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Today’s Home Price Appreciation Is Great News For Existing Homeowners

Today’s Home Price Appreciation Is Great News For Existing Homeowners

How Higher Home Prices Is Great News for Existing Homeowners

 

If you’re planning to sell your home this season, rising prices are great news for you. But it’s important to understand why prices are rising to begin with. One major factor is supply and demand.

In any industry, when there are more buyers for an item than there are of that item available, prices naturally rise. In those situations, buyers are willing to pay more to get the product or service they’re looking for when options are scarce. And that’s exactly what’s happening in the current real estate market.

Selma Hepp, Executive, Research & Insights and Deputy Chief Economist at CoreLogic, puts it like this:

With so few homes, buyers are once again left with fierce competition that’s driving the share of homes that sold over the listing price up to 66% . . . With the continued imbalance between supply and demand, home prices are likely to have another year of strong gains and are expected to average about 10% growth for the year.”

Because it will take some time for housing supply to increase, experts believe prices will continue rising. The latest Home Price Expectations Survey forecasts what will happen with home prices over the next 5 years. As the graph below shows, while the rate of appreciation will moderate over the next few years, prices will continue rising through 2026:

What This Means When You Sell Your House

If you’re a homeowner, the projection for continued price appreciation this year opens up an opportunity to move. That’s because it may give your equity a major boost. Equity is the difference between what you owe on your house and its market value. The amount of equity you have increases as you make your monthly payments and as rising home prices drive up the market value for your home.

Growing equity is a powerful tool for homeowners. When you sell your house, the equity you’ve built comes back to you in the sale. That money could be enough to cover some (if not all) of your down payment on your next home.

Of course, if you want to know how much equity you have in your current house, it’s crucial to work with a real estate professional. They follow current market trends and can help you understand your home’s value when you’re ready to sell.

What This Means for Your Next Purchase

But today’s rising home values aren’t just good news if you’re ready to sell. Because price appreciation is forecast to continue in the years ahead, you can rest assured your next home will be an investment that should grow in value with time. That’s one of several reasons why real estate has been rated the best investment in a recent Gallup poll.

Bottom Line

If you’re weighing whether or not you should sell your house this season, know rising home values may be opening up an opportunity to use equity to fuel your move. Let’s connect so you can find out how much your home is worth and to learn more about all the benefits you have in today’s market.

 

Have a question or want to know what rate you qualify for? Contact us below!

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Meet Sharp Loan Team Member, Vanessa Ochoa

Meet Sharp Loan Team Member, Vanessa Ochoa

 

What is your role at Sharp Loan and how long have you been with the company?
I am a Customer Service Rep and I am also a Closer/Funder. I’ve been with the company for almost 2 years.

What do you enjoy most about what you do?
Seeing happy clients leave us great reviews and seeing amazing testimonies of clients we were able to help.

Can you share a memorable experience or story while working?
Going on FaceTime with my team to hear Delia’s testimony on how we helped her get her home out of foreclosure.

What do you like to do in your free time when you aren’t helping clients realize their home-ownership dreams?
I love spending time with my dog Hopper and my husband Rafael, we love going to the park and going for walks at the beach.

What is your ideal vacation spot or favorite restaurant in Orange County?

Portillo’s and what I love from there is their chocolate cake shake!

My ideal vacation spot would be Tulum, Mexico.

 

Need help with your home mortgage purchase or refinance? Contact us below to get a quick and hassle-free interest quote!

 

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Why You Should Have a Pre-Approval When Buying a Home

Why You Should Have a Pre-Approval When Buying a Home

Being intentional and competitive are musts when buying a home this season. That’s why pre-approval is so important today. Pre-approval from a lender is the only way to know your true price range and how much money you can borrow for your loan. Peter Warden, Editor of The Mortgage Reports, explains:

“The lender will check out your personal finances and issue you a letter confirming the amount you’re eligible to borrow. This not only gives you a firm budget for house hunting, but also lets sellers know you’re qualified to make an offer.”

Why does that matter so much today? There are many more buyers looking for homes today than there are homes available for sale, and that’s creating some serious competition. According to the National Association of Realtors (NAR), the average home is getting 4.8 offers per sale. As a result, bidding wars are still common.

Your pre-approval gives you a leg up in these situations. That’s because you know exactly what you’re approved to borrow before you write your offer, and it lets the seller know you’re qualified to buy their home. This helps both you and the seller feel confident in what you’re bringing to the table. And that puts you in a better position to potentially win a bidding war.

As Warden puts it:

“There’s another important reason to get pre-approved, too. And that’s because there are way more buyers than homes in today’s market — which means you need to be ultra-prepared if you want to win a bidding war. Most sellers are getting multiple offers right now. And most won’t even entertain an offer without a pre-approval letter included.”

Every advantage you can gain as a buyer is crucial in a market that’s constantly changing. Mortgage rates are rising, home prices are going up, and lending institutions are regularly updating their standards. You’re going to need guidance to navigate these waters, so it’s important to have a team of professionals, such as a loan officer and a trusted real estate advisor, on your side. They’ll help make sure you’re ready to put your best foot forward.

Bottom Line

Getting pre-approved for a mortgage helps you better understand what you can afford and signals to sellers you’re serious about purchasing their home. Let’s connect so you have the tools you need to succeed as a homebuyer in today’s market.

 

Have a question or want to know what rate you qualify for? Contact us below!

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What’s Happening with Mortgage Rates, and Where Will They Go from Here?

What’s Happening with Mortgage Rates, and Where Will They Go from Here?

Based on the Primary Mortgage Market Survey from Freddie Mac, the average 30-year fixed-rate mortgage has increased by 1.2% (3.22% to 4.42%) since January of this year. The rate jumped by more than a quarter of a point from just a week ago. Here’s a visual to show how mortgage rate movement throughout 2021 was steady compared to the rapid increase in mortgage rates this year:

What’s Happening with Mortgage Rates, and Where Will They Go from Here? | MyKCM

*All rates shown are industry averages and may not reflect actual rates at the moment. Please contact us for your individual rate that you qualify for.

Just a few months ago, Freddie Mac projected mortgage rates would average 3.6% in 2022. Earlier this month, Fannie Mae forecast mortgage rates would average 3.8% in 2022. As the chart above shows, rates have already surpassed those projections.

Sam Khater, Chief Economist at Freddie Mac, explained in a press release last week:

“This week, the 30-year fixed-rate mortgage increased by more than a quarter of a percent as mortgage rates across all loan types continued to move up. Rising inflation, escalating geopolitical uncertainty and the Federal Reserve’s actions are driving rates higher and weakening consumers’ purchasing power.”

Where Are Mortgage Rates Going from Here?

In a recent article by Bankrate, several industry experts weighed in on where rates might be headed going forward. Here are some of their forecasts:

Greg McBride, Chief Financial Analyst, Bankrate:

“With inflation figures continuing to surprise to the upside, mortgage rates will remain above 4.0% on the 30-year fixed.”

Nadia Evangelou, Senior Economist and Director of Forecasting, National Association of Realtors (NAR):

“While higher short-term interest rates will push up mortgage rates, I expect some of this impact to be mitigated eventually through lower inflation. Thus, I expect the 30-year fixed mortgage rate to continue to rise, although we aren’t likely to see the big jumps that occurred over the past few weeks.”

Len Kiefer, Deputy Chief Economist, Freddie Mac:

“Mortgage rates are likely to continue to move higher throughout the balance of 2022, although the pace of rate increases is likely to moderate.”

In a recent realtor.com article, another expert adds to the conversation:

Danielle Hale, Chief Economist, realtor.com:

“. . . As markets digest the Fed’s updated economic projections, I anticipate a continued increase in mortgage rates over the next several months. . . .”

What Does This Mean for You if You’re Looking To Buy a Home?

With both mortgage rates and home values expected to increase throughout the year, it would be better to buy sooner rather than later if you’re able. That’s because it’ll cost you more the longer you wait. But, there is a possible silver lining to buying a home right now. While you’ll be paying a higher price and a higher mortgage rate than you would have last year, rising prices do have a long-term benefit once you buy.

If you purchase a home today valued at $400,000 and put 10% down, you would be taking out a $360,000 mortgage. According to mortgagecalculator.net, at a 4.42% fixed mortgage rate, your mortgage payment would be $1,807 a month (this does not include insurance, taxes, and other fees because those vary by location).

Now, let’s put that mortgage payment into a new perspective based on the substantial growth in equity that comes with the escalation in home prices. Every quarter, Pulsenomics surveys a panel of over 100 economists, investment strategists, and housing market analysts about their expectations for future home prices in the United States. Last week, Pulsenomics released their latest Home Price Expectation Survey. The survey reveals that the average of the experts’ forecasts calls for a 9% increase in home values in 2022.

Based on those projections, a $400,000 house you buy today could be valued at $436,000 by this time next year. If you break that down, that means the equity in your home would increase by $3,000 a month over that period. That’s greater than the estimated monthly payment above. Granted, the increase in your net worth is tied to the home, but it is one way to put the home price appreciation to use in a way that benefits you.

Bottom Line

Paying a higher price for a home and a higher mortgage rate can be a difficult pill to swallow. However, waiting will just cost you more. If you’re ready, willing, and able to buy a home, now will be a better time than a year, or even six months from now. Let’s connect to begin the process today.

 

Have a question or want to know what rate you qualify for? Contact us below!

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Meet Sharp Loan Team Member, Rumi Venegas

Meet Sharp Loan Team Member, Rumi Venegas

 

What is your role at Sharp Loan and how long have you been with the company?
I’m a Loan Processor. I’m the one that will help our clients’ files pass underwriting so we can fund and close the loan. I have been with Sharp loan about a year and a half.

What do you enjoy most about what you do?
I enjoy sending my CLEAR TO CLOSE emails to our Funding Team. This step is when we have FINAL LOAN DOCS for our client so they could complete their refinance or purchase of their home and provide the client a sense of a dream come true.

Can you share a memorable experience or story while working?
We had a client who almost lost her mom’s home from a reverse mortgage company and the team at Sharp Loan was able to help her save her home right before the deadline.

What do you like to do in your free time when you aren’t helping clients realize their home-ownership dreams?
Working out at the gym.

What is your ideal vacation spot or favorite restaurant in Orange County?
Thailand or Playa de Carmen in Mexico… in Orange County, just take me to Disneyland.

 

Need help with your home mortgage purchase or refinance? Contact us below to get a quick and hassle-free interest quote!

 

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What to Know About Closing Costs So You Won’t Get Caught Off Guard

What to Know About Closing Costs So You Won’t Get Caught Off Guard

As a homebuyer, it’s important to plan and budget for the expenses you’ll encounter when you purchase a home. While most people understand the need to save for a down payment, a recent survey found 41% of homebuyers were surprised by their closing costs. Here’s some information to help you get started so you’re not caught off guard when it’s time to close on your home.

What Are Closing Costs?

One possible reason some people are surprised by closing costs may be because they don’t know what they are or what they cover. According to U.S. News and World Report:

“Closing costs encompass a variety of expenses above your property’s purchase price. They include things like lender fees, title insurance, government processing fees, upfront tax payments and homeowners insurance.”

In other words, your closing costs are a collection of fees and payments made to a variety of individuals and organizations who are involved with your transaction. According to Freddie Mac, while they can vary by location and situation, closing costs typically include:

  • Government recording costs
  • Appraisal fees
  • Credit report fees
  • Lender origination fees
  • Title services
  • Tax service fees
  • Survey fees
  • Attorney fees
  • Underwriting Fees

How Much Will You Need To Budget for Closing Costs?

Understanding what closing costs include is important, but knowing what you’ll need to budget to cover them is critical to achieving your homebuying goals. According to the Freddie Mac article mentioned above, the costs to close are typically between 2% and 5% of the total purchase price of your home. With that in mind, here’s how you can get an idea of what you’ll need to cover your closing costs.

Let’s say you find a home you want to purchase for the median price of $350,300. Based on the 2-5% Freddie Mac estimate, your closing fees could be between roughly $7,000 and $17,500.

Keep in mind, if you’re in the market for a home above or below this price range, your closing costs will be higher or lower.

What’s the Best Way To Make Sure You’re Prepared At Closing Time?

Freddie Mac provides great advice for homebuyers, saying:

As you start your homebuying journey, take the time to get a sense of all costs involved – from your down payment to closing costs.”

The best way to understand what you’ll need at the closing table is to work with a team of trusted real estate professionals. An agent can help connect you with a lender, and together they can provide you with answers to the questions you might have.

Bottom Line

In today’s real estate market, it’s more important than ever to make sure your budget includes any fees and payments due at closing. Let’s connect so you have the knowledge you need to be confident going into the homebuying process.

 

Have a question? Contact us below!

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When It Comes to Jumbo Loans, One Size Doesn’t Fit All

When It Comes to Jumbo Loans, One Size Doesn’t Fit All

When it comes to Jumbo Loans, one size doesn’t necessarily fit all. At Sharp Loan, we offer multiple Prime Jumbo products designed to accommodate a broad range of borrowers. Each is tailored to borrowers with different circumstances. In choosing a jumbo product, we take your unique priorities into account and work to find the pricing and loan experience that meets your exact needs. Here are five Jumbo loan programs that we offer.

PRIME JUMBO (15- OR 30-YEAR FIXED)

  • Loan amounts up to $3M
  • 680+ FICO and up to 45% DTI
  • Up to 89.99% LTV and no MI required
  • UWM services these loans exclusively
  • Borrower solicitation protection
  • Eligible on primary, second and investment properties for purchases, rate/term and cash-out refinances
  • One appraisal required for purchases up to $3M and refinances up to $2M*
  • Two appraisals, from two different appraisers, required for refinances over $2M*
  • Loan amounts greater than $2M require 18 months of reserves in addition to any reserves required by AUS

PRIME JUMBO RELEASED (30-YEAR FIXED)

  • Loan amounts up to $3M
  • 680+ FICO and up to 45% DTI
  • Up to 89.99% LTV
  • Eligible on primary, second and investment properties for purchases, rate/term and cash-out refinances
  • One appraisal required for loans up to $2M*
  • Two appraisals, from two different appraisers, required for loans over $2M*
  • Loan amounts greater than $2M require 18 months of reserves in addition to any reserves required by AUS

PRIME JUMBO ARMS (5-, 7- AND 10-YEAR)

  • Loan amounts up to $3M
  • 680+ FICO and up to 45% DTI
  • Up to 80% LTV
  • Eligible on primary, second and investment properties for purchases, rate/term and cash-out refinances
  • One appraisal required for purchase up to $3M and refinances up to $2M*
  • Two appraisals, from two different appraisers, required for refinances over $2M*
  • Loan amounts greater than $2M require 18 months of reserves in addition to any reserves required by AUS

PRIME JUMBO INTEREST ONLY (30-YEAR FIXED)

  • Loan amounts up to $3M
  • 700+ FICO and up to 43% DTI
  • Up to 80% LTV
  • 10-year interest only, 20-year amortization period
  • Eligible for primary and second homes for purchases and rate/term refinances
  • One appraisal required for purchases up to $3M and refinances up to $2M*
  • Two appraisals, from two different appraisers, required for refinances over $2M*
  • Loan amounts up to $1M require 12 months of reserves in addition to any reserves required by AUS
  • Loan amounts over $1M require 24 months of reserves in addition to any reserves required by AUS

PRIME JUMBO MAX (30-YEAR FIXED)

  • Loans up to 80% LTV
    • Loan amounts up to $2.5M
    • 700+ FICO and up to 43% DTI
    • Eligible for primary and second homes for purchases and rate/term and cash-out refinances
    • One appraisal required for loans up to $2M*
    • Two appraisals, from two different appraisal companies, required for loans over $2M*
    • For primary purchase loans up to $2M – 12 months reserves required
    • For second home loans over $2M – 18 months reserves required
    • For primary cash out loans up to $1M – 12 months reserves required (up to $300,000 cash back)
    • For primary and second home loans over $1M – 18 months reserves required (up to $300,000 cash back)
    • For primary cash out loans between $1.501-$2M – 12 months reserves required (up to $500,000 cash back)
    • For second home cash out loans between $1.501-$2M – 18 months reserves required (up to $500,000 cash back)
  • Loans with an LTV between 80.01-96.5%
    • Loan amounts up to $1.5M
    • 720+ FICO and up to 40% DTI
    • Eligible for primary purchases and rate/term refinances
    • One appraisal required for loans up to $1M*
    • Two appraisals, from two different appraisers, required for loans over $1M*
    • For primary purchase loans up to $1.5M – 24 months reserves required

*Appraisal waivers are not applicable on Prime Jumbo, Prime Jumbo Released, Prime Jumbo ARMs, Prime Jumbo Interest Only and Prime Jumbo Max.

 

Have a question? Contact us below!

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¿Quiere el mejor precio por su casa? Ahora es el momento de ponerla a la venta.

¿Quiere el mejor precio por su casa? Ahora es el momento de ponerla a la venta.

Cuando vende cualquier artículo, generalmente quiere venderlo por la mayor ganancia posible. Eso sucede cuando hay una demanda fuerte y una oferta limitada de ese artículo. En el mercado de bienes raíces, ese momento es ahora mismo. Si está pensando en vender su casa este año, aquí hay dos razones por las que ahora es el momento de ponerla a la venta.

 

1. La demanda es muy fuerte este invierno

Un artículo reciente en Inman News explica:

“La primavera, la época más fuerte del año para los compradores y vendedores de viviendas, ha comenzado temprano, según los economistas… ¡La temporada de compras de vivienda parece estar ya en pleno apogeo!”

Y no son los únicos que dicen que los compradores ya están en plena vigencia. Esa afirmación está respaldada con los datos publicados la semana pasada por ShowingTime. El índice de ShowingTime hace un seguimiento al número promedio de exhibiciones mensuales de los compradores en propiedades residenciales activas, el cual es un indicador líder altamente confiable de las tendencias actuales y futuras para la demanda de los compradores.  El último índice revela que este diciembre fue el diciembre más activo en cinco años (ver la gráfica a continuación):

¿Quiere el mejor precio por su casa? Ahora es el momento de ponerla a la venta. | Simplifying The Market
Como indican los datos, los compradores están muy activos este invierno. En diciembre se registraron aún más exhibiciones que en diciembre de 2020, que ya era un invierno más fuerte de lo habitual. Y recuerde: usted quiere vender algo cuando hay una demanda fuerte de ese artículo. Ese momento es ahora.

2. La oferta de vivienda es extremadamente baja

Cada mes, realtor.com publica datos sobre el número de casas para la venta vigentes (actualmente en venta).  Su informe más reciente revela que el último número mensual es el más bajo que hemos visto en cualquier enero desde 2017 (vea la gráfica a continuación):

¿Quiere el mejor precio por su casa? Ahora es el momento de ponerla a la venta. | Simplifying The Market
Y no lo olvide, el mejor momento para vender un artículo es cuando hay un suministro limitado disponible. Esta gráfica muestra claramente cuán extremadamente baja es la oferta de viviendas en la actualidad.

A pesar de que la oferta está en un mínimo histórico, las ventas de viviendas están en un máximo de 15 años

Según el último Informe de Ventas de Casas Existentes de la Asociación Nacional de Realtors (NAR por sus siglas en inglés), las ventas de casas existentes totalizaron 6.12 millones en 2021, el nivel anual más alto desde 2006. Esto significa que el mercado está en auge y los propietarios están en un buen lugar para vender ahora, mientras que las ventas son tan fuertes.

NAR también informa la cantidad de casas para la venta disponibles calculando el suministro de inventario de los meses actuales. Explican:

El suministro mensual se refiere a la cantidad de meses que tomaría para que el inventario actual de casas en el mercado se venda dado el ritmo de ventas actual”.

El suministro actual de 1.8 meses es el más bajo jamás reportado. Aquí están los números de diciembre en los últimos cinco años (vea la gráfica a continuación):

¿Quiere el mejor precio por su casa? Ahora es el momento de ponerla a la venta. | Simplifying The Market
La proporción de compradores y vendedores favorece a los propietarios de viviendas en este momento en mayor medida que en cualquier otro momento de la historia. La demanda de los compradores es alta y la oferta es baja. Eso les da a los vendedores como usted una oportunidad increíble.

En conclusión

Si está de acuerdo en que el mejor momento para vender algo es cuando la demanda es alta y la oferta es baja, vamos a comunicarnos hoy para discutir la venta de su casa.

Contacta con nosotros para ayuda

 

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