Despite the forecasts of mortgage rate rise, demand for homes has continuously outnumbered its supply. Let's find out why.
According to the National Association of Realtors (NAR), the inventory of homes for sale "has fallen year-over-year for 36 consecutive months," and now stands at a 4.1-month supply. A 6-month supply of inventory is necessary for a balanced market and has not been seen since August of 2012.
NARs Chief Economist Lawrence Yun had this to say,
Is There Any Relief Coming?
According to the CoreLogic's 2018 Consumer Housing Sentiment Study, four times as many renters are considering buying homes in the next 12 months than homeowners who are planning to sell, "which is the crux of the available housing-supply imbalance."
As more and more renters realize the benefits of homeownership, the demand for housing will continue to rise.
Do homeowners realize demand is so high? With home prices rising across the country, homeowners gained over a trillion dollars in equity over the last 12 months, with the average homeowner gaining over $16,000!
The map below shows the breakdown by state:
Many homeowners who have not thought about listing their homes may not even realize how much equity they have gained, or the opportunity available to them in today's market!
If you are one of the many homeowners across the country who hasn't quite found their forever home, now may be a great time to list your house for sale and find your dream home!
We work hard, we get a good job, we start a family, we buy a house and then, when we're done with that house, we buy a bigger one. We accumulate wealth in our home and then pass that wealth on to our children, who will be better off than us. That's the American dream. Now let's take a closer look at some more personal reasons why we buy homes.
1. Owning your home offers you the stability to start and raise a family
Between the best neighborhoods and the best school districts, even buyers without children at the time of purchase may have these things in mind as major reasons for choosing the locations of the homes 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 in 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 do just that in your own home?
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.
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Love it or hate it, social media platforms have invaded and taken over the past time of the majority of the world today, and it does not show any sign of stopping or slowing down in any foreseeable future. To be on the top of your game, you need to adapt and utilize the social media to your advantage. Here's how you can do just that.
The key is targeting the best social media options--those proven to attract real estate leads--and building a marketing plan tailored to getting the most out of these accounts.
There is no denying Facebook is huge. Odds are, almost everyone you know has an account. But when it comes to real estate marketing, Facebook has a huge benefit over nearly every other social network: demographics. Facebook reaches everyone. Regardless of age group, income level, or location, almost everyone is on Facebook, and you should be too.
Here's how to pull it off:
Instagram has amassed a huge, loyal user base. Don't let the photo-based sharing deter you. Smart Insights found when it comes to interaction, Instagram blows other social media sites out of the water with a whopping 70 interactions per 1,000 followers. Getting started on Instagram is easy.
Here's how to pull it off:
Pinterest is often overlooked by agents, but it shouldn't be. The site has a huge fan base and many dedicated followers actively 'pinning' every day. Building up your Pinterest 'boards' (collections of clickable photos) will take dedication, but the payoff will be worth it.
Here's how to pull it off:
Twitter shouldn't be the only social media you use, but the fast--paced feeds can help you generate leads (and crossover followers to other social media sites) if you do it right.
Here's how to pull it off:
There's no denying that social media can help boost your real estate leads. With that said, it doesn't mean you need to be on every social media platform. Your audience may just be on one platform or may be on all platforms. Some platforms may perform better than others. So it's important to come up with a social media strategy that will work best for you. If some social media sites perform better for you than others, then focus your attention on those that will give a better return. Overall, a social media strategy and some hard work can help boost your real estate leads to where you want them to be.
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We are grateful to all our clients for their trust and support. We promise to deliver exceptional service.
If you have any homes or properties to sell give us a call at 914.920.2299 and check our website www.nyreex.com
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It is given that purchasing power is always desired. But with all the current trends in the real estate industry, how true is it that many believe that house-buying power is near historic levels?
We keep hearing that home affordability is approaching crisis levels. While this may be true in a few metros across the country, housing affordability is not a challenge in the clear majority of the country. In their most recent Real House Price Index, First American reported that consumer "house-buying power" is at "near-historic levels."
Their index is based on three components:
Combining these three crucial pieces of the home purchasing process, First American created an index delineating the actual home-buying power that consumers have had dating back to 1991.
Here is a graph comparing First American's consumer house-buying power (blue area) to the actual median home price that year from the National Association of Realtors (yellow line).
Consumer house-buyer power has been greater than the actual price of a home since 1991. And, the spread is larger over the last decade.
Even though home prices are increasing rapidly and are now close to the values last seen a decade ago, the actual affordability of a home is much better now. As Chief Economist Mark Fleming explains in the report:
Some may just be a fad or a short-term trend, others may be permanent changes like technological advancements. Needless to say, here are some of 2018's top real estate influencing phenomenon.
1. Technology Advancements
The advancement of technological innovation in the real estate industry has been changing rapidly and all agents should adapt to this to maximize exposure for their listings. Companies like Redfin, Zillow, Trulia and Homesnap have been changing the way sellers and buyers perceive the market and it is crucial for agents to quickly adapt to this new reality. - Alex Chieng, A & L Real Estate Team
Not to belabor the already highly-trending topic of blockchain changing the world, but this is the reality of our industry. Blockchain-based applications are changing the way buyers, sellers and investors interact with each other and the properties they have interests in. Welcome to an new world of unleashed liquidity, transparency and disintermediation. The real estate world is rapidly changing and we must do so too, or we will fall by the wayside. - Garratt Hasenstab, The Mountain Life Companies
3. Return Of The Co-Ops
For the past several years in Manhattan, we've seen the downtown new development condo market take a big bite out of the co-op resale market. Now that there are so many new (and more expensive) projects, we're seeing buyers actually return uptown to purchase co-ops because the prices are more moderate in comparison. What hasn't changed is that some of the boards remain difficult to pass. - Elizabeth Ann Stribling-Kivlan, stribling.com
4. Home Prices Still Rising
The NYC real estate market indicates that home prices might rise more slowly in the months ahead. During the years 2012-2015, we saw 12%-15% growth. We didn't have any surprises this year. Average home price growth over the last few decades is somewhere between 5% and 10% per year. So, perhaps what we are seeing here is a normalization within the Manhattan real estate market. - Elliot Bogod, Broadway Realty
5. Millennials Buying Homes
I've seen article after article saying millennials do not want to buy a home or cannot afford it, yet homeownership for this age group is on the rise. Fortunately, this age group is still a significant portion of the luxury rental market, and the baby boomers who just sold their houses are an increasing renter base. - Susan Tjarksen, KIG CRE LLC
6. Steady Stream Of New Construction
The top trend I've seen so far has been a steady stream of new construction, which is keeping rent prices mostly in check for 2018. A stable pipeline of new buildings means we'll see the impact of lower rent growth but still above long-term averages when it comes to rent across the U.S. - Nathaniel Kunes, AppFolio Inc.
7. Low Available Inventory
The drought of available inventory has been the most surprising trend, by far. Whether the underlying reasons are demographic, economic, regulatory (i.e., zoning) or a combination thereof, we just aren't seeing as many homes hit the market as we should. Agents have to do a better job in prompting inventory and explaining the current seller's market to homeowners. - Ari Afshar, Compass
8. Visual Marketing Trends Soaring
We are seeing a huge uptick in agents recognizing the value in using professionals for all their visual marketing needs -- virtual staging, drone video and photography, virtual tours, interactive floor plans and more. Hiring the pros to help will continue to be less of a "nice to have" and more of a "must have" for agents, homeowners and home seekers alike. - Brian Balduf, VHT Studios
We have to be aware and prepared, we have to be able to adapt to these trends to stay on top of our game.
Nowadays, people buy insurance for all sorts of things they hold dear. Jewelry, pets, computer equipment and believe it or not, even body parts. It gives one peace of mind and a sense of security to know their possessions are safe. All the more reason why your home should be insured with the best insurance provider you can find. Here a few things you need to know about home insurance and the top providers of 2018.
The first thing you need to know about homeowners insurance is what it covers. One well-known aspect of homeowners insurance is that it covers your dwelling and its contents if there's a fire or other event that causes damage -- or if your stuff is stolen or vandalized. Policies typically cover certain kinds of weather or extreme events like hail, lightning, or damage from wind, but not others. Floods and earthquakes, for example, are often excluded from most base plans. You have to buy additional coverage if you want to protect yourself in case of those events.
When it comes to dwelling and property coverage there are two types. The first is cash value coverage, which only will pay you the amount that your property is currently worth or the depreciated value of the property. The second kind is replacement value coverage, which will give you as much as you need to replace an item at its current market value. Certain types of property or property with values that are over a certain dollar amount can't be insured in some circumstances. For that reason, you might also need a special insurance rider or include these items in a schedule.
But homeowners insurance doesn't just help you repair or replace your things, it also provides liability coverage. This covers you against liability if anyone is injured on your property or if you damage their property. It also often covers you in case someone is injured because of your dog. Usually these liability coverage policies have low coverage amounts and offer just $100,000 in total coverage.
After that, different home insurance companies offer different types of additional coverages in their base policies. Some include things like medical payments coverage in the event someone gets injured on your property. It can offer a certain dollar amount to cover medical bills without having to go to court or reach a settlement. There are also home insurance companies that offer things like "loss of use" coverage, which pays for a hotel and food if you can't return to your home, identity fraud coverage, additional liability coverage, and other types of special riders.
Are you wondering what type of coverage is best for you and what company you should buy it from?
We look at the best homeowners insurance companies to help you decide.
Here are LendEDU's best homeowners insurance companies (click a company to read their full review):
Best Homeowners Insurance Comparison
There are a lot of home insurance providers out there, you have the freedom to pick one that you find can cater to all your needs.
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So you decided to take a leap and join the real estate industry. You have an idea of what it's about but want to know more about the day to day activities and routine of a real estate agent. Let's dig in a little deeper find out more.
Many successful real estate agents have an assistant or office manager to assist with the day-to-day activities, allowing the salesperson or broker to focus on more direct revenue-generating activities.
You're Not Just Selling Homes, You're Selling Yourself
Attracting clients is crucial to a real estate agent's success. Below are some tips to attracting new clients:
Real estate agents typically work in an office with other agents and brokers and have many opportunities to discuss new listings, get updates on listings, and discuss buyer's and seller's needs. Another option that agents utilize to narrow down a search for a buyer or to perform research on the competition for sellers is the MLS tour. This allows agents and brokers to quickly gather first-hand knowledge on a number of available properties in the local market.
Developing Your Skills
Although continuing education is a requirement to maintain a real estate license, it is also an opportunity to develop the skills that will keep an agent at the top of their game or open a door to new real estate opportunities within the regional or local market. Continual development is crucial to long-term success of real estate agents and brokers. Continuing education not only widens their scope of expertise, but it also improves their proficiency, knowledge, and marketability as a real estate professional.
Overall price, initial cash out, monthly amortization etc. are the things we look out for in buying a home. A lot of these may seem higher than it used to last year, but what most do not know is that it is lower compared to how it used to way back.
However, it is not just the price of a home that determines its affordability. The monthly cost of a home is determined by the price and the interest rate on the mortgage used to purchase it.
Today, mortgage interest rates stand at about 4.5%. The average annual mortgage interest rate from 1985 to 2000 was almost double that number, at 8.92%. When comparing affordability of homeownership over the decades, we must also realize that incomes have increased.
This is why most indexes use the percentage of median income required to make monthly mortgage payments on a typical home as the point of comparison.
Zillow recently released a report comparing home affordability over the decades using this formula. The report revealed that, though homes are less affordable this year than last year, they are more affordable today (17.1%) than they were between 1985-2000 (21%). Additionally, homes are more affordable now than at the peak of the housing bubble in 2006 (25.4%).
Here is a chart of these findings:
What will happen when mortgage interest rates rise?
Most experts think that the mortgage interest rate will increase to about 5% by year's end. How will that impact affordability? Zillow also covered this in their report:
Rates would need to approach 6% before homes became less affordable than they had been historically.
Though homes are less affordable today than they were last year, they are still a great purchase while interest rates are below the 6% mark. Making a decision today may save you money.
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Today is the day that good triumphed over evil, hope over despair, and freedom triumphed over bondage. Let us show our utmost gratitude for being part of this great nation. May we never forget the importance of this day. Let's enjoy our freedom now and always. Happy 4th of July! â
In the early times, selling may be defined simply as "the process of handing over something in exchange for money." Nowadays, with technology upping the ante with marketing and promotional media platforms, and payment methods and terms adding to the already complicated ordeal. Selling your home can be quite a process.
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 a buyer's behavior during the home buying process.
According to the National Association of Realtors" 2018 Home Buyer & Seller Generational Trends Report, the first step that "42% of recent buyers took in the home buying process was to look online at properties for sale."
However, the report also revealed that 94% of buyers who used the internet when searching for homes ultimately purchased their homes through either a real estate agent/broker or from a builder or builder's agent. Only 2% of buyers purchased their homes directly from a seller whom they didn't know. Buyers search for a home online but then depend on an agent to find the home they will buy 52%, to negotiate the terms of the sale 47% & price 38%, or to help understand the process 60%.
The plethora of information now available has resulted in an increase in the percentage of buyers who reach out to real estate professionals to "connect the dots." This is obvious, as the percentage of overall buyers who have used agents to buy their homes has steadily increased from 69% in 2001.
Everyone could use a help of a professional who has dedicated time in the field to make their lives easier. If you are thinking of selling your home, don't underestimate the role a real estate professional can play in the process.
One of the biggest traps a seller can fall into is confusing features vs. benefits. Often when selling a product or service, sellers merely present a list of features--and that's simply not enough to make a sale. Both features and benefits are equally important for effective advertising copy, but at the end of the day, it will be the benefits that give you the best advantages for converting customers.
One common mistake real estate professionals (and salespeople in a variety of industries) make is focusing too hard on selling the house, and not enough on selling a solution to the buyer's problem. The house is the product. It's the center piece of the transaction. But it's your buyer's lifestyle, family situation, age, income, career, and a multitude of other factors that determine whether or not a specific house is a good fit for them.
Focusing on your customer's pain points and the ways your product or service can provide the solution to their problems is known as solution selling. In order to be successful in solution selling, you must understand the difference between features and benefits, and the most effective way to present both as you walk through the process of selling the home.
Features are Generic
A feature of a particular property is a tangible characteristic of it. A two-acre yard, a new furnace, multiple bathrooms, an eat-in kitchen are all features. As the person selling the home, you need to know the features. Potential buyers like to compare features of all the homes on their radar. Think of the features like a checklist clients have in their head that helps determine whether or not this particular home is even on their radar for consideration. The features of the home you are selling will likely come into play very early on, possibly before you even speak to a potential buyer.
Benefits are Personal
Benefits are what your customer has to gain from the particular features of the property you're trying to sell. Benefits are usually intangible and represent value to a particular buyer. They vary from buyer to buyer, depending on their needs and interests. A two-acre yard is a benefit to a buyer with three young children who need some space to run. To a retired couple without any nearby grandchildren, it might simply represent a lot of hard work they don't have the time, interest, or energy to perform. Benefits illustrate how the features solve the individual customer's pain points.
Bringing it Together with Solution Selling
Features definitely play a role in the real estate sales process. But solution selling is where you really have an opportunity to bring value to the transaction by understanding what a buyer is looking for, and clearly demonstrating how the features of a given property fill that need. Don't simply sell the same home to every buyer, in the same way. Adjusting your sales pitch to match the needs of the buyer demonstrates sincere interest in providing the best possible solution for them. Use features as the arsenal of tools at your disposal when trying to solve a buyer's problem with benefits. Sometimes, one particular feature will do it. Oftentimes, it's the combination of two or three features that serve a particular need. Even if the buyer doesn't purchase that particular home, it's a great strategy for demonstrating your client care skills and prospecting new buyer clients at an open house or a showing.
For many Americans, July 4th is a day to lounge by the pool, barbecue, and watch fireworks. But before you celebrate with a bang, make sure you're prepared. Many assume homeowners insurance will cover any damage they cause. Although this usually is true--there are exceptions.
There has been a lot of talk regarding when the next recession could be, we all remember that the housing crisis in 2008 caused the last recession. Is there a likelihood of that repeating itself?
Economists and analysts know that the country has experienced economic growth for almost a decade. They also know that a recession can't be too far off. A recent report by Zillow Research shed light on a survey conducted by Pulsenomics in which they asked economists, investment strategists and market analysts how they felt about the current housing market. That report revealed the possible timing of the next recession:
That timing concurs with a recent survey of economists by the Wall Street Journal:
Here is a graph comparing the opinions of those surveyed by both the Wall Street Journal and Pulsenomics:
Recession DOES NOT Equal Housing Crisis
According to the Merriam-Webster Dictionary, a recession is defined as follows:
A recession means the economy has slowed down markedly. It does not mean we are experiencing another housing crisis. Obviously, the housing crash of 2008 caused the last recession. However, during the previous five recessions home values appreciated.
According to the experts surveyed by Pulsenomics, the top three probable triggers for the next recession are:
Others agree that housing will not be impacted like it was a decade ago.
Mark Fleming, First American's Chief Economist, explained:
A recession is probably less than two years away. A housing crisis is not.
Home buying can prove to be a long and tedious process that could take months on end. This is what happened to Melvyn Diaz, a homebuyer who worked with a realtor in search of a new home. Mr. Diaz and his realtor worked together for over a year, looking at multiple units in different locations and still end up empty-handed. We can only imagine the time, effort and resources wasted on waiting that long.
Enter Kavita, a seasoned agent from New York Real Estate Experts who puts client satisfaction on top of her priorities. She partnered with Heather of Contour Mortgages and attorney Paul Solomon and met with Mr. Diaz, she showed him one unit that fits his preference and helped him all the way through closing the deal.
This is an excellent display of team effort and a wonderful demonstration of customer service. Good job everyone!
Some say the first is the hardest, in some levels this saying applies in getting your first real estate client if you're a newcomer. But worry no more for we will be giving you three ways to get your first client.
There are over 2 million real estate agents in the United States. New agents may find it cumbersome to understand how to get started. Although brokers and franchises have a number of tools available to new agents, it can be difficult to understand how to best make use of them. There isn't a silver bullet or industry secret to starting a successful real estate career. The principles of success are actually quite simple...it's the execution that ultimately trips up most new agents. If you want to generate consistent business as a real estate agent, the best thing you can do is ask everyone you know for a referral. Everyone you know likely has a friend, family member, or coworker who is moving in the next three to six months.
Over 45% of millennials seeking a real estate agent ask friends and family members for recommendations. The next generation of homebuyers is very keen on using website reviews, testimonials, and star ratings to assist with buying decisions. The same can be said for selecting a real estate agent. In addition to the web, they're turning to people they know and respect to provide input and reviews. As a new real estate agent who doesn't have any clients yet, you may be overwhelmed by the prospect of finding your first client.
Here are a few simple tips and procedures to help you to ramp up your business:
1. Ask friends and family first. Your friends and family know and trust you. They're very willing to help you, and they want you to be successful. Let them know you're licensed and are actively seeking buyers and sellers to build your book of business. Let them know you intend to work hard for your clients, and you will leave a great impression on anyone they refer to you. They'll be glad to help!
2. Keep asking! Over 70% of millennial home buyers are so happy with their agent that they would hire them again, or send them a referral of a friend or family member or someone that they know. That's a lot of new client potential! Make sure you are the "top-of-mind" real estate agent they think of when they talk with your next potential client.
3. Let them know you appreciate it. One great way to keep your friends and family referring your services is to write a "thank you" card. Send your best referral sources something special to let them know you sincerely appreciate their help in starting your business.
It's not easy getting started in real estate, and many new agents aren't prepared for the constant networking efforts and hard work it takes to be successful. You've earned your license and demonstrated a commitment to your new career. Don't become a statistic. The most critical step you can take toward building a successful real estate business is a simple, three-letter word: ASK.
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"NEW AGENT! I'm honored and excited to welcome Glenroy (Glen) Samuels to our team here at the New York Real Estate Experts.
Glen is a lifelong and established professional musician who has played with well-known names such as the Fab5 Band, Freddy Jackson, Percy Sledge, Ray Goodman & Brown, Lauren Hill, Chi-Lites, Sanchez, Luciano Etc etc. He's presently playing with Chaka Demus & Pliers.
Glen has had a life long dream of doing real estate and we are super excited to have him join our family of Realtors for the leads, the systems, the mentoring and motivation we have to provide for success. We are looking forward to seeing Glen grow and thrive in real estate.
Please help me welcome Glen to our team."
Home purchases are big decisions made not without hesitation. It's normal to question one's self-capability to pay for such at first. Nevertheless, some brave through this intimidating ordeal and managed just fine.
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:
You may not be much different than many people who have already purchased their first homes. If you're still hesitating or debating whether or not you should go for it, meet with a local real estate professional who can help you determine if your dream home is within your grasp today.
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We have a lot of potential homeowners and families having second thoughts about buying today. Current mortgage rates and home prices intimidate buyers and it's completely understandable.
With both home prices and mortgage rates increasing this year, many are concerned about a family's ability to purchase a major part of the American Dream - its own home. However, if we compare housing affordability today to the average affordability prior to the housing boom and bust, we are in much better shape than most believe.
In Black Knight's latest monthly Mortgage Monitor, they revealed that in the vast majority of the country, it is actually more affordable to purchase a home today than it was between 1995 to 2003 when looking at mortgage payments (determined by price and interest rate) as compared to incomes. Home prices are up compared to 1995-2003, but mortgage rates are still much lower now than at that time. Today, they stand at about 4.5%. Here are the average mortgage rates for each of the years mentioned:
Black Knight's research revealed that, when comparing "the share of median income required to buy the median-priced home" today, to the average between 1995 to 2003, it is currently more affordable to purchase a home in 44 of 50 states.
Here is a state map of the percentage change in the price-to-payment ratio. Positive numbers indicate that it is less affordable to buy while negative numbers indicate that it is more affordable.
Whether you are moving up to the home of your dreams or purchasing your first house, it is a great time to buy when looking at historic affordability data.