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The 2020 Millennial Home Buyer Report shows how this generation is not really any different from previous ones when it comes to homeownership goals:
“The majority of millennials not only want to own a home, but 84% of millennials in 2019 considered it a major part of the Canadian Dream.”
Unfortunately, the myths surrounding the barriers to homeownership – especially those related to down payments and FICO® scores – might be keeping many buyers out of the arena. The piece also reveals:
“Millennials have to navigate a lot of obstacles to be able to own a home. According to our 2020 survey, saving for a down payment is the biggest barrier for 50% of millennials.”
Millennial or not, unpacking two of the biggest myths that may be standing in the way of homeownership among all generations is a great place to start the debunking process.
Many buyers often overestimate what they need to qualify for a home loan. According to the same article:
“A down payment of 20% for a home of that price [$210,000] would be about $42,000; only about 30% of the millennials in our survey have enough in savings to cover that, not to mention the additional closing costs.”
While many potential buyers still think they need to put at least 20% down for the home of their dreams, they often don’t realize how many assistance programs are available with as little as 3% down. With a bit of research, many renters may be able to enter the housing market sooner than they ever imagined.
In addition to down payments, buyers are also often confused about the FICO® score it takes to qualify for a mortgage, believing they need a credit score of 780 or higher.
The Origination Insight Report, which focuses on recently closed (approved) loans, shows the truth is, over 50% of approved loans were granted with a FICO® score below 750 (see graph below):Even today, many of the myths of the homebuying process are unfortunately keeping plenty of motivated buyers on the sidelines. In reality, it really doesn’t have to be that way.
If you’re thinking of buying a home, you may have more options than you think. Let’s connect to answer your questions and help you determine your next steps.
The travel industry is one of the major sectors that’s been hit extremely hard by the COVID-19 pandemic. Today, it’s hard to know how long it will take for summer travelers to be back in action and for the industry to fully recover. Homeowners who rent their secondary properties on their own or through programs like Airbnb, which has over 660,000 listings in the U.S. alone, have been impacted in this challenging time. Some of these homeowners are considering selling their vacation homes, and understandably so.
A recent CNN article indicated:
“With global travel screeching to a halt during the pandemic, a number of Airbnb hosts are planning to sell their properties…These desperate moves come as hosts face the possibility of losing thousands of dollars a month in canceled bookings while bills, maintenance costs, and mortgage payments pile up.”
If you’re one of the property owners in this position, you too may be feeling the pain of decreased travel, especially as we prepare for the typical busy summer vacation season. A recent survey notes that 48% of Americans have already canceled summer travel plans due to the current health crisis. In addition, 36% indicated they don’t have vacation plans, and only 16% said they did not cancel their summer travel.
The same survey also asked, “How long will you wait before traveling again?” Not surprisingly, only 29% of respondents are planning to travel within the next 6 months. That means 71% are putting their plans on hold for at least 6 months, or are still unsure about future travel. That can continue to add to the significant income loss that many property renters felt this spring.If you’re considering selling your rental property, know that there are two key factors indicating that selling your vacation home now may be your best move as a homeowner.
The inventory of overall homes for sale is well below the demand from potential buyers, so many eyes may be searching for a home like yours. According to the National Association of Realtors (NAR), total housing inventory, meaning homes available to purchase, is down 19.7% from one year ago (see graph below):Inventory across the country continues to be a challenge, with only a 4.1-month supply of listings available at the current sales pace. For a balanced market, where there are enough homes available for interested buyers to purchase, that number would need to bump up to a 6-month supply. This means we don’t have enough inventory for the number of buyers looking for homes, so selling in this scenario is ideal. Buyers are looking now, and some vacation homes make a great primary residence or second home for those eager to escape from more populated urban areas.
The lack of inventory is also keeping homes from depreciating in value. Today, prices are holding strong and experts forecast home price appreciation to continue throughout this year. Selling your home while prices are holding steady is a sound business move. You’ll likely have equity you’ve earned working for you as well. If your home has been vacant for the past few months, the forced savings you have built in your equity may help balance out possible rental income loss due to the slowdown in the travel industry.
We don’t know exactly when heightened summer travel will return or what it will look like when it does. If you’re considering selling your vacation home, let’s connect today to determine your options in the current market.
When you sell, you’ll probably want to get the best possible price for your property. Who wouldn’t? Unfortunately, there are many ways to inadvertently leave money on the table – sometimes thousands of dollars.
How do you avoid that possibility? Just remember the 4 Ps:
• Prep. Do everything you can to prepare your home so that it looks great to buyers. Clean, declutter, fix, make improvements. Home staging can also help. In fact, effectively staged homes have been shown to sell for up to 5% more than comparable unstaged properties.
• Price. Set the right asking price. That’s crucial. If it’s too low, you’ll attract only deal-hunters — and you might end up getting less than you should. If the asking price is too high, however, you’ll discourage those buyers who might otherwise be interested and willing to make a good offer. Be careful with pricing!
• Promotion. There may be qualified buyers out there who would be eager to see your property. But, they need to find out about your listing and the great features of your home first! Reaching these buyers requires more than merely profiling the listing on the MLS. Homes that sell for top dollar often have strong marketing — directed to the right buyers.
• Proposal. Once an offer comes in, there may be an opportunity to negotiate with the buyer to maximize the final price you get. This requires deep knowledge of the local market as well as street-smart negotiation skills. If done effectively, these negotiations can help put more money in your pocket.
These four Ps are easy to remember, but sometimes not so easy to implement! That’s why working with a great real estate agent is so important.
Contact me to get the conversation started. (416) 779-8732.
*Morris Marketing*
When you’re selling your home, it’s a little like having company over. You want to make your home look its best. The only difference is in how high the stakes are. When friends come, they simply visit. When buyers come, you want them to be so impressed with your home they’ll want to put in an offer.
One way to do that is to make a trip to the dollar store. There are some great inexpensive home improvement items you can buy that will make a big difference. Here are a few examples:
• New welcome mats for the front door and foyer.
• Replacement light bulbs, with the proper wattage for each room.
• A new lamp or two for areas that aren’t currently well lit.
• A new houseplant or two. (Have at least one with flowers.)
• Colour-matching wood filler pens to repair scuffs and cracks in wood items, such as cabinets and tables.
• Plastic bins to help eliminate clutter from closets and other areas.
• New towels for the bathrooms.
Of course, you can buy these items anywhere – but you don’t need to spend a lot. Everything on this list is relatively inexpensive and can help your home show better.
*Morris Marketing*
Moving around the corner or even across town is relatively simple because you are likely familiar with the various neighbourhoods and you can access them anytime. If there’s a listed home you want to view, you can simply go see it.
Relocating to a different town or city, however, is much more challenging. It may not be possible for you to make multiple visits to see homes for sale. You may also be unfamiliar with the various neighbourhoods.
So what do you do if you want to move out-of-town or need to relocate due to work?
Your first step is to get the information you need. You’ll want up-to-date data on the neighbourhoods so you can pinpoint the ones that are the best fit for your needs and lifestyle. You’ll also want to get a sense of the types of homes for sale in those neighbourhoods — style, size, features, listing price, etc.
Your next step is to schedule a day to view homes. This visit must be carefully planned so you only see those properties that are likely to be of interest. You don’t want to travel all that way only to end up seeing properties you wouldn’t likely buy!
So, if you are relocating, you’ll need help. Give me a call. I can help make the relocation go smoothly for you. (416) 779-8732
You’ve probably heard of “staging”. It involves setting up each room of your home in a way that maximizes its appeal to buyers. You’ve probably also heard that this strategy can help sell your home faster – and for a higher price.
That’s true. However, if you’re like many homeowners, you’re worried about the time, energy and cost involved in staging your home properly. After all, don’t professional stagers bring in special furniture and décor? Will you have to do the same thing?
Not necessarily. Staging doesn’t have to be a big imposition. In fact, there are many staging techniques that most homeowners can easily do on their own. Among the simplest are: cleaning, decluttering, fixing, and painting.
Rearranging furniture can also improve the look of a room, while putting some furniture into storage can make the room look more spacious. A helpful technique is to think of each room in your home as a product for sale. Then, explore ways to make it the kind of room buyers would want to buy.
When it comes to effective staging, that’s a good mindset to get you started.
When they are required to provide an online security password, many people simply use the same memorable sequence for all logins. This is a bad idea, because simple passcodes can be easily discovered and duplicated by hackers, who could then access any other sites where the legitimate user has assigned the same code.
A good solution that can save time, trouble and anxiety is a password manager app. Once its proprietary software is downloaded on your computer or device, it can help you create a complex and unique password for each website.
Some will save the security code on your device, allowing you to retrieve and apply it without re-keying, while others can recognize the website you are accessing and automatically complete a secure log-in for your initial visit, and recall or rewrite it whenever you return.
Somepopular apps are available free of charge, but they may have limitations. Those available by subscription offer more features, and often provide a free trial period to attract new subscribers. Before choosing, be sure to check the specifications for compatibility with your device (Apple versus Android) and your preferred browser (Safari versus Chrome).
*Morris Marketing*
Buying an older property definitely has its advantages. The neighbourhood will already be well-established, so you’ll be able to get a sense of the community. The trees will be grown. The area will have a defined character. This combination of an older home and established community may be something you like, or even love.
However, when you’re viewing an older home for sale, there are a few extra things you need to be sure to check. Here are the most important:
Needed Replacements: Nothing lasts forever. In any home, there are items that will eventually need to be replaced. The most common include roofing shingles, furnace, water heater, air conditioner, windows, deck, and fencing. When viewing an older property, ask about the age of each of these items. You’ll get an idea of probable upcoming replacement expenses.
Building Issues: Homes were built differently decades ago than they are today. So, there may be issues that need to be addressed by a new owner. Some can be serious, such as water leakage and structural problems. Others, less so, such as old electrical outlets that need to be updated. If there are issues like these, they’ll likely be identified during the professional home inspection.
Drafts: Drafts are common in older homes. Of course, that doesn’t mean they shouldn’t be fixed. Even modest infiltration of air through an old window or door with worn weatherstripping could add hundreds of wasted dollars to your energy bill each year. Look for signs of drafts when viewing a home.
The good news is, the overwhelming majority of these issues can be fixed easily. Don’t let them dissuade you from buying an older home you otherwise like.
*Morris Marketing*
Do you have only a few weeks to search for your next dream home? Don’t panic. There are things you can do to find the perfect (or, at least, almost perfect) property — without getting too stressed out!
Consider these tips:
• Pre-arrange your mortgage. You want to be able to make a good offer on a home right away, without worrying about financing. So, talk to your mortgage advisor or lender about getting a mortgage preapproval. Sellers will take your offer more seriously if you have financing in hand.
• Decide what you want. What type of home are you looking for? What type of neighbourhood do you want to live in? The narrower your focus, the less time you’ll waste looking at properties that don’t fit your needs.
• Be open to possibilities. There are probably terrific homes on the market — right now — that are close to what you’re looking for. So be prepared to consider properties that are less-than-perfect. Remember, what a home lacks today may be remedied with a renovation later on.
• Be flexible with your schedule. When you see a home you like, schedule a viewing immediately, even if it’s at an inconvenient day/time, such as a weekday after work. Finding a great home, quickly, is worth some inconvenience.
• Get alerted to new listings. As they say, the early-bird gets the worm. So arrange to be alerted to new listings the moment they come on the market. That way, you can see these properties right away.
Want more tips on finding a home, quickly? Give me a call. 416-779-8732
Brampton Real Estate Talk 