Many Americans interested in, not only the potential value of their home, but also other homes in their neighborhood, the homes of their friends or homes they dream to own someday, search Zillow.com to see the estimated value the site has calculated. Zillow.com, however, is looking to branch out beyond just providing home price estimates, they have begun to actually buy and sell homes and plan on making the process even easier.
In an article published by CNN Business, the new division of Zillow, called Zillow Offers has some new features to make the process of selling a home possible with just a few clicks of a mouse. As CNN Business reporter, Clare Duffy, details, “For certain homes, Zillow’s ‘Zestimate’— the online estimate of the home’s value — will now represent an initial cash offer from the company to buy the property. That could mean an even quicker timeline for homeowners looking to close a sale without going through the hassle of a formal listing, or a source of helpful data for would-be sellers who want to know how much money they’ll have to buy their next house.”
The Zillow Offers division of the company has been operating in a handful of markets for about three years now. They have been requesting information from homeowners in order to determine the cash offer from Zillow. The new, revamped process, soon to be available in 23 markets, will skip the required questionnaire and photos from the homeowner. Zillow is confident in the information currently available for many of the homes that the posted Zestimate would be the actual cash offer. A homeowner could simply contact Zillow to cash in on the Zestimate. After an inspection and adjustment made based on any repair issues, the sellers could pay a Zillow the seller’s fee and close the deal.
Skeptics doubt the accuracy of the posted home values. Yet, according to the article, Zillow’s COO Jeremy Wacksman points out, “For homeowners who decline Zillow’s cash offer, the difference between Zillow’s offer and what they end up selling for is typically less than 1%…”
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A look back at the first few weeks of 2021 and the national real estate market shows that home sales and the number of buyers increased in comparison to the last few weeks of 2020. Nevertheless, a low inventory of homes continues to create difficulty buying conditions for these would-be homeowners.
In an article published by CNBC.com, reported by Diana Olick, the housing market is compared to the beginning of 2020 where January 2021 is reported to have seen sales 23.7% higher than January of last year. According to the article, ‘“Home sales are continuing to play a part in propping up the economy,” said Lawrence Yun, chief economist for the NAR. “With additional stimulus likely to pass and several vaccines now available, the housing outlook looks solid for this year.”’
However, the availability of homes, in comparison to January 2020, was down 26%. This reported 1.9-month supply, compared to a January 2020 3- month supply, is the lowest ever reported. Of course, the low housing inventory coupled with the continued demand has allowed the median home price to increase a little over 14% since last January.
The article goes on to report new home sales and how builders have benefited from the shortages but also face supply and labor issues. Read the entire article.
The next few winter months are looking to be a pretty optimal time to sell a home. The mortgage rates continue to remain very low, demand for homes is high and there continues to be a drop in inventory compared to inventory a year ago. Chief economist at the National Association of Realtors®, Lawrence Yun proclaimed, “It will be one of the best winter sales years ever.”
Nevertheless, selling a home during a world-wide pandemic can offer challenges and sellers are still looking for ways to sell safely and for top dollar. An article published by Realtor.com, reported Erica Sweeney, has detailed some tips for homeowners selling homes over the next few months.
From a safety perspective, it is important to have a virtual tour available on the listing. This will allow shoppers to view the home online to get a better sense of the home layout and features. Doing this will help to keep the number of in-person showings to a minimum. When in-person showings are scheduled, masks and social distancing should be encouraged and larger time gaps between showings will help ensure the safety of all visitors. Once the prospective home buyers and agents have left the house, sanitizing all high touch surfaces will keep the home clean for the residents of the home.
Sweeney also gave tips of preparing and pricing a home. She reports, ‘According to a realtor.com report, the national median home listing price jumped 13.4% in December compared with last year, reaching $340,000, and price per square foot rose 15.9%.’ Sellers and their agents should ensure that they are pricing the house to align with the current market pricing. To add, highlighting upgrades and updates that buyers won’t have to worry about upon moving in during the winter months as well as features that accommodate work from home and e-learning from home will appeal to buyers that are in the midst of spending more time than normal at home.
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As the new year rolled in, many have reflected on a year of unexpected and historic events and how they impacted many aspects of the lives of Americans. The real estate market had its share of ups and downs as Americans adjusted to new realities of shutdowns, spending more time at home, and mortgage rates that continue to remain exceptionally low. It leaves many real estate professionals and American homeowners and would-be home owners trying to predict what 2021 could possibly have in store for them.
In a piece published by Norada Real Estate Investments, written by Marco Santarelli, many questions for the future of the market in 2021 are posed and explanations and predictions are provided. The article addresses questions Americans might have about a potential affordability crisis, if the value of homes will continue to rise, what the trends in new home construction might be and whether or not a housing market crash is predicted in 2021.
Santarelli indicates, “While we still face economic and health challenges ahead, it is no doubt that the nation will continue to recover from this pandemic and an improving economy will continue to prop up the housing market competition. Industry experts believe the housing market will remain strong and is set to break more records in 2021.” He describes how it continues to be a seller’s market and a continued rise in home prices could lead to affordability issues.
To add, some experts, such as Zillow Economic Research, predict that home values will, in fact, continue to increase. Some predictions call for a 3.6% increase over the next three months and appreciate of home value by up to 10% through the end of 2021.
As the demands for houses continues to outpace the availability, new home construction attempts to fill the gap. However, according to the article, “Land and material availability and a persistent skilled labor shortage will continue to place upward pressure on construction costs resulting in limited housing supply.”
Read the entire article for more predictions for 2021.
2020 has been a year full of the unexpected and has been unpredictable, to say the least. The economic effects of the pandemic have been staggering; businesses have had to close or make modifications that result in lost income, many Americans are collecting unemployment due to COVID-19 related layoffs. In this type of economic climate, it would be expected that the housing market and home prices would suffer as well.
Nevertheless, 2020 has brought drastic increases in home prices. According to an article published in Realtor Magazine, ” . Existing-home prices for all housing types jumped 15.5% year over year in October to $313,000, according to the National Association of REALTORS®.” In fact, this year’s home appreciation rate is the fastest appreciation rate the housing market has seen in 6 years.
The home value gains are seen across the United States. New York saw some of the lowest gains, being up 2.6% over the past year. However, areas in other parts of the Northwest, such as Maine, saw home values appreciate almost 15%. Western states are seeing values increase around 12 and 13 percent compared to last year.
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2020 is wrapping up and it has been quite a year, to say the least. With just a few weeks left in this year, Americans anticipate many upcoming changes from political to medical. However, some may wonder what to expect from the mortgage and real estate markets.
According to an article published by Realtor Magazine, “Mortgage rates have hit new record lows 13 times this year, the latest in November”. Its predicted that the rates will hover near a record low of 2.9% throughout December. Further, some economy experts expect these low rates to continue into 2021, perhaps with slight increases, with a possible 3.10% 30 year mortgage by the end of the first quarter of 2021.
However, not all agree with those 2021 predictions. The article details other predictions, “Fannie Mae predicts the 30-year fixed-rate mortgage will average about 2.8% through the end of next year. The Mortgage Bankers Association predicts a 2.9% average in December and a 3.3% average for 2021. Freddie Mac predicts an average of 3% over the next 13 months.”
Nevertheless, the available mortgage rates have, throughout 2020, and will continue to boost the real estate activity. The low rates are opening opportunities of home buying to many more, with a much more affordable monthly payment. Additionally, homeowners are able to refinance into these lower rates and save money on their existing monthly payments.
Nadia Evangelou, senior economist and director of forecasting for the National Association of REALTORS®, advises home buyers should lock in the low mortgage rates now if they can.”
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Now that the 2020 election has seemingly come to a close, many Americans are anticipating what the housing and mortgage industry may look like with Biden as president. Throughout his presidential campaign, Biden pledged to make some changes so that Americans will have “access to housing that is affordable, stable, safe and healthy, accessible, energy efficient and resilient,” according to his campaign website. In a Housing Wire article reporters James Kleinmann and Tim Glaze detail some of the possible changes that may be proposed by Biden.
To begin, Biden is looking to introduce a tax credit of close to $15,000 for first time home buyers. The purpose of the tax credit would be to help first time home buyers, specifically younger Americans as well as Black and Hispanic Americans. Although, according to the article, “Industry observers … weren’t optimistic that Biden would have the legislative muscle to get the full initiative through, unless Democrats also take the Senate.”
Biden also promised to put more regulation in place for agencies such as Consumer Financial Protection Bureau, where it is anticipated he will select a new leader of the agency. Its expected he would also look to continue the conservatorship of GSEs. According to Tim Rood, head of government & industry relations for Situs AMC, “If Biden wins, he is going to look to use Fannie and Freddie as instruments of public policy to help close the homeownership gap, the wealth gap, cap people’s payments on both rental and occupied housing, support the construction of 1.5 million to 2 million affordable housing units.”
Nevertheless, the results of the 2020 general election seem to point toward a split government, with a Republic-led Senate and Biden, a Democrat, as President. This balance is predicted to work in favor of the mortgage and real estate industry. The Republican led Senate may be able to push back on some of the tax policies, which could impact the investment and cost of owning a home, Biden has promised to introduce.
The undisputed belief among industry experts is that rates will continue to remain at the historically low rates for the next few years as the economy continues to stabilize.
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The pandemic has impacted Americans in a variety of ways. To say the real estate market, in many parts of the U.S., has changed in unexpected ways would be an understatement. The demand for homes far outnumbers the supply in many areas of our country.
According to an article published by CNBC.com, reporter Kevin Stankiewicz finds, “Existing home sales increased 9.4% in September, surpassing expectations, and the median purchase price rose nearly 15% year over year, according to data released earlier Thursday by the National Association of Realtors.”
Consumers are enticed by low interest rates and, those who can afford and are able to, are moving out of major metropolitan areas to suburban areas or even to second homes in vacation areas, where they might be able to work remotely.
Although buyers continue to search for homes and rush to put an offer in when they find the perfect home, the number of homes for sale has tightened up. Nevertheless, it is anticipated that after the election, more sellers may decide to put their homes on the market. One professional, Glen Kelman of Redfin, is quoted in the article, “I think the sellers are just looking long term at the economy and still feeling some anxiety. Many of them are going to put their homes on the market in January and February.”
While many realize the type of demand for homes that has been occurring since the summer of 2020 cannot last forever, its is expected to continue into the new year as more and more Americans find ways and reasons to relocate.
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First time home buyers who decided that 2020 would be the year they would leap into home ownership were met with a variety of challenges, economically, personally and emotionally. Obviously, the pandemic has had effects that are wide-reaching; the real estate market has not been immune.
In an article published in the Chicago Sun Times, the effects of COVID-19 on the real estate market are detailed. To begin, as fears of becoming ill with the coronavirus spread, home inventory dropped as homeowners feared having strangers in their homes for showings. In fact, the inventory dropped 20% in June in comparison to June 2019.
Nevertheless, there were still many Americans searching for homes and with mortgage rates falling, many more prospective home buyers began to enter the home search as well. With the influx of buyers searching the low inventory of homes, buyers found themselves in competition with other buyers; homes were purchased quickly and sometimes secured offers above their asking price.
This type of real estate market can be intimidating and frustrating for anyone trying to purchase a home. However, the impact on first time home buyers has been significant. The price of homes has risen faster than incomes, making more and more homes unaffordable for these prospective home owners.
To help prepare mentally and financially for the bumpy road that may lay ahead for these first time home buyers, article details some important tips and reminders for first time home buyers and their agents.
These buyers should expect some disappointment in the home buying process and be aware that they might not be successful in purchasing a home immediately. However, it they stay the course, most likely, the results will eventually be in their favor.
To avoid the emotional pitfalls of home buying, buyers should know up-front how much they are willing to spend on a specific home. This will allow them to walk away before over paying or letting a deal fall through over a few hundred dollars.
An important step to take to prepare for the home purchasing process is to get pre-approved for the loan. Knowing a buyer is pre-approved can help a seller feel more confident about the buyer’s ability to complete the purchase and can give the buyer a leg up on competition.
If the current state of the real estate market is too overwhelming and homes are beyond a buyer’s financial reach, the last bit of advice is to consider waiting. Perhaps the market conditions will change in the next few months and a buyer can secure some additional funds for a down payment to put down on that perfect home.
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In response to COVID-19 related economic struggles many Americans are facing, Congress passed the CARES Act. One benefit to Americans that was to come from this $2 trillion act that was made law in March 2020, was a ban on evictions on many rental units in the United States. Effective until the end of July, federally financed properties, such as rental units backed by Fannie Mae and Freddie Mac, landlords were restricted from evicting their tenants.
One glaring issue with the act, according to an article published by CNBC.com is, ” the law failed to protect many struggling tenants during the pandemic because there was little effort to ensure that landlords followed it.” The act does not detail any penalty for violating it, so it, in some cases, has been treated as more of a “guideline”. Landlords across the country have moved forward with evicting their tenants, many of which did not realize they were protected by the CAREs Act and did not hire legal representation to assist them with challenging the eviction.
The effects are devastating. As one example, in Iowa, he article indicates “Data provided to CNBC by Iowa Legal Aid shows that during one week in July in Polk County, where Des Moines is located, 40% of the families forced to leave their homes were through evictions that violated either the state or CARES Act moratorium. “
President Trump signed an executive order shortly have the CARES Act expired, yet many experts in the housing advocate field indicate that it provides protection to even fewer renters and still does not provide guidance to ensure its enforced.
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