Monthly Archives: March 2014

Benefits of Buying vs. Renting

Are you wondering whether you should buy or continue renting? Given where we are now with interest rates and where they are headed (see recent blog post Mortgage Rate Projections, if you were sitting on the fence about whether now is the right time to buy, then you should consider that it is cheaper to buy than to rent in all of the 100 largest metro markets.

One reason is the increase we’ve seen in rents:

Its not just the rising cost to rent – there are benefits to home ownership:

Mortgage Tax Deduction Benefits

  • Mortgage deduction: The tax code allows homeowners to deduct the mortgage interest from their tax obligations. For many people this is a huge deduction, since interest payments can be the largest component of your mortgage payment in the early years of owning a home.
  • Some closing cost deductions: The first year you buy your home, you are able to claim the points (also called origination fees) on your loan, no matter whether they are paid by you or the seller. And because origination fees of 1 percent or more are common, the savings are considerable.
  • Property tax is deductible: Real estate property taxes paid on your primary residence and a vacation home are fully deductible for income tax purposes.

Capital Gains Exclusion

If you buy a home to live in as your primary residence for more than two years then you will qualify. When you sell, you can keep profits up to $250,000 if you are single, or $500,000 if you are married, and not owe any capital gains taxes. Now, it may sound ridiculous that your house could be worth more than when you purchased it after these past several years of falling house prices. However, if you purchased your home anytime prior to 2003, chances are it has appreciated in value.

Average home prices have now exceeded their pre-crash prices.

Conclusion

First Time home buyers should get off the fence, and quickly!

For more information on over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.

74 Goden St, Belmont – Just Listed

Check out this stunning home that we’ve just bought on the market this week. 74 Goden St, Belmont – priced at $749,000. This solidly built 3 bedroom, 1.5 bathroom home walking distance to the newly built Wellington ES, Chenery MS and Belmont HS area of Belmont. Spacious living room, open dining room with built in china cabinet and French doors into the light filled sunroom. A renovated, eat in kitchen with cherry cabinets and quartz countertops, mudroom, half bath complete the first floor. Three bedrooms, an office and a full bathroom upstairs. High ceilings, hardwood floors, double paned windows throughout. Fantastic location of Belmont, surrounded by impressive homes in a lovely community. 1 car detached garage. Walk to all schools, town center, parks, pool, library , transportation and everything that Belmont has to offer.

Broker tour Friday from 11-12pm, Open House Sat/Sun 1-3pm, and reviewing offers at 5pm on Monday.

http://www.youtube.com/watch?v=KzVy-Ceu2NI

You can find more info at www.74goden.com or if you’re on your smartphone mobile.74goden.com

Mortgage Rate Projections

Prior to 2008 when the financial markets began collapsing interest rates hovered around 5.75 and 6%. The red line constitutes the actual moment that the financial worlds collapsed. From that point the government began implementing all sorts of stimulus packages to attempt to bring back the housing market, and this resulted in driving interest rates down. And they drove them all the way down until the market started to come back in early 2012. Since the market has come back in 2012, we are seeing interest rates starting to again increase.

Mortgage rate predictions for Q1 2015 by four of the major analysts have mortgage interest rates up by ¾ to 1% within the next year.

These rate should be seen in context though. The following graph shows the Freddie Mac mortgage rate from the past 20 years. As this shows the current and projected mortgage rates are still low. But, buyers should not delay their home search – the sooner you can find the home for you and lock in a rate the sooner you are protected from the inevitable rate rise.

For more information on over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.

Home Price Expectation Survey

Recently a new Home Price Expectation Survey was released. A nationwide panel of over 100 economists, real estate experts, and investment and market strategists are surveyed every quarter. They are asked where are prices going moving forward. This is what their expectation is for cumulative price appreciation up to 2018. Even the bears, the ones with the most negative outlook on where prices will be in 2018 are predicting that there will be 11% appreciation!

In many of the towns the MA Properties Online Team track prices you can see we are well on our way to achieving these price increases.

Lexington

Arlington

Stoneham

Reading

For more information on over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.

First Time Homebuyer and Mortgage Rates

According to the 2013 NAR profile of First Time Homebuyer, these are the sources of their down-payment. The cash buyers are out there but they are generally not first time home buyers. 95% of first time homebuyers still take out a mortgage, so what is happening with mortgage interest rates is critical to these folks. Most analysts predict that by Q4 2014 interest rates will be up by ¾ or 1% point higher than they are currently.

If you are a first time homebuyer or you’ve done it before but are just unclear of the process when buying a home the MA Properties Online team have prepared FREE comprehensive Buyer’s and Seller’s Guides that provide a wealth of information about the home buying and selling process. Each guide takes you through each step of the process providing details on what you can expect as you move through the process to owning or selling your home. A page where you can request your FREE copies can be found on our website Free buying and selling guide

For more information on over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.

First Time Homebuyer Profile

According to NAR (National Association of Realtors) this is the profile of the First Time Homebuyer. Does this match you or your friends?

If you are a first time homebuyer or you’ve done it before but are just unclear of the process when buying a home the MA Properties Online team have prepared a FREE comprehensive Buyer’s and Seller’s Guides that provide a wealth of information about the home buying and selling process. Each guide takes you through each step of the process providing details on what you can expect as you move through the process to owning or selling your home. A page where you can request your FREE copies can be found on our website Free buying and selling guide

For more information on over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.

Real Estate Market Healthy Both Nationally and Locally

When you review the breakdown of sales for Q4 2013 you can see that the real estate market is getting healthier across the country, not just locally. Homes over $250,000 in price have experienced a positive percentage change in sales from a year ago. This is indicative of a healthy market. Distressed properties(generally in the lower price ranges) are reducing but non-distressed property sales are increasing.

As we have shown in this blog the same is true for the majority of the towns that the MA Properties Online Team track data for. In many towns the prices are at an all-time high.

Lexington

Arlington

Wakefield

For more information on over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.

Number of Distressed Properties Reduces

To follow on from the assertion recently made that there is a reduced amount of distressed homes for sale from Q4 2012 to Q4 2013 you can see this from the graph. When you factor in the number of non-distressed homes sold during Q4 2012 and Q4 2013, the % change of home sales across the country is up, contrary to what some media sources are reporting. You have to understand the whole of the market, and the whole of the market is getting healthier! We’re clearing through all of the distressed homes (short sales and foreclosures) and are selling more of the non-distressed properties now.

The MA Properties Online Team tracks a variety of real estate statistics in over 40 towns so what is the situation in these towns since 2009 (the first year MA tracks lender owned or short sale properties.

As the graph shows the number peaked in the 2010 – 2012 period but reduced dramatically in 2013.

Short Sales and Foreclosures

  • Short Sales – the home occupier still owns the house but the outstanding mortgage amount is larger than the house value. In order to sell the house the home owner needs bank approval. Here lies the issue – it’s a two-step process Approval and Processing. In the case of a large bank both of these steps can take anything from 12-18 months, smaller usually local banks are quicker (6 – 12 months) but there is still a considerable delay between making an offer and approval (or rejection). In addition, once the bank is involved it does rather disappear into a black-hole whilst they decide if they will approval the offer to buy. During this time the buyer is left waiting not knowing if the bank will OK it. In practice, many buyers give-up because they simply can’t (don’t want to) wait this long.
  • Foreclosures (Lender Owned) – the bank owns the property and (in the prior home owner has moved out). This is very different because the bank makes a decision much faster (at least as fast as a home owner) – the negotiations are very cut-and-dry, the bank has a bottom line and we just negotiate to it (there is no emotion on their part).

For more information on over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.

News Sources Give Dire Predictions – Are They Right?

Some news media sources are giving dire predictions that there is a lack of consumer confidence in the housing market, or that interest rates are having an impact on the housing recovery. This is not true. If you look at this pictorial of the % change in house sales in Q4 of 2013 you see that the West of the country is experiencing a dramatic decrease in sales, whereas the Northeast is showing a very positive increase. If there was a lack of consumer confidence in the housing market you would see similar characteristics across the country. If interest rates were impacting the housing recovery, you would see similar characteristics across the country. What we are seeing in the West is a dramatic lack of inventory. There are just not the houses on the market for the buyers to buy. It is also reflecting the difference in the quantity of short sales and foreclosures that were available for sale back in Q4 2012 – we just are not seeing the same amount of distressed homes on the market any more.

If we look more closely we can see this price increase in the towns the MA Properties Online Team focus on.

Lexington

Arlington

Winchester

These are just a small sample of the towns the MA Properties Online Team track statistics. For more information on over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.

158 Burlington St, Lexington – Sold in the First Weekend


Last weekend we put 158 Burlington St, Lexington on the market. The home is immaculate throughout and priced at $669,000 for 3 bedroom, 2 bathroom home is in the newly built Estabrook ES area, and the quiet end of Burlington St, in Lexington; we expected lots of interest! After reviewing offers on Tuesday evening the property went under agreement. It seems that the high demand for homes in Lexington that we saw in 2013 is continuing into 2014. Here’s the data for the last 12 months – the orange line is the ratio between list and sales price (a value of 100% means it sold for asking). The ratio is greater than 100% for the majority of 2013 – expect the same for 2014 as demand exceeds supply in this very popular town.

This high ratio is (of course) driving up prices as buyers compete for homes:

A wealth of information about Lexington as well as over 40 other towns (and a lot more information on buying/selling) can be found on our website www.mapropertiesonline.com (or if you’re on your smartphone – mobile.mapropertiesonline.com) and if you have any questions do not hesitate to contact us.