Posted by on

2017 Economic Outlook

Real estate training vector sketch icon isolated on background. Hand drawn Real estate training icon. Real estate training sketch icon for infographic, website or app.

Hello Central Oregonians,

Welcome to the new year! December closed out 2016 with a bang. Sales were up, home prices have seen record highs recently, all leading to a powerful seller’s market this winter.

The “Housing Bubble” of past markets is not what our area market is experiencing today.  The steady and strong market recovery over the last several years has resulted in the highest home prices within our market over the past decade.

Property inventories are very low at this time, even considering that, historically, winter months are the time of the year to expect a lower number of available properties.  There continues to be a healthy number of potential buyers looking for “the right property”. This time of year, is an optimal time for sellers to get their property on the market and take advantage of fewer competing properties.

Given the seller’s market and a consistent number of property sales in prior months, we expect to see an active beginning to 2017’s real estate market in Central Oregon. Due to increased continual interest in the Bend area, we expect to see fewer price reductions in the coming months as well.

Many ask us if we see a housing bubble happening in the future.  We don’t foresee housing prices dropping in the next couple of years. Housing prices in the area fell to their lowest point in 2010 and have been on the rise since. We expect a slow upward trend in the future.  Over the past year, home values have appreciated each month by slightly more than 1 percent.  All indications show a slower yet steady rise over the next two years.

Keeping track of the current real estate trends in Central Oregon, is our business at Duke Warner Realty. We compile comprehensive market data that is available to home sellers and buyers. We’re constantly analyzing local market trends to better help our prospective clients, buyers and sellers.

We’re already keeping an eye out for the trends of spring, and the coming warmer months. Learn about what we can do to help you with buying or selling real estate by visiting dukewarner.com, browsing our Facebook page, or calling us at 541-382-8262.

Here’s to a wonderful year ahead,

Duke Warner Realty

Posted by on

Why Pre-approval should be your first step

Hand holds the magnifying glass in front of an open newspaper with paper houses. That could mean rent search purchase real estate.

If you’re starting to house hunt, and have faced the question “Are you pre-approved?” it might be time to consider investigating more.  Being pre-approved can speed up your house hunting search, and can help you secure the home or property of your dreams before someone else does. Here are some benefits of being pre-approved.

Pre-qualified and pre-approved

Understanding the difference between being pre-qualified and pre-approved is important. Pre-approved means that a lender has checked your credit score and verified your documentation, so that you are approved for a specific loan or mortgage amount if you need it. Being pre-approved usually lasts for a 90-day period in most states.  Pre-qualified means that an estimation of how much you can afford to spend on a mortgage from month to month has been done, but it is not final. Your final loan approval happens when you have the property that you’re going to apply the loan to and you have an appraisal done on that property.

Getting pre-approved

Bring proof of your income for the last two years. All loans currently need this proof of income. W-2s are also accepted, in addition to pay stubs. Bring bank statements, investment account statements, etc. to show that you have enough money for a down payment, closing costs, fees, etc.

You also will need to provide proof of employment, or employment verification. Today lenders want to make sure that they are loaning money to someone with stable employment, as it increases the odds of the loan being paid back in full. They may call to verify your employment and check on your salary. Don’t forget the basics: your driver’s license, a social security number and permission for the lender to pull your credit report.

Good credit

Good credit takes time, and it’s necessary to purchase a home with a loan or mortgage. If you’re considering buying a home sometime in the near future, monitor your credit and make sure it’s acceptable to be applying for a loan. Talk to a banker or lender, or financial advisor to see what you can work on to improve your credit in the meantime.

Finally

Be advised to shop around to see who is going to offer you the best mortgage rate and the best interest rate in your state and area. Apply for those rates to get pre-approved. Meet with a lender to discuss your options, find out what you may or may not be able to afford. Getting pre-approved prior to house hunting helps your search, because you know what you can or can’t feasibly afford.

Posted by on

How to Sell an Inherited House

Vintage / retro style with a long shadow : Fountain pen a pocket watch on a last will and testament. A form is printed on a mulberry paper and waiting to be filled and signed by testator / testatrix.

Inheriting a home can be a blessing or a curse. Sometimes it’s a wonderful gift and sometimes it can be an unfortunate inconvenience. Sometimes inheritors will sell their own properties and move into the home, other times the home will be emptied with an estate sale and then sold. Here are some great resources and information on what to do if you inherit a house or property.

Selling it

If you’ve inherited a home and want to consider selling it, you need to be able to figure out what you can afford to sell the home for. You also need to be able to calculate what selling the home could cost you in taxes. Be sure to report sale proceeds to the IRS. It will be documented as taxable income if you sell an inherited property. Even if you don’t owe any taxes on the home sale, it’s still a good idea to report the event. Be sure to do the research on inheritance tax and estate tax, because it can differ from state to state.

If you want to proceed with selling the home, take time to clear out any personal belongings. This can be time consuming and emotionally hard. While you may want to keep everything, you may not be able to. Hiring an appraiser to look at family heirlooms or jewelry may be a good idea before you decide to sell everything in an estate sale. Be sure to get cherished possessions to heirs, and other family members, as noted in any wills.

Holding a yard sale or an estate sale can be a great way to get rid of things. Selling a home as is, or already furnished, can be a hard sell to complete. Homes show better on the market when they’re empty or staged, but not filled with the previous tenants’ belongings.

Do your research on probate. Most inherited homes have to go through probate before you can sell them. Determine or decide who in the family holds the legal responsibility to handle the transaction of sale.

Other options

Some family members decide to sell properties of their own and move into inherited homes. There are still legal loopholes to close before this can be done. Other family members may have a right to the home as well, so it’s important to follow all loose ends before you start selling property of your own.

Some may choose to rent the home out and use it as a small source of income. Either way, it’s your choice. If you’re going to sell the home, it will be beneficial to invest in a real estate agent. They may know how to hook you up with a great estate sale business, and all the steps you’ll need to complete tax-wise. In addition to being a great resource in the actual sale of the property, your real estate agent can help make the process much easier.

Posted by on

December Real Estate Forecast shows a strong finish to an extremely active year in the Central Oregon Real Estate Market

dec. trend graphic

2016 was a great year for real estate in Central Oregon, and December closed out the year with a strong finish. Sales were up in December, despite lots of inclement weather and snow, inventory dipped expectedly, and a consistent number of pending sales are expected to complete in 2017. Let’s take a deeper look.

Monthly Number of Sales and Price Reductions

The monthly number of sales stayed at a consistent high in the market. The number of price reductions in the month of December were fewer than the month before, as the number had nearly stabilized in November. Price reductions typically happen when properties sit on the market too long, with little to no interest, and it typically means that the property hasn’t been priced correctly. With fewer price reductions in December, we can expect to see more sales moving into early 2017.

Inventory low

Inventory has dipped to an annual low, which is to be expected in the month of December and is typical during the holiday season. The inventory seen this month was lower than the previous four months.

The real estate market becomes more of a seller’s market during the winter months, with fewer listings available.  Property owners should take advantage of this time, with little competition for potential buyers. Duke Warner has months of inventory for every price point under $525,000 in Bend being less than two months.

Consistent Pending Sales

Pending sales stayed at a high number for the month of December, which is surprising considering the winter weather December brought.

Final Analysis

All of this proves that we can expect an active beginning to 2017, that will carry on into the coming winter months.

Sales are expected to remain at slightly above average numbers. Due to the interest in the Central Oregon Real Estate Market, we can expect that fewer price reductions will take place.

The seller’s market will continue into the new year, with fewer properties listed. The time to get a property listed is now, with the expectation of significant activity and lots of serious buyers early in 2017.

Posted by on

Pros and Cons of Open Houses

A home for sale shows the open house sign on a sunny afternoon.

Pros and Cons of Open Houses

Selling your home? Considering holding an open house to spark interest? Open houses have long been a point of contention between seller and real estate agents. Some sellers insist upon them, refuse to have them or are undecided about them. Real estate agents are the same: some love them, hate them or don’t have an opinion either way. Learn about some of the pros and cons of hosting an open house, and decide if it’s a great option for you or not.

Pros

There are both negative and positive results to holding an open house. By holding an open house you may be able to attract buyers who are dragging their feet on the start of their house hunt. Some buyers may not be sure as to how to get the ball rolling on a house hunt, and an open house is a great way to get some potential buyers in the door. An open house sign on the side of the street may attract someone who has not yet begun the steps to start house hunting. They allow potential buyers not to feel pressured.

Open houses give great additional exposure to a home. Often open houses are advertised with street signs, newspaper ads, ads online and more. They may also be beneficial to your realtor, as it gives them a chance to connect with other potential buyers.

Cons

Open houses are not necessary to sell a home. The percentage of homes that sell as a result of an open house can actually be quite low. More potential buyers schedule private showings of properties that they’re seriously interested in. Most buyers want to be taken through the home by an agent, and learn about the property. Most open house crowds are less serious.

In order for a potential buyer to be viewing homes with an agent, they must be pre-approved for a certain level of mortgage. The potential buyers that you’re going to attract with an open house could contain a majority of visitors that aren’t even pre-approved. Having people walking through your home, that can’t afford to buy it, is a waste of your time. You would be upset with a realtor that kept showing your home to potential buyers that couldn’t afford to purchase it. Hosting an open house can sometimes be the equivalent of this.

Final takeaway

Deciding to hold an open house for your home is a choice you must make. Consult your real estate agent and get their thoughts on it. Some think that open houses are old fashioned, and in today’s market where the seller has technology at their fingertips, they’ll probably do most of their research online.

 

Posted by on

Why Hire a Listing Agent?

happy young couple buying new home with real estate agent and looking big comfort bright apartment plans and taking key

Why Hire a Listing Agent?

If you’re getting ready to sell your home or property, you may be thinking why do I need a listing agent? With technology these days, you can probably list the property yourself and save yourself the cost of a real estate agent, right? Here are some reasons why hiring a professional real estate agent could benefit you in the long run.

Experience

Local real estate agents have experience selling. While this may not be the first home you’ve sold, a real estate agent has sold hundreds. They know the market you’re selling in, and know what listing prices to recommend, who to market to, etc. A great real estate agent will help you negotiate on a great price, not simply delivering the offer to the buyer.

Agents also can act as a filter for showings and visits. Your agent isn’t going to show your house, unless they’re sure they’ve found a great buyer for it. Typically, your agent will show the house to prospective buyers that have already been vetted or pre-approved by the firm they represent. In short, they’re showing your property to people who they know are interested and who they know can afford it. When you list a property yourself, the calls you get for showings won’t be verified and you could wind up wasting time showing the property to a lot of uninterested buyers, or buyers that aren’t serious about committing to a new property.

Market Knowledge

Agents know what you should list your property at, because they’re working closely with the real estate market in your area. They can find comparable sales for pricing references. Local real estate agents also know where it’s best to market your property. Your agent won’t tell you what you should list your property at, but they can help guide you to a price that increases your changes of selling.

Your real estate agent is there to ensure you have as easy a sale as possible. They’ll help with paperwork, questions and more. Purchase agreements can run over 10 pages, without including federal or state disclosures.

Take Away

There are a lot of questions that come with buying or selling a home. One of the greatest benefits of having a listing agent is that you can call them and ask questions anytime. Even after you’ve closed your home, if you get an invoice about property tax assessments that you don’t understand, you can call them and straighten it out. Lots of questions can pop up after the excitement of closing on a house, and a real estate agent will still be there to answer them.

Posted by on

November real estate forecast shows drop in new listings and stabilization of home pricing

nov-trend

The real estate market has slowed down slightly for the holiday season, from an eventful fall market. It continues to be a seller’s market in the Central Oregon Real Estate Market. Moving into the new year the market promises to be a great time to list a property.

Fewer listings and inventory

Typical for the holiday season, fewer new listings are coming onto the market in Central Oregon. With fewer listings on the market, November still saw more properties go into pending. With more pending listings than new listings coming on to the market, there were lower property inventory numbers.

Novembers inventory was lower than the previous three months. Even with a lower inventory, more homes sold in November than in October, representing great activity in the Central Oregon Real Estate Market.

Price reductions

The number of price reductions has dropped dramatically from previous months, with pricing stabilizing in November.

Seller’s Market

With a limited number of listings, it’s a perfect time to sell. Getting your property on the market at this time would be advantageous. Fewer listings could help to highlight your property. This trend is expected to continue through the new year.

Property owners that are thinking of selling should take advantage of the low inventory of property competing for available buyer’s.

Final Analysis

We can expect the trend of the seller’s market to continue. Fewer listings provides for a better market for the seller’s with fewer properties to choose from and consider.

The beginning of the new year is a great time to get a property listed. We can expect the trend of the seller’s market to continue, with continued high buyer demand for properties.  Listings that hit the market early in 2017 should have significant activity of serious buyers’ wanting to make a purchase.

Posted by on

How long should you own a starter home?

our first house sign in couples new home

How long should you own a starter home?

Starter homes are great for first time home buyers. While they can tend to come in lower socio-economic areas or require a bit of a fixer upper, they can be a great investment and a great way to enter the housing market.

The case against Starter Homes

A lot of people invest in smaller homes as their starter homes, like townhomes or condos. While this can seem like a great idea at the time, you should really only invest in property if you plan on staying there for at least 5 years.

Typically, when first time home owners buy their first home, they have a renting mindset. They are used to yearlong leases, and may have a harder time grasping the concept of longevity in a house. After about three years most people tend to start looking for larger properties.

Staying in a house for at least five years, can help you see more of a return on your investment. Moving after three years of owning a home can tend to lose you money, unless you’re planning to keep the property as a rental property.

Consider closing costs. Every time you buy and sell a home you have to pay closing costs. While these costs may be small compared to the overall price of a home, it’s still money that you lose every time a housing transaction is made.

They way most mortgages are structured, you pay more interest in the first five years. So spending only five years in a home can be a waste of your resources. After five years, you usually have made enough progress on the principal amount due, to justify paying a mortgage rather than just rent.

The case for Starter Homes

People tend to invest in as much house they can afford, which generally isn’t much. It’s usually in the upper end of what your finances allow, which stretches you thin. If you consider buying in the lower range, and not spending as much money a month on your mortgage, you have the chance to pay off a bigger chunk of your principal amount owed.

Purchasing a starter home is completely up to you and what your finances allow, but consider whether you truly consider your home a starter home or whether it’s an investment that you want to make and commit to for years to come. Consider what you can afford and what you’d like your monthly payments to be, what you want to be financially responsible for. If you want more flexibility and may not want to stay in the home for a long time, buy on the lower end of your budget. It gives you the chance to pay off the home faster, giving you more leverage when you hit the housing market the next time.

 

Posted by on

First time home buyers: What to look for and what to ignore

Realtor Showing Young Family Around Property For Sale

First time home buyers: What to look for and what to ignore

When shopping for your first home it can be hard to narrow down what you want, and stick to a list of needs. It’s easy to get distracted by staging or design work, or location, and miss great attributes or glaring problems to a future home. While house hunting it’s important to make a list of what you absolutely need in a home, and some things that you’d want in a home. You need to know what your deal breakers are before you go out hunting. Here’s a list of what to look for in a property and what you should over look.

Staging

Don’t get distracted by the staging. It’s meant to make the home look appealing to you. Try not to focus on cosmetic or topical design elements, but focus more on the structure of the home. There could be a particularly tricky room, that a stager has laid out flawlessly, but you may not possess the same furniture or design elements. Ask yourself what you could really do with that room. These staging accessories are designed to appeal to you, they can sometimes trick you into liking a property that otherwise wouldn’t appeal to you.

Good staging can help you see the potential that the home has, but be sure to ask yourself if it’s the home you love and not the furniture or design in it.

Location

You may want to find houses within a certain neighborhood or area. Maybe it has the best schools or is the most walk-able to downtown. Whatever the reason, don’t let your desire to live in this area overshadow what you’re looking for in a home. You may find a cute home in the neighborhood that you love but it could be 1-2 bedrooms or bathrooms short of what you’re looking for. If it’s a popular neighborhood, you could be priced out of what you’re looking for too. You need to decide if paying more for a smaller home is worth it to you, even if it’s in the neighborhood that you desire.

Cosmetic Changes

Even though a home may appear less attractive than you’re looking for, it’s important to consider what features are cosmetic to a home and which aren’t. For example, you may hate the external paint color, but paint colors are always things you can fix about a home. Minor adjustments can always be made, whether it’s a tiny kitchen or bathroom renovation, etc. Know what can be changed later and what’s important to focus on now.

Along the same vein of this, don’t think that every problem is an easy fix. Making a layout more open by knocking down walls, is an expensive change to a home. It may be more financially smart to find a home with an existing open layout.

 

Posted by on

Different Types of Mortgages

Model of cardboard house with key, calculator, notebook, pen and cash dollars. House building, loan and real estate. Cost of public utilities, insurance, rent or buying a new home concept.

Different Types of Mortgages

If you’re looking at becoming a first-time home owner, you may need to brush up on your mortgage knowledge. Talk to your real estate broker and see if they can recommend a lender for you to talk to about your mortgage options. Getting pre-approved when you’re house hunting can be a great advantage to getting the home that you want.

If you’re pre-approved you already know what sort of financial situation you are in, and what sort of mortgage you can afford. Therefore, you know what price point of homes you can look at, what price of homes that you can afford.

Learn about different types of mortgages here and talk to a lender and see which mortgage works better for you.

Fixed-rate mortgage

A fixed rate mortgage means that the interest rate for the loan, is locked in at the beginning of the mortgage agreement. Fixed rate mortgages can come in terms of 10-15-30 years. The most common of mortgages is a fixed rate 30 year mortgage. This provides the owner with the lowest mortgage payment per month, as it divides the loan into 30 years of payments, with a fixed rate of interest.

Fixed rate mortgages are also popular because they are the most predictable; the owner knows what their payment will be month to month for the entire timeline of their term in years.

Adjustable Rate Mortgages

There are many different types of adjustable rate mortgages(ARM), but the essential idea is that the interest rate can change over time.  If a home buyer gets a one year ARM, the interest rates on their loan change to the current market rate, once a year on the anniversary of their loan. This can be risky as you could wind up paying different amounts of mortgage payments from year to year. They payment amount may go down, but it also may go up.

10/1 ARM’s also change in interest as time goes on. This features a fixed interest rate for the first 10 years, but then is subject to change every year to the current market interest. This loan is typically for 30 years, and is typically used by homeowners who intend to pay their home off before the initial 10 years have passed.

Balloon Mortgages

Balloon mortgages feature a much shorter term and a fixed rate of interest, much like a fixed rate mortgage. The difference is that balloon mortgages feature a larger or balloon payment at the end of the loan. The monthly payments are lower and typically go to interest being accrued. Balloon mortgages are great for responsible borrowers, and typically are for people who intent to sell the house before the balloon payment is due. These mortgages can get tricky, as you’ll be required to re-finance if you can’t afford the balloon payment when it’s due.

Check out the different types of mortgages and see what you can afford, and how long a payment schedule you want to commit to. Talk to a lender to see what your options are and what makes the most sense for you.