by Shawn Boday | Feb 7, 2023 | Real Estate, Shawn Boday
If you’re looking for a great deal in a tough real estate market, buying a foreclosed home may be the best option. While the main benefit of purchasing a foreclosure property is the price, the process is more complex than with a traditional real estate listing. It’s important to know what to look for and how to buy a foreclosed home if you want to get the best deal. Here are five tips to keep in mind when buying a foreclosed home.
It is often difficult to access these properties before they become available for sale.
Many people think there must be a secret way to get access to foreclosed properties before they go on the market, but the reality is that most of these properties are owned by large financial institutions that have a lot of other assets. These companies tend to outsource the entire foreclosure process to a management company, which includes hiring a local Realtor to evaluate the property before it is listed. Local banks may be able to provide information on who’s handling the foreclosed property, but this is the exception rather than the rule. So this means it can be difficult to access these properties before they become available to the public.
Make sure that you are actually getting a good deal.
When it comes to buying a foreclosure, it’s important to ensure that you’re actually getting a good deal. Contrary to popular belief, foreclosures are not always the best buy. In fact, most foreclosures are listed on the open market, meaning that the visibility and demand for them are the same as you would expect with other properties. The price of foreclosures is set at the highest possible value in order to meet the needs of the bank and the listing agent. Therefore, it’s important to remember that foreclosures are not being offered at discounted prices.
Conduct a full property inspection, including all utilities.
Before you purchase a foreclosure property, you should get a full inspection done with the utilities turned on. Make sure the house has been winterized, and you can access the furnace if necessary. Be aware that you may need to purchase special access to get the utilities going, which can be costly and time-consuming.
Prepare for the worst if purchasing a home as-is.
If you’re buying a foreclosure in “as-is” condition, you should prepare for the worst. Although no inspection is required, it’s a good idea to have a contractor evaluate the home and estimate the cost of any repairs. An inspection can identify major issues that the bank isn’t aware of, so it’s worth considering. This will help you decide whether you want to proceed with the purchase or walk away from the deal. To make sure you have room to cover repairs and other costs, look for a foreclosure home within the lower end of your budget.
Get a preapproval letter.
If you’re thinking about making an offer on a foreclosure, it’s important to have a mortgage preapproval letter in hand. This letter will outline information about the amount you are able to borrow based on your credit score and income. With foreclosures, the best deals often go quickly, and buyers need to have their financing worked out beforehand. Real estate investors who pay cash are usually the ones to take advantage of these deals.
by Shawn Boday | Feb 7, 2023 | Real Estate, Shawn Boday
When it comes to buying or selling a home, it’s important to get your information from a trusted source. Unfortunately, there is a lot of misinformation and bad advice online, and if you don’t do your research, you could be caught off guard. Many myths about real estate can be easily debunked with the right information. To help you stay informed and avoid making costly mistakes, here are ten common real estate myths debunked.
Real Estate Myth 01: It’s not necessary to get preapproved.
It is beneficial to get preapproved before beginning the home-buying process. Not only will it lets you know much you can afford, but it will also demonstrate to sellers that you are serious about buying and have the financial means to do it. Contrary to popular belief, getting preapproved won’t hurt your credit score.
Real Estate Myth 02: If you don’t have children, the school system isn’t relevant.
When purchasing a home, consider looking for one with good schools, even if you don’t have kids. Buying in a desirable school district will add to the resale value. This is why schools are an important factor for many homebuyers.
Real Estate Myth 03: Realtors only show homes listed with their own company.
Realtors are bound to a strict code of ethics, meaning they must show you any and all homes that fit your criteria, regardless of the listing company. As long as the property is listed in the MLS system, you have the right to view it.
Real Estate Myth 04: When bidding on a home, offer a lower price.
Making a lowball offer on a house can be risky in a competitive market. If there are multiple offers on the house, submitting a lower offer runs the risk of not being taken seriously and may not result in a counteroffer. Additionally, low offers can come across as disrespectful to the seller and can make for an unpleasant transaction. Therefore, it is best to make an offer that is close to or at the asking price.
Real Estate Myth 05: When pricing your house for sale, set it high.
When it comes to pricing your house for sale, it’s best to list it at a price that is competitive and fair. An overpriced house can be a turn-off for potential buyers and result in fewer offers. To make sure your home grabs the attention of buyers, it’s best to price it realistically so that buyers know they are getting a good deal.
Real Estate Myth 06: To make more money, renovate it beforehand.
Before deciding to renovate your home when selling, it is important to take into account the cost of the improvements and the return on investment. Minor repairs, decluttering, and staging may be all you need to get the best possible price. In today’s market, many buyers are looking for more affordable homes and are willing to do the repairs themselves.
Real Estate Myth 07: If a home is in perfect condition, an inspection isn’t necessary
No matter how new or attractive a home may appear, it is always important to get a professional inspection. This will alert you to any potential issues that need to be addressed before you take possession. Without an inspection, you could be stuck with expensive problems in the future. It is wise to either ask for the problems to be fixed before you buy the home or to have the purchase price lowered to cover the cost of the repairs.
Real Estate Myth 08: Buying is a better option than renting.
It’s not always a given that buying a home is better than renting one. Many variables come into play when considering this decision, including your financial situation, stage in life, and future plans. To make the best decision, it is important to crunch some numbers and compare the costs of each option. You may discover that, depending on your lifestyle and goals, renting could be the right decision for you.
Real Estate Myth 09: Realtors earn a lot of money.
Real estate agents do not have a set salary but instead are paid on commission. This commission is typically split with the brokerage firm that employs them, as well as covers expenses such as driving, hosting open houses, doing research, etc. Furthermore, the commission they receive is not guaranteed, as it is open to negotiation.
Real Estate Myth 10: Having a real estate agent doesn’t offer any benefits.
Having a real estate agent can be a huge advantage when buying or selling a home. They have access to homes for sale that you may not have known about and can use their expertise in order to negotiate the best price possible. They can also help guide you through the paperwork and complex process of buying or selling a property. Without a Realtor, you may find yourself struggling to navigate the market, so having one in your corner can make all the difference.
by Shawn Boday | Feb 7, 2023 | Real Estate, Shawn Boday
Are you looking to expand your real estate knowledge? Podcasts are an excellent source of information on investing, home improvement, and the latest housing news. With so many real estate podcasts available, it can be a challenge finding ones that are worth your time. To make it easier, here are 10 of the top real estate podcasts that span a range of topics related to property and housing.
The Indicator from Planet Money
For those looking to gain a better grasp on business and economics and work in quickly and easily understandable terms, check out The Indicator from Planet Money, a 10-minute podcast that explores “big ideas” related to the economy. Topics include home sales, moving trends, the commercial market, and renting, with each episode featuring data releases or findings and how they affect consumers and the economy. Perfect for buyers, sellers, homeowners, and investors.
BiggerPockets: The Real Estate Investing Podcast
The BiggerPockets Real Estate Podcast is a popular weekly podcast that features informal and fun interviews with a variety of investors and entrepreneurs. Guests range from well-known names like Matthew McConaughey and Ken Corsini from HGTV’s “Flip or Flop Atlanta” to industry players who share their experiences and advice. Hosted by Rob Abasolo and David Greene, this podcast is perfect for beginner and intermediate investors.
Real Estate Today
Real Estate Today is a radio program and podcast hosted by Stephen Gasque, the broadcasting and multimedia communications director for the National Association of Realtors. With hundreds of episodes, the program covers topics such as purchasing a second home, home buying for millennials, maximum selling secrets, creating a smart home, and first-time buying. This is a great resource for buyers, sellers, homeowners, and investors.
This podcast is the perfect resource for homebuyers, both first-timers and repeat buyers. Hosted by Dan Moralez, a mortgage expert and loan officer in Michigan, it covers topics such as credit repair, getting preapproved for a loan, mortgage comparison shopping, and tips for self-employed homebuyers. With over 150 episodes, it offers a wealth of insider secrets and helpful advice to make the home buying process easier.
Martini Mortgage Podcast
The Martini Mortgage Podcast, hosted by lending expert Kevin Martini from Raleigh, North Carolina, offers listeners a wealth of knowledge and advice on the ins and outs of getting a mortgage loan and purchasing a home. Over 150 episodes, listeners can learn about topics like winning bidding wars, improving credit, tax credits for first-time buyers, avoiding forbearance, and home affordability. Ideal for sellers and buyers, this podcast is a great resource to help navigate the homebuying process.
The Money Pit Home Improvement Podcast
This podcast, which is also a nationally syndicated radio program, focuses on home improvement and repair. Hosted by experts Leslie Segrete and Tom Kraeutler, the podcast covers a wide range of topics related to homeowners and DIYers. Popular episodes from the over 1,500 available include four popular home improvement hacks, stress-free closet organization, germ-free faucets, high-return home improvements, and the best kitchen lighting. It is perfect for homeowners planning to remodel.
The Remote Real Estate Investor
The Remote Real Estate Investor podcast is the perfect resource for remote and out-of-state investors interested in real estate. Hosts Emil Shour, Tom Schneider, and Michael Albaum explore a range of topics, from finding the hottest markets to analyzing properties from afar and avoiding common pitfalls. Perfect for those looking to invest in real estate without actually living near the property.
Making Money in Multifamily
If you are interested in investing in multifamily properties, you should check out the Making Money in Multifamily podcast. Host Dave Morgia is a real estate investor and interviews industry experts to discuss the practices and principles for successful investing in this field. He also dives into deals that didn’t meet expectations and why they failed. It’s perfect for those who are just starting out or experienced in multifamily investing.
Best Real Estate Investing Advice Ever
Joe Fairless hosts this popular podcast that has had over 3,000 episodes, offering daily real estate investing advice. His journey began with low-cost single-family homes, and now his portfolio is worth billions. This podcast provides insight into commercial real estate investing and helps listeners navigate through uncertain markets. It’s a great resource for both novice and experienced investors.
Real Estate News for Investors
This podcast is ideal for beginner and experienced real estate investors, as well as news buffs. Host Kathy Fettke, co-CEO of the Real Wealth Network and author of “Retire Rich With Rentals,” reviews the latest reports from national organizations and market data analysis to inform listeners about building and holding a real estate investment portfolio. Topics range from the best real estate markets to investing in property values and tax law, as well as news and information for real estate flippers.
by Shawn Boday | Jan 4, 2023 | Real Estate, Shawn Boday
Economic predictions for 2023 are uncertain due to the many unknowns influencing the housing market. The Federal Reserve’s ability to bring down inflation and borrowing costs without affecting buyer demand is a factor yet to be seen. While there is some worry, economists and analysts do not expect a recession. Despite this, there is still a concern about high housing prices and rents that may be unaffordable to many.
With the 2023 housing market still up in the air, the issue of affordability continues to be a barrier for many younger buyers, particularly in more expensive markets. This could mean many of them will be stuck renting for the foreseeable future. However, if remote working continues to increase, they may choose to relocate to more cost-effective areas.
In 2023, the housing market will be affected by typical supply, demand, and affordability factors. Provided the nation is able to dodge a recession or experience only a short and shallow one, these are the predictions for the housing market in 2023.
Home prices are projected to decrease.
It is predicted that existing home prices will decrease by 5% nationally in 2023, with potential drops of up to 10% or more in high-priced areas and regions with high home values. In the event of a deeper recession, prices could decrease by 10% or more in areas with a large discrepancy between home prices and local incomes.
Existing Home Sales Will Slow
The low affordability of homes and low mortgage rates will limit the number of transactions; however, those without mortgages may be more likely to sell. Additionally, more homeowners may choose to keep their homes as investments and rent them out rather than accept a lower sale price.
Construction of new single-family homes will decrease.
Homebuilders increased production during the pandemic to meet demand but are now reducing the number of new homes for sale. In 2023, these homes will either be sold to buyers who signed contracts in 2022, converted into rentals, or sold to investors to rent out. Some builders are downsizing and reducing input costs to offer more new homes to first-time buyers. In 2023, the production of new homes to sell and rent will decrease, particularly for single-family homes. However, in areas with unmet demand for affordable homes, construction may still be higher.
Rents will level out, the rise.
Rent increases have been mostly flat in the past few months and are expected to rise slightly in 2023. However, there could be a decrease in rents due to the highest number of multifamily units under construction since the early 1970s likely to hit the market in 2023, as well as new supply from frustrated short-term rental landlords and homeowners entering the rental business.
Building Permits Will Decline
In 2023, residential building permits are expected to drop more than housing starts as developers and builders take a step back to reevaluate risk in the face of uncertainty. Homebuilders will likely use this time to discount unsold homes, divest from unwanted land, and merge with or acquire smaller competitors in preparation for a rebound.
30-year Fixed Mortgage Rates Won’t Fall Substantially
Mortgage rates are expected to stay high in 2023 due to economic uncertainty and inflation, investors demanding higher rates due to the possibility of refinancing when rates drop, and the Federal Reserve’s insistence on forcing inflation down to 2.0%. It is uncertain if this goal will be achievable in 2023.
by Shawn Boday | Jan 4, 2023 | Real Estate, Shawn Boday
A measure of the rise in average prices of goods and services in the economy over a certain period of time, inflation can be seen as a decrease in the purchasing power of the US dollar. Inflation can significantly impact the real estate market, causing potential investors to be cautious. However, inflationary times present potential investment opportunities in the property market; despite the risks, real estate remains a prime investment option to generate passive income. This article will explain how inflation affects real estate and a summary of the typical ramifications.
Increased cost of borrowing.
When inflation is present, it often results in higher costs for borrowing money. To protect their profits, banks will respond by raising the interest rates that borrowers must pay and becoming stricter with lending criteria, which means fewer loans are given out in order to reduce risk.
New build plans can suffer.
In addition to increased borrowing costs, inflation has caused the costs of construction materials, labor, and machinery to rise, making new construction investment difficult.
Increased rental property rates.
High inflation makes it difficult for people to secure affordable mortgages, causing more people to rent and increasing demand for rental properties. This, in turn, leads to a decrease in inventory and an increase in rent prices. For landlords, this can be a good time if their borrowing costs and financial circumstances are favorable.
Property values typically appreciate.
Inflationary times lead to a decrease in new builds, resulting in fewer property inventory levels and higher demand ratios. This increases prices, potentially pricing out potential buyers and causing affordability migration.
Real estate as a hedge against inflation.
Investors purchase real estate as a way to protect against inflation, whereas other investments usually decline in value. Real estate tends to appreciate in value as inflation increases, providing a financial benefit for those with a low interest rate on their property.
The relative cost of historical debt is reduced by inflation.
Inflation can be beneficial for borrowers with pre-existing debt, as wages increase in line with inflation allowing more money to be paid off. This means the same dollar amount is owed, but the currency is now worth less than when it was originally borrowed. Overall, the results of inflation aren’t all negative
The bottom line.
Rising inflation can have both negative and positive effects on the real estate sector; while it can be difficult to enter the market and difficult for renters to find affordable options, landlords with no borrowing costs will be in a good position.
Interest rates are leading to affordability issues in booming markets, which is causing a decrease in demand. However, the lack of property inventory is limiting the extent to which values will drop. Investors often favor real estate due to its resiliency in the face of inflation; it is able to withstand market pressure and usually increases in value.