The COST of Your Next Home Will Be LESS Than Your Parents’ Home Was

The COST of Your Next Home Will Be LESS Than Your Parents' Home Was | MyKCM

There is no doubt that the price of a home in most regions of the country is greater now than at any time in history. However, when we look at the cost of a home, it is cheaper to own today than it has been historically.

The Difference Between PRICE and COST

The price of a home is the dollar amount you and the seller agree to at the time of purchase. The cost of a home is the monthly expense you pay for your mortgage payment.

To accurately compare costs in different time periods, we must look at home prices, mortgage rates, and wages during each period. Home prices were less expensive years ago, but paychecks were also smaller and mortgage rates were much higher (the average mortgage interest rate in 1988 was 10.34%).

The best way to measure the COST of a home is to determine what percentage of income is necessary to buy a home at the time. That would take into account the price of the home, the mortgage interest rate and wages at the time.

Zillow just released research that examined home costs using this formula. The research compares the historic percentage of income necessary to afford a mortgage to the percentage needed today. It also revealed the cost if mortgage rates continue to rise as experts are predicting. Here is a graph of their findings*:

The COST of Your Next Home Will Be LESS Than Your Parents' Home Was | MyKCM

Rates would need to jump to 7% in order for the percentage of necessary income to be greater than historic norms.

Bottom Line

Whether you are a homeowner considering selling your current house and moving up to the home of your dreams, or a first-time buyer trying to purchase your first home, it’s a great time to move forward. Give The Johnson Team a call at (888) 713-3056 or email us at Info@JohnsonTeamRealEstate.com.

*Assumptions in the Zillow report: Buyer puts 20% down, takes out a conforming, 30-year fixed-rate mortgage at rates prevailing at the time, earns the median household income, and is buying a median-valued home.

Friday the 13th Pending Ratios!

Thbellingham homese market continues to be active with inventory running 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 Friday, April 6th, the pending ratio in Bellingham was 48%. 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 42%

The Ferndale pending ratio was 44%

The Lynden pending ratio was 50%

The Sudden Valley pending ratio was 63%

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

US Housing Market Still In ‘Buy Territory’!

US Housing Market Still In ‘Buy Territory’! | MyKCM

According to the Beracha, Hardin & Johnson Buy vs. Rent (BH&J) Index, the U.S. housing market has continued to move deeper into buy territory, supporting the belief that housing markets across the country remain a sound investment.

The BH&J Index is a quarterly report that attempts to answer the question:

In today’s housing market, is it better to rent or buy a home?

The index examines the entire US housing market and then isolates 23 major cities for comparison. The researchers “measure the relationship between purchasing property and building wealth through a buildup in equity versus renting a comparable property and investing in a portfolio of stocks and bonds.” 

While 13 of the 23 metropolitan markets examined moved further into buy territory, markets like Dallas, Denver, and Houston are currently deep into rent territory. Due to a lack of inventory, the home prices in these areas have increased by 6.7%6.3%, and 5.3%  respectively from a year ago.

According to Eli Beracha, Ph.D., Co-Creator of the index, home prices will begin to return to more normal levels.

Our data indicates that prices are above their 40-year trend but not significantly so as they were in 2007. Rather than a crash, I anticipate slower growth in prices accompanied by longer marketing times for sellers and increasing inventories, which should bring prices back in conjunction with their 40-year trend.”

Bottom Line

The majority of the country is strongly in buy territory. Buying a home makes sense socially and financially, as rents are predicted to increase substantially in the next year. Protect yourself from rising rents by locking in your housing cost with a mortgage payment now. 

To Find Out More About the Study: The BH&J Index and other FAU real estate activities are sponsored by Investments Limited of Boca Raton. The BH&J Index is published quarterly and is available online at http://business.fau.edu/buyvsrent. If you have any questions, give us a call at (888) 713-3056 or email us at Info@JohnsonTeamRealEstate.com.13

Today’s Purchase Rates

Mortgage rates are an important factor in many aspects of buying, selling, or refinancing a home. In order to be an informed home buyer, the rates are a must know! And here are the most current rates as of  April 12th.

Capture

For more details, or a custom home loan quote, contact Sidney Stonecypher at People’s Bank at 360-676-4597.

Mike’s “Reel Estate” Fishing Report for the San Juan Islands

FishingWhat an exciting year so far!

Typically the winter Chinook season has ended in February with the allotted amount of fish caught by then. This year- we are still able to be on the water. Admittedly it has not been as productive as years past but, there are still salmon to be had. It seems like 2015-2016 spoons seemed to be the hot ticket- now I find myself dragging herring in the hood and it seems to be productive. The fish we are catching seem to be bigger and have a lot of fight. We have been using the dodger style flasher with the bait trailing behind about 5 feet- when they hit it , what a fight. Pt Thompson has been the best so far for 2018 on the “Reel Estate”- not as many fish but teenage size which has been fun. With May around the corner- Ling Cod, Halibut and Spot Prawns will be in order. Refer to WDFW for specific dates but I hear they are much more favorable for the angler this year.

If you need the latest tips just give the Johnson Team fishing hotline a call at 360-303-2734 and we are happy to help.

 

Southwest Corn Salad Recipe

Looking for a light and fresh recipe to take to your next barbecue or potluck? This cold Southwest Corn Salad recipe is just the ticket!
Bellingham Recipes

Ingredients

  • 1⁄2 red bell pepper, sliced and chopped
  • 1⁄2 green bell pepper, sliced and chopped
  • 1⁄2 purple onion, chopped
  • 1 cup mayonnaise
  • 1 cup shredded cheddar cheese
  • 5 ounces of corn chips

Directions

Mix all the ingredients except the chips.

Add the chips in before serving otherwise the chips will get soggy.

Enjoy!

 

Are We Feeling the Shockwaves of Seattle’s Market?

The headline on the front page of The Seattle Times this morning is “Home Prices Jump in South Seattle”.  The article goes on to say the City’s median house price is now nearly $820,000. We feel the shock waves of the Seattle market here in Whatcom County as more Seattleites search up & down the I-5 corridor to find an affordable home.

More often than not, one hears “how can local folks afford to buy a home here”? Many times the buyers are people displaced by the high prices of the Seattle market & searching out a place for their family. Terms we are hearing now include “Pressure Cooker Market”, “Surging Prices”, “Instant Response Market” rather than a “Quick Action Market”.  No matter what terms you prefer to use, know that our local real estate market will continue to rise, inventory will be in short supply & while interest rates will continue to rise, it’s doubtful to me that it will do much to slow things down.

Here’s a great visual on the number of homes available overtime:

April 2018 Snap Shot

If you or your friends or family have questions about the market, Mike & I would be more than  happy to help you make some sense out of it.  Give us a call at 360 303 2734.

 

VA Loans by the Numbers

VA Loans by the Numbers [INFOGRAPHIC] | MyKCM

Some Highlights:

  • Since the creation of the VA Home Loans Program, 22 million veterans have been able to achieve the American Dream of homeownership.
  • In 2017, $188 billion was loaned to veterans and their families through the program.
  • VA Purchase Loans are on the rise in 46 out of 50 states and Washington, DC.
  • Call us today at (888) 713-3056 or email us at Info@JohnsonTeamRealEstate.com.

Beginning of April Pending Ratios

Thbellingham homese market continues to be active with inventory running 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 Friday, April 6th, the pending ratio in Bellingham was 49%. 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 43%

The Ferndale pending ratio was 45%

The Lynden pending ratio was 53%

The Sudden Valley pending ratio was 68%

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

Have Any Unwanted Appliances?

34413943 - repairman is repairing a washing machine on the white background.

Appliance Depot is now offering free pick up of any and all unwanted appliances in Whatcom County until May 5th to celebrate Earth Day!

 

These appliances must all be outside of the home and ready for pickup. If the company needs to come inside to remove the appliance, then the normal charges apply (anywhere from $10 – $30). 

 

You can schedule a pickup by calling them at 360-527-2646 or emailing them at info@ApplianceDepotBham.com.