If you’ve given even a casual thought to selling your house in the near future, this is the time to really think seriously about making a move. Here’s why this season is the ultimate sellers’ market and the optimal time to make sure your house is available for buyers who are looking for homes to purchase.
The latest Existing Home Sales Report from The National Association of Realtors (NAR) shows the inventory of houses for sale is still astonishingly low, sitting at just a 2-month supply at the current sales pace.
Historically, a 6-month supply is necessary for a ‘normal’ or ‘neutral’ market in which there are enough homes available for active buyers (See graph below):When the supply of houses for sale is as low as it is right now, it’s much harder for buyers to find homes to purchase. As a result, competition among purchasers rises and more bidding wars take place, making it essential for buyers to submit very attractive offers.
As this happens, home prices rise and sellers are in the best position to negotiate deals that meet their ideal terms. If you put your house on the market while so few homes are available to buy, it will likely get a lot of attention from hopeful buyers.
Today, there are many buyers who are ready, willing, and able to purchase a home. Low mortgage rates and a year filled with unique changes have prompted buyers to think differently about where they live – and they’re taking action. The supply of homes for sale is not keeping up with this high demand, making now the optimal time to sell your house.
Bottom Line
Home prices are appreciating in today’s sellers’ market. Making your home available over the coming weeks will give you the most exposure to buyers who will actively compete against each other to purchase it.
Maybe with the leverage you currently have, you can negotiate a deal that will allow you to make the move of your dreams. What’s your home’s value?
Carol Buchanan – Green Team New York Realty 2020 Citizen of the Year
Carol Buchanan donates Citizen of the Year Prize Money to local charities. She and her husband have always been involved in the community. They raised their children to give back. Now they are raising their grandchildren to do the same. For instance, Carol and her granddaughter were spotted ringing the bell for the Salvation Army at Shoprite.
Lucyann Tinnirello, Broker Manager of Green Team New York Realty, said this about Carol.
“She has a dedicated heart. It takes a special person to be so kind. Furthermore, she’s a loving mother, devoted wife, doting grandmother, and busy real estate professional, However, Carol still makes time to give to her community.”
It’s no wonder Carol was recognized as Citizen of the Year. She has been a Meals on Wheels driver for the past 12 years. Moreover, she continues to deliver meals despite the pandemic. Unfortunately, Carol can’t chat with the seniors she delivers to. Consequently, she misses those conversations almost as much as they do. In addition, she is very involved with the Lions Club of Warwick and fundraising, including their 5K Labor Day Race.
Honoring Citizen of the Year with Donations to Local Charities
Geoff Green, President of Green Team Realty, believes in giving back to the community. In fact, Green Team’s core values include volunteerism and support of local charities. Geoff Green donated a total of $500 to the charities of Carol’s choosing in honor of her Citizen of the Year Award.
Carol graciously accepted the Award and announced the charities to receive donations:
“I’m honored to have received this award. I thank Geoff Green for his generous donation to the Warwick Area Migrant Committee and the Warwick Valley Humane Society. It is always my pleasure to give back to the Warwick community that has been so good to me and my family. I’ve always admired the work and dedication of Suzy Barron for the Humane Society, as well as Kathy Brieger for her generous support and wonderful programs for the children of migrant workers.
Warwick Area Migrant Committee
Kathy Brieger, Warwick Area Migrant Committee, shared these words::
“Carol, Congratulations on your recognition. I’m grateful to you for giving us this gift. We will be using the $250 to support our Safety Backpack Project. The bright orange bags will be given to 200 farmworkers who walk or ride their bikes to work.
These bags are packed with safety-related items like safety goggles and hand sanitizer. The intention of the safety backpacks is to allow drivers to see farm workers as they walk or ride their bikes to work. This is often a safety hazard during certain times of the harvest when farmworkers may be leaving for work and returning home when it is dark. The date for the distribution is April 17th at 12 pm. It will be organized by WAMC at the ALAMO.”
Warwick Valley Humane Society
Suzyn Barron of the WVHS sent the following message:
“Warwick Valley Humane Society is so honored to receive this donation from Carol for our Building Fund towards a new shelter facility. On behalf of our homeless pets, we thank her for her generosity in sharing her award of Citizen of the Year with our organization.
The current shelter facility is not up to today’s standards in animal sheltering. This new facility will offer a more spacious, healthier, safer, and well-ventilated building for the animals, staff, and visitors. Thanks, Carol, for helping us build a better safe haven for our community’s unwanted, abandoned, and neglected animals.
Carol Buchanan and Geoffrey Green present Suzyn Barron, Warwick Valley Humane Society, and Kathy Brieger, Warwick Area Migrant Committee with donation checks
Right now, the housing market is full of outstanding opportunities for both buyers and sellers. Whether you’re thinking of buying your first home, moving up to a bigger one, or selling so you can downsize this spring, there are perks today that are powering big moves for people across the country. Here are the top two to keep on the radar this season.
The Biggest Perk for Buyers: Low Mortgage Rates
Today’s most compelling buyer incentive is low mortgage interest rates. The 30-year fixed-rate is now averaging just over 3%. While that’s slightly higher than the record-lows from 2020 and earlier this year, it’s still way lower than historic norms, making purchasing a home an ongoing perk for hopeful buyers (See graph below):This is a huge advantage for buyers and helps to make owning a home attainable for more households – and there’s good reason to strive for homeownership. The latest Homeowner Equity Report from CoreLogic shows how homeowners saw major gains in their net worth last year, all thanks to owning a home. Frank Martell, President and CEO of CoreLogic, explains:
“Positive factors like record-low interest rates and a booming housing market encouraged many families to enter homeownership. This growing bank of personal wealth that homeownership affords was noticed by many but in particular for first-time buyers who want a piece of the cake. As a result, we may see more of those currently renting start to enter the market in the near future.”
Low mortgage rates are a plus for buyers right now, but experts forecast we’ll see them continue to rise as the year goes on. If you’re ready to purchase a home, it’s wise to get started on the process soon so you can secure today’s comparatively low rate.
The Biggest Perk for Sellers: Low Inventory
Today, there are simply not enough houses on the market for the number of buyers looking to purchase them, and it’s creating a serious sellers’ market. According to Danielle Hale, Chief Economist at realtor.com:
“Total active inventory continues to decline, dropping 50 percent. With buyers active in the market and sellers still slow to put homes up for sale, homes are selling quickly and the total number actively available for sale at any point in time continues to decline.” (See map below):
The lack of houses for sale continues to challenge the market, and with low mortgage rates fueling buyer demand, homes are hard for buyers to find today. According to the latest Realtors Confidence Index Survey by the National Association of Realtors (NAR), the average house is now receiving 4.1 offers and is on the market for only 20 days.
Buyers are clearly eager to purchase, and because of the shortage of inventory available, they’re often entering bidding wars. This is one of the factors keeping home prices strong and giving sellers leverage in the negotiation process.
Homeowners who are in a position to sell shouldn’t wait to make their move. There’s a light at the end of the tunnel for today’s inventory shortage, so listing this spring will get your house on the market when conditions are most favorable. With low inventory and high buyer demand, homeowners can potentially earn a greater profit on their houses and sell them quickly in the fast-paced spring market.
Bottom Line
Whether you’re thinking about buying or selling a home, there are major perks available in today’s housing market. Let’s connect today to discuss how these favorable conditions play to your advantage in our local area.
The Green Team Realty March 2021 Housing Market Update was held on March 16 at 12:00 p.m. If you missed the live webinar or would like to watch it again, it’s available here:
Overview of the real estate market on the national level
Geoff Green, President of Green Team Realty, began the update with a quote from Lawrence Yun, Chief Economist at NAR:
“Home sales could possibly reach 8 million if we had more inventory… Mortgage rates should remain very low throughout 2021, although we may have seen the lowest already.”
As shown in this graphic, foreclosure activity is minimal.
Geoff pointed out that with the job loss and economic woes resulting from the pandemic, you would expect the number of foreclosures to be much higher. According to DS News,
“About 325,000 people will exit the forbearance program over the next six to nine months without a plan in place. Some – but probably not all – of those loans will likely default.”
The continuing saga of low inventory – and the Sellers Market
Year-over-year changes indicate that this is a great time to sell. Inventory is so low, if you are thinking about getting your house on the market, now is the time to do it!
Home Price Appreciation
For an in-depth discussion on home price appreciation, watch the housing market update here.
National and Local Housing Market Stats (Orange County NY and Sussex County NJ) are then discussed.
“Housekeeping” Items
Meet our Panel
Geoff was joined by Keren Gonenof Green Team New Jersey Realty and Carol Buchanan of Green Team New York Realty. In addition, Ken Aulicino of Family First Funding added his expertise as a Mortgage Specialist.
The discussion began with the topic of buyers and possible issues in obtaining mortgages. In addition, whether appraisals were coming in, even with rising home prices. Geoff asked Ken Aulicino about whether rates were coming up. Even with rates coming up, historically they are still very low. Click here to watch the full panel discussion, including a question and answer session.
If you would like to get in touch with any of our panelists, their contact information is below:
We’ll see you on Tuesday, April 20 at 12 p.m. for our next Housing Market Update.
According to data from the most recent Origination Insight Report by Ellie Mae, the average FICO® score on closed loans reached 753 in February. As lending standards have tightened recently, many are concerned over whether or not their credit score is strong enough to qualify for a mortgage. While stricter lending standards could be a challenge for some, many buyers may be surprised by the options that are still available for borrowers with lower credit scores.
The fact that the average American has seen their credit score go up in recent years is a great sign of financial health. As someone’s score rises, they’re building toward a stronger financial future. As more Americans with strong credit enter the housing market, we see a natural increase in the FICO® score distribution of closed loans, as shown in the graph below:If your credit score is below 750, it’s easy to see this data and fear that you may not be able to qualify for a mortgage. However, that’s not always the case. While the majority of borrowers right now do have a score above 750, there’s more to qualifying for a mortgage than just the credit score, and there are still options that allow people with lower credit scores to buy their dream home. Here’s what Experian, a global leader in consumer and business credit reporting, says:
Federal Housing Administration (FHA) loans:“With a 3.5% down payment, homebuyers may be able to get an FHA loan with a 580 credit score or higher. If you can manage a 10% down payment, though, that minimum goes as low as 500.”
Conventional loans:“The most popular loan type typically comes with a 620 minimum credit score.”
S. Department of Agriculture (USDA) loans:“In general, lenders require a minimum credit score of 640 for a USDA loan, though some may go as low as 580.”
S. Department of Veterans Affairs (VA) loans:“VA loans don’t technically have a minimum credit score, but lenders will typically require between 580 and 620.”
There’s no doubt a higher credit score will give you more options and better terms when applying for a mortgage, especially when lending is tight like it is right now. When planning to buy a home, speaking to an expert about steps you can take to improve your credit score is essential so you’re in the best position possible. However, don’t rule yourself out if your score is less than perfect – today’s market is still full of opportunity.
Bottom Line
Don’t let assumptions about whether your credit score is strong enough put a premature end to your homeownership goals. Let’s connect today to discuss the options that are best for you.
For generations, the homebuying process never really changed. The seller would try to estimate the market value of the home and tack on a little extra to give themselves some negotiating room. That figure would become the listing price of the house. Buyers would then try to determine how much less than the full price they could offer and still get the home. The asking price was generally the ceiling of the negotiation. The actual sales price would almost always be somewhat lower than the list price. It was unthinkable to pay more than what the seller was asking.
Today is different.
The record-low supply of homes for sale coupled with very strong buyer demand is leading to a rise in bidding wars on many homes. Because of this, homes today often sell for more than the list price. In some cases, they sell for a lot more.
According to the Home Buyers and Sellers Generational Trendsreport just released by the National Association of Realtors (NAR), 45% of buyers paid full price or more.
You may need to change the way you look at the asking price of a home.
In this market, you likely can’t shop for a home with the old-school mentality of refusing to pay full price or more for a house.
Because of the shortage of inventory of houses for sale, many homes are actually being offered in an auction-like atmosphere in which the highest bidder wins the home. In an actual auction, the seller of an item agrees to take the highest bid, and many sellers set a reserve price on the item they’re selling. A reserve price is the minimum amount a seller will accept as the winning bid.
When navigating a competitive housing market, think of the list price of the house as the reserve price at an auction. It’s the minimum the seller will accept in many cases. Today, the asking price is often becoming the floor of the negotiation rather than the ceiling. Therefore, if you really love a home, know that it may ultimately sell for more than the sellers are asking. So, as you’re navigating the homebuying process, make sure you know your budget, know what you can afford, and work with a trusted advisor who can help you make all the right moves as you buy a home.
Bottom Line
Someone who’s more familiar with the housing market of the past than that of today may think offering more for a home than the listing price is foolish. However, frequent and competitive bidding wars are creating an auction-like atmosphere in many real estate transactions. Let’s connect so you have the best advice on how to make a competitive offer on a home in our local market.
Freddie Mac recently released their Quarterly Refinance Statistics report which covers refinances through 2020. The report explains that the dollar amount of cash-out refinances was greater in 2020 than in recent years. A cash-out refinance, as defined by Investopia, is:
“a mortgage refinancing option in which an old mortgage is replaced for a new one with a larger amount than owed on the previously existing loan, helping borrowers use their home mortgage to get some cash.”
The Freddie Mac report led to articles like the one published by The Real Deal titled, House or ATM? Cash-Out Refinances Spiked in 2020, which reports:
“Americans treated their homes like ATMs last year, withdrawing $152.7 billion amid a cash-out refinancing spree not seen since before the 2008 financial crisis.”
Whenever you combine the terms “spiked,” “homes like ATMs,” and “financial crisis,” it conjures up memories of the housing crash we experienced in 2008.
However, that comparison is invalid for three reasons:
1. Americans are sitting on much more home equity today.
Mortgage data giant Black Knight just issued information on the amount of tappable equity U.S. homeowners with a mortgage have. Tappable equity is the amount of equity available for homeowners to use and still have 20% equity in their home. Here’s a graph showing the findings from their report:In 2006, directly before the crash, tappable home equity in the U.S. topped out at $4.6 trillion. Today, that number is $7.3 trillion.
As Black Knight explains:
“At year’s end, some 46 million homeowners held a total $7.3 trillion in tappable equity, the largest amount ever recorded…That’s an increase of more than $1.1 trillion (+18%) since the end of 2019, the largest percentage gain since 2013 and – you guessed it – the largest dollar value gain in history, to boot. All in all, it works out to roughly $158,000 on average per homeowner with tappable equity, up nearly $19,000 from the end of 2019.”
2. Homeowners cashed-out a much smaller amount this time.
In 2006, Americans cashed-out a total of $321 billion. In 2020, that number was less than half, totaling $153 billion. The $321 billion made up 7% of the total tappable equity in the country in 2006. On the other hand, the $153 billion made up only 2% of the total tappable equity last year.
3. Fewer homeowners tapped their equity in 2020 than in 2006.
Freddie Mac reports that 89% of refinances in 2006 were cash-out refinances. Last year, that number was less than half at 33%. As a percentage of those who refinanced, many more Americans lowered their equity position fifteen years ago as compared to last year.
Bottom Line
It’s true that many Americans liquidated a portion of the equity in their homes last year for various reasons. However, less than half of them tapped their equity compared to 2006, and they cashed-out less than one-third of that available equity. Today’s cash-out refinance situation bears no resemblance to the situation that preceded the housing crash.
Maybe with the leverage you currently have, you can negotiate a deal that will allow you to make the move of your dreams. What’s your home’s value?
Thursday, February 11, was the second night of Green Team Realty’s 2020 Awards Celebration. Like many events occurring in 2020, it took place on Zoom! The first night celebrated Sales Awards. The third and last night was for the Momentum Builder Award. And this night was to announce the Team Player and Citizen of the Year Awards.
Team Player Award
Geoff Green, President of Green Team Realty, stresses the importance of elevating those around you. .Focusing on winning each day creates a winning culture, a Green Team Core Value. The recipients of this award do all that. In addition, they are deemed most reliable, and positive. Furthermore, they are dependable, work well with others, and have great problem-solving skills.
Before the winners are announced, a word from our Broker Managers
The Broker Managers were instrumental in selecting the Team Player Award Recipients. Lucyann Tinnirello, Broker Manager of the Warwick office, said this about her selection:
“The person selected has a lot of the attributes described above. Furthermore, sales associates in the office had a say in the selection and hit the nail right on the head!”
Kim Lasalandra, Broker Manager of the Vernon office, had this to say:
“This person is always very reliable and always seems to be around at the right time. If not out with clients, then she’s in the office helping other agents.”
And the Team Players of the Year are…
Tiffany just celebrated her second year with Green Team. She had set business goals for herself, which she achieved for 2020. However, she had no idea that she would be named Team Player of Green Team New York Realty. When Lucyann called to tell her, she was overwhelmed with emotion. Tiffany summed up her feelings on teamwork with one of her favorite quotes:
“Teamwork divides the tasks and multiplies the success.”
Cathieloves the truly positive attitude that exists at Green Team New Jersey Realty. She has found a sense of comradery at Green Team that was missing in other offices she has been with. Cathie loves being part of the Green Team and is grateful to be here.
Geoff, in turn, told Cathie how much he appreciates her positive attitude and willingness to help others. He stressed how important connection with others is, especially now. The team players are the ones that help provide that connection, something he is grateful for.
Citizen of the Year Award
Geoff began the presentation of this award with a quote by George Elliston, American Journalist and Poet, 1883-1946:
“How beautiful a day can be when kindness touches it.”
Recipients of this award have made outstanding contributions to our local communities. Many of the sales associates in each office are very involved in the community, making the decision a difficult one. However, in the end, there were two very deserving individuals who received this award.
According to Lucyann, Carol has a dedicated heart. It takes a special person to be so kind. In addition to being a loving mother, devoted wife, doting grandmother, and busy real estate professional, Carol makes time to give to her community. Carol has been a driver for Meals on Wheels for over 12 years now. It’s been hard during COVID since she hasn’t been able to chat with the seniors she is delivering to. She misses that connection with them as much as they do.
Carol and her husband have always been involved in the community. They raised their children to give back, and are now raising their grandchildren to do the same. Lucyann commented that at Christmas, Carol was at Shoprite, ringing the bell for the Salvation Army with her granddaughter. As Carol says,
“Volunteering is good for the soul.”
Another Green Teamer who believes in the power of volunteering is:
Kim stated that Alison is also a dedicated wife, mother, and fabulous real estate agent. She also spends a lot of her time helping the school and the community. Alison is currently the current President of SCA (School Community Association) at Vernon Township High School. She was the treasurer for 2 years. Before that, the secretary. Last year, both the president and vice president vacated their positions. Alison stepped up to become President. What’s more, her mother stepped up to take on the treasurer role.
Basically, the SCA raises a lot of money through different programs to assist the school. 2020 was a difficult year. The usual fundraisers are social events. Therefore, they could not be held due to COVID. An online auction is being planned to raise money for scholarships for high school seniors. The organization also helps senior citizens, and local children through the Giving Tree project.
A surprise ending to the evening…
Geoff was moved by the work that these volunteers and their organizations are doing. Furthermore, upon hearing the difficulties that non-profits were facing raising funds due to COVID, he decided right then to do something special. Each Citizen of the Year Award recipient will receive $500 to be donated to the charities of their choice. Geoff went on to say, when all is said and done, these are the things that will matter most. Family, and helping others.
Congratulations to our Team Players and Citizens of the Year!
It was a night to remember. Actually, it was three nights to remember! In a “normal” year, Green Team sales associates and staff would gather for a festive evening of awards, photos, food, drink, and dancing to live music. However, 2020 was not a normal year. In case you missed any of it or would like to see it again, here is the 2020 Awards Ceremony Recap. Below you’ll find a list of the awards and recipients in each category.
The team player award honors the sales associate deemed the most reliable, positive, and dependable. Furthermore, that person works well with others and has great problem-solving skills.
Recipients of the Citizen of the Year Award have made outstanding contributions to our local communities. Here are the award recipients for 2020.
Every year Geoff Green selects a sales associate who has demonstrated hard work and determination while overcoming obstacles. That someone has come through a tough spot in life and turned challenges into success. Furthermore, that person has shown success in not only real estate, but in life. For 2020, the Momentum Builder Award recipient was Keren Gonen.
To learn more about Keren’s inspiring story and attitude, click here.
There have been a lot of headlines reporting on how homeowner equity (the difference between the current market value of your home and the amount you owe on your mortgage) has dramatically increased over the past few years. CoreLogic indicated that equity increased for the average homeowner by $17,000 in the last year alone. ATTOM Data Solutions, in their latest U.S. Home Equity Report, revealed that 30.2% of the 59 million mortgaged homes in the United States have at least 50% equity. That doesn’t even include the 38% of homes that are owned free and clear, meaning they don’t have a mortgage at all.
How can equity help a household?
Having equity in your home can dramatically impact your life. Equity is like a savings account you can tap into when you need cash. Like any other savings, you should be sensible in how you use it, though. Here are three good reasons to consider using your equity.
1. You’re experiencing financial hardship (job loss, medical expenses, etc.)
Equity gives you options during difficult financial times. With equity, you could refinance your house to get cash which may ease the burden. It also puts you in a better position to talk to the bank about restructuring your home loan until you can get back on your feet.
Today, there are 2.7 million Americans who are currently in a forbearance program because of the pandemic. Ninety percent of those in the program have at least 10% equity. That puts them in a better position to get a loan modification instead of facing foreclosure because many banks will see the equity as a form of collateral in a new deal. If you’re in this position, even if you can’t get a modification, the equity allows you the option to sell your house and walk away with your equity instead of losing the house and your investment in it.
2. You need money to start a new business
We’ve all heard the stories about how many great American companies started in the founder’s garage (i.e., Disney, Hewlett Packard, Apple, Yankee Candle, Keeping Current Matters). What we might not realize, however, is the garage (along with the rest of the home) supplied the start-up money for many of these companies in the form of a refinance.
If you’re passionate about an idea you have for a new product or service, the equity in your home may enable you to make that dream a reality.
3. You want to invest in a loved one’s future
It’s been a long-standing tradition in this country for many households to help pay college expenses for their children. Some have tapped into the equity in their homes to do that.
Additionally, George Ratiu, Senior Economist for realtor.com, notes:
“52% of Americans who bought their first home in 2020 said they got help with their down payment from friends or family. The number one lender? Their parents.”
It’s safe to assume a percentage of that down payment money likely came from home equity.
Bottom Line
Savings in any form is a good thing. The forced savings you can earn from making a mortgage payment enables you to build wealth through home equity. That equity can come in handy in both good and more challenging times.
Facebook
X
Pinterest
Copy Link
When the supply of houses for sale is as low as it is right now, it’s much harder for buyers to find homes to purchase. As a result, competition among purchasers rises and more bidding wars take place, making it essential for buyers to submit very attractive offers.
