Thursday, May 29, 2008

Your Home is your Castle

One of the current problems I'm seeing in the real estate market is the mind set that people's homes have become viewed as investment vehicles. True, a home is an investment, and for most families it is their largest. In the recent past, homes appreciated at such a rate that some were able to buy a home, live in it for a year or two and then sell it for considerable more than they paid. Home values now are down from their high in early 2006 10,15, even 20% or more.

A home is first and foremost a place to live, raise a family and as a place of refuge at the end of a day of work. If a home is taken care of and updated as needed to keep it current with the better homes in the neighborhood, it should and often does increase in value. Historically, homes increase at a rate of between 3% to as much as 7% per year. This is not a guarentee. In 2002, 2003, 2004 and 2005, homes rose in value anywhere from 8% to as much as 15% and more per year and in many but not all areas. This was above the averages and so they are now retreating. It's a painful process for some. For many who bought a home since 2005 and thought they could count on an increase in value, the reality has been harsh. Unless you bought a fixer upper or a gut rehab, most homes have come down in value since 2005.

It's time we all got back to the notion that a house is a home not a means of getting RICH! As my title says, your home is your castle and nothing more.

Wednesday, May 21, 2008

Lenders and their ads for low rates

Have you heard the ads some lenders are running on the radio and tv? How can they offer loan rates below what everyone else does? One ad says they aren't brokers, THEY APROVE THEIR LOANS! Instead of locking in on the interest rate, borrowers need to ask how much is it going to cost them to get this wonderfully low rate. What hidden fees are they hiding? Give a list of all fees and charges.

I've talked to several loan officers with good track records and many years in the business. They all say when shopping for a home loan, ask questions. Ask to compare head to head the various loan products against a competitor that the potential borrower has already gotten information from or is considering. Ask the loan officer how much they (the loan officer) are going to make on this loan. Ask for a written list of all fees and loan costs. Only after a full accounting can you decide who amoung the various lenders, to do business with. Any loan officer that won't give answers to these questions without hesitation, should be avoided at all costs!

Friday, May 16, 2008

Current state of the housing market

Their is guarded optomisim amoung real estate professionals about the state of the real estate market in the St. Louis area. Interest rates have remained low, the weather is improving and new housing starts have gone up instead of down for the first time in almost a year.

For buyers, this is the best market to be in. Supply is plentiful. Loans for qualified buyers are still being made. Home values seem to be stabile. Many buyers however, seem to think that home values will drop even more and are hesitant to commit at this time. These folks are trying to "time the market". What they don't realize is that by waiting, they run the risk that both home prices and interest rates will begin to go up, effectively pushing them out of the market.

NOW is the time! Anyone hoping to buy their first home or move up to a better one needs to get off the mark and "JUST DO IT"!!