Buying • August 4, 2023

Mortgage Myths Debunked: What You Should Know

by Suzanne Volkman

In the world of mortgages, misconceptions abound, but it’s essential to separate fact from fiction. Here are some common mortgage myths debunked:

Myth #1: A 20% Down Payment is Mandatory

While the 20% down payment rule is widely known, it’s not an absolute requirement for buying a home. While making a larger down payment can have advantages, like lower monthly payments and interest rates, there are many programs available for first-time homebuyers that allow for smaller or even no down payment. Options like FHA loans, USDA loans, and VA loans cater to various financial situations. Additionally, you can always refinance later to secure better rates and terms.

Myth #2: Perfect Credit is a Must for Mortgage Approval

Credit score is crucial, but it’s not the sole factor lenders consider when approving a mortgage application. Lenders also assess your debt-to-income ratio, employment history, and income. A lower credit score may not necessarily disqualify you if the rest of your application is strong. Some lenders even offer programs for borrowers with credit scores as low as 500. Just be aware that a lower credit score may result in a higher interest rate.

Myth #3: Renting is Always Cheaper than Buying

Renting might seem cheaper in the short term, depending on the housing market. However, homeownership often proves to be a more sound financial decision in the long run. With each mortgage payment, you build equity in your home, which can be used later for various expenses or as a source of profit when you sell the property. Unlike renting, where your money goes to the landlord with no return on investment, homeownership offers numerous benefits, including potential tax advantages and a hedge against rising rents.

Myth #4: The Lowest Interest Rate is Always the Best

While a favorable interest rate is vital, it’s not the sole factor to consider when choosing a mortgage. There are other costs to consider, such as closing costs, property taxes, homeowners insurance, maintenance expenses, and possibly private mortgage insurance (PMI). Take all these costs into account to determine the overall affordability of the mortgage.

Myth #5: Adjustable-Rate Mortgages (ARMs) are Always Risky

Fixed-rate mortgages are popular for their stability and predictability. However, that doesn’t mean adjustable-rate mortgages (ARMs) should be dismissed outright. ARMs can offer lower interest rates during the initial years, making them a viable option for those planning to sell or relocate in the near future or expecting an increase in income. The decision to opt for an ARM should be based on individual circumstances, risk tolerance, and future plans.

In conclusion, navigating the world of mortgages can be overwhelming, especially with so many myths circulating. By educating yourself and dispelling common misconceptions, you can confidently explore your mortgage options and find the one that best suits your needs.

Buying • August 4, 2023

Avoid These Common Mistakes That Could Derail Your Mortgage Closing

by Suzanne Volkman

Are you on the verge of closing on your dream home? It’s crucial to be mindful of certain financial decisions that could potentially jeopardize the closing process or even prevent you from obtaining a mortgage altogether. To ensure a smooth closing, here are five common mistakes you should steer clear of:

1. Refrain from Major Purchases
As you approach the closing date, avoid making significant purchases like a new car, boat, or any other expensive item. Even purchasing furniture or appliances on installment plans is best postponed until after your mortgage is finalized. Such transactions may impact your credit score and history, potentially leading to higher interest rates or requiring a larger down payment. Delaying major purchases until the closing is complete will safeguard your qualification for the loan.

2. Be Cautious with New Credit
Opening a new credit card or closing an existing one can also affect your credit score. During the lead-up to the mortgage closing, lenders meticulously assess the credit risk for each applicant. Any changes to your credit score during this critical period could work against you and might even impede the loan finalization. Be especially cautious if you’re on the borderline of qualifying for a mortgage due to a low credit score.

3. Steer Clear of Job Changes
Changing jobs just before closing on your new home is a mistake you should avoid. Mortgage lenders scrutinize employment history for consistency, and making job switches can delay the closing process. If possible, hold off on any job changes until after the closing to ensure a smoother transaction.

4. Respect the Timeline
Closing on a mortgage is time-sensitive, even if you’ve locked in your rate. It’s essential to stay organized and ensure all required paperwork is submitted on time. Failure to do so could lead to the loss of your agreed-upon terms, necessitating the restarting of the entire process.

5. Think Twice about Personal Loans
Obtaining a personal loan or co-signing for someone else’s loan can present challenges before reaching the closing table. Lenders take into account your debt-to-income (DTI) ratio, a crucial factor in mortgage approvals. Depending on the loan amount and how it affects your DTI, lenders may reject your loan application, even if you were preapproved. A hard inquiry resulting from applying for a personal loan could also impact your credit score, potentially making you ineligible for the mortgage.

By avoiding these five common mistakes, you can safeguard a successful mortgage closing and move into your new home with peace of mind. Remember, being financially responsible during this crucial time is key to securing your dream home and the loan you need.

Buying • Market Trends • August 4, 2023

Migration from the Bay Area to Sacramento is creating a ‘megaregion’

by Suzanne Volkman

Tessa McLean, SFGATE

July 31, 2023Updated: July 31, 2023 11:24 a.m.

At least three people in Jose Medina’s Sacramento neighborhood have moved there from the Bay Area in recent years. And those are just the ones he knows of. Medina, too, is a transplant — and since relocating from Oakland in 2021, he said he’s had an additional seven friends move to the city or its surrounding areas.

The Bay Area exodus may be mostly a myth, but the trend of people moving inland, leaving coastal metros in search of more space at better prices, is growing. There are more people moving to Sacramento from the Bay Area than anywhere else in the country, according to Redfin data. People moving from the Bay Area to Sacramento isn’t a new phenomenon, but COVID-19 sped up a process that experts say was inevitable, and it could have long-lasting effects on the state.

In 2020 alone, migration between San Francisco County and Sacramento County grew 70% from the previous year, a CBRE report concluded. The Sacramento region is projected to grow another 4% in the next 5 years, largely buoyed by this continued migration.

A home in the ‘city of trees’

Medina and his girlfriend were living in a one-bedroom condo in Oakland when the city shut down, forcing them to start working from home. They quickly realized they needed a larger home if they would be working remotely for the foreseeable future. “We started looking in the East Bay for spots and were met with everybody trying to do the same thing we were doing,” he said. “It was a very competitive market and everything was going well over asking — sometimes 50% over.”

A friend who had just moved to Sacramento invited them to visit and take a break from the hunt. “We quickly fell in love with Sacramento,” he said. “The culture, the city of trees, it is exactly what it is. It’s a town, but a city at the same time.”

While Medina said the real estate market still felt competitive, it wasn’t nearly as ruthless as it had been in the Bay Area. The couple soon put an offer in on a new-construction home. He said they now have “way more space than we ever imagined.” They’re both still working remotely for tech companies, happy they moved and planning to stay in Sacramento for the long haul.

Creating a ‘megaregion’

They’re far from the only ones who have made the move, and all the new transplants are having a significant impact on Sacramento’s population, which grew 26% between 2000 and 2019, according to census data. The Bay Area’s grew just 14.6% during the same period. A recent study conducted through a collaboration between the University of Southern California, Occidental College, and UC Davis suggests increased migration could even be creating a “megaregion,” breaking down barriers that traditionally separated the coastal cities of the Bay Area from the inland region around Sacramento.

The “megaregion” and the resulting demographic shifts will have an outsized impact on traffic and infrastructure, creating new needs for California’s future. While the study showed there was a small dip in the proportion of people commuting to the Bay Area from Sacramento County, the percentage of people “supercommuting” — defined as a commute of more than 50 miles — had grown from 17% in 2008 to 20% in 2018. That percentage grew in every Central Valley county studied and is likely to continue as high-wage earners with jobs centered in the coastal metros seek larger homes inland.

Seva Rodnyansky, a research specialist on the project, said if this increased migration continues, it could present problems for state agencies, which will be forced to work together to provide the necessary infrastructure. “The more seats at the table, the harder it is to deal with specific concerns,” he said.

The issues are not limited to Sacramento and the surrounding suburbs, according to Rodnyansky, and his research suggests the megaregion could stretch all the way to Fresno. Past Sacramento, people are also spreading out to surrounding El Dorado and Amador counties, where they will likely face challenges they’re not prepared for, like managing their land for increasing wildfire risk.

The trickle-down effect

There’s also the trickle-down effect of rising housing costs. Demand for housing far surpasses supply, both near Sacramento and in outlying areas, where decades of home-building shortfalls have compounded while the job market has remained concentrated in the city centers.

The Sacramento median home price is $475,000, according to Redfin, up 38% from 2019. The average San Francisco home sells for nearly triple that. The average home in Placerville jumped 27% since 2019.

Buying • July 27, 2023

Packing to Move – 7 Amazing Tips & Tricks

by Suzanne Volkman

1 – Use The Correct Boxes

Even if you’re on a budget, make sure to purchase specialty boxes. Just one wardrobe box per bedroom will help tremendously. Your clothes will not arrive at your new home wrinkled and you won’t have to worry about packing your hangers.

TV and art boxes are also worth the cost. Don’t chance your expensive art or electronics getting damaged.

Other boxes can be found at your local grocery store. We recommend the produce boxes. You can also find deals on Craigslist and Freecycle.

2 – Allow Enough Time

As a rule, allocate one day of packing per room. Double that if you have a lot of belongings or unusual sized things to pack.

Budget 3-5 full days to pack a three-bedroom home. A studio should take 1-2 days. A one-bedroom should take 2-3 days and plan on 5-8 days for a five-bedroom. Of course, it will take less time if you have help!

3 – Color Code The Boxes

Instead of writing room names on your boxes, color code them! This will keep you from having to direct your helpers all day long, freeing you up to do other things.

Our Moving Game Plans ELITE and Downsizing Magic offer unique visual systems that organizes and simplifies the packing, unloading, and unpacking process, saving you and your move team hours (if not days) of precious time.

4 – Pack One Room at a Time

Wandering from one room to another will waste your precious time so begin with the least used room and complete it before moving to the next. This will help you stay organized and focused AND you’ll feel a great sense of accomplishment when it is done!

Your least used room could be your guest bedroom, the attic, garage, or storage closets.

Note: Make sure to put the heavier items on the bottom and don’t leave any extra space in the boxes.

5 – Room by Room Tips

For detailed recommendations, visit our BLOG for these nifty packing tips:

Kitchen

2.	Dining Room

Bathrooms

4.	Garage & Outdoor Furniture

Bedrooms

6.	Living Room & Office

6 – Things to set aside

Create an Essentials Box. This is the first box you will open, and it should have what you need for your first night and morning in your new home. It should have medications, snacks, toilet paper, paper towels, phone chargers, coffee, and a set of clothes. Make sure to include a first aid kit too!

If you have small children and pets, consider packing their own essentials bag.

7 – Develop a Moving Timeline

Having a calendar is very helpful. It’ll help reduce your stress and keep you motivated. You’ll feel less rushed knowing that you are on task.

Break big rooms and projects into small, easy to accomplish tasks. It will keep your spirits up knowing you are accomplishing things!

Stick to the schedule and you’ll have everything ready when the moving truck arrives!

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Appraisals • Market Trends • Real Estate • July 21, 2023

Buy a home now and refinance it later? Here’s what experts think

by Suzanne Volkman

For some buyers, it may make sense to buy a home now and refinance it to a lower rate in the future. GETTY IMAGES

While inflation is cooling, interest rates remain high, which puts a damper on Americans’ plans to buy a home or refinance their existing mortgages. The natural question many homeowners are asking themselves in this economic climate: Should I buy a home now at high rates and refinance later, or should I wait for rates to fall? We posed the question to several real estate and mortgage professionals and educators, and their answers may surprise you.

When buyers should buy now and refinance later

Robert Johnson, a professor at Heider College of Business at Creighton University, points out that purchase price and mortgage rate are the two primary financial factors potential homebuyers consider when buying a home, but there’s a critical distinction between the two.

“What many fail to understand is that only one—mortgage rate—can be renegotiated,” says Johnson. “Once a home is purchased, you can’t renegotiate the purchase price. What this means, in my opinion, is that if you find a home you believe is priced attractively, I would be more apt to pull the trigger than if mortgage rates are attractive and home prices seem high. In financial terms, you have optionality for the remainder of your mortgage to renegotiate terms. You don’t have that option with a purchase price.”

As the saying goes, “Marry the home, but date the rate.”

Additionally, you may experience other unique benefits if you buy a home in the current climate. “Buyers who are in the market while interest rates are high may have certain advantages that they otherwise wouldn’t, such as less competition and more negotiating power,” states Afifa Saburi, senior researcher at Veterans United Home Loans. “While they still have the option to refinance, potentially more than once throughout their 15- or 30-year mortgage term, they also have the opportunity to build equity and wealth.”

As with many financial questions, the answer may not be cut and dried, as it will depend on your financial situation and forces outside your control. For example, it’s hard to consider mortgage rates in a financial decision when it’s unclear which direction they will move.

Regarding whether to buy now and refinance later or adopt a wait-and-see approach to , economist Peter C. Earle from the American Institute for Economic Research says it’s hard to predict. “Typically, the rule of thumb is that one wouldn’t finance unless the new mortgage rate to lock in is at least 0.75% to 1% lower than the established rate,” says Earle.

“The Fed has jawboned exhaustively about their intention to keep rates at present levels once their hiking campaign is over, but if the U.S. enters a recession, it’s not at all clear that they won’t drop rates. That’s been their playbook since the Greenspan era,” said Earle, referring to Alan Greenspan, the former chairman of the Federal Reserve of the United States.

When buyers should wait until rates drop back down

No matter when you buy a home, the decision should be based on sound financials, namely, whether you can afford the payments and how long you plan on staying in the home long-term.

Brian Wittman, owner and CEO of SILT Real Estate and Investments, cautions: “I don’t believe in the philosophy that buying now and refinancing later is the best course of action. We’re still not sure of the direction of the housing market, including both property values and interest rates. The problem with this particular philosophy is that buying now and hoping that interest rates go down to make your payment better is bad financial planning. If you can’t really afford the payment now, you’ll be overpaying while you wait and hope for interest rates to drop.”

For existing homeowners, the decision to buy now and refinance later, or wait until mortgage rates fall, may come down to your existing home’s mortgage rate. “In general, I’d suggest not selling or refinancing your home if the rates are higher than your existing mortgage, especially if you want to purchase a new house,” advises Michael Gifford, CEO and co-founder at Splitero.

The bottom line

If you’ve decided to take out a mortgage now, but have concerns about locking yourself into a high rate, consider getting a mortgage with a float-down option. This feature allows you to lock in your interest rate while also allowing you to take advantage of a lower rate within a specific period.

Not sure whether to buy a home now and refinance it later, or wait for mortgage rates to drop? It may help to know there are other alternatives worth considering. One option is to make improvements to your home using funds from a home equity loan or home equity line of credit (HELOC). Tapping into your home equity to upgrade your property may increase its value.

Originally Posted Here

Buying • Market Trends • Selling • July 21, 2023

Just 1% of U.S. Homes Have Changed Hands This Year, the Lowest Share in at Least a Decade

by Suzanne Volkman

SEATTLE–(BUSINESS WIRE)– (NASDAQ: RDFN) — Roughly 14 of every 1,000 U.S. homes changed hands during the first six months of 2023, according to a new report from Redfin, the technology-powered real estate brokerage. That’s down from 19 of every 1,000 during the same period of 2019 and the lowest turnover rate in at least a decade.

In 2018, Freddie Mac estimated that about 2.5 million more homes needed to be built to meet demand, with the shortfall mainly due to a lack of construction of single-family homes. The homebuying boom of late 2020 and 2021, driven by record-low mortgage rates, remote work and a surge in investor purchases, depleted already low inventory levels. Finally, 2022’s soaring mortgage rates—average rates nearly doubled from January to June—exacerbated the shortage by handcuffing homeowners to their comparatively low rates.

“The quick increase in mortgage rates created an uphill battle for many Americans who want to buy a home by locking up inventory and making the homes that do hit the market too expensive. The typical home is selling for about 40% more than before the pandemic,” said Redfin Deputy Chief Economist Taylor Marr. “Mortgage rates dropping closer to 5% would make the biggest dent in the affordability crisis by freeing up some inventory and bringing monthly payments down. But there are a few other things that would boost turnover and help make homes more affordable. Building more housing is imperative, and federal and local governments can help by reforming zoning and making the building process easier. Financial incentives, like reducing transfer taxes for home sellers and subsidizing major moves with tax breaks, would also add to supply.”

The turnover rate has shrunk most in the suburbs: 16 of every 1,000 large suburban houses have changed hands this year, two-thirds as many as 2019

House hunters searching for large homes in the suburbs have seen the biggest drop in their options. Just about 16 of every 1,000 four-bedroom-plus suburban single-family homes sold in the first half of this year, down from 24 of every 1,000 that sold in the same period in 2019. That means buyers of that home type have 33% fewer houses to choose from.

“New listings normally hit the market on Thursdays, and I have buyers who are excitedly checking their Redfin app Thursday mornings, only to find nothing new,” said Phoenix Redfin Premier agent Heather Mahmood-Corley. “That goes for buyers in every price range in every type of neighborhood, but what people want most are those move-in ready, mid-sized homes in neighborhoods with highly rated schools. Those are hardest to find because for people to buy one, someone needs to sell one. That’s not happening, because so many of those homeowners have low mortgage rates.”

The turnover rate has dropped for every size home in every type of neighborhood over the last four years (though buyers will have an easier time finding something for sale in certain metro areas).

The turnover rate of condos and townhomes didn’t shrink as much as that of single-family homes during the pandemic. Supply of that home type wasn’t depleted as much because there wasn’t as much demand for them.

Modestly sized single-family homes in the city are hardest to find: Just 11 of every 1,000 two- and three-bedroom urban houses sold in the first half of this year

Smaller houses in the city have the lowest turnover rate of all the home types in this analysis. Roughly 11 of every 1,000 two- and three-bedroom single-family homes in urban neighborhoods sold in the first six months of 2023, compared to 14 of every 1,000 during the same period in 2019.

Two- to three-bedroom homes in suburban neighborhoods are essentially tied with their urban counterparts for the lowest turnover rate, with 11 of every 1,000 changing hands this year. That’s down from 16 of every 1,000 in 2019.

Homebuyers have the smallest pool of options in the Bay Area: Just 6 of every 1,000 San Jose homes have turned over to a new owner this year

Northern California has the lowest turnover rate in the U.S. Just six of every 1,000 homes in San Jose changed hands in the first half of 2023, the lowest rate of the 50 most populous U.S. metros. It’s followed closely by Oakland, San Diego, Los Angeles, Sacramento and Anaheim, all places where about eight of every 1,000 homes turned over to a new owner.

The pandemic exacerbated the supply shortage throughout California, with the turnover rate dropping by at least 30% in each of those metros from 2019 to 2023.

Zooming in on large, suburban single-family homes, California still has the lowest turnover rate. California historically has the lowest housing turnover because the state’s tax laws–namely proposition 13–incentivizes homeowners to stay put by limiting property-tax increases.

Homebuyers have the biggest pool of options in Newark, NJ and Nashville, where more than 23 of every 1,000 homes have changed hands this year

Newark, NJ has the highest turnover rate in the U.S., with 24 of every 1,000 homes changing hands during the first six months this year. It’s followed closely by Nashville, TN (23 of every 1,000) and Austin, TX (22 of every 1,000). Nashville and Austin are also two of the three metros (along with Fort Worth, TX) with the highest turnover for large suburban, single-family homes.

But Nashville and Austin are both among the five metros with the smallest declines in turnover since 2019, posting drops of just 10% and 14%, respectively. When it comes to large suburban houses, Nashville and Austin have the second and third smallest declines. That’s partly due to robust new construction in Nashville and Austin: Inventory of single-family homes for sale in both metros is made up of more than 30% newly built homes, compared to 22% nationwide.

Only Milwaukee and Columbus, OH, which both saw overall turnover drop by about 8% from 2019 to 2023, had smaller declines in turnover than Nashville. Indianapolis, IN comes in fourth, with a 14% decline. Milwaukee, Columbus and Indianapolis have relatively stable turnover because they didn’t experience huge homebuying demand swings throughout the pandemic.

Buying • July 13, 2023

FHA vs. Conventional Loan: Which Mortgage Is Right for You?

by Suzanne Volkman

FHA versus conventional loan: If you need a mortgage to buy a house, you may find yourself weighing these two options. What’s the difference, and which one is right for you?

While the majority of homebuyers might assume they should get a conventional home loan, about 40% end up with FHA loans, which are insured by the Federal Housing Administration.

To help you decide whether an FHA or conventional loan is better for your circumstances, here’s more information about each, including their distinct advantages to you as a home buyer as well as what you’ll need to qualify (which may vary by lender).

Conventional loan requirements

Minimum down payment: 3% to 20%
Minimum credit score: 620
Maximum debt-to-income ratio: below 50%

Conventional lenders look for borrowers who have well-established credit scores, solid assets, and steady income, says Todd Sheinin, mortgage lender and chief operating officer at Homespire Mortgage in Gaithersburg, MD. As such, these loans have higher barriers to entry than the FHA-backed options. So you’d better have your A-game on!

Typically, you need at least a 620 credit score and ideally a 20% down payment, although you can put down as little as 3% if you so wish (this is generally reserved for first-time homebuyers). Just know that on any down payment under 20%, you’ll have to pay private mortgage insurance, an extra monthly fee meant to mitigate the risk to the lender that you might default on your loan. (PMI ranges from about 0.58% to 1.86% of your home loan.)

Most conventional loans also require a maximum 50% debt-to-income ratio, which compares how much money you owe (on student loans, credit cards, car loans, and—hopefully soon—a home loan) with your income. So, for instance, if your household take-home income amounts to $5,000 per month, that would mean you should spend no more than $2,500 per month on your mortgage and other debts.

Conventional loan advantages

Conventional loans don’t require mortgage insurance as long as you put down at least 20%.
Conventional loans can cover higher loan amounts than FHA loans, which are restricted to county limits.
Conventional loans, on average, are processed faster than FHA loans.

FHA loan requirements

Minimum down payment: 3.5%
Minimum credit score: 580
Maximum debt-to-income ratio: 43%

FHA loans are great for first-time buyers or people without sterling credit or much money. Created by the Federal Housing Administration, these loans are insured by this government agency, so that guarantees that lenders won’t lose their money if borrowers default on their mortgage. In short, it allows lenders to take on riskier borrowers, while also helping hopeful home buyers in less-than-ideal circumstances achieve the dream of homeownership.

To qualify for an FHA loan, you need at least a 3.5% down payment and a credit score of 580, says Tim Lucas, editor at MyMortgageInsider.com. Applicants with lower credit scores (e.g., 500) may not be out of the running entirely, but must cough up a larger down payment of at least 10%.

These loans also have debt-to-income requirements of less than 43%. So for example, if your monthly income is $5,000, your payments for your mortgage and other debts should not exceed $2,150.

FHA loans may be a boon to homebuyers (particularly first-timers) who might not qualify for a loan otherwise, but they do have a few disadvantages. For one, they’re usually capped at $472,030 (in certain high-cost areas, the limit is $1,089,300)—meaning you may have limited buying power. Also, because the federal government insures these loans, you have to pay an upfront mortgage insurance premium (currently, the fee is about 1.75%) and annual mortgage insurance (typically 0.85% of the borrowed loan amount), which remains throughout the life of the loan (or until you can refinance the loan into a conventional mortgage).

FHA loan advantages

FHA loans have lower down payment requirements (3.5%).
FHA loans have lower credit score requirements (as low as 580 for qualified borrowers).
FHA loans have low DTI requirements of 43% or less.

FHA vs. conventional loan: Which should you pick?

Generally if you have the means and qualifications to afford a conventional loan, this is the one to opt for, since it has fewer restrictions (and is faster to get). However, if you’re a less-than-ideal homebuyer with a mediocre credit score, down payment, or income, then an FHA loan may be the best—or only—avenue open to you.

Check with your lender to know where you stand, or plug your numbers into an online home affordability calculator to get a ballpark idea of whether an FHA or conventional loan is right for you.

By Daniel Bortz

Jul 5, 2023

Uncategorized • July 13, 2023

Interest Rates : A Short History

by Suzanne Volkman

Buying • July 13, 2023

What prospective homebuyers should do until interest rates drop

by Suzanne Volkman

In this high-interest-rate environment, many prospective homebuyers are put off by high mortgage costs. Homes that might have been in your budget in the past might no longer be affordable when accounting for monthly interest payments.

But that doesn’t mean the situation is totally out of your control. While mortgage timing can be tricky, you might decide to wait to see if interest rates drop, as many experts predict will happen in the next year or so.

You can also take a number of steps to improve your financial situation and get a handle on the real estate market now as you’re figuring out when to buy a home.

What prospective homebuyers should do until interest rates drop

In particular, some action items to consider as you wait to see what happens with mortgage interest rates include the following expert-recommend tips:

Figure out what you want

If you’re waiting to see what happens with interest rates, use this time to do more research. That includes narrowing down what you want in a home and what you can realistically afford.

“Use this time to refine exactly what you’re looking for in your next home, including things like what your budget can buy you and what your ‘needs’ and ‘wants’ are,” says Merav Bloch, VP and GM of Opendoor Exclusives. “If you’re willing to trade a longer commute for your dream yard, but your partner wants to be within a 10-minute drive of their office, now is an opportune time to debate that trade-off.”

Even if you’re not necessarily ready to buy right away, you can still tour homes.

“I encourage buyers to see what’s out there and tour as many homes as possible to get a sense of what your budget will get you, what your non-negotiables are and what neighborhoods you’re open to,” Bloch says. “People typically don’t get married on the first date, and it’s usually better not to purchase the first home you tour.”

Talk to experts

As you figure out what you want in a home, it can help to talk to experts like mortgage consultants and real estate agents to narrow down what’s realistic for you.

Tanya Ball, home loans regional director at BOK Financial, suggests asking experts about down payment assistance options as well as “specialized loan programs if you are a veteran, Native American, first-time buyer or buying in a rural area.”

Plus, speaking with an expert like a mortgage professional “can let you know which items to focus on for better offers — for example, a higher down payment or paying off debt,” says Michael Merritt, mortgage servicing operations manager at BOK Financial. “The biggest benefit will vary based on your circumstances, so it is important to focus on the things that will help you the most.”

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Home Improvement • June 28, 2023

Unveiling the Key Trends in the 2023 Cost vs. Value for Home Improvements

by Suzanne Volkman

As a REALTOR®, it’s my responsibility to stay on top of the latest trends and developments in the housing market. Home improvements not only enhance the aesthetic appeal and functionality of a property but also significantly impact its overall value. In this blog post, we’ll delve into the key trends shaping the cost versus value equation for home improvements in 2023. Whether you’re a homeowner planning to sell or looking to add value to your property, these insights will be invaluable to you.

Energy-Efficient Upgrades: A Wise Investment

The focus on energy efficiency continues to dominate the real estate landscape, and 2023 is no exception. Homebuyers are increasingly drawn to properties equipped with energy-efficient features that not only help reduce utility costs but also contribute to a greener environment. Investments in insulation, high-performance windows, energy-efficient appliances, and smart home technologies are likely to yield impressive returns by enhancing the overall value of a home.

Outdoor Living Spaces: Extending the Boundaries

The pandemic has redefined our relationship with our living spaces, and homeowners are now seeking to optimize their outdoor areas. Whether it’s creating a cozy patio, installing a deck, or designing a lush garden, outdoor living spaces are becoming an integral part of a home’s value proposition. These extensions of the living space not only provide additional square footage but also enhance the appeal for potential buyers who value the opportunity to enjoy nature and entertain outdoors.

Multi-Functional Spaces: The Demand for Flexibility

The concept of home offices gained tremendous momentum during the pandemic, and this trend has now evolved into a desire for multi-functional spaces. Homebuyers in 2023 are seeking properties with versatile rooms that can serve multiple purposes. Whether it’s a guest room that can double as a home gym or a living area that easily converts into a workspace, the ability to adapt spaces to changing needs is highly valued. As a homeowner, consider the possibilities of transforming your property to offer flexible living arrangements, thus boosting its overall value.

Smart Home Integration: The Future of Convenience

The integration of smart home technology has transformed the way we live and interact with our homes. In 2023, homeowners are increasingly looking to incorporate smart features that enhance convenience, security, and energy efficiency. From automated lighting and thermostats to home security systems and voice-activated assistants, these technological advancements not only offer practical benefits but also elevate a property’s perceived value.

Sustainable Materials and Design: Environmentally Conscious Choices

In recent years, there has been a growing awareness of the environmental impact of construction and design choices. Homeowners are now prioritizing sustainable materials and eco-friendly practices when undertaking home improvement projects. Incorporating recycled or reclaimed materials, opting for low VOC paints, and investing in renewable energy systems are all factors that resonate with environmentally conscious buyers. By making sustainable choices, homeowners can align their property with the values of the future, attracting potential buyers and enhancing their home’s desirability.

The 2023 cost versus value landscape for home improvements is marked by a focus on energy efficiency, outdoor living spaces, flexibility, smart home integration, and sustainable design. As a REALTOR, I encourage homeowners to consider these trends when planning their improvement projects. By making strategic choices and staying ahead of the curve, you can not only enhance your living space but also maximize the value of your property. Remember, the right improvements can make all the difference when it comes to attracting buyers and securing a strong return on investment in today’s dynamic real estate market.

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Suzanne Volkman

REALTOR®

Coldwell Banker Realty

DRE#00702179