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REAL ESTATE INDUSTRY NEWS

US Real Estate News for Global Investors 1-26-2023

Posted By Yoshi Takita on January 26, 2023 in Global Real Estate

Why It Makes Sense To Move Before Spring Why It Makes Sense To Move Before Spring | MyKCM Spring is usually the busiest season in the housing market. Many buyers wait until then to make their move, believing it’s the best time to find a home. However, that isn’t always the case when you factor in the competition you could face with other buyers at that time of year. If you’re ready to buy a home, here’s why it makes sense to move before the spring market picks up. Spring Should Bring a Wave of Buyers to the Market In most years, the housing market goes through predictable seasonal trends in activity. Winter is typically a quiet point in the year, while spring sees a surge of buyers begin their search. And experts project that this year will be no exception. Right now, buyer demand is low due to a combination of normal seasonal trends and a reaction to last year’s rise in mortgage rates. But rates have started to come down since last November, which has more and more potential buyers planning to jump into the market. That means right now is a sweet spot if you’re in a good position to buy, before more buyers reappear. Affordability is beginning to improve, but demand is still low — for now. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), shares: “. . . expect sales to pick up again soon since mortgage rates have markedly declined after peaking late last year.” If you’re ready to buy a home, right now is the best time to do so before your competition grows and more buyers enter the market. Today’s Sellers Are Motivated Low demand from buyers often means sellers are more motivated to work with you, and that can set you up to buy a home on your terms. In fact, sellers have been more willing to negotiate this winter because there are fewer buyers in the market. According to a recent article from Forbes: “. . . sellers gave concessions to buyers in 41.9% of home sales in the fourth quarter of last year.” But keep in mind, the advantages buyers have this winter won’t last forever. The competition you face could be greater if you wait until spring to make a move, and increased buyer demand means sellers will have less motivation to negotiate with you. Be sure to work with a trusted real estate professional to learn what you can expect in your local market right now. Bottom Line If you’re in a good position to make a move, it may make sense to move before spring. Working with your team of expert real estate advisors is the best way to learn about the current market and what it means for you. Let’s connect today to determine the best plan to achieve your homebuying goals.

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US Real Estate News for Global Investors 1-24-2023

Posted By Yoshi Takita on January 25, 2023 in Global Real Estate

What Experts Are Saying About the 2023 Housing Market What Experts Are Saying About the 2023 Housing Market | MyKCM If you’re thinking about buying or selling a home soon, you probably want to know what you can expect from the housing market this year. In 2022, the market underwent a major shift as economic uncertainty and higher mortgage rates reduced buyer demand, slowed the pace of home sales, and moderated home prices. But what about 2023? An article from HousingWire offers this perspective: “The red-hot housing market of the past 2 ½ years was characterized by sub-three percent mortgage rates, fast-paced bidding wars and record-low inventory. But more recently, market conditions have done an about-face. . . . now is the opportunity for everyone to become re-educated about what a ‘typical’ housing market looks like.” This year, experts agree we may see the return of greater stability and predictability in the housing market if inflation continues to ease and mortgage rates stabilize. Here’s what they

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US Real Estate News for Global Investors 1-24-2023

Posted By Yoshi Takita on January 24, 2023 in Global Real Estate

The 3 Factors That Affect Home Affordability The 3 Factors That Affect Home Affordability | MyKCM If you’ve been following the housing market over the last couple of years, you’ve likely heard about growing affordability challenges. But according to experts, the key factors that determine housing affordability are projected to improve this year. Selma Hepp, Executive, Deputy Chief Economist at CoreLogic, shares: “. . . with slowly improving affordability and a more optimistic economic outlook than previously believed, the housing market could show resilience in 2023.” The three measures used to establish home affordability are home prices, mortgage rates, and wages. Here’s a closer look at each one. 1. Mortgage Rates Mortgage rates shot up to over 7% last year, causing many buyers to put their plans on hold. But things are looking different today as rates are starting to come down. George Ratiu, Senior Economist at realtor.com, explains: “Let’s celebrate some good news. . . . mortgage rates are down. With inflation showing a tangible slowdown, I do expect mortgage rates to follow suit in the months ahead.” Even a small change in rates can impact your purchasing power. Nadia Evangelou, Director of Forecasting for the National Association of Realtors (NAR), gives this context: “With a 6% rate instead of 7%, buyers pay about $2,700 less every year on their mortgage. As a result, owning a home becomes affordable to about 1.4 million more renters and 4.3 million more homeowners.” If 7% rates paused your homebuying plans last year, this could be the opportunity you need to get back in the game. Be sure to work with a team of experts who know the latest on mortgage rates and can give you the best advice for the current market. 2. Home Prices The second factor at play is home prices. Home prices have made headlines over the past few years because they skyrocketed during the pandemic. When discussing home prices in 2023, Lawrence Yun, Chief Economist at NAR, says: “After a big boom over the past two years, there will essentially be no change nationally . . . Half of the country may experience small price gains, while the other half may see slight price declines.” So, while prices will likely be flat this year in some markets, others could see small gains or slight declines. It all depends on your local area. For insight into what’s happening in your market and how prices are impacting affordability, reach out to a trusted real estate professional. 3. Wages The final component in the affordability equation is wages. The graph below uses data from the Bureau of Labor Statistics (BLS) to show how wages have increased over time: The 3 Factors That Affect Home Affordability | MyKCM When you think about affordability, remember the full picture includes more than just mortgage rates and prices. Wages need to be factored in as well. Because wages have been rising, many buyers have renewed opportunity in the market. While affordability hurdles are not completely going away this year, based on current trends and projections, 2023 should bring some sense of relief to homebuyers who have faced growing challenges. As Mike Fratantoni, Chief Economist at the Mortgage Bankers Association (MBA), says: “Rates are expected to move lower for the year, and home price growth is expected to cool, both of which will help affordability challenges.” Bottom Line If you have questions, let’s connect. You’ll also want to make sure you have a trusted lender so you can explore your financing options. You may be closer to owning a home than you think.

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US Real Estate News for Global Investors 1-23-2023

Posted By Yoshi Takita on January 23, 2023 in Global Real Estate

Want To Sell Your House? Price It Right. Want To Sell Your House? Price It Right. | MyKCM Last year, the housing market slowed down in response to higher mortgage rates, and that had an impact on home prices. If you’re thinking of selling your house soon, that means you’ll want to adjust your expectations accordingly. As realtor.com explains: “. . . some of the more prominent pandemic trends have changed, so sellers might wish to adjust accordingly to get the best deal possible.” In a more moderate market, how you price your house will make a big difference to not only your bottom line, but to how quickly your house could sell. And the reality is, homes priced right are still selling in today’s market. Why Pricing Your House Appropriately Matters Especially today, your asking price sends a message to potential buyers. If it’s priced too low, you may leave money on the table or discourage buyers who may see a lower-than-expected price tag and wonder if that means something is wrong with the home. If it’s priced too high, you run the risk of deterring buyers. When that happens, you may have to lower the price to try to reignite interest in your house when it sits on the market for a while. But be aware that a price drop can be seen as a red flag by some buyers who will wonder what that means about the home. To avoid either headache, price it right from the start. A real estate professional knows how to determine that ideal asking price. They balance the value of homes in your neighborhood, current market trends, buyer demand, the condition of your house, and more to find the right price. This helps lead to stronger offers and a greater likelihood your house will sell quickly. The visual below helps summarize the impact your asking price can have: Want To Sell Your House? Price It Right. | MyKCM Bottom Line Homes that are priced at current market value are still selling. To make sure you price your house appropriately, maximize your sales potential, and minimize your hassle, let’s connect.

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1-20^2-23 US Real Estate News for Global Investors

Posted By Yoshi Takita on January 20, 2023 in Global Real Estate

What’s Really Happening with Home Prices? [INFOGRAPHIC] What’s Really Happening with Home Prices? [INFOGRAPHIC] | MyKCM Some Highlights If you’re thinking about selling your house, recent headlines about home prices falling month-over-month may have you second guessing your decision—but perspective matters. While home prices are down slightly month-over-month in some markets, home values are still up almost 10% nationally on a year-over-year basis. A nearly 10% gain is still dramatic compared to the more normal level of appreciation, which is 3-4%. Let’s connect to find out how much equity you have in your current home and how you can use it to fuel your next purchase.

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US Real Estate News for Global Investroers 1-19-2023

Posted By Yoshi Takita on January 19, 2023 in Global Real Estate

Pre-Approval in 2023: What You Need To Know Pre-Approval in 2023: What You Need To Know | MyKCM One of the first steps in your homebuying journey is getting pre-approved. To understand why it’s such an important step, you need to understand what pre-approval is and what it does for you. Business Insider explains: “In a preapproval [sic], the lender tells you which types of loans you may be eligible to take out, how much you may be approved to borrow, and what your rate could be.” Basically, pre-approval gives you critical information about the homebuying process that’ll help you understand your options and what you may be able to borrow. How does it work? As part of the pre-approval process, a lender will look at your finances to determine what they’d be willing to loan you. From there, your lender will give you a pre-approval letter to help you understand how much money you can borrow. That can make it easier when you set out to search for homes because you’ll know your overall numbers. And with higher mortgage rates impacting affordability for many buyers today, a solid understanding of your numbers is even more important. Pre-Approval Helps Show You’re a Serious Buyer Another added benefit is pre-approval can help a seller feel more confident in your offer because it shows you’re serious about buying their house. A recent article from Forbes notes: “From the seller’s perspective, a preapproval [sic] letter from a reputable local lender often can make the difference between accepting and rejecting an offer.” This goes to show, even though you may not face the intense bidding wars you saw if you tried to buy during the pandemic, pre-approval is still an important part of making a strong offer. In fact, Christy Bieber, Personal Finance Writer at The Motley Fool explains it may be the most important part of making an offer: “Pre-approval maximizes the chances you’ll be able to actually close the deal – and sellers want to see that. The fact that a pre-approval gives you a better chance of getting your offer accepted is undoubtedly the most important reason to complete this step . . .” Bottom Line Getting pre-approved is an important first step towards buying a home. It lets you know what you can borrow and shows sellers you’re serious about purchasing their home. Connect with a local real estate professional and a trusted lender so you have the tools you need to purchase a home in today’s market.

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US Real Estate News for Global Investroers 1-18-2023

Posted By Yoshi Takita on January 18, 2023 in Global Real Estate

Have Home Values Hit Bottom? Have Home Values Hit Bottom? | MyKCM Whether you’re already a homeowner or you’re looking to become one, the recent headlines about home prices may leave you with more questions than answers. News stories are talking about home prices falling, and that’s raising concerns about a repeat of what happened to prices in the crash in 2008. One of the questions that’s on many minds, based on those headlines, is: how much will home prices decline? But what you may not realize is expert forecasters aren’t calling for a free fall in prices. In fact, if you look at the latest data, there’s a case to be made that the biggest portion of month-over-month price depreciation nationally may already behind us – and even those numbers weren’t significant declines on the national level. Instead of how far will they drop, the question becomes: have home values hit bottom? Let’s take a look at the latest data from several reputable industry sources (see chart below): Have Home Values Hit Bottom? | MyKCM The chart above provides a look at the most recent reports from Case-Shiller, the Federal Housing Finance Agency (FHFA), Black Knight, and CoreLogic. It shows how, on a national scale, home values have changed month-over-month since January 2022. November and December numbers have yet to come out. Let’s focus in on what the red numbers tell us. The red numbers are the change in home values over the last four months that have been published. And if we isolate the last four months, what the data shows is, in each case, home price depreciation peaked in August. While that doesn’t guarantee home price depreciation has hit bottom, it confirms prices aren’t in a free fall, and it may be an early signal that the worst is already behind us. As the numbers for November and December are released, data will be able to further validate this national trend. Bottom Line Home prices month-over-month have depreciated for the past four months on record, but there’s a strong case to be made that the worst may be behind us. If you have questions about what’s happening with home prices in our local market, let’s connect.

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Wells Fargo Bank offers mortgage program for E2 Visa

Posted By Paul Xumsai on January 18, 2023 in Global Real Estate

Wells Fargo Bank offers program for E2 Visa to buy a house.

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US Real Estate News for Global Investors 1-17-2023

Posted By Yoshi Takita on January 17, 2023 in Global Real Estate

Think Twice Before Waiting for 3% Mortgage Rates Think Twice Before Waiting for 3% Mortgage Rates | MyKCM Last year, the Federal Reserve took action to try to bring down inflation. In response to those efforts, mortgage rates jumped up rapidly from the record lows we saw in 2021, peaking at just over 7% last October. Hopeful buyers experienced a hit to their purchasing power as a result, and some decided to press pause on their plans. Today, the rate of inflation is starting to drop. And as a result, mortgage rates have dipped below last year’s peak. Sam Khater, Chief Economist at Freddie Mac, shares: “While mortgage market activity has significantly shrunk over the last year, inflationary pressures are easing and should lead to lower mortgage rates in 2023.” That’s potentially great news if you’re a buyer aiming to jump back into the housing market. Any drop in mortgage rates helps boost your purchasing power by bringing down your expected monthly mortgage payment. This means the lower mortgage rates experts forecast this year could be just what you need to reignite your homebuying goals. While this opens up a window of opportunity for you, remember: you shouldn’t expect rates to drop back down to record lows like we saw in 2021. Experts agree that’s not the range buyers should bank on. Greg McBride, Chief Financial Analyst at Bankrate, explains: “I think we could be surprised at how much mortgage rates pull back this year. But we’re not going back to 3 percent anytime soon, because inflation is not going back to 2 percent anytime soon.” It’s important to have a realistic vision for what you can expect this year, and that’s where the advice of expert real estate advisors is critical. You may be surprised by the impact even a mild drop in mortgage rates has on your budget. If you’re ready to buy a home now, today’s market presents the opportunity to get a more affordable mortgage rate, find your dream home, and face less competition from other buyers. Bottom Line The recent pullback in mortgage rates is great news – but if you’re ready to buy now, holding out for 3% is a mistake. Work with a local lender to learn how today’s rates impact your goals, and let’s connect to explore your options in our area.

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US Real Estate News for Global Investors 1-16-2023

Posted By Yoshi Takita on January 16, 2023 in Global Real Estate

What Past Recessions Tell Us About the Housing Market What Past Recessions Tell Us About the Housing Market | MyKCM It doesn’t matter if you’re someone who closely follows the economy or not, chances are you’ve heard whispers of an upcoming recession. Economic conditions are determined by a broad range of factors, so rather than explaining them each in depth, let’s lean on the experts and what history tells us to see what could lie ahead. As Greg McBride, Chief Financial Analyst at Bankrate, says: “Two-in-three economists are forecasting a recession in 2023 . . .” As talk about a potential recession grows, you may be wondering what a recession could mean for the housing market. Here’s a look at the historical data to show what happened in real estate during previous recessions to help prove why you shouldn’t be afraid of what a recession could mean for the housing market today. A Recession Doesn’t Mean Falling Home Prices To show that home prices don’t fall every time there’s a recession, it helps to turn to historical data. As the graph below illustrates, looking at recessions going all the way back to 1980, home prices appreciated in four of the last six of them. So historically, when the economy slows down, it doesn’t mean home values will always fall. Most people remember the housing crisis in 2008 (the larger of the two red bars in the graph above) and think another recession would be a repeat of what happened to housing then. But today’s housing market isn’t about to crash because the fundamentals of the market are different than they were in 2008. According to experts, home prices will vary by market and may go up or down depending on the local area. But the average of their 2023 forecasts shows prices will net neutral nationwide, not fall drastically like they did in 2008. A Recession Means Falling Mortgage Rates Research also helps paint the picture of how a recession could impact the cost of financing a home. As the graph below shows, historically, each time the economy slowed down, mortgage rates decreased. What Past Recessions Tell Us About the Housing Market in 2023 | MyKCM Fortune explains mortgage rates typically fall during an economic slowdown: “Over the past five recessions, mortgage rates have fallen an average of 1.8 percentage points from the peak seen during the recession to the trough. And in many cases, they continued to fall after the fact as it takes some time to turn things around even when the recession is technically over.” In 2023, market experts say mortgage rates will likely stabilize below the peak we saw last year. That’s because mortgage rates tend to respond to inflation. And early signs show inflation is starting to cool. If inflation continues to ease, rates may fall a bit more, but the days of 3% are likely behind us. The big takeaway is you don’t need to fear the word recession when it comes to housing. In fact, experts say a recession would be mild and housing would play a key role in a quick economic rebound. As the 2022 CEO Outlook from KPMG, says: “Global CEOs see a ‘mild and short’ recession, yet optimistic about global economy over 3-year horizon . . . More than 8 out of 10 anticipate a recession over the next 12 months, with more than half expecting it to be mild and short.” Bottom Line While history doesn’t always repeat itself, we can learn from the past. According to historical data, in most recessions, home values have appreciated and mortgage rates have declined. If you’re thinking about buying or selling a home this year, let’s connect so you have expert advice on what’s happening in the housing market and what that means for your homeownership goals.

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