evaluate your ability to buy today!




    January 9, 2018
    The Impact of Tight Inventory on the Housing Market

    The Impact of Tight Inventory on the Housing Market | MyKCM

    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, and distressed sales (foreclosures and short sales) have fallen to their lowest points in years. It seems that the market will continue to strengthen in 2018.

    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:

     

    National Association of Realtors

    “Total housing inventory at the end of November dropped 7.2 percent to 1.67 million existing homes available for sale, and is now 9.7 percent lower than a year ago (1.85 million) and has fallen year-over-year for 30 consecutive months. Unsold inventory is at a 3.4-month supply at the current sales pace, which is down from 4.0 months a year ago.”

    Joseph Kirchner, Senior Economist for Realtor.com

    “The increases in single-family permits and starts show that builders are planning and starting new construction projects, that’s a good thing because it will help to relieve the shortage of homes on the market.”

    Sam Khater, Deputy Chief Economist at CoreLogic

    Inventory is tighter than it appears. It’s much lower for entry-level buyers.”

    Bottom Line 

    If you are thinking of selling, now may be the time. Demand for your house will be strong at a time when there is very little competition. That could lead to a quick sale for a really good price.




    January 8, 2018
    712,000 Homes in the US Regained Equity in the Past 12 Months!

    712,000 Homes in the US Regained Equity in the Past 12 Months! | MyKCM

    CoreLogic’s latest Equity Report revealed that “over the past 12 months, 712,000 borrowers moved into positive equity.” This is great news, as the share of homeowners with negative equity (those who owe more than their home is worth), has dropped more than 20% since the peak in Q4 of 2009 (26%) to 4.9% today.

    The report also revealed:

    • The average homeowner gained approximately $14,900 in equity during the past year.
    • Compared to Q3 2016, negative equity decreased 22% from 3.2 million homes, or 6.3% of all mortgaged properties.
    • U.S. homeowners with mortgages (roughly 63% of all homeownershave seen their equity increase by a total of $870.6 billion since Q3 2016, an increase of 11.8%, year-over-year.

    The map below shows the percentage of homes by state with a mortgage and positive equity. (The states in gray have insufficient data to report.)

    712,000 Homes in the US Regained Equity in the Past 12 Months! | MyKCM

    Significant Equity Is on The Rise

    Frank Nothaft, Chief Economist at CoreLogic, believes this is great news for the “housing market.” He went on to say:

    “Homeowner equity increased by almost $871 billion over the last 12 months, the largest increase in more than three years. This increase is primarily a reflection of rising home prices, which drives up home values, leading to an increase in home equity positions and supporting consumer spending.”

    Of the 95.1% of homeowners with positive equity in the U.S., 82.9% have significant equity (defined as more than 20%). This means that more than three out of four homeowners with a mortgage could use the equity in their current home to purchase a new home now.

    The map below shows the percentage of homes by state with a mortgage and significant equity.

    712,000 Homes in the US Regained Equity in the Past 12 Months! | MyKCM

    Bottom Line

    If you are one of the many homeowners who are unsure of how much equity you have in your home and are curious about your ability to move, let’s meet up to evaluate your situation.




    January 5, 2018
    Time on the Market Drops to New Low in 2017

    Time on the Market Drops to New Low in 2017 | MyKCM

    According to recently released data from the National Association of Realtors (NAR), the median amount of time a home spent on the market hit an all-time low of only three weeks in 2017.

    Strong buyer demand, a good economy, and a low inventory of new and existing homes for sale created the perfect storm to accelerate the time between listing and signing a contract. The time needed to sell a home has dropped substantially since its highest mark of 11 weeks in 2012.

    The chart below shows the median weeks on the market from 1987 to today.

    Time on the Market Drops to New Low in 2017 | MyKCM

    Bottom Line

    If you are a homeowner who is debating whether or not to list your home for sale, know that national market conditions are primed for a quick turnaround! Let’s get together to discuss exactly what’s going on in our area, today!




    January 4, 2018
    4 Reasons to Sell This Winter [INFOGRAPHIC]

    4 Reasons to Sell This Winter [INFOGRAPHIC] | MyKCM

    Some Highlights:

    • Buyer demand continues to outpace the supply of homes for sale which means that buyers are often competing with one another for the few listings that are available!
    • Housing inventory is still under the 6-month supply needed to sustain a normal housing market.
    • Perhaps the time has come for you and your family to move on and start living the life you desire.




    January 3, 2018
    The Benefits of Homeownership Go Beyond the Financial

    The Benefits of Homeownership Go Beyond the Financial | MyKCM

    Homeownership is a major part of the American Dream. As evidence of that, 91% of Americans believe that owning a home is either essential (43%) or important (48%) to achieving that “dream.” In a market where some people may be unsure about the benefits and possibilities of buying a home, it is important that we remember this.

    Homeownership is NOT just about the money. In fact, some of the major benefits are non-financial. Here are a few of those benefits as per the National Association of Realtors:

    • Consistent findings show that homeownership does make a significant positive impact on educational achievement.
    • Several researchers have found that homeowners tend to be more involved in their communities than renters.
    • Early studies of homeownership and health outcomes found that homeowners and children of homeowners are generally happier and healthier than non-owners, even after controlling for factors such as income and education levels that are also associated with positive health outcomes and positively correlated with homeownership.

    Bottom Line

    Homeownership means something more to people and their families than just the financial considerations.




    January 2, 2018
    How Rising Prices Will Help You Build Family Wealth in 2018

    How Rising Prices Will Help You Build Family Wealth in 2018 | MyKCM

    Over the next five years, home prices are expected to appreciate on average by 3.35% per year and to grow by 24.34% cumulatively, according to Pulsenomics’ most recent Home Price Expectation Survey.

    So, what does this mean for homeowners and their equity position?

    As an example, let’s assume a young couple purchases and closes on a $250,000 home this month (January). If we only look at the projected increase in the price of that home, how much equity will they earn over the next 5 years?

    How Rising Prices Will Help You Build Family Wealth in 2018 | MyKCM

    Since the experts predict that home prices will increase by 4.2% in 2018, the young homeowners will have gained $10,500 in equity in just one year.

    Over a five-year period, their equity will increase by nearly $45,000! This figure does not even take into account their monthly principal mortgage payments. In many cases, home equity is one of the largest portions of a family’s overall net worth.

    Bottom Line

    Not only is homeownership something to be proud of, but it also offers you and your family the ability to build equity you can borrow against in the future. If you are ready and willing to buy, find out if you are able to today!




    January 1, 2018
    Here’s to a Wonderful 2018!

    Here?s to a Wonderful 2018! | MyKCM

    We hope 2018 is a great year for you, both personally and professionally!




    December 29, 2017
    Buying or Selling in 2018? 5 Reasons to Resolve to Hire a Pro [INFOGRAPHIC]

    Buying or Selling in 2018? 5 Reasons to Resolve to Hire a Pro [INFOGRAPHIC] | MyKCM

    Some Highlights:

    • As we usher in the new year, one thing is for certain… if you plan to buy or sell a house this year, you need a real estate professional on your team!
    • There are many benefits to using a local professional!
    • Pick a professional who knows your local market and can help you achieve your dreams!




    December 28, 2017
    There’s More to a Bubble Than Rising Home Prices

    There's More to a Bubble Than Rising Home Prices | MyKCM

    What truly causes a housing bubble and the inevitable crash? For the best explanation, let’s go to a person who correctly called the last housing bubble – a year before it happened.

    “A bubble requires both overvaluation based on fundamentals and speculation. It is natural to focus on an asset’s fundamental value, but the real key for detecting a bubble is speculation…Speculation tends to chase appreciating assets, and then speculation begets more speculation, until finally, for some reason that will become obvious to all in hindsight, the ‘bubble’ bursts.

    I have taken to calling the housing market a ‘bubble’.”

    – Bill McBride of Calculated Risk calling the bubble back in April 2005

    Where do we stand today regarding speculation?

    There are two measurements that are used to determine the speculation in a housing market:

    1. The number of homes purchased by an investor and
    2. The number of homes being flipped (resold within a twelve-month period)

    As compared to 2005, investor purchases are down dramatically (from 23% to 13%) and so is flipping (from 8.2% to 5.7%). McBride explains:

    “There is currently some flipping activity, but this is more the normal type of flipping (buy, improve and then sell). Back in 2005, people were just buying homes and letting them sit vacant – and then selling without significant improvements. Classic speculation.”

    What are the experts saying about speculation in today’s market?

    DSNews recently ran an article which asked two economists to compare the speculation in today’s market to that in 2005-2007. Here is what they said:

    Dr. Eddie SeilerChief Housing Economist at Summit Consulting:

    “The speculative ‘flipping mania’ of 2006 is absent from most metro areas.”

    Tian LiuChief Economist of Genworth Mortgage Insurance:

    “The nature of housing demand is different as well, with more potential homeowners and far fewer speculators in the housing market compared to the 2005-2007 period.”

    And what does McBride, who called the last housing bubble, think about today’s real estate market?

    Sixty days ago, he explained:

    “In 2005, people were just buying homes and letting them sit vacant – and then selling without significant improvements. Classic speculation. And even more dangerous during the bubble was the excessive use of leverage (all those poor-quality loans). Currently lending standards are decent, and loan quality is excellent…

    I wouldn’t call house prices a bubble – and I don’t expect house prices to decline nationally like during the bust.”

    Bottom Line

    Speculation is a major element of the housing bubble formula. Right now, there are not elevated percentages of investors and house flippers. Therefore, there is not an elevated rate of speculation.




    December 27, 2017
    Top 4 REAL Reasons We Buy a Home

    Top 4 REAL Reasons We Buy a Home | MyKCM

    We often talk about the financial reasons why buying a home makes sense. But, more often than not, the emotional reasons are the more powerful or compelling reasons.

    No matter what shape or size your living space is, the concept and feeling of home can mean different things to different people. Whether it’s a certain scent or a favorite chair, the emotional reasons why we choose to buy our own homes are typically more important to us than the financial ones.

    1. Owning your home offers stability to start and raise a family

    From the best neighborhoods to the best school districts, even those without children at the time of purchase may have this in the back of their minds as a major reason for choosing the location of the home that they purchase.

    2. There’s no place like home

    Owning your own home offers you not only safety and security, but also a comfortable place that allows you to relax after a long day!

    3. You have more space for you and your family

    Whether your family is expanding, an older family member is moving in, or you need to have a large backyard for your pets, you can take this all into consideration when buying your dream home!

    4. You have control over renovations, updates, and style

    Looking to actually try one of those complicated wall treatments that you saw on Pinterest? Tired of paying an additional pet deposit for your apartment building? Or maybe you want to finally adopt that puppy or kitten you’ve seen online 100 times? Who’s to say that you can’t in your own home?

    Bottom Line

    Whether you are a first-time homebuyer or a move-up buyer who wants to start a new chapter in your life, now is a great time to reflect on the intangible factors that make a house a home.




    December 26, 2017
    Top 5 Reasons You Shouldn’t FSBO

    Top 5 Reasons You Shouldn?t FSBO | MyKCM

    In today’s market, with home prices rising and a lack of inventory, some homeowners may consider trying to sell their home on their own, known in the industry as a For Sale by Owner (FSBO). There are several reasons why this might not be a good idea for the vast majority of sellers.

    Here are the top five reasons:

    1. Exposure to Prospective Buyers

    Recent studies have shown that 95% of buyers search online for a home. That is in comparison to only 17% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?

    2. Results Come from the Internet

    Where did buyers find the home they actually purchased?

    • 49% on the internet
    • 31% from a Real Estate Agent
    • 7% from a yard sign
    • 1% from newspapers

    The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.

    3. There Are Too Many People to Negotiate With

    Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale By Owner:

    • The buyer who wants the best deal possible
    • The buyer’s agent who solely represents the best interest of the buyer
    • The buyer’s attorney (in some parts of the country)
    • The home inspection companies, which work for the buyer and will almost always find some problems with the house
    • The appraiser if there is a question of value

    4. FSBOing Has Become More And More Difficult

    The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 8% over the last 20+ years.

    The 8% share represents the lowest recorded figure since NAR began collecting data in 1981.

    5. You Net More Money When Using an Agent

    Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission.

    study by Collateral Analytics revealed that FSBOs don’t actually save anything, and in some cases, may be costing themselves more, by not listing with an agent. One of the main reasons for the price difference at the time of sale is: 

    “Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.”

    If more buyers see a home, the greater the chances are that there could be a bidding war for the property. The study showed that the difference in price between comparable homes of size and location is currently at an average of 6% this year.

    Why would you choose to list on your own and manage the entire transaction when you can hire an agent and not have to pay anything more?

    Bottom Line

    Before you decide to take on the challenges of selling your house on your own, sit with a real estate professional in your marketplace and see what they have to offer.




    December  25, 2017
    Thank You for All Your Support

    Thank You for All Your Support | MyKCM




    December 22, 2017
    Existing Home Sales Reach Highest Annual Pace in 11 Years [INFOGRAPHIC]

    Existing Home Sales Reach Highest Annual Pace in 11 Years [INFOGRAPHIC] | MyKCM

    Some Highlights:

    • Existing home sales are currently at an annual pace of 5.81 million, the highest pace since December 2006.
    • The inventory of existing homes for sale has dropped year-over-year for the last 30 consecutive months and is now at a 3.4-month supply.
    • NAR’s Chief Economist Lawrence Yun had this to say: “Faster economic growth in recent quarters, the booming stock market and continuous job gains are fueling substantial demand for buying a home as 2017 comes to an end.”




    December 21, 2017
    Housing Prices are NOT Heading for Another Crash

    As home values continue to increase at levels greater than historic norms, some are concerned that we are heading for another crash like the one we experienced ten years ago. We recently explained that the lenient lending standards of the previous decade (which created false demand) no longer exist. But what about prices?

    Are prices appreciating at the same rate that they were prior to the crash of 2006-2008? Let’s look at the numbers as reported by Freddie Mac:

    Housing Prices are NOT Heading for Another Crash | MyKCM

    The levels of appreciation we have experienced over the last four years aren’t anywhere near the levels that were reached in the four years prior to last decade’s crash.

    We must also realize that, to a degree, the current run-up in prices is the market trying to catch up after a crash that dramatically dropped prices for five years.

    Bottom Line

    Prices are appreciating at levels greater than historic norms. However, we are not at the levels that led to the housing bubble and bust.




    December 20, 2017
    Top 5 Benefits of Hiring a Real Estate Agent

    Top 5 Benefits of Hiring a Real Estate Agent | MyKCM

    The National Association of Realtors (NAR) recently released their 2017 Profile of Home Buyers and Sellers in which they surveyed recent home buyers and sellers about their experiences. An entire section of the profile is dedicated to buyers’ experiences with their real estate agents.

    If you are looking to buy in 2018, here are the top 5 benefits of using a real estate agent when buying your dream home as cited by recent buyers:

    1. Helped the buyer understand the process – 60%

    If you are new to the home buying process, an experienced real estate professional can explain exactly what to expect during the entire transaction so you aren’t caught off guard.

    2. Pointed out unnoticed features/faults with the property – 56%

    Whether it’s pointing out possible uses for an extra bedroom/office, or using their trained eye to see potentially disastrous hazards that may be hiding out of site, your agent is there to protect your interests and make sure your home buying experience is a good one.

    3. Negotiated better sales contract terms – 47%

    When it comes to negotiating the complex terms of your contract and coming to an agreement with the seller, it never hurts to have someone who has been there before on your side. If earlier in your search you found a couple of less than desirable features on the home you are going to purchase, your agent can make sure that contingencies are in place for you to pay the best price. Their analysis of comparable properties in the area will also help to make sure that your dream home is priced properly for the market.

    4. Provided a better list of service providers – 46%

    Real estate agents are titans of networking. Many have a list of preferred providers who they have worked with in the past and who they trust to work as a part of your team to make your dream come true. This can include mortgage professionals (listed as the #8 reason to use an agent at 22%), home inspectors, plumbers, contractors, painters, landscapers, home stagers, and so many more!

    5. Improved the buyer’s knowledge of search areas – 44%

    Local real estate professionals are often members of community organizations and are usually well versed in their area’s history. Their ties to the community make them a great resource whether you plan to relocate to a new area or across town.

    Bottom Line

    If your plans for 2018 include purchasing your dream home, let’s get together to discuss your options and to help you make the most powerful and confident decisions for you and your family.




    December 19, 2017
    Rents Are on the Rise: Don’t Get Caught in the Rental Trap!

    Rents Are on the Rise: Don't Get Caught in the Rental Trap! | MyKCM

    There are many benefits to homeownership. One of the top benefits is protecting yourself from rising rents, by locking in your housing cost for the life of your mortgage.

    Don’t Become Trapped 

    A recent article by Apartment List addressed rising rents by stating:

    “Rents are up 2.7% year-over-year at the national level. Year-over-year growth continues to fall between the 2.1% rate from this time last year and the 3.4% growth rate from October 2015.”

    The article continues explaining that:

    “Despite the seasonal slowdown, rents are still up year-over-year in 89 of the 100 Largest cities.

    Additionally, the Urban Institute revealed that,

    Over a quarter of renters, or 11.1 million households, are severely cost burdened, spending at least half their income on rental housing.

    These households struggle to save for a rainy day and pay other bills, including groceries and healthcare.

    It’s Cheaper to Buy Than Rent 

    As we have previously mentioned, the results of the latest Rent vs. Buy Report from Trulia shows that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage in the 100 largest metro areas in the United States.

    The updated numbers show that the range is an average of 6.5% less expensive in San Jose (CA), all the way up to 57% less expensive in Detroit (MI) and 37.4% nationwide!

    Know Your Options

    Perhaps you have already saved enough to buy your first home. A nationwide survey of about 24,000 renters found that 80% of millennial renters plan to eventually buy a house, but 72% cite affordability as their primary obstacle. Aside from affordability, one in three millennial renters have concerns about their credit scores, and another 53% said that a down payment is an obstacle.

    Many first-time homebuyers who believe that they need a large down payment may be holding themselves back from their dream homes. As we have reported before, in many areas of the country, a first-time home buyer can save for a 3% down payment in less than two years. You may have already saved enough!

    Bottom Line

    Don’t get caught in the trap that so many renters are currently in. If you are ready and willing to buy a home, find out if you are able. Let’s get together to determine if you can qualify for a mortgage now!




    December 18, 2017
    4 Reasons to Buy a Home This Winter!

    4 Reasons to Buy a Home This Winter! | MyKCM

    Here are four great reasons to consider buying a home today instead of waiting.

    1. Prices Will Continue to Rise

    CoreLogic’s latest Home Price Index reports that home prices have appreciated by 7.0% over the last 12 months. The same report predicts that prices will continue to increase at a rate of 4.7% over the next year.

    The bottom in home prices has come and gone. Home values will continue to appreciate for years. Waiting no longer makes sense.

    2. Mortgage Interest Rates Are Projected to Increase 

    Freddie Mac’s Primary Mortgage Market Survey shows that interest rates for a 30-year mortgage have hovered around 4%. Most experts predict that rates will rise over the next 12 months. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison, projecting that rates will increase by this time next year.

    An increase in rates will impact YOUR monthly mortgage payment. A year from now, your housing expense will increase if a mortgage is necessary to buy your next home.

    3. Either Way, you are Paying a Mortgage

    There are some renters who have not yet purchased a home because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.

    As an owner, your mortgage payment is a form of ‘forced savings’ that allows you to have equity in your home that you can tap into later in life. As a renter, you guarantee your landlord is the person with that equity.

    Are you ready to put your housing cost to work for you?

    4. It’s Time to Move on with Your Life

    The ‘cost’ of a home is determined by two major components: the price of the home and the current mortgage rate. It appears that both are on the rise.

    But what if they weren’t? Would you wait?

    Look at the actual reason you are buying and decide if it is worth waiting. Whether you want to have a great place for your children to grow up, you want your family to be safer, or you just want to have control over renovations, maybe now is the time to buy.

    If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings.




    December 15, 2017
    Home Prices Up 6.54% Across the Country! [INFOGRAPHIC]

    Home Prices Up 6.54% Across the Country! [INFOGRAPHIC] | MyKCM

    Some Highlights:

    • The Federal Housing Finance Agency (FHFA) recently released their latest Quarterly Home Price Index report.
    • In the report, home prices are compared both regionally and by state.
    • Based on the latest numbers, if you plan on relocating to another state, waiting to move may end up costing you more!




    December 14, 2017
    Should Boomers Buy or Rent after Selling?

    Should Boomers Buy or Rent after Selling? | MyKCM

    In a recent CNBC article, it was reported that many baby boomers are selling their current homes and moving into rentals, rather than purchasing another home.

    “Between 2009 and 2015, the number of renters aged 55 or above rose 28 percent, while those aged 34 or younger only increased 3 percent...

    Meanwhile, more than 5 million baby boomers across the nation are expected to rent their next home by 2020, according to a 2016 analysis from Freddie Mac.”

    This makes sense in the short term for many reasons. If you are moving to a different part of town or a new region of the country, you may decide to rent until you pick the perfect home in an area you love. However, is renting a good long-term strategy?

    A mortgage payment remains fixed. Rents, however…

    The Census Bureau recently released their 2017 third quarter median rent numbers. Here is a graph showing rent increases from 1988 until today:

    Should Boomers Buy or Rent after Selling? | MyKCM

    As you can see, rents have steadily increased and are showing no signs of slowing down. If you are faced with making the decision of whether you should rent or buy your next home, you should take this into consideration.

    Bottom Line

    One way to protect yourself from rising rents is to lock in your housing expense by buying a home instead of renting. Let’s get together so we can help you decide what the best step is for you and your family!




    December 13, 2017
    What is the Cost of Waiting Until Next Year to Buy?

    What is the Cost of Waiting Until Next Year to Buy? | MyKCM

    We recently shared that over the course of the last 12 months, home prices have appreciated by 7.0%. Over the same amount of time, interest rates have remained historically low which has allowed many buyers to enter the market.

    As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.

    The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Index Report, home prices will appreciate by 4.7% over the next 12 months.

    What Does This Mean as a Buyer?

    If home prices appreciate by 4.7% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:

    What is the Cost of Waiting Until Next Year to Buy? | MyKCM

    Bottom Line

    If buying a home is in your plan for 2018, doing it sooner rather than later could save you thousands of dollars over the terms of your loan.




    December 12, 2017
    Before You Make an Offer, Here Are 4 Tips for Success!

    Before You Make an Offer, Here Are 4 Tips for Success! | MyKCM

    So, you’ve been searching for that perfect house to call a ‘home,’ and you finally found it! The price is right, and in such a competitive market, you want to make sure that you make a good offer so that you can guarantee that your dream of making this house yours comes true!

    Freddie Mac covered “4 Tips for Making an Offer” in their Executive Perspective. Here are the 4 tips they covered along with some additional information for your consideration:

    1. Understand How Much You Can Afford

    “While it’s not nearly as fun as house hunting, fully understanding your finances is critical in making an offer.”

    This ‘tip’ or ‘step’ should really take place before you start your home search process.

    Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and will allow you to make your offer with the confidence of knowing that you have already been approved for a mortgage for that amount. You will also need to know if you are prepared to make any repairs that may need to be made to the house (ex: new roof, new furnace).

    2. Act Fast

    “Even though there are fewer investors, the inventory of homes for sale is also low and competition for housing continues to heat up in many parts of the country.” 

    The inventory of homes listed for sale has remained well below the 6-month supply that is needed for a ‘normal’ market. Buyer demand has continued to outpace the supply of homes for sale, causing buyers to compete with each other for their dream homes.

    Make sure that as soon as you decide that you want to make an offer, you work with your agent to present it as soon as possible.

    3. Make a Solid Offer

    Freddie Mac offers this advice to help make your offer the strongest it can be:

    “Your strongest offer will be comparable with other sales and listings in the neighborhood. A licensed real estate agent active in the neighborhoods you are considering will be instrumental in helping you put in a solid offer based on their experience and other key considerations such as recent sales of similar homes, the condition of the house and what you can afford.”

    Talk with your agent to find out if there are any ways that you can make your offer stand out in this competitive market!

    4. Be Prepared to Negotiate

    “It’s likely that you’ll get at least one counteroffer from the sellers so be prepared. The two things most likely to be negotiated are the selling price and closing date. Given that, you’ll be glad you did your homework first to understand how much you can afford.

    Your agent will also be key in the negotiation process, giving you guidance on the counteroffer and making sure that the agreed-to contract terms are met.”

    If your offer is approved, Freddie Mac urges you to “always get an independent home inspection, so you know the true condition of the home.” If the inspector uncovers undisclosed problems or issues, you can discuss any repairs that may need to be made with the seller, or cancel the contract.

    Bottom Line 

    Whether buying your first home or your fifth, having a local real estate professional who is an expert in their market on your side is your best bet to make sure the process goes smoothly. Let’s talk about how we can make your dreams of homeownership a reality!




    December 11, 2017
    Why Getting Pre-Approved Should Be Your First Step

    Why Getting Pre-Approved Should Be Your First Step | MyKCM

    In many markets across the country, the number of buyers searching for their dream homes greatly outnumbers the number 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 is to get pre-qualified or pre-approved for a mortgage before starting your search.

    Even if you are in a market that is not as competitive, knowing your budget will give you the confidence of knowing 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:

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

    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.

    Bottom Line

    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 pleasantly surprised at your ability to do so as well.




    December 8, 2017
    3 Tips for Making Your Dream Home a Reality [INFOGRAPHIC]

    3 Tips for Making Your Dream Home a Reality [INFOGRAPHIC] | MyKCM

    Some Highlights:

    • Realtor.com shared their “5 Habits to Start Now If You Hope to Buy a Home.”
    • Setting up an automatic savings plan that saves a small amount of every check is one of the best ways to save without thinking a lot about it.
    • Living within a budget will not only help you save money for down payments but will help you pay down other debts that might be holding you back.




    December 7, 2017
    The #1 Reason to List Your House Today!

    The #1 Reason to List Your House Today! | MyKCM

    Many people believe that selling their house during “the spring buyers’ market” is the best thing to do. Their reasoning is that there will be more buyers than there are during the winter months and, therefore, their house will sell quicker and for a higher price.

    Historically, this made sense. However, today’s real estate market is not following the rules of the past.

    The National Association of Realtors (NAR) measures buyer “foot traffic” each month. It receives data on the number of properties shown to a prospective purchaser by a Realtor® (based on the number of lockboxes used). The data reveals the number of buyers out actively looking for a home, not just window shopping on the internet. NAR explains:

    “Foot traffic has a strong correlation with future contracts and home sales, so it can be viewed as a peek ahead at sales trends two to three months into the future.”

    According to the latest Foot Traffic Report, buyer traffic is greater now than it was during this year’s spring market and there are more buyers out now than at any other time in the last five years (March of 2012).

    The chart below shows that buyer activity over the last three months (blue bars) was greater than it was during this past spring market (green bars).

    The #1 Reason to List Your House Today! | MyKCM

    Bottom Line

    If you are waiting for next spring to list your home because you think that’s when the buyers will be out in force, perhaps you should reconsider. Buyers are out right now!




    December 6, 2017
    Home Prices Up 7% from Last Year

    Home Prices Up 7% from Last Year | MyKCM

    According to CoreLogic’s latest Home Price Indexnational home prices have appreciated by 7.0% from October 2016 to October 2017. This marks the second month in a row with a 7.0% year-over-year increase.

    A lack of supply of homes for sale has led to upward pressure on home prices across the country, especially in areas where both existing and new home inventory have not kept up with buyer demand.

    CoreLogic’s Chief Economist Frank Nothaft elaborated on the significance of such a large year-over-year gain, 

    “Single-family residential sales and prices continued to heat up in October. On a year-over-year basis, home prices grew in excess of 6 percent for four consecutive months ending in October, the longest such streak since June 2014.

    This escalation in home prices reflects both the acute lack of supply and the strengthening economy.”

    This is great news for homeowners who have gained over $13,000 in equity in their home over the last year! Those homeowners who had been on the fence as to whether or not to sell will be pleasantly surprised to find out that they now have an even larger profit to help cover a down payment on their dream home.

    CoreLogic’s President & CEO Frank Martell had this to say,

    “The acceleration in home prices is good news for both homeowners and the economy because it leads to higher home equity balances that support consumer spending and is a cushion against mortgage risk. However, for entry-level renters and first-time homebuyers, it leads to tougher affordability challenges.”

    Any time the price of a home goes up there will likely be concern about the affordability of that home, but there is good news. Mortgage interest rates remain at historic lows, allowing buyers to enter the housing market and lock in a low monthly housing cost.

    Rents Are Also Rising

    The report went on to mention that over the same 12-month period, median rental prices for a single-family home have also risen by 4.2%.

    With rents and home prices rising at the same time, first-time buyers may find the task of saving for a down payment a little daunting. Low down payment programs are available and have been a very popular option for first-time buyers. The median down payment for first-time buyers in 2017 was only 5%! 

    Bottom Line

    If you are looking to enter the housing market, as either a buyer or a seller, let’s get together to go over exactly what’s going on in our neighborhood and discuss your options!




    December 5, 2017
    Why Is There So Much Paperwork Required to Get a Mortgage?

    Why Is There So Much Paperwork Required to Get a Mortgage? | MyKCM

    Why is there so much paperwork mandated by the lenders for a mortgage loan application when buying a home today? It seems that they need to know everything about you and requires three separate sources to validate each and every entry on the application form.

    Many buyers are being told by friends and family that the process was a hundred times easier when they bought their home ten to twenty years ago.

    There are two very good reasons that the loan process is much more onerous on today’s buyer than perhaps any time in history.

    1. The government has set new guidelines that now demand that the bank proves beyond any doubt that you are indeed capable of paying the mortgage.

    During the run-up to the housing crisis, many people ‘qualified’ for mortgages that they could never pay back. This led to millions of families losing their home. The government wants to make sure this can’t happen again.

    2. The banks don’t want to be in the real estate business.

    Over the last seven years, banks were forced to take on the responsibility of liquidating millions of foreclosures and also negotiating another million plus short sales. Just like the government, they don’t want more foreclosures. For that reason, they need to double (maybe even triple) check everything on the application.

    However, there is some good news in the situation.

    The housing crash that mandated that banks be extremely strict on paperwork requirements also allowed you to get a mortgage interest rate around 4%.

    The friends and family who bought homes ten or twenty years ago experienced a simpler mortgage application process, but also paid a higher interest rate (the average 30-year fixed rate mortgage was 8.12% in the 1990s and 6.29% in the 2000s).

    If you went to the bank and offered to pay 7% instead of around 4%, they would probably bend over backward to make the process much easier.

    Bottom Line

    Instead of concentrating on the additional paperwork required, let’s be thankful that we are able to buy a home at historically low rates.




    December 4, 2017
    5 Reasons to Sell This Winter!

    5 Reasons to Sell This Winter! | MyKCM

    Here are five reasons listing your home for sale this winter makes sense.

    1. Demand Is Strong

    The latest Buyer Traffic Report from the National Association of Realtors (NAR) shows that buyer demand remains very strong throughout the vast majority of the country. These buyers are ready, willing and able to purchase… and are in the market right now! More often than not, multiple buyers are competing with each other to buy a home.

    Take advantage of the buyer activity currently in the market.

    2. There Is Less Competition Now

    Housing inventory is still under the 6-month supply that is needed for a normal housing market. This means that, in the majority of the country, there are not enough homes for sale to satisfy the number of buyers in the market. This is good news for homeowners who have gained equity as their home values have increased. However, additional inventory could be coming to the market soon.

    Historically, the average number of years a homeowner stayed in their home was six, but has hovered between nine and ten years since 2011. There is a pent-up desire for many homeowners to move, as they were unable to sell over the last few years because of a negative equity situation. As home values continue to appreciate, more and more homeowners will be given the freedom to move.

    The choices buyers have will continue to increase. Don’t wait until this other inventory comes to market before you decide to sell.

    3. The Process Will Be Quicker

    Today’s competitive environment has forced buyers to do all they can to stand out from the crowd, including getting pre-approved for their mortgage financing. This makes the entire selling process much faster and much simpler as buyers know exactly what they can afford before home shopping. According to Ellie Mae’s latest Origination Insights Report, the time to close a loan has dropped to 44 days, after seeing a 12-month high of 48 days in January.

    4. There Will Never Be a Better Time to Move Up

    If your next move will be into a premium or luxury home, now is the time to move up! The inventory of homes for sale at these higher price ranges has forced these markets into a buyer’s market. This means that if you are planning on selling a starter or trade-up home, your home will sell quickly, AND you’ll be able to find a premium home to call your own!

    Prices are projected to appreciate by 4.7% over the next year according to CoreLogic. If you are moving to a higher-priced home, it will wind up costing you more in raw dollars (both in down payment and mortgage payment) if you wait.

    5. It’s Time to Move on With Your Life

    Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?

    Only you know the answers to the questions above. You have the power to take control of the situation by putting your home on the market. Perhaps the time has come for you and your family to move on and start living the life you desire.

    That is what is truly important.




    December 1, 2017
    Median Days on the Market Drops to 34! [INFOGRAPHIC]

    Median Days on the Market Drops to 34! [INFOGRAPHIC] | MyKCM

    Some Highlights:

    • The National Association of REALTORS® surveyed their members for their Confidence Index.
    • The REALTORS® Confidence Index is a key indicator of housing market strength based on a monthly survey sent to over 50,000 real estate practitioners. Practitioners are asked about their expectations for home sales, prices and market conditions.
    • Homes sold in less than 60 days in 44 out of 50 states, and Washington D.C.
    • Homes typically went under contract in 34 days in October!




    November 30, 2017
    The Real Reason Home Prices are Increasing

    The Real Reason Home Prices are Increasing | MyKCM

    There are many unsubstantiated theories as to why home values are continuing to increase. From those who are worried that lending standards are again becoming too lenient (data shows this is untrue), to those who are concerned that prices are again approaching boom peaks because of “irrational exuberance” (this is also untrue as prices are not at peak levels when they are adjusted for inflation), there seems to be no shortage of opinion.

    However, the increase in prices is easily explained by the theory of supply & demand. Whenever there is a limited supply of an item that is in high demand, prices increase.

    It is that simple. In real estate, it takes a six-month supply of existing salable inventory to maintain pricing stability. In most housing markets, anything less than six months will cause home values to appreciate and anything more than seven months will cause prices to depreciate (see chart 1).

    The Real Reason Home Prices are Increasing | MyKCM

    According to the Existing Home Sales Report from the National Association of Realtors (NAR), the monthly inventory of homes has been below six months for the last four years (see chart 2).

    The Real Reason Home Prices are Increasing | MyKCM

    Bottom Line

    If buyer demand outpaces the current supply of existing homes for sale, prices will continue to appreciate. Nothing nefarious is taking place. It is simply the theory of supply & demand working as it should.



    November 29, 2017
    2 Charts That Show the Truth about Home Affordability

    2 Charts That Show the Truth about Home Affordability | MyKCM

    There is a lot of discussion about the current state of housing affordability for both first-time and move-up buyers, and much of the narrative is tarnished with a negative slant. However, the truth is that housing affordability is better today than at almost any time in our history.

    The naysayers are correct in the fact that affordability today is not as good as it has been over the last several years. But, we must remember that home prices collapsed during the housing crash, and distressed properties (foreclosures and short sales) kept home values depressed for years. When we compare affordability to the decades that proceeded the crash, a different story is revealed.

    Here is a graph of the National Association of Realtors’ Housing Affordability Index. The higher the graph, the more affordable homes are.

    2 Charts That Show the Truth about Home Affordability | MyKCM

    We can see that affordability is better today than in the fifteen years prior to the boom and bust.

    CoreLogic just published a report showing the National Homebuyers’ “Typical Mortgage Payment.” Here is a graph of their findings:

    2 Charts That Show the Truth about Home Affordability | MyKCM

    It reveals that, though a ‘typical’ housing payment was less expensive in 2012 (remember distressed properties), it is currently less expensive than it was in 2000 and is still projected to be lower next year than it was in 2000.

    Bottom Line

    Mark Fleming, Chief Economist at First American, explained it best:

    “While borrowing power for the potential home buyer has fallen relative to the low point of 2012, it remains high today and will remain high next year, relative to the long run average. If you don’t want to rent anymore and are considering becoming a homeowner, even if mortgage rates rise next year, your borrowing power will remain strong by historic standards.”




    November 28, 2017
    Low Interest Rates Have a High Impact on Your Purchasing Power

    According to Freddie Mac’s latest Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at 3.92%, which is still near record lows in comparison to recent history!

    The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

    Purchasing power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford will decrease if you plan to stay within a certain monthly housing budget.

    The chart below shows what impact rising interest rates would have if you planned to purchase a home within the national median price range, and planned to keep your principal and interest payments between $1,850-$1,900 a month.

    Low Interest Rates Have a High Impact on Your Purchasing Power | MyKCM

    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 be closer to 5% by this time next year.

    Act now to get the most house for your hard-earned money.




    November 27, 2017
    The Cost of NOT Owning Your Home

    The Cost of NOT Owning Your Home | MyKCM