Latest Posts

51% of Homeowners Love Their Forever Homes ...Do You? - VIDEO -

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The Tale of Two Markets [INFOGRAPHIC]

The Tale of Two Markets [INFOGRAPHIC]

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Where Are Interest Rates Headed in 2019? Will Interest Rates Continue to Rise or Level Off?

Where Are Interest Rates Headed in 2019?

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5 Reasons to List Your Home This Holiday Season - VIDEO -

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Homeowners Aged 65+ Have 48x More Net Worth Than Renters

Homeowners Aged 65+ Have 48x More Net Worth Than Renters

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4 Reasons to Buy A Home This Winter!

4 Reasons to Buy A Home This Winter!

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US Existing-Home Sales Rise After Six Months of Declines

US Existing-Home Sales Rise After Six Months of Declines

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The #1 Reason to Not Wait Until Spring to Sell Your House

The #1 Reason to Not Wait Until Spring to Sell Your House

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Further Proof It’s NOT 2008 All Over Again

Further Proof It’s NOT 2008 All Over Again

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Buyers: Don’t Be Surprised by Closing Costs!

Buyers: Don’t Be Surprised by Closing Costs!

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7 Reasons to List Your House For Sale This Holiday Season

7 Reasons to List Your House For Sale This Holiday Season

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Home Sellers in Q3 Netted $61K at Resale

Home Sellers in Q3 Netted $61K at Resale

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Are Homeowners Renovating to Sell or to Stay?

Are Homeowners Renovating to Sell or to Stay?

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75% of Renters Have Been Misinformed

75% of Renters Have Been Misinformed

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Why Has Housing Supply Increased as Sales Have Slowed Down?

Why Has Housing Supply Increased as Sales Have Slowed Down?

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2 Myths Holding Back Home Buyers

2 Myths Holding Back Home Buyers

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Are We Heading Towards Another Housing Bubble? NO! - VIDEO -

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How Will Home Sales Measure Up Next Year? Stats say Home Sales Will Rise in 2019!!!

How Will Home Sales Measure Up Next Year?

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Taking Fear Out of the Mortgage Process

Taking Fear Out of the Mortgage Process

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Owning a Home is Important to All Generations - VIDEO

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How the Housing Market is Impacted by Natural Disasters - VIDEO

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Don't Be Spooked by the Real Estate Market - Video

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Thinking of Selling Your Home? Here’s Why You Need A Pro in Your Corner

Thinking of Selling Your Home? Here’s Why You Need A Pro in Your Corner

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Where are Home Values Headed over the Next Few Years?

Where are Home Values Headed over the Next Few Years?

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Housing Is Still Affordable in the United States!

Housing Is Still Affordable in the United States!

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HOMEOWNER'S PROPERTY TAX CALENDAR 2018-2019

CALIFORNIA PROPERTY TAX REMINDER....

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Is the Increase in Inventory a Bullish or Bearish Sign for Real Estate?

Is the Increase in Inventory a Bullish or Bearish Sign for Real Estate?

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THIS IS HOME...rely on Only The Best...The Brown Team Real Estate Group!!!

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Baby Boomers are Downsizing, Are You Ready to Move?

Baby Boomers are Downsizing, Are You Ready to Move?

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Pre-Approval: Your 1st Step in Buying a Home

Pre-Approval: Your 1st Step in Buying a Home

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Dispelling the Myth About Home Affordability

Dispelling the Myth About Home Affordability

Dispelling the Myth About Home Affordability | MyKCM

We have all seen the headlines that report that buying a home is less affordable today than it was at any other time in the last ten years, and those headlines are accurate. But, have you ever wondered why the headlines don’t say the last 25 years, the last 20 years, or even the last 11 years?

The reason is that homes were less affordable 25, 20, or even 11 years ago than they are today.

Obviously, buying a home is more expensive now than during the ten years immediately following one of the worst housing crashes in American history.

Over the past decade, the market was flooded with distressed properties (foreclosures and short sales) that were selling at 10-50% discounts. There were so many distressed properties that the prices of non-distressed properties in the same neighborhoods were lowered and mortgage rates were kept low to help the economy.

Low Prices + Low Mortgage Rates = High Affordability

Prices have since recovered and mortgage rates have increased as the economy has gained strength. This has and will continue to impact housing affordability moving forward.

However, let’s give affordability some historical context. The National Association of Realtors (NAR) issues their Affordability Index each month. According to NAR:

“The Monthly Housing Affordability Index measures whether or not a typical family earns enough income to qualify for a mortgage loan on a typical home at the national and regional levels based on the most recent monthly price and income data.”

NAR’s current index stands at 138.8. The index had been higher each of the last ten years, peaking at 197 in 2012 (the higher the index the more affordable houses are).

But, the average index between 1990 and 2007 was just 123 and there were no years with an index above 133. That means that homes are more affordable today than at any time during the eighteen years between 1990 and 2007.

Bottom Line

With home prices continuing to appreciate and mortgage rates increasing, home affordability will likely continue to slide. However, this does not mean that buying a house is not an attainable goal in most markets as it is less expensive today than during the eighteen-year stretch immediately preceding the housing bubble and crash.

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Thinking About Moving to a New City? Here's What You Need to Know

Brought to you by - MIKE BROWN BROKER
Real Estate News October 2018
Thinking About Moving to a New City? Here's What You Need to Know
By Eliot Ward
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Perhaps you recently accepted a job offer in a new city, or you just needed a change of scenery and decided now was the time to make that change. Uprooting your life isn't an easy feat—yet, it's exciting and new. You'll get to explore a whole new place and all that that new place has to offer! There'll be new activities, new restaurants, new friends, new parks, and more.

rulerWhat should you know about your new hometown? What research should you do ahead of time to ensure you relocate to a place you'll be comfortable living in? Here's what you need to know:

Do Your Research Before Buying (or Renting) 
The area you live in makes your home what it is. Check out Google Maps before your big move. Maybe even make a list of the advantages and disadvantages to each area you research—it can help make the decision easier.

If your kids are in school, you'll likely want a school facility close by. Do you want them to attend a private or public school? Is there one close by? What about grocery shopping? Is it easy to get to? Do you like to have a gym you can walk to? Are there parks? Ask yourself these questions ahead of time. Determine their importance to you and your family.

Research the Local Big Activities and Events
With a new city comes a new list of annual events and festivals. Find out what big attractions take place. If your family is into skiing or mountain biking, look to see if there is a place close by to partake in these activities. Plus, finding activities and fun events to look forward to can lessen the impact of a move, such as moving far away from friends and family. It's exciting, but it can also be really tough. Make the best out of it!

Research the Costs of Your New City
This is a big one. Cities come with different price tags. Make sure you know what you'll be spending before you commit.

Even grocery prices tend to change. Calculate what you can expect to spend in your new city—does it work for your budget? The worst thing that could happen is you move and find out you can't afford your new city. Financial planning makes all the difference, and it can help you avoid future panic or crises.
Top Benefits of Installing a Tankless Water Heater
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Tankless Hot Water HeaterAs is the case with most household appliances, modern technological advancements can result in massive improvements. Here are the top benefits of installing a tankless water heater in your home: Save Money on Your Energy Bill
With a conventional water heater, hot water is stored inside the tank. In theory, this keeps a ready supply of hot water on hand for immediate use, but the fact is that the hot water just sits around when not being used. This is not only a complete waste of energy; it also costs you extra money at the end of the month on your energy bill.

Tankless Is Better Than Conventional
A tankless water heater does not store hot water for later use. Instead, a tankless water heater only produces as much hot water as a person needs. In other words, when the hot water faucet is turned on, the tankless unit provides the exact amount of hot water dispensed until the faucet is turned off. With the installation of a tankless unit in your home, you never need to worry about running out of hot water again during a shower.

The Single Biggest Flaw of Conventional Tank Water Heaters
One of the biggest problems with conventional tank water heaters is leakage. No matter how fancy of an electric water heater you buy, the unit will start leaking as time takes its toll. After all, these are constantly filled with water day in and day out for a period of years. A tankless water heater, on the other hand, doesn't store water, and, therefore, will never leave you a big mess to clean up—because there's nothing to leak!

Mike Brown, SFR
Broker/Owner/Realtor
BRE #01388620
BRE #01894369 Corporation

SOUTH COAST EXCLUSIVE PROPERTIES

SOUTH COAST LUXURY HOMES

Offices in Carlsbad & San Juan Capistrano, CA

Serving All of San Diego and Orange Counties

Earning Your Trust....Delivering Results For Our Clients

The Brown Team Real Estate Group

Honesty - Integrity - Commitment

760-822-8734 - cell
760-696-3797 - fax

MikeBrownBroker@gmail.com

www.SouthCoastExclusiveProperties.com

www.TheBrownTeamSellsHomes.com


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Follow me on Twitter at http://twitter.com/mikebrownbroker for the latest updates on local Real Estate and Financial News.

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2 Factors to Watch in Today’s Real Estate Market Whether Buying or Selling

2 Factors to Watch in Today’s Real Estate Market Whether Buying or Selling

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How Does the Supply of Homes for Sale Impact Buyer Demand?

How Does the Supply of Homes for Sale Impact Buyer Demand?

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Is There a Shift Happening in the Real Estate Market? - VIDEO -

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Are Home Prices Softening or Are They Falling?

Are Home Prices Softening or Are They Falling?

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The Cost of NOT Paying PMI

The Cost of NOT Paying PMI

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SHOW ME THE MONEY.... HOMEOWNERS HAVE A WEALTH OF EQUITY IN THEIR HOME...

25% of Homes with a Mortgage are Now Equity Rich!  

 Homeowners can now say SHOW ME THE MONEY... The Brown Team Real Estate Group can help you find your DREAM HOME and Build Equity. Call Mike Brown Broker at 760.822.8734

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If You Are Thinking of Selling? You Must Act NOW!

If You Are Thinking of Selling? You Must Act NOW!

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Are Homebuyers Starting to Hit the ‘Pause’ Button?

Are Homebuyers Starting to Hit the ‘Pause’ Button?

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Home Prices Have Appreciated 6.9% in 2018

Home Prices Have Appreciated 6.9% in 2018

Home Prices Have Appreciated 6.9% in 2018 | MyKCM

Between 1987 and 1999, which is often referred to as the ‘Pre-Bubble Period,’ home prices grew at an average of 3.6% according to the Home Price Expectation Survey.

Every month, the economists at CoreLogic release the results of their Home Price Insights Report, which includes the actual year-over-year change in prices across the country and their predictions for the following year.

The chart below shows the forecasted year-over-year prices for 2018 (predictions made in 2017). According to their predictions, the average appreciation over the course of 2018 should be 4.8%, which is still greater than the ‘normal’ appreciation of 3.6%.

Home Prices Have Appreciated 6.9% in 2018 | MyKCM

If we layer in the actual price appreciation that has occurred this year, we can see that over the course of 2018, home prices have appreciated by an average of 6.9% and have outpaced projections all year!

Home Prices Have Appreciated 6.9% in 2018 | MyKCM

What does this mean?

The tale of today’s real estate market is one of low inventory, high demand, and rising prices. The forces at work can be simply explained with the theory of supply and demand. That being said, if a large supply of inventory were to come to the market, prices may start to appreciate closer to the forecasted rate which would STILL be greater than the historic norm!

Bottom Line

If you are a homeowner whose house no longer meets your needs, now may be a great time to list your home and capitalize on the equity you have gained over the last year to make a significant down payment on your next home!

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5 REASONS TO SELL YOUR HOME THIS FALL - VIDEO -

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ORANGE COUNTY HOUSING UPDATE...

The most recent range County Housing Report stated the market has rapidly slowed since May of 2018 and the demand reading is the lowest for this time of year since 2007. What did the report not say is what has caused this change?

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TOP 3 MYTHS HOLDING BACK BUYERS - VIDEO -

Top 3 Myths Holding Back Buyers

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What Does the Future Hold for Home Prices?

What Does the Future Hold for Home Prices?

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Homeownership is a Dominant Gene

Homeownership is a Dominant Gene

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5 Reasons You Should Sell This Fall!

5 Reasons You Should Sell This Fall!

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San Diego Bucks 3-Month Statewide Trend of Falling Home Sales

San Diego Bucks 3-Month Statewide Trend of Falling Home Sales

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How SuppLy & Demand Impacts Real Estate Values - VIDEO -

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Top 3 Myths About Today’s Real Estate Market

Top 3 Myths About Today’s Real Estate Market

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Home Sales Expected to Continue Increasing in 2019

Home Sales Expected to Continue Increasing in 2019

Freddie Mac, Fannie Mae, and the Mortgage Bankers Association are all projecting that home sales will increase nicely in 2019. Below is a chart depicting the projections of each entity for the remainder of 2018, as well as for 2019.

Home Sales Expected to Continue Increasing in 2019 | MyKCM

As we can see, Freddie Mac, Fannie Mae, and the Mortgage Bankers Association all believe that homes sales will increase steadily over the next year. If you are a homeowner who has considered selling your house recently, now may be the best time to put it on the market.

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Rent or Buy: Either Way You’re Paying A Mortgage!

Rent or Buy: Either Way You’re Paying A Mortgage!

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Existing Home Sales Cooling Off This Summer

Existing Home Sales Cooling Off This Summer [INFOGRAPHIC]

Existing Home Sales Cooling Off This Summer [INFOGRAPHIC] | MyKCM

Some Highlights:

  • According to the National Association of Realtors’ latest Existing Home Sales Report, sales in June were down 2.2% from last year.
  • Inventory of homes for sale showed a modest improvement of 0.5% over last year’s figures, but still remains under the 6-month supply needed for a normal market.
  • NAR’s Chief Economist Lawrence Yun had this to say: “There continues to be a mismatch since the spring between the growing level of homebuyer demand in most of the country in relation to the actual pace of home sales, which are declining. The root cause is without a doubt the severe housing shortage that is not releasing its grip on the nation’s housing market.”

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Will The Next Economic Slowdown Impact The Value Of Your Home? - VIDEO -

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What Does the Recent Rash of Price Reductions Mean to the Real Estate Market?

What Does the Recent Rash of Price Reductions Mean to the Real Estate Market?

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5 Real Estate Reality TV Myths Explained

5 Real Estate Reality TV Myths Explained

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Have You Outgrown Your Starter Home?

Have You Outgrown Your Starter Home?

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BUYING REMAINS CHEAPER THAN RENTING!!!! - VIDEO -

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Housing Market: Another Gigantic Difference Between 2008 and 2018

Housing Market: Another Gigantic Difference Between 2008 and 2018

Housing Market: Another Gigantic Difference Between 2008 and 2018 | MyKCM

Some are attempting to compare the current housing market to the market leading up to the “boom and bust” that we experienced a decade ago. They look at price appreciation and conclude that we are on a similar trajectory, speeding toward another housing crisis.

However, there is a major difference between the two markets. Last decade, while demand was being artificially created by extremely loose lending standards, a tremendous amount of inventory was coming to the market to satisfy that demand. Below is a graph of the inventory of homes available for sale leading up to the 2008 crash.

 

Housing Market: Another Gigantic Difference Between 2008 and 2018 | MyKCM

A normal market should have approximately 6 months supply of housing inventory. As we can see, that number jumped to over 11 months supply leading up to the housing crisis. When questionable mortgage practices ceased, and demand dried up, there was a glut of inventory on the market which caused prices to drop as there was too much supply and not enough demand.

Today is radically different!

There are those who believe that low mortgage rates have created an artificial demand in the current market. They fear that if mortgage rates continue to rise, some of the current demand will dry up (which is a possibility).

However, if we look at supply again, we can see that the current supply of homes is well below the norm of 6 months.

Housing Market: Another Gigantic Difference Between 2008 and 2018 | MyKCM

Bottom Line

We will not have a glut of inventory like we did back in 2008 and home values won’t come tumbling down. Instead, if demand weakens, we will return to a normal market (approximately a 6-month supply) with historic levels of appreciation (3.6% annually).

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Supply & Demand Will Determine Future Home Values

Supply & Demand Will Determine Future Home Values

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Are You Thinking of Selling Your Home? Competition Is Coming!

Are You Thinking of Selling Your Home? Competition Is Coming!

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Is Housing Affordable? - VIDEO -

As home prices continue to rise due to a lack of inventory, many people are becoming more concerned about housing affordability. Taking a look at NAR's Housing Affordability Index puts that concern to rest. Let's get together to go over your specific market and determine whether or not you are ready to buy today!

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5 Reasons to Hire a Real Estate Professional Before Entering the Market

5 Reasons to Hire a Real Estate Professional Before Entering the Market!

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Millionaire to Millennials: Owning Your Home Can Help You Retire Sooner!

Millionaire to Millennials: Owning Your Home Can Help You Retire Sooner!

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Home Buying Myths Slayed

Home Buying Myths Slayed [INFOGRAPHIC]

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Buying Is Now 26.3% Cheaper Than Renting in the US

Buying Is Now 26.3% Cheaper Than Renting in the US

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Are Lending Standards Propping Up Home Prices?

Are Lending Standards Propping Up Home Prices?

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The 3 Things You'll Need to Get a HOME LOAN In Today's Market Place - VIDEO

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You Need an Agent MIKE BROWN BROKER Who Will Always Put You First

You Need an Agent Who Will Always Put You First

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The #1 Reason to Put Your House on The Market TODAY!

The #1 Reason to Put Your House on The Market TODAY!

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4 Reasons Why We Are Not Heading Toward Another Housing Bubble

4 Reasons Why We Are Not Heading Toward Another Housing Bubble

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our Current House Fit Your Needs in Retirement?

Will Your Current House Fit Your Needs in Retirement?

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SELLERS REMAIN IN DRIVER'S SEAT


July, 2018

SELLERS REMAIN IN DRIVER'S SEAT 


The lazy days of summer may be here, but it's a busy season for the real estate industry. Home buyers are out in force looking for new homes, but fewer "For Sale" signs are popping up in neighborhoods across much of the nation, creating stiff competition for those seeking their dream homes.


This spring's home-sale numbers reflect the continued housing inventory shortage. In May, existing-home sales decreased modestly, according to the National Association of Realtors® (NAR). Existing-home sales dropped by 0.4% from April and 3% from a year earlier to a seasonally adjusted rate of 5.43 million, NAR reported.

Continues To Be A Sellers Market



New-home sales are faring much better. Sales of new single-family houses climbed 6.7% in May, the highest level since November 2017, according to the Commerce Department. Construction of new homes is expected to increase 10% this year, to about 1.3 million new single-family homes, but that still won't be enough to keep up with the growing demand, said Lawrence Yun, NAR chief economist, in an interview with CNN Money.


Besides low inventory, buyers are facing a gradual rise in loan interest rates, which have been trending slightly higher throughout 2018 and are expected to continue increasing the rest of the year. So, despite the tough competition, if you're thinking of buying a new home this year, now is a good time to start.


Here are a few more reasons why the summer of 2018 is a great time to sell:

  • NAR's latest Buyer Traffic Report shows that buyer demand remains very strong in most parts of the country. Buyers are ready and able to purchase, with multiple buyers often competing for the same home.
  • NAR's Realtor® Confidence Index showed that properties were typically on the market for just 26 days in May, giving homeowners time to sell quickly and get settled in a new home before kids return to school.
  • More buyers are getting pre-approved for loans before beginning their home search, making the selling process much faster and simpler. According to Ellie Mae®Origination Insight Report, the average time it took to close a loan in April was 41 days.
  • With trees, flowers and other plantings flourishing, curb appeal is typically at its peak during the summer

To make the most out of your summer real estate goals, it is vital to choose an experienced local agent with the resources and tools to guide you through the entire process, so contact Mike Brown Broker today at 760.822.8734.


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The #1 Reason to List Your House for Sale NOW!

The #1 Reason to List Your House for Sale NOW!

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Lack of Listings Slowing Down the Market

Lack of Listings Slowing Down the Market

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What You Need to Know About the Mortgage Process

What You Need to Know About the Mortgage Process [INFOGRAPHIC]

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Housing Will Not Fall Victim to Next Economic Storm

Housing Will Not Fall Victim to Next Economic Storm

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Demand for Homes to Buy Continues to Climb

Demand for Homes to Buy Continues to Climb

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4 REAL Reasons Why We Buy A Home!

4 REAL Reasons Why We Buy A Home!

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Want to Sell Your House Faster? Don’t Forget to Stage!

Want to Sell Your House Faster? Don’t Forget to Stage! [INFOGRAPHIC]

Want to Sell Your House Faster? Dont Forget to Stage! [INFOGRAPHIC] | MyKCM

Some Highlights:

  • The National Association of Realtors surveyed their members & released the findings of their Profile of Home Staging.
  • 62% of seller’s agents say that staging a home decreases the amount of time a home spends on the market.
  • 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.

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House-Buying Power at Near-Historic Levels

House-Buying Power at Near-Historic Levels

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Rising Interest Rates Have Not Dampened Demand

Rising Interest Rates Have Not Dampened Demand

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How Long Do Most Families Live in a House?

How Long Do Most Families Live in a House?

How Long Do Most Families Live in a House? | MyKCM

The National Association of Realtors (NAR) keeps historical data on many aspects of homeownership. One of their data points, which has changed dramatically, is the median tenure of a family in a home, meaning how long a family stays in a home prior to moving.

As the graph below shows, over the last twenty years (1985-2008), the median tenure averaged exactly six years. However, since 2014, that average is almost ten years – an increase of almost 50%.

How Long Do Most Families Live in a House? | MyKCM

Why the dramatic increase?

The reasons for this change are plentiful!

The fall in home prices during the housing crisis left many homeowners in a negative equity situation (where their home was worth less than the mortgage on the property). Also, the uncertainty of the economy made some homeowners much more fiscally conservative about making a move.

With home prices rising dramatically over the last several years, 95.3% of homes with a mortgage are now in a positive equity situation, according to CoreLogic.

With the economy coming back and wages starting to increase, many homeowners are in a much better financial situation than they were just a few short years ago.

One other reason for the increase was brought to light by NAR in their 2018 Home Buyer and Seller Generational Trends ReportAccording to the report,

“Sellers 37 years and younger stayed in their home for six years…”

These homeowners, who are either looking for more space to accommodate their growing families or for better school districts to do the same, are likely to move more often (compared to typical sellers who stayed in their homes for 10 years). The homeownership rate among young families, however, has still not caught up to previous generations, resulting in the jump we have seen in median tenure!

What does this mean for housing?

Many believe that a large portion of homeowners are not in a house that is best for their current family circumstance; they could be baby boomers living in an empty, four-bedroom colonial, or a millennial couple living in a one-bedroom condo planning to start a family.

These homeowners are ready to make a move, and since a lack of housing inventory is still a major challenge in the current housing market, this could be great news.

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Cost Across Time

Cost Across Time [INFOGRAPHIC]

Cost Across Time [INFOGRAPHIC] | MyKCM

Some Highlights:

  • With interest rates still around 4.5%, now is a great time to look back at where rates have been over the last 40 years.
  • Rates are projected to climb to 5.1% by this time next year according to Freddie Mac.
  • The impact your interest rate makes on your monthly mortgage cost is significant!
  • Lock in a low rate now while you can!

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VA Loans: Making a Home for the Brave Possible

VA Loans: Making a Home for the Brave Possible

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Why Should You Use A Professional to Sell Your Home?

Why Should You Use A Professional to Sell Your Home?

Why Should You Use A Professional to Sell Your Home? | MyKCM

When homeowners decide to sell their houses, they obviously want to get the best possible price for their home with the least amount of hassles along the way. However, for the vast majority of sellers, the most important result is actually getting their homes sold.

In order to accomplish all three goals, a seller should realize the importance of using a real estate professional. We realize that technology has changed 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.

Bottom Line

If you are thinking of selling your home, don’t underestimate the role a real estate professional can play in the process.

Read More

Top 5 Reasons You Shouldn't FSBO/FOR SALE BY OWNER...VIDEO

As home prices continue to rise, a lack of inventory remains a crucial challenge in today's market which has some homeowners trying to sell their homes on their own.

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Should You Buy Now Or Wait Until Next Year - VIDEO

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

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Home Prices - The Difference 5 Years Makes - VIDEO

Every day, thousands of homeowners regain positive equity in their homes. You may have enough equity to sell your house and move on to your dream home.

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4 Reasons to Sell Your House - VIDEO

Is this summer the right time to sell your home? Wondering if you should put your house on the market today? Check out this video for the best reasons to list your house this summer!

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5 Reasons Millennials Choose to Buy a Home

5 Reasons Millennials Choose to Buy a Home [INFOGRAPHIC]

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Next Recession in 2020? What Will Be the Impact?

Next Recession in 2020? What Will Be the Impact?

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What’s the Median Home Value in Your State?

What’s the Median Home Value in Your State?

Whats the Median Home Value in Your State? | MyKCM

If you’ve entered the real estate market as a buyer or a seller, you’ve inevitably heard the mantra “location, location, location” in reference to identical homes increasing or decreasing in value based on where they’re located.

In today’s housing market where home prices are appreciating quickly, it’s important to know that not every home appreciates at the same rate. The map below demonstrates that point on a state-by-state basis using data from the National Association of Realtors.

Whats the Median Home Value in Your State? | MyKCM

Demand often dictates value, even for houses in the same area of the country! High demand for starter and trade-up homes have driven prices up in these categories by nearly 10% over the past year, while those in the premium markets have appreciated at closer to 6%.

Bottom Line

If you are debating whether or not to buy and/or sell a home this year, let’s get together to help you figure out exactly what’s going on in our market.

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Are You Wondering If You Can Buy Your First Home?

Are You Wondering If You Can Buy Your First Home?

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You DO NOT Need 20% Down to Buy Your Home NOW!

You DO NOT Need 20% Down to Buy Your Home NOW!

You DO NOT Need 20% Down to Buy Your Home NOW! | MyKCM

The Aspiring Home Buyers Profile from the National Association of Realtors (NAR) found that the American public is still somewhat confused about what is required to qualify for a home mortgage loan in today’s housing market. The results of the survey show that the main reason why non-homeowners do not own their own homes is because they believe that they cannot afford them.

This brings us to two major misconceptions that we want to address today.

1. Down Payment

A recent survey by Laurel Road, the National Online Lender and FDIC-Insured Bank, revealed that consumers overestimate the down payment funds needed to qualify for a home loan.

According to the survey, 53% of Americans who plan to buy or have already bought a home admit to their concerns about their ability to afford a home in the current market. In addition, 46% are currently unfamiliar with alternative down payment options, and 46% of millennials do not feel confident that they could currently afford a 20% down payment.

What these people don’t realize, however, is that there are many loans written with down payments of 3% or less.

Many renters may actually be able to enter the housing market sooner than they ever imagined with new programs that have emerged allowing less cash out of pocket.

2. FICO®Scores

An Ipsos survey revealed that 62% of respondents believe they need excellent credit to buy a home, with 43% thinking a “good credit score” is over 780. In actuality, the average FICO® scores for approved conventional and FHA mortgages are much lower.

The average conventional loan closed in May had a credit score of 753, while FHA mortgages closed with an average score of 676. The average across all loans closed in May was 724. The chart below shows the distribution of FICO® Scores for all loans approved in May.

You DO NOT Need 20% Down to Buy Your Home NOW! | MyKCM

Bottom Line

If you are a prospective buyer who is ‘ready’ and ‘willing’ to act now, but you are not sure if you are ‘able’ to, let’s sit down to help you understand your true options today.

Read More

4 Reasons to Sell This Summer

4 Reasons to Sell This Summer [INFOGRAPHIC]

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Top 5 Reasons You Shouldn’t FSBO

Top 5 Reasons You Shouldn’t FSBO

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Are Lending Standards Too Loose…or Too Tight?

Are Lending Standards Too Loose…or Too Tight?

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Parents Say Kids’ Opinions Matter Big When Buying a Home

Parents Say Kids’ Opinions Matter Big When Buying a Home

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When Is a Good Time to Rent? Not Now!

When Is a Good Time to Rent? Not Now!

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Days on The Market Drops to New Low in April

Days on The Market Drops to New Low in April

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The Cost of Renting vs. Buying

The Cost of Renting vs. Buying [INFOGRAPHIC]

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Homeowners & Appraisers See the Most Eye-to-Eye on Price in 3 Years

Homeowners & Appraisers See the Most Eye-to-Eye on Price in 3 Years


Homeowners & Appraisers See the Most Eye-to-Eye on Price in 3 Years | MyKCM

In today’s housing market, where supply is very low and demand is very high, home values are increasing rapidly. Many experts are projecting that home values could appreciate by another 5% (or more) over the next twelve months. One major challenge in such a market is the bank appraisal.

When prices are surging, it is difficult for appraisers to find adequate, comparable sales (similar houses in the same neighborhood that recently closed) to defend the selling price when performing the appraisal for the bank.

Every month in their Home Price Perception Index (HPPI), Quicken Loans measures the disparity between what a homeowner who is seeking to refinance their home believes their house is worth and what an appraiser’s evaluation of that same home is.

March 2015 marked the first month of a three-year gap between what an appraiser and a homeowner believed a home was worth. That gap widened to 2.65% in September 2015 and had consistently hovered between 1.0% and 2.0% through November 2017.

The chart below illustrates the changes in home price estimates over the last three years:

Homeowners & Appraisers See the Most Eye-to-Eye on Price in 3 Years | MyKCM

In the latest release, the disparity was the narrowest it has been since March 2015, as the gap between appraisers and homeowners was only -0.33%. This is important for homeowners to note as even a .33% difference in appraisal could equate to thousands of dollars that a buyer or seller has to come up with at closing (depending on the price of the home).

Bill Banfield, Executive VP of Capital Markets at Quicken Loans urges homeowners to find out how their local markets have been impacted by supply and demand: 

“The appraisal is one of the most important, although sometimes least predictable, parts of the mortgage process. The Home Price Perception Index is a way to illustrate the differences of opinion, and these differences affect everything from the type of mortgage a borrower can get to the expectations a seller has about the proceeds available upon sale of their home.”

Bottom Line

Every house on the market must be sold twice; once to a prospective buyer and then again to the bank (through the bank’s appraisal). With escalating prices, the second sale may be even more difficult than the first. If you are planning on entering the housing market this year, let’s get together to discuss this and any other obstacles that may arise.

Read More

4 Reasons Why Summer Is a Great Time to Buy a Home!


4 Reasons Why Summer Is a Great Time to Buy a Home!

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Top Reasons to Own Your Home

Top Reasons to Own Your Home [INFOGRAPHIC]

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Millennials Are Skipping Starter Homes for Their Dream Homes

Millennials Are Skipping Starter Homes for Their Dream Homes

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5 Reasons Why to Sell This Summer!

5 Reasons Why to Sell This Summer!

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All Gave Some. Some Gave All.

All Gave Some. Some Gave All.

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Drop in Inventory Fuels Sales Slowdown

Drop in Inventory Fuels Sales Slowdown [INFOGRAPHIC]

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How Current Interest Rates Can Have a High Impact on Your Purchasing Power

How Current Interest Rates Can Have a High Impact on Your Purchasing Power

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Don’t Wait to Sell Your House! Buyers Are Out Now

Don’t Wait to Sell Your House! Buyers Are Out Now

Dont Wait to Sell Your House! Buyers Are Out Now | MyKCM

Recently released data from the National Association of Realtors (NAR) suggests that now is a great time to sell your home. The concept of ‘supply & demand’ reveals that the best price for an item is realized when the supply of that item is low and the demand for that item is high.

Let’s see how this applies to the current residential real estate market.

SUPPLY

It is no secret that the supply of homes for sale has been far below the number needed to sustain a normal market for over a year at this point. A normal market requires six months of housing inventory to meet the demand. The latest report from NAR revealed that there is currently only a 3.6-month supply of houses on the market.

Supply is currently very low!

DEMAND

A report that was just released tells us that demand is very strong. The most recent Foot Traffic Report (which sheds light on the number of buyers who are actually out looking at homes) disclosed that “foot traffic grew 10.5 points to 52.4 in March as the new season approaches.”

Demand is currently very high!

Bottom Line

Waiting to sell will only increase the competition between you and all of the other sellers putting their houses on the market later this summer. If you are debating whether or not to list your home, let’s get together to discuss the conditions in our market.

Read More

Moving Up to Your Dream Home? Don’t Wait!

Moving Up to Your Dream Home? Don’t Wait!

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Renters Under 50 Want to Buy a Home!

Renters Under 50 Want to Buy a Home!

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Homeownership: “A Man Is Not a Complete Man, Unless He Owns a House”

Homeownership: “A Man Is Not a Complete Man, Unless He Owns a House”

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3 Tips for Making Your Dream of Owning a Home a Reality

3 Tips for Making Your Dream of Owning a Home a Reality [INFOGRAPHIC]

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5 Ways Tax Reform Has Impacted the 2018 Housing Market

5 Ways Tax Reform Has Impacted the 2018 Housing Market

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Real Estate Tops Best Investment Poll for 5th Year Running

Real Estate Tops Best Investment Poll for 5th Year Running

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Home Inspections: What to Expect

Home Inspections: What to Expect

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What If I Wait Until Next Year to Buy a Home?

What If I Wait Until Next Year to Buy a Home?

What If I Wait Until Next Year to Buy a Home? | MyKCM

We recently shared that national home prices have increased by 6.7% year-over-year. Over that same time period, 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 Reporthome prices will appreciate by 5.2% over the next 12 months.

What Does This Mean as a Buyer?

If home prices appreciate by 5.2% 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 If I Wait Until Next Year to Buy a Home? | MyKCM

Bottom Line

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

Read More

4 Reasons Why Today’s Housing Market is NOT 2006 All Over Again

4 Reasons Why Today’s Housing Market is NOT 2006 All Over Again

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50% of Homes Sold in 30 Days in March

50% of Homes Sold in 30 Days in March [INFOGRAPHIC]

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Data Says May is the Best Month to Sell Your Home

This Just In: Data Says May is the Best Month to Sell Your Home

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How Much Has Your Home Increased in Value Over the Last Year?

How Much Has Your Home Increased in Value Over the Last Year?

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Existing Home Sales Grow Despite Low Inventory...

Existing Home Sales Grow Despite Low Inventory [INFOGRAPHIC]

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“Short of a war or stock market crash…”

“Short of a war or stock market crash…”

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New Study Shows ‘Best States for Millennials’

New Study Shows ‘Best States for Millennials’

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Thinking of Selling Your Home? Why You Need A Pro in Your Corner...Call Mike Brown - Broker at 760.822.8734

Thinking of Selling Your Home? Why You Need A Pro in Your Corner

Thinking of Selling Your Home? Why You Need A Pro in Your Corner | MyKCM

With home prices on the rise and buyer demand strong, some sellers may be tempted to try and sell their homes on their own (FSBO) without using the services of a real estate professional.

Real estate agents are trained and experienced in negotiation and, in most cases, the seller is not. Sellers must realize that their ability to negotiate will determine whether or not they get the best deal for themselves and their families.

Here is a list of some of the people with whom the seller must be prepared to negotiate if they decide to FSBO:

  • 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 termite company if there are challenges
  • The buyer’s lender if the structure of the mortgage requires the sellers’ participation
  • The appraiser if there is a question of value
  • The title company if there are challenges with certificates of occupancy (CO) or other permits
  • The town or municipality if you need to get the CO permits mentioned above
  • The buyer’s buyer in case there are challenges with the house your buyer is selling
  • Your bank in the case of a short sale

Bottom Line

The percentage of sellers who have hired real estate agents to sell their homes has increased steadily over the last 20 years. Let’s get together and discuss all we can do to make the process easier for you.

Read More

Buying a Home Is Cheaper Than Renting in the Majority of the US

Buying a Home Is Cheaper Than Renting in the Majority of the US

Buying a Home Is Cheaper Than Renting in the Majority of the US | MyKCM

The results of the 2018 Rental Affordability Report from ATTOM show that buying a median-priced home is more affordable than renting a three-bedroom property in 54% of U.S. counties analyzed for the report.

The updated numbers show that renting a three-bedroom property in the United States requires an average of 38.8% of income.

The least affordable market for renting was Marin County, CA, just over the Golden Gate Bridge from San Francisco, where renters spend a staggering 79.5% of average wages on rent, while the most affordable market was Madison County, AL where 22.3% of average wages went to rent.

Other interesting findings in the report include:

  • Average rent rose faster than income in 60% of counties
  • Average rent rose faster than median home prices in 41% of counties
  • While median home prices rose faster than average rents in 58% of counties

Bottom Line

Buying a home makes sense socially and financially. If you are one of the many renters out there who would like to evaluate your ability to buy this year, let’s get together to find your dream home.

Read More

Is Family Mortgage Debt Out of Control?

Is Family Mortgage Debt Out of Control?

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How Much Do You Need to Make to Buy a Home in California?

How Much Do You Need to Make to Buy a Home in Your State?

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Rising Prices Help You Build Your Family’s Wealth


Rising Prices Help You Build Your Family’s Wealth

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Getting Pre-Approved Should Always Be Your First Step

Getting Pre-Approved Should Always Be Your First Step

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A Tale of Two Markets...Seller's Market vs Buyer's Market

A Tale of Two Markets [INFOGRAPHIC]

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The COST of Your Next Home Will Be LESS Than Your Parents’ Home Was

The COST of Your Next Home Will Be LESS Than Your Parents’ Home Was

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Mortgage Interest Rates Have Begun to Level Off

Mortgage Interest Rates Have Begun to Level Off

Mortgage Interest Rates Have Begun to Level Off | MyKCM

Whether you are a buyer searching for your first home, or a homeowner looking to move up to your next home, you should pay attention to where mortgage interest rates are heading.

Over the course of 2018, according to Freddie Mac’s Primary Mortgage Market Survey, rates have increased from 3.95% in the first week of January to 4.40% in the first week of April.

At first glance, the difference between these numbers in such a short amount of time could be concerning, but if we look at the graph below, we’ll see that rates have already started to level off and return to the mark set in February.

Mortgage Interest Rates Have Begun to Level Off | MyKCM

This is great news for anyone looking to buy a home this spring! The spring is always one of the busiest seasons for home buying, and with rates increasing even more, buyers have come off the fence to lock in great rates! This is still great advice as the experts believe that rates will continue to rise throughout the year.

Every month, Freddie Mac, Fannie Mae, the Mortgage Bankers Association and the National Association of Realtorsrelease their projections for where they believe mortgage rates will be in the coming months. If we take the average of what each of the four organizations is predicting for the second quarter, rates are expected to rise to about 4.48% by June.

That average climbs to 4.73% by the end of this year.

So, what does this mean?

Waiting until the end of the year to buy, with rates still projected to increase, will end up costing you more money on your monthly mortgage payment. For every $250,000 you need to borrow to purchase your dream home, you will spend $49.21 more per month, $590.52 per year, and over $17,700 by the end of your 30-year mortgage.

And that’s just the impact of your interest rate going up!

Bottom Line

If you are ready and willing to purchase a home, find out if you’re able to. Let’s get together to evaluate your needs and help you with next steps!

Read More

What Is Private Mortgage Insurance (PMI)?

What Is Private Mortgage Insurance (PMI)?

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US Housing Market Still In ‘Buy Territory’!

US Housing Market Still In ‘Buy Territory’!

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VA Loans by the Numbers

VA Loans by the Numbers [INFOGRAPHIC]

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House Prices: Simply a Matter of Supply & Demand

House Prices: Simply a Matter of Supply & Demand

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Boomerang Buyers: Most Qualify for Financing in 2-3 Years

Boomerang Buyers: Most Qualify for Financing in 2-3 Years

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What Should You Look for In Your Real Estate Team?

What Should You Look for In Your Real Estate Team?

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NOT Owning Your Home Can Cost You a Lot of Money!

NOT Owning Your Home Can Cost You a Lot of Money!

NOT Owning Your Home Can Cost You a Lot of Money! | MyKCM

Owning a home has great financial benefits, yet many continue to rent! Today, let’s look at the financial reasons why owning a home of your own has been a part of the American Dream for as long as America has existed.

Realtor.com recently reported that:

Buying remains the more attractive option in the long term – that remains the American dream, and it’s true in many markets where renting has become really the shortsighted option… as people get more savings in their pockets, buying becomes the better option.”

What proof exists that owning is financially better than renting?

1. In a previous blog we highlighted the top 5 financial benefits of homeownership:

  • Homeownership is a form of forced savings.
  • Homeownership provides tax savings.
  • Homeownership allows you to lock in your monthly housing cost.
  • Buying a home is cheaper than renting.
  • No other investment lets you live inside of it.

2. Studies have shown that a homeowner’s net worth is 44x greater than that of a renter.

3. Just a few months ago, we explained that a family that purchased an average-priced home at the beginning of 2018 could build more than $44,000 in family wealth over the next five years.

4. Some argue that renting eliminates the cost of taxes and home repairs, but every potential renter must realize that all the expenses the landlord incurs are already baked into the rent paymentalong with a profit margin!!

Bottom Line

Owning a home has always been, and will always be, better from a financial standpoint than renting.

Read More

The Cost of Renting vs. Buying Today

The Cost of Renting vs. Buying Today 

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99% of Experts Agree: Home Prices Will Increase in 2018

99% of Experts Agree: Home Prices Will Increase

99% of Experts Agree: Home Prices Will Increase | MyKCM

Some believe that the combined effects of the new tax code and rising mortgage rates will have an adverse impact on residential real estate prices in 2018. However, the clear majority of recently surveyed housing experts believe that home values will continue to rise this year.

What is the Home Price Expectation Survey?

Each quarter, Pulsenomics surveys a nationwide panel of economists, real estate experts and investment & market strategists. Those surveyed include experts such as:

  • Daniel Bachman, Senior Manager, U.S. Economics at Deloitte Services, LP
  • Kathy Bostjancic, Head of U.S. Macro Investors Service at Oxford Economics
  • David Downs, Real Estate Finance Professor at VCU
  • Edward Pinto, Resident Fellow at American Enterprise Institute
  • Albert Saiz, Director at MIT Center for Real Estate

Where do these experts see home values headed in 2018?

Here is a breakdown of where they see home values twelve months from now:

  • 21.6% believe prices will appreciate by 6% or more
  • 71.6% believe prices will appreciate between 3 and 5.99%
  • 5.7% believe prices will appreciate between 0 and 2.99%
  • Only 1.1% believe prices will depreciate

Bottom Line

Almost ninety-nine percent of the top experts studying residential real estate believe that prices will appreciate this year, and over 93% believe home values will appreciate by at least 3%.

Read More

Be Thankful You Don’t Have to Pay Your Parents’ Interest Rate!

Be Thankful You Don’t Have to Pay Your Parents’ Interest Rate!

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Buyer Demand Still Outpacing the Supply of Homes for Sale

Buyer Demand Still Outpacing the Supply of Homes for Sale

Buyer Demand Still Outpacing the Supply of Homes for Sale | MyKCM

The price of any item is determined by the supply of that item, as well as market demand. The National Association of REALTORS (NAR) surveys “over 50,000 real estate practitioners about their expectations for home sales, prices and market conditions” for their monthly REALTORS Confidence Index.

Their latest edition sheds some light on the relationship between Seller Traffic (supply) and Buyer Traffic (demand).

Buyer Demand

The map below was created after asking the question: “How would you rate buyer traffic in your area?”

Buyer Demand Still Outpacing the Supply of Homes for Sale | MyKCM

The darker the blue, the stronger the demand for homes in that area. Only four states had a ‘stable’ demand level.

Seller Supply

The index also asked: “How would you rate seller traffic in your area?”

As you can see from the map below, 25 states reported ‘weak’ seller traffic, 21 states reported ‘stable’ seller traffic, 3 states and Washington D.C. reported ‘strong’ seller traffic, and only 1 state reported ‘very strong’ seller traffic. This means there are far fewer homes on the market than what is needed to satisfy the buyers who are out looking for their dream homes.

Buyer Demand Still Outpacing the Supply of Homes for Sale | MyKCM

Bottom Line

Looking at the maps above, it is not hard to see why prices are appreciating in many areas of the country. Until the supply of homes for sale starts to meet buyer demand, prices will continue to increase. If you are debating listing your home for sale, let’s get together to help you capitalize on the demand in the market now!

Read More

5 Reasons Why to Sell This Spring!

5 Reasons Why to Sell This Spring!

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20 Tips for Preparing Your House for Sale This Spring

20 Tips for Preparing Your House for Sale This Spring [INFOGRAPHIC]

Tips for Preparing Your House for Sale This Spring [INFOGRAPHIC] | MyKCM

Highlights:

  • When listing your house for sale your top goal will be to get the home sold for the best price possible!
  • There are many small projects that you can do to ensure this happens!
  • Your real estate agent will have a list of specific suggestions for getting your house ready for market and is a great resource for finding local contractors who can help!

Read More

Freddie Mac: Rising Mortgage Rates DO NOT Lead to Falling Home Prices

Freddie Mac: Rising Mortgage Rates DO NOT Lead to Falling Home Prices

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Is a Major Home Renovation Worth It in the Long Run?

Is a Major Home Renovation Worth It in the Long Run?

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Are You Aware of How Much Equity You Have in Your Home? You May Be Surprised!

Are You Aware of How Much Equity You Have in Your Home? You May Be Surprised!

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Dreaming of a Luxury Home? Now’s the Time!

Dreaming of a Luxury Home? Now’s the Time!

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DON'T WAIT FOR LOWER HOME SALES PRICES....SALES PRICE VERSUS INTEREST RATES...DON'T LOSE PURCHASING POWER...

When a buyer asks me if they should hold off purchasing a home and wait for lower sales prices I am quick to point out the loss of purchasing power as mortgage interest rates increase.

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7 Factors to Consider When Choosing A Home to Retire In

7 Factors to Consider When Choosing A Home to Retire In

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The Cost of Waiting: Interest Rates Edition

The Cost of Waiting: Interest Rates Edition [INFOGRAPHIC]

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Now Is The Time To Moving Up.... It Is MORE Affordable Now Than Almost Any Other Time in 40 Years

Moving up Is MORE Affordable Now Than Almost Any Other Time in 40 Years

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You Can Save for a Down Payment Faster Than You Think!

You Can Save for a Down Payment Faster Than You Think!

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4 Reasons Spring is a Great Time to Buy a Home!

4 Reasons Spring is a Great Time to Buy a Home!

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NORTH SAN DIEGO COUNTY REAL ESTATE REPORT FROM HOMEDEX....

Homes continue to move quickly with multiple offers from Buyers.  Inventory continues to be low as for February only 1,930 homes for sale, which is down -16.6% from 2017.  If you are considering Selling your Home, now is the perfect time before more homes/competition come on the market in early April and May.  If you would like a FREE Market Analysis of your home, please give me a call:  Mike Brown - Broker - 760.822.8734

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Home Prices: The Difference 5 Years Makes


Home Prices: The Difference 5 Years Makes

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Competition is Coming, Are You Thinking of Selling Your Home?

Competition is Coming, Are You Thinking of Selling Your Home?

Competition is Coming, Are You Thinking of Selling Your Home? | MyKCM

The number of building permits issued for single-family homes is the best indicator of how many newly built homes will rise over the next few months. According to the latest U.S. Census Bureau and U.S. Department of Housing & Urban DevelopmentResidential Sales Report, the number of these permits were up 7.4% over last year.

How will this impact buyers?

More inventory means more options. Lawrence Yun, NAR’s Chief Economistexplained this is good news for the housing market – especially for those looking to buy:

“This rise in single-family housing construction will help tame home price growth, and the increase in multifamily units should continue to help slow rent growth.”

How will this impact sellers?

More inventory means more competition. Today, because of the tremendous lack of inventory, a seller can expect:

  1. A great price on their home as buyers outbid each other for it
  2. A quick sale as buyers have so little to choose from
  3. Fewer hassles as buyers don’t want to “rock the boat” on the deal

With an increase in competition, the seller may not enjoy these same benefits. As ChiefEconomist Nela Richardson, added:

“Because existing home inventory has been so low for so long, new construction is taking a larger share of the market…Builders meet the buyers and see the demand firsthand.”

Bottom Line

If you are considering selling your house, you’ll want to beat this new competition to market to ensure you get the most attention for your listing and the best price.

Read More

Housing Market Expected To “Spring Forward” This Year

Housing Market Expected To “Spring Forward” This Year

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4 Reasons to Sell This Spring

4 Reasons to Sell This Spring

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Are Home Values Really Overinflated?


Are Home Values Really Overinflated?

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It’s Tax Season… Use Your Refund to Jump Start Your Down Payment Savings!

It’s Tax Season… Use Your Refund to Jump Start Your Down Payment Savings!

It's Tax Season Use Your Refund to Jump Start Your Down Payment Savings! | MyKCM

According to data released by the Internal Revenue Service (IRS), Americans can expect an estimated average refund of $2,840 this year when filing their taxes. This is down slightly from the average refund of $2,895, last year.

Tax refunds are often thought of as ‘extra money’ that can be used toward larger goals; for anyone looking to buy a home in 2018, this can be a great jump start toward a down payment!

The map below shows the average tax refund Americans received last year by state. (The refunds received for the 2017 tax year should continue to reflect these numbers as the new tax code will go into effect for 2018 tax filings.)

It's Tax Season Use Your Refund to Jump Start Your Down Payment Savings! | MyKCM

Many first-time buyers believe that a 20% down payment is required to qualify for a mortgage. Programs from the Federal Housing Authority, Freddie Mac, and Fannie Mae all allow for down payments as low as 3%, with Veterans Affairs Loans allowing many veterans to purchase a home with 0% down.

If you started your down payment savings with your tax refund check this year, how close would you be to a 3% down payment?

The map below shows what percentage of a 3% down payment is covered by the average tax refund by taking into account the median price of homes sold by state.

It's Tax Season Use Your Refund to Jump Start Your Down Payment Savings! | MyKCM

 

The darker the blue, the closer your tax refund gets you to homeownership! For those in Alabama looking to purchase their first homes, their tax refund could potentially get them 69% closer to that dream!

Bottom Line

Saving for a down payment can seem like a daunting task. But the more you know about what’s required, the more prepared you can be to make the best decision for you and your family! This tax season, your refund could be your key to homeownership!

Read More

Is Now a Good Time to Rent? No Not Really...Rents Are Going Up Very Fast in Southern California...

Is Now a Good Time to Rent?

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Latest NAR Data Shows Now Is a Great Time to Sell!

Latest NAR Data Shows Now Is a Great Time to Sell!

Latest NAR Data Shows Now Is a Great Time to Sell! | MyKCM

We all realize that the best time to sell anything is when demand for that item is high, and the supply of that item is limited. Two major reports released by the National Association of Realtors (NAR) revealed information that suggests that now is a great time to sell your house.

Let’s look at the data covered in the latest REALTORS® Confidence Index and Existing Home Sales Report.

REALTORS® CONFIDENCE INDEX

Every month, NAR surveys “over 50,000 real estate practitioners about their expectations for home sales, prices and market conditions.” This month, the index showed (again) that homebuying demand continued to outpace the supply of homes available in January.

The map below illustrates buyer demand broken down by state (the darker your state, the stronger demand there is).

Latest NAR Data Shows Now Is a Great Time to Sell! | MyKCM

In addition to revealing high demand, the index also shows that compared to conditions in the same month last year, seller traffic conditions were ‘weak’ in 22 states, ‘stable’ in 25 states, and ‘strong’ in only 4 states (Alaska, Nevada, North Dakota & Utah).

Takeaway: Demand for housing continues to be strong but supply is struggling to keep up, and this trend is likely to continue throughout 2018.

THE EXISTING HOME SALES REPORT

The most important data revealed in the report was not sales but was instead the inventory of homes for sale (supply). The report explained:

  • Total housing inventory rose 4.1% from December to 1.52 million homes available for sale.
  • Unsold inventory is 9.5% lower than a year ago, marking the 32nd consecutive month with year-over-year declines.
  • This represents a 3.4-month supply at the current sales pace.

According to Lawrence Yun, Chief Economist at NAR:

“Another month of solid price gains underlines this ongoing trend of strong demand and weak supply. The underproduction of single-family homes over the last decade has played a predominant role in the current inventory crisis that is weighing on affordability.”

In real estate, there is a guideline that often applies; when there is less than a 6-month supply of inventory available, we are in a seller’s market and we will see appreciation. Between 6-7 months is a neutral market, where prices will increase at the rate of inflation. More than a 7-month supply means we are in a buyer’s market and should expect depreciation in home values.

As we mentioned before, there is currently a 3.4-month supply, and houses are going under contract fast. The Existing Home Sales Report shows that 43% of properties were on the market for less than a month when sold.

In January, properties sold nationally were typically on the market for 42 days. As Yun notes, this will continue unless more listings come to the market.

“While the good news is that Realtors in most areas are saying buyer traffic is even stronger than the beginning of last year, sales failed to follow course and far lagged last January’s pace. It’s very clear that too many markets right now are becoming less affordable and desperately need more new listings to calm the speedy price growth.”

Takeaway: Inventory of homes for sale is still well below the 6-month supply needed for a normal market and supply will ‘fail to catch up with demand’ if a ‘sizable’ supply does not enter the market.

Bottom Line

If you are going to sell, now may be the time to take advantage of the ready, willing, and able buyers that are still out searching for your house.

Read More

The Mortgage Process: What You Need to Know

The Mortgage Process: What You Need to Know [INFOGRAPHIC]

The Mortgage Process: What You Need to Know [INFOGRAPHIC] | MyKCM

Some Highlights:

  • Many buyers are purchasing a home with a down payment as little as 3%.
  • You may already qualify for a loan, even if you don’t have perfect credit.
  • Take advantage of the knowledge of your local professionals who are there to help you determine how much you can afford.

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Mortgage Rates on FIRE! Home Prices Up in Smoke?

Mortgage Rates on FIRE! Home Prices Up in Smoke?

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80% of Renters Believe Homeownership is a Part of Their American Dream

80% of Renters Believe Homeownership is a Part of Their American Dream

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2 Ways to Get the Most Money from The Sale of Your Home

2 Ways to Get the Most Money from The Sale of Your Home

2 Ways to Get the Most Money from The Sale of Your Home | MyKCM

Every homeowner wants to make sure they maximize their financial reward when selling their home. But how do you guarantee that you receive the maximum value for your house?

Here are two keys to ensure that you get the highest price possible.

1. Price it a LITTLE LOW 

This may seem counterintuitive, but let’s look at this concept for a moment. Many homeowners think that pricing their homes a little OVER market value will leave them with room for negotiation. In actuality, this just dramatically lessens the demand for your house (see chart below).

2 Ways to Get the Most Money from The Sale of Your Home | MyKCM

Instead of the seller trying to ‘win’ the negotiation with one buyer, they should price it so that demand for the home is maximized. By doing this, the seller will not be fighting with a buyer over the price but will instead have multiple buyers fighting with each other over the house.

Realtor.com gives this advice:

“Aim to price your property at or just slightly below the going rate. Today’s buyers are highly informed, so if they sense they’re getting a deal, they’re likely to bid up a property that’s slightly underpriced, especially in areas with low inventory.”

2. Use a Real Estate Professional

This, too, may seem counterintuitive. The seller may think they would make more money if they didn’t have to pay a real estate commission. With this being said, studies have shown that homes typically sell for more money when handled by a real estate professional.

A study by Collateral Analytics, reveals that FSBOs don’t actually save any money, and in some cases may be costing themselves more, by not listing with an agent.

In the study, they analyzed home sales in a variety of markets in 2016 and the first half of 2017. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate.”

The results of the study showed that the differential in selling prices for FSBOs when compared to MLS sales of similar properties is about 5.5%. Sales in 2017 suggest the average price was near 6% lower for FSBO sales of similar properties.

Bottom Line

Price your house at or slightly below the current market value and hire a professional. This will guarantee that you maximize the price you get for your house.

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Top 5 Reasons to Hire a Real Estate Professional When Buying or Selling!

Top 5 Reasons to Hire a Real Estate Professional When Buying or Selling!

Top 5 Reasons to Hire a Real Estate Professional When Buying or Selling! | MyKCM

Whether you are buying or selling a home it can be quite the adventure, which is why you need an experienced real estate professional to guide you on the path to achieving your ultimate goal. But in this world of instant gratification and internet searches, many sellers think that they can ‘For Sale by Owner’ or ‘FSBO.’

The 5 reasons you NEED a real estate professional in your corner haven’t changed but have rather been strengthened by the projections of higher mortgage interest rates & home prices as the market continues to pick up steam.

1. What do you do with all this paperwork?

Each state has different regulations regarding the contracts required for a successful sale, and these regulations are constantly changing. A true real estate professional is an expert in his or her market and can guide you through the stacks of paperwork necessary to make your dream a reality.

2. Ok, so you found your dream house, now what?

There are over 180 possible steps that need to take place during every successful real estate transaction. Don’t you want someone who has been there before, someone who knows what these actions are, to make sure that you achieve your dream?

3. Are you a good negotiator?

So maybe you’re not convinced that you need an agent to sell your home. After looking at the list of parties that you will need to be prepared to negotiate with, you’ll soon realize the value in selecting a real estate professional. From the buyers (who want the best deals possible), to the home inspection companies, all the way to the appraisers, there are at least 11 different people who you will need to be knowledgeable of, and answer to, during the process.

4. What is the home you’re buying/selling really worth?

It is important for your home to be priced correctly from the start to attract the right buyers and shorten the amount of time that it’s on the market. You need someone who is not emotionally connected to your home to give you the truth as to your home’s value. According to a study by Collateral Analytics, FSBOs achieve prices significantly lower than those from similar properties sold by real estate agents:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate.”

Get the most out of your transaction by hiring a professional.

5. Do you know what’s really going on in the market?

There is so much information out there on the news and on the internet about home sales, prices, and mortgage rates; how do you know what’s going on specifically in your area? Who do you turn to in order to competitively and correctly price your home at the beginning of the selling process? How do you know what to offer on your dream home without paying too much, or offending the seller with a lowball offer?

Dave Ramsey, the financial guru, advises:

“When getting help with money, whether it’s insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman.”

Hiring an agent who has his or her finger on the pulse of the market will make your buying or selling experience an educated one. You need someone who is going to tell you the truth, not just what they think you want to hear.

Bottom Line

You wouldn’t replace the engine in your car without a trusted mechanic, so why would you make one of the most important financial decisions of your life without hiring a real estate professional?

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Should I Wait Until Next Year to Buy? Or Buy Now?

Should I Wait Until Next Year to Buy? Or Buy Now? 

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The Stock Market May Be Shaky...However, Calm Down! The Real Estate Market is NOT Falling Apart

Calm Down! The Real Estate Market is NOT Falling Apart

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Which Comes First… Marriage or Mortgage?

Which Comes First… Marriage or Mortgage?

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LOW INVENTORY HAS PUSHED HOME PRICES HIGHER...

Low Inventory Pushes Home Prices Higher

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The #1 Reason to Sell Now Before Spring

The #1 Reason to Sell Now Before Spring

The #1 Reason to Sell Now Before Spring | MyKCM

The price of any item (including residential real estate) is determined by ‘supply and demand.’ If many people are looking to buy an item and the supply of that item is limited, the price of that item increases.

According to the National Association of Realtors (NAR), the supply of homes for sale dramatically increases every spring. As an example, here is what happened to housing inventory at the beginning of 2017:

The #1 Reason to Sell Now Before Spring | MyKCM

Putting your home on the market now instead of waiting for increased competition in the spring might make a lot of sense.

Bottom Line

Buyers in the market during the winter months are truly motivated purchasers. They want to buy now. With limited inventory currently available in most markets, sellers are in a great position to negotiate.

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Homeownership: “The Reports of My Death Have Been Greatly Exaggerated”

Homeownership: “The Reports of My Death Have Been Greatly Exaggerated”

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Where Are Mortgage Interest Rates Headed in 2018?

Where Are Mortgage Interest Rates Headed in 2018?

Where Are Mortgage Interest Rates Headed in 2018? | MyKCM

The interest rate you pay on your home mortgage has a direct impact on your monthly payment. The higher the rate the greater the payment will be. That is why it is important to know where rates are headed when deciding to start your home search.

Below is a chart created using Freddie Mac’s U.S. Economic & Housing Marketing Outlook. As you can see, interest rates are projected to increase steadily over the course of the next 12 months.

Where Are Interest Rates Headed? | MyKCM

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.

According to CoreLogic’s latest Home Price Index, national home prices have appreciated 7.0% from this time last year and are predicted to be 4.2% higher next year.

If both the predictions of home price and interest rate increases become reality, families would wind up paying considerably more for their next home.

Bottom Line 

Even a small increase in interest rate can impact your family’s wealth. Let’s get together to evaluate your ability to purchase your dream home.

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Millionaire to Millennials: Don’t Rent a Home… Buy!

Millionaire to Millennials: Don’t Rent a Home… Buy!

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Bidding Wars Abound… How Long Will They Continue?

Bidding Wars Abound… How Long Will They Continue?

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Whether You Rent or Buy, Either Way You’re Paying a Mortgage!

Whether You Rent or Buy, Either Way You’re Paying a Mortgage!

Whether You Rent or Buy, Either Way You're Paying a Mortgage! | MyKCM

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

As Entrepreneur Magazine, a premier source for small business, explained in their article, “12 Practical Steps to Getting Rich”:

“While renting on a temporary basis isn’t terrible, you should most certainly own the roof over your head if you’re serious about your finances. It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich.”

Christina Boyle, Senior Vice President and head of the Single-Family Sales & Relationship Management organization at Freddie Mac, explains another benefit of securing a mortgage as opposed to paying rent:

“With a 30-year fixed rate mortgage, you’ll have the certainty & stability of knowing what your mortgage payment will be for the next 30 years – unlike rents which will continue to rise over the next three decades.”

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

Interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.22% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, now may be the time to buy.

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5 Reasons Homeowners Can Throw Better Super Bowl Parties!

5 Reasons Homeowners Can Throw Better Super Bowl Parties! 

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STUDY SHOWS "MILLENNIALS DESERVE MORE CREDIT"

Study Shows “Millennials Deserve More Credit”

Study Shows "Millennials Deserve More Credit" | MyKCM

When it comes to talking about millennials, there are many stereotypes out there that have influenced the way the public feels about the generation. Whether it’s the assumption that millennials are irresponsible with money and would rather buy avocado toast than save for a down payment, or that millennials jump from job to job, the majority of these stereotypes paint the generation in a negative light.

A new study by Bank of America entitled Better Money Habits Millennial Report recently came to the defense of the generation when it reported that:

“Millennials deserve more credit – both from themselves and from others – for their mindfulness when it comes to money and their lives.”

Here are some key takeaways from the study proving that millennials deserve more credit for what they are already doing:

  • 63% are saving – (47% have $15,000 or more in savings)
  • 54% are budgeting – (73% who have a budget stick to it every month)
  • 57% have a savings goal – (67% who have a goal stick to it every month)
  • 46% have asked for a raise in the past 2 years – (80% who asked for a raise got one)
  • 59% feel financially secure – (16% have $100,000 or more in savings)

Many have wondered if millennials even want to own their own homes or if they would choose to rent instead. Well, not only do they want to own their own homes, but many already do and are looking to trade up! A recent study by realtor.com shows that 49% of Americans who plan to sell their home in the next 12 months are millennials!

Danielle Hale, realtor.com’s Chief Economist, gave some insight into why millennials are looking to sell,

“The housing shortage forced many first-time homebuyers to consider smaller homes and condos as a way to literally get their foot in the door. Our survey data reveals that we may see more of these homes hitting the market in the next year.”

Bottom Line

Not every millennial fits into the stereotypes that are so prominent in our society. Those who have risen above the stereotype are ready and willing to buy a home of their own, and many others already have!

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2 MAJOR MYTHS HOLDING BACK HOME BUYERS...

2 Major Myths Holding Back Home Buyers

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U.S. Housing Inventory Crunch Continues… List Your House Today!

U.S. Housing Inventory Crunch Continues… List Your House Today!

U.S. Housing Inventory Crunch Continues List Your House Today! | MyKCM

Every winter, families across the country decide if this will be the year that they sell their current houses and move into their dream homes.

Mortgage rates hovered around 4% for all of 2017 which forced many buyers off the fence and into the market, resulting in incredibly strong demand RIGHT NOW!

At the same time, however, inventory levels of homes for sale have dropped dramatically as compared to this time last year.

Trulia reported that “in Q4 2017, U.S. home inventory decreased by 10.5%. That is the biggest drop we’ve seen since Q2 2013.”

Here is a chart showing the decrease in inventory levels by category:

U.S. Housing Inventory Crunch Continues List Your House Today! | MyKCM

The largest drop in inventory was in the starter home category which saw a 19% dip in listings.

Bottom Line

Demand for your home is very strong right now while your competition (other homes for sale) is at a historically low level. If you are thinking of selling in 2018, now may be the perfect time.

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If You’re Considering Selling, ACT NOW!!

If You’re Considering Selling, ACT NOW!!

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Gap Between Homeowners & Appraisers Narrows to Lowest Mark in 2 Years

Gap Between Homeowners & Appraisers Narrows to Lowest Mark in 2 Years

Gap Between Homeowners & Appraisers Narrows to Lowest Mark in 2 Years | MyKCM

In today’s housing market, where supply is very low and demand is very high, home values are increasing rapidly. Many experts are projecting that home values could appreciate by another 4% or more over the next twelve months. One major challenge in such a market is the bank appraisal.

When prices are surging, it is difficult for appraisers to find adequate, comparable sales (similar houses in the neighborhood that recently closed) to defend the selling price when performing the appraisal for the bank.

Every month in their Home Price Perception Index (HPPI), Quicken Loans measures the disparity between what a homeowner who is seeking to refinance their home believes their house is worth and what an appraiser’s evaluation of that same home is.

In the latest release, the disparity was the narrowest it has been in over two years, as the gap between appraisers and homeowners was only -0.5%. This is important for homeowners to note as even a .5% difference in appraisal can mean thousands of dollars that a buyer or seller would have to come up with at closing (depending on the price of the home)

The chart below illustrates the changes in home price estimates over the last two years.

Gap Between Homeowners & Appraisers Narrows to Lowest Mark in 2 Years | MyKCM

Bill Banfield, Executive VP of Capital Markets at Quicken Loans urges homeowners to find out how their local markets have been impacted by supply and demand:

“Appraisers and real estate professionals evaluate their local housing markets daily. Homeowners, on the other hand, may only think about their housing market when they see ‘for sale’ signs hit front yards in the spring or when they think about accessing their equity.”

“With several years of growth, owners may have more equity than they realize. Many consumers use the tax season at the beginning of the year to reevaluate their entire financial life. It also provides a good opportunity for them to consider how best to take advantage of their equity while mortgage interest rates and borrowing costs are still near record lows.”

Bottom Line 

Every house on the market must be sold twice; once to a prospective buyer and then to the bank (through the bank’s appraisal). With escalating prices, the second sale might be even more difficult than the first. If you are planning on entering the housing market this year, let’s get together to discuss this and any other obstacles that may arise.

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Why You Need a Professional on Your Team When Buying a Home

Why You Need a Professional on Your Team When Buying a Home

Why You Need a Professional on Your Team When Buying a Home | MyKCM

Many people wonder whether they should hire a real estate professional to assist them in buying their dream homes or if they should first try to go through the buying process on their own. In today’s market: you need an experienced professional!

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

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

A great agent will also have relationships with mortgage professionals and other experts that you will need in order to secure your dream home. 

You Need a Skilled Negotiator

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

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

If they were Clark Kent when negotiating with you, they will not turn into Superman when negotiating with the buyer or seller in your deal. 

Bottom Line

Famous sayings become famous because they are true. You get what you pay for. Just like a good accountant or a good attorney, a good agent will save you money…not cost you money.

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Buying A Home Is More Affordable Than Renting In 54% Of US Counties

Buying A Home Is More Affordable Than Renting In 54% Of US Counties

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Where Did Americans Move in 2017?

Where Did Americans Move in 2017? 

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


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

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Wondering If You Can Buy Your First Home?


Wondering If You Can Buy Your First Home?

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THINKING ABOUT SELLING YOUR HOME? NOW IS THE PERFECT TIME...

Thinking of Selling? Now is the Perfect Time

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The Impact Staging Your Home Has on Sales Price

The Impact Staging Your Home Has on Sales Price 

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IS YOUR AMERICAN DREAM HOMEOWNERSHIP?

93% Believe Homeownership Is Important in Attaining the American Dream

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FICO® Scores on Approved Home Loans Drop Again


FICO® Scores on Approved Home Loans Drop Again

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The Impact of Tight Inventory on the Housing Market

The Impact of Tight Inventory on the Housing Market

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HOMES IN SOUTHERN CALIFORNIA CONTINUE TO INCREASE IN VALUE THROUGH APPRECIATION..

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

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EASEMENTS: WHAT ARE THEY AND HOW THE AFFECT REAL PROPERTY

EASEMENTS: WHAT ARE THEY AND HOW THE AFFECT REAL PROPERTY

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Low Inventory Set New Low For Homes on Market in 2017

Time on the Market Drops to New Low in 2017

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The Benefits of Homeownership Go Beyond the Financial

The Benefits of Homeownership Go Beyond the Financial

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How Rising Prices Will Help You Build Family Wealth in 2018

How Rising Prices Will Help You Build Family Wealth in 2018

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HAPPY NEW YEAR!!!...HOPE EVERYONE HAS AN AMAZING 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!

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Buying or Selling in 2018? 5 Reasons to Resolve to Hire a Pro...Mike Brown Broker

Buying or Selling in 2018? 5 Reasons to Resolve to Hire a Pro...Mike Brown Broker

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There's More To A "Housing Bubble" Than Rising Home Prices...


There’s More to a Bubble Than Rising Home Prices

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Top 4 REAL Reasons We Purchase A Home...

Top 4 REAL Reasons We Buy a Home

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SUMMARY & REFERENCE GUIDE ON THE RECENT TAX REFORM BILL PASSED BY CONGRESS....

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FSBO/FOR SALE BY OWNER...You will receive LESS than working with a Professional Real Estate Broker!!!

Top 5 Reasons You Shouldn’t FSBO

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Existing Home Sales Reach Highest Annual Pace in 11 Years


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

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HOME PRICES CONTINUE TO RISE YEAR OVER YEAR IN SOUTHERN CALIFORNIA...

Home Prices Up 7% from Last Year

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WHY THE FEDS REQUIRE SO MUCH PAPERWORK TO GET A HOME MORTGAGE IN TODAY'S MARKETPLACE?

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.

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Winter In Souther California...Warm & Sunny...5 Reasons To Sell Your Home This Winter!


5 Reasons to Sell This Winter!

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IS IT TOO EASY TO GET A HOME MORTGAGE TODAY?

Bubble Alert! Is it Getting Too Easy to Get a Mortgage?

Bubble Alert! Is it Getting Too Easy to Get a Mortgage? | MyKCM

There is little doubt that it is easier to get a home mortgage today than it was last year. The Mortgage Credit Availability Index (MCAI), published by the Mortgage Bankers Association, shows that mortgage credit has become more available in each of the last several years. In fact, in just the last year:

  • More buyers are putting less than 20% down to purchase a home
  • The average credit score on closed mortgages is lower
  • More low-down-payment programs have been introduced

This has some people worrying that we are returning to the lax lending standards which led to the boom and bust that real estate experienced ten years ago. Let’s alleviate some of that concern.

The graph below shows the MCAI going back to the boom years of 2004-2005. The higher the graph line, the easier it was to get a mortgage.

Bubble Alert! Is it Getting Too Easy to Get a Mortgage? | MyKCM

As you can see, lending standards were much more lenient from 2004 to 2007. Though it has gradually become easier to get a mortgage since 2011, we are nowhere near the lenient standards during the boom.

The Urban Institute also publishes a Home Credit Availability Index (HCAI). According to the Institute, the HCAI:

“Measures the percentage of home purchase loans that are likely to default—that is, go unpaid for more than 90 days past their due date. A lower HCAI indicates that lenders are unwilling to tolerate defaults and are imposing tighter lending standards, making it harder to get a loan. A higher HCAI indicates … it is easier to get a loan.”

Here is a graph showing their findings:

Bubble Alert! Is it Getting Too Easy to Get a Mortgage? | MyKCM

Again, today’s lending standards are nowhere near the levels of the boom years. As a matter of fact, they are more stringent than they were even before the boom.

Bottom Line

It is getting easier to gain financing for a home purchase. However, we are not seeing the irresponsible lending that caused the housing crisis.

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CARLSBAD CA REAL ESTATE UPDATE FOR WEEK ENDING NOV 27 2017

The City Of Carlsbad Real Estate Update...

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Why Are Home Prices Increasing Significantly In Southern California?

The Real Reason Home Prices are Increasing

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The Truth About Home Affordability...

2 Charts That Show the Truth about Home Affordability

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You Will Be Surprised How Much House You Can Now Afford with Extremely Low Mortgage Rates...

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.

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BUYING YOUR DREAM HOME MAKES MORE FINANCIAL SENSE THAN RENTING A HOME...

The Cost of NOT Owning Your Home

The Cost of NOT Owning Your Home | MyKCM

Owning a home has great financial benefits, yet many continue to rent! Today, let’s look at the financial reasons why owning a home of your own has been a part of the American Dream for as long as America has existed.

Zillow recently reported that:

“In reality, buying or renting a home is an intensely personal decision, with emotional and even financial considerations that go beyond whether to invest in this one (admittedly large) asset. Looking strictly at housing market numbers, there is a concrete point at which buying a home makes more financial sense than renting it.”

What proof exists that owning is financially better than renting?

1. We recently highlighted the top 5 financial benefits of homeownership:

  • Homeownership is a form of forced savings.
  • Homeownership provides tax savings.
  • Homeownership allows you to lock in your monthly housing cost.
  • Buying a home is cheaper than renting.
  • No other investment lets you live inside of it.

2. Studies have shown that a homeowner’s net worth is 44x greater than that of a renter.

3. Just a few months ago, we explained that a family that purchased an average-priced home at the beginning of 2017 could build more than $48,000 in family wealth over the next five years.

4. Some argue that renting eliminates the cost of taxes and home repairs, but every potential renter must realize that all the expenses the landlord incurs are already baked into the rent paymentalong with a profit margin!!

Bottom Line

Owning a home has always been, and will always be, better from a financial standpoint than renting.

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The Cost of RENTING vs. BUYING...

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Home Buying & Selling By Generation...

What Generation Do you and Your Family Belong Too???

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Existing Home Sales Slowed by a Lack of Listings For Buyers...

Existing Home Sales Slowed by a Lack of Listings For Buyers...

Read More

Southern CA Homes Continue To Increase In Value Due To Low Inventory...

Low Inventory Causes Home Prices to Maintain Fast Growth

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Your Home May Not Appraise At A Value You Think It Is Worth...

Homeowners: Your House Must Be Sold TWICE

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Start Your Home Renovations Now...To Sell In The Spring...

Top 4 Home Renovations for Maximum ROI...

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Access To Your Home For Buyers...Can Be More Important Than Price...

Access: A Key Component in Getting Your House SOLD!

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For Sale By Owners Don't Save On The Real Estate Commissions...

FSBOs Don’t Save Real Estate Commission

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NOW IS THE RIGHT TIME TO PURCHASE YOUR DREAM HOME...

Your Friends Are Crazy Wrong If They're Telling You Not to Buy

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Tis The Season...12 Great Reasons You Should List Your Home During The Holidays....

12 Reasons to List During Fall & Winter Months
Why Acting NOW Could BENEFIT You… NOW!
1. Inventory of Competition is Lower. Law of Supply and Demand works! Your home stands out with serious buyers who have less to choose from now. Your odds of selling go UP during this time of year. The % of total inventory sold is great during these months.
2. Only SERIOUS Buyers are out in the fall/winter. Fewer people are in the house, yet are more likely to make an offer.
3. Taking Exterior Photos with Holiday Decorations. This can be a big asset before being left with full-on-winter, dead landscaping… and nothing to dress it up!
4. Homes Show Better While Decorated. Fireplaces, evergreens, and scented candles, all add to the beauty inside… when it’s not so pretty outside. This Contrast can cause YOUR home to show BEST NOW.
5. Little Know Fact: It’s perfectly OK to have specific “no showings-times” during the Holidays. In fact, it’s expected. Just because you’re planning a few days of no showings is no reason to not be for sale the REST of the time. “None this weekend” is perfectly OK.
6. Houses Feel More Like “Homes”. Coming in from the cold… some cozy-home-feelings causes emotion you can’t get other time of the year. People are generally just grateful and happier during this time of year. That can equal a Sale since a lot of Buyers buy on emotion.
7. Online Searches Go Way Up. People stay indoors and tend to do more home research online during times they were outdoors over the spring/summer. If you aren’t listed, they can’t find you online. If you don’t play, you can’t win!
8. End of Year Buyers May Even Pay More. End of year buyers may have mental or actual deadlines they want to meet. With less time to negotiate AND fewer homes competing that could = the BEST price for YOU. Often the % of asking price received is statically higher Nov-March.
9. More Day-time Showings mid-November through January. With holiday time-off, daytime showings increase during this time of year leaving your home free for you during evenings and weekends.
10. End of Year Buyers often has an “urgency factor” they must meet. Many employers hire to start January. There are also tax benefits and other urgency factors that may affect Buyers in Nov/Dec. If you don’t list now, you miss those buyers. They’ve already bought before you ever go on the market if you wait until the new year.
11. Late occupancies are common during this time. Many that need to buy by end of year don’t have to occupy right away, allowing a real win-win. They win buying now, and you may be able to negotiate your move for later while taking your profit out now. This happens over the holidays more than any other time of year.
12. Decreased Demand on Vendors means easier quicker closings. Lenders, appraisers, home inspectors, movers and other vendors are less busy during this time of year, resulting more time for YOUR transaction to be smoother & easier. A huge reason to do this NOW rather than with the “crowds”.


Think of the Peace of Mind you’ll have to be “all done” while others are just starting! --- Not listing now could cause you to miss YOUR perfect buyer who needs to buy NOW.

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Contact
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Mike Brown

(760) 822-8734

MikeBrownBroker@gmail.com

Find Your Dream Home