Wage Increases Make Home Buying More Affordable

Wage Increases Make Home Buying More Affordable | MyKCM

Everyone knows that housing affordability has been negatively impacted by rising prices and increasing mortgage rates, but there is another piece to the affordability equation – wages.

How much a family earns obviously impacts how easy or difficult it is for them to afford to own a home. Because of an improving economy, wages are finally beginning to increase – and that dramatically affects home affordability.

According to the National Association of Realtors’ (NAR) September 2018 Housing Affordability Index,wages have increased in every region of the country:

Wage Increases Make Home Buying More Affordable | MyKCM

After applying current salaries, home prices, and mortgage rates to their Home Affordability Index equation, the index, though still lower than this time last year (160.1 to 146.7), increased over the last month (141.2 to 146.7). For the complete methodology used by NAR, click here.

The percentage of income needed to own a home has also decreased each of the last three months. It currently sits at 17% which is substantially lower than historic numbers.

Wage Increases Make Home Buying More Affordable | MyKCM

Bottom Line

If you are a first-time buyer or a move-up buyer who believes that purchasing a home is not within your budget, let’s get together to determine if that is still true.

Are Homeowners Renovating to Sell or to Stay?

Are Homeowners Renovating to Sell or to Stay? | MyKCM

Over the past few years, two trends have emerged in the housing market:

  • Home renovations have shot up
  • Inventory of homes available for sale on the market has dropped

A ‘normal’ housing market is defined by having a 6-month supply of homes for sale. According to the latest Existing Home Sales Report from the National Association of Realtors, we are currently at a 4.4-month supply.

This low inventory environment has many current homeowners worried that they would be unable to find a home to buy if they were to list and sell their current houses, which is causing many homeowners to instead renovate their homes in an attempt to fit their needs.

According to Home Advisorhomeowners spent an average of $6,649 on home improvements over the last 12 months. If that number seems high, it also includes homeowners who recently bought fixer-uppers.

A new study from Zillow asked the question,

“Given a choice between spending a fixed amount of money on a down payment for a new home or fixing up their current home, what would you do?”

Seventy-six percent of those surveyed said that they would rather renovate their current homes than move. The results are broken down by generation below.

 

Are Homeowners Renovating to Sell or to Stay? | MyKCM

More and more studies are coming out about the intention that many Americans have to ‘age in place’ (or retire in the area in which they live). Among retirees, 91% would prefer to renovate than spend their available funds on a down payment on a new home.

If their current house fits their needs as far as space and accessibility are concerned, then a renovation could make sense. But if renovations will end up changing the identity of the home and impacting resale value, then the renovations may end up costing them more in the long run.

With home prices increasing steadily for the last 6.5 years, homeowners have naturally gained equity that they may not even be aware of. Listing your house for sale in this low-competition environment could net you more money than your renovations otherwise would.

Bottom Line

If you are one of the many homeowners who is thinking about remodeling instead of selling, let’s get together to help you make the right decision for you based on the demand for your house in today’s market.

Sunday Open House in Lynden At Remodeled Country Home With Designer Finishes

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Join Rich Johnson for an open house this Sunday from 10am – 2pm at 226 W King Tut Road in Lynden. Stop into this breathtaking home and see the high end touches that make you want to call this place home.

An iron entry gate, a winding blacktop driveway, a stable in the center of a green pasture with a white-railed fence, beautifully landscaped gardens featuring a delightful tunneled grape arbor walkway, several outdoor patios, a play area to include a life-sized dollhouse, a miniature “Red Barn” potting shed, a glorious Mt Baker & Twin Sister view & finally a completely remodeled Country Home with designer finishes throughout along with a huge wraparound deck & veranda is all waiting to be yours.

For more information, visit our virtual tour!

Beginning of November Pending Ratios!

Bellingham Real Estate

If you have been following the local real estate market you know it’s active and inventory is low. If you are thinking of selling now is the time!

The number of real estate signs you see in yards can be deceiving as to the number of homes actually for sale WITHOUT offers on them. If you are seeing new signs around your neighborhood and curious if any of those homes already have offers on them, we have your answers!

Every week we keep track of how many homes are for sale around Bellingham and Whatcom County and how many of those homes have pending offers on them. Pending is the time frame between when an offer has been mutual accepted between the buyer’s and the seller’s of the home and when the title actually transfers hands. This give the buyer’s time to get the financing, do inspection, review the title reports and more.

As of Monday, November 5th, the pending ratio in Bellingham was 38%. Click the links to view a report of how many homes are for sale in each area by price range and how many of them are pending showing just how active certain sectors of the market are.

The Birch Bay Pending ratio was 27%

The Ferndale pending ratio was 29%

The Lynden pending ratio was 29%

The Sudden Valley pending ratio was 36%

If you are thinking of selling your home or property, Johnson Team Real Estate would love to help! We are here to help you will all your real estate needs! You can reach us toll free at 1-888-713-3056 or email us at Info@JohnsonTeamRealEstate.com

The Difference An Hour Makes

Tomorrow we adjust our clocks back one hour for daylight savings. There is a lot that happens in one hour of the housing market across the United States!

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Every Hour in the US Housing Market:
596 Homes Sell
278 Homes Regain Positive Equity
Median Home Values Go Up $1.20

Just Listed 3 Bedroom, 2 Bath Home In Birch Bay!

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Just listed in Birch Bay, an amazing 1,529 sq foot rambler with new marbled and engineered hardwood flooring. This move in ready home is one you will enjoy for years!

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This immaculate one level home is located on a quiet side street. It has a nice floorplan with large open spaces & is waiting for you to enjoy. Inside you’ll appreciate the warmth of the in-floor radiant heat, the spacious kitchen & the huge master bedroom. Put your “Green Thumb” to good use in this large sunny fully fenced backyard. Whether it’s roses, Fido or croquet, it’s a yard you’ll enjoy for years. Within a short walk is a beach to roam and explore, who knows what treasures you’ll find.

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For more information, take a look at the virtual tour!

Just Reduced! Raptor Lane Custom Home in Bellingham With Views

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PRICE REDUCTION! Take a look at this gorgeous custom home in Bellingham with amazing views! This is one you don’t want to miss.

Bellingham Bay, the Islands, Chuckanut Mtn, Lookout Mtns & everything in between, it’s there from the windows & deck of 4660 Raptor Ln. Add some fog, a bit of mist, a setting sun & you then have the lifestyle everyone dreams about but too often slips by. Inside is a gorgeous custom home with beautiful hardwood floors, a kitchen to inspire cook & guests alike & a large master bedroom with elegant bath. Outside is a gardeners dream with sun, plantings, water feature, secret paths & privacy.

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Give us a call today to schedule a private showing! (888) 713-3056

For more information – https://www.tourfactory.com/2006528

What Are Today’s Mortgage Rates?

Thinking of buying, selling or refinancing? The mortgage rates are a must know! People’s Bank Home Loan Center passed along today’s rates to us. Below is a chart showing the rates as of yesterday, October 5th!

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Thank you Sidney Stonecypher at People’s Bank Home Loan Center for the rates. If you have mortgage questions you can reach her at 360-650-5365!

Fall Happenings In and Around Whatcom County

How Do You Celebrate Fall_

Looking for some fun ways to celebrate fall here in Whatcom County? Here are just a few ideas for events that are offered locally.

– Cloud Mountain Farm Center: Pumpkin Patch and Fruit Tasting: Pick out your pumpkin and taste over 200 different varieties of fruit grown on the farm.

 
– Bellewood Acres U-Pick Orchard and Pumpkin Patch: Take a ride through the you pick orchard or stop by their pumpkin patch.

 
– Lore and Gore: Good Time Girls Historical Tours: Take a tour of historical downtown Bellingham and Fairhaven with a spooky twist.

 
– Lynden FFA Corn Maze: Only offered in September so make sure you stop by this corn maze ASAP.
– Nightmare on Railroad: Boundary Bay Brewery and BAAY: Plan to stop in here for a meal and a trip through the haunted house.

 

– Stoney Ridge Farm is open again this year after a two year break: They are bringing back several of the things that made the farm a popular fall destination spot, including the train ride, corn maze and wagon rides. The pumpkin patch and apple trees will also be open for u-pick.

Have any other ideas or traditions? Let us know your plans!

Where Are Mortgage Interest Rates Headed In 2019?

Where Are Mortgage Interest Rates Headed In 2019? | MyKCM

The interest rate you pay on your home mortgage has a direct impact on your monthly payment; the higher the rate, the greater the payment will be. That is why it is important to know where rates are headed when deciding to start your home search.

Below is a chart created using Freddie Mac’s U.S. Economic & Housing Marketing Outlook. As you can see, interest rates are projected to increase steadily over the course of the next year.

Where Are Mortgage Interest Rates Headed In 2019? | MyKCM

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.

According to CoreLogic’s latest Home Price Index, national home prices have appreciated 6.2% from this time last year and are predicted to be 5.1% higher next year.

If both the predictions of home price and interest rate increases become a reality, families would wind up paying considerably more for their next homes.

Bottom Line

Even a small increase in interest rate can impact your family’s wealth, so don’t wait until next year! Let’s get together to evaluate your ability to purchase your dream home now.