Three Quick Tips For Getting Ready To Buy A Home
While starting the process of buying a home may seem easy when all one needs to do is click to a local Cincinnati real estate website and start browsing homes, the process is a bit more involved than that. There will be a variety of homes in many different price points. Prior to even getting serious about a home the home buyer needs to follow the below steps to make sure the process starts off successfully.
Step 1. Understand Your Budget
Everyone should have a good grasp of their budget including their debts and monthly expenses. A house payment can take up a large portion of a homeowner’s budget. Buying a home that puts the mortgage expense at the top end of the budget can lead to problems down the line when other expenses increase. Especially in an inflationary environment like we have today in 2022 the cost of daily items like groceries, utility bills, gas and more keep going up. So once where a budget was perfect with the exact amount of money coming in as going out is now a disaster since things cost more.
Even with a fixed interest rate mortgage the payments for a house can go up. Especially if the homeowner is escrowing their tax and insurance payments as taxes and insurance rates go up on the home so will the monthly payment. Even for those who are not escrowing tax and insurance payments if those go up they have to get paid regardless if the budget can cover it or not.
Home buyers need to understand their overall financial picture...
Timing The Real Estate Market
Timing the real estate market like timing the stock market is easy to talk about but hard to do in practice. Even those “experts” in the field while offering predictions rarely will offer guarantees as to performance. For the average real estate buyer or seller, trying to time the market may cause more pain than any gain. Instead buyers and sellers of residential or investment real estate need to look at their current needs and the financials in order to determine if it is the right time to buy or sell as this article explores.
Why Trying to Time the Real Estate Market May Be a Mistake
Trying to time any market for maximum profit can be a mistake as usually it is difficult to do. It may be easier to sell during a long term down trend or long term up trend and make some money. Trying to sell at the high or low for maximum gain can be appropriate where the real estate is for investment purposes. It may be that the price has reached a point where it makes sense to sell and invest somewhere else.
The homeowner hoping to sell while prices are high and then buy when prices reduce may find themselves losing money overall due to high transaction costs and getting the timing wrong. If the homeowner has a reason to sell/buy, like downsizing, upsizing, change of job, etc. then it makes sense to sell and consider everything together. A home should be viewed as something one lives in and not as an investment meant to make money. When it comes to paying interest on a 30-year mortgage, paying for maintenance and upkeep on...
July 2022 Greater Cincinnati Luxury Real Estate Market Report
Median price ticked down a small amount and the average days on market increased by six days. Total quantity of luxury homes that sold did drop by 22%. Whether this trend holds remains to be seen. Mortgage interest rates have settles in the mid-5 range for convention mortgages. For jumbo mortgages rates are also in the mid-5 range for a 30 year fixed mortgage.
How To Keep Your Home Cool During The Summer Heat Wave
The summer heat is raging in many areas. Keeping your house cool during the summertime not only helps one stay comfortable but when done right can also save money. Cooling is a major expense for homeowners during the summer. Check out the great tips in this article to help keep your home cool.
Homeowners need to make sure their HVAC is tuned up and the filter is changed on a regular basis. Clogged or old HVAC filters lead to less cool air being pumped through the home as well as result in increased cost when running the furnace. HVAC filters need to be changed based on the recommendations of the HVAC manufacturer and the filter maker.
Regular tune-ups on the HVAC system make sure things are operating smoothly and at peak efficiency. An inefficient HVAC means less cooling capacity and increased energy costs. Professional HVAC companies can come out, tune-up an HVAC system and make sure problems don’t happen. Having an HVAC system go out during the hottest days of summer will lead to plenty of discomfort for the homeowners and can possibly cause damage to the home through excess heat and humidity.
Homes located in humid regions, close to rivers, lakes and oceans can experience high humidity which makes it feel hotter. Homes in general can build up humidity through everyday activities like cooking, bathing, and more. A dehumidifier takes that humidity out of the air resulting in the body feeling more comfortable. While...
Great Burgers In Cincinnati & Northern Kentucky
Have a craving for a burger? Check out this list with some of the tried and true burger places in Cincinnati. From the traditional burger to the unique offerings this list has something for everyone.
Fifty West Brewing
Fifty West Brewing offers an assortment of burgers that pair well with their brews. From spicy burgers to burgers topped with chili they have something for everyone. Swap the burger with grilled chicken or a black bean burger.
June 2022 Greater Cincinnati Real Estate Market Report
Average days on market decreased from May 2022 and the amount of luxury homes sold in the Greater Cincinnati area increased. Inventory increased as well from May 2022. The national average for a jumbo mortgage rates used to buy a luxury home is 5.5% according to Bankrate. Traditional mortgage rates are a slight bit higher. The luxury market has proven resilient in light of the interest rate increases amd there are still buyers out there ready to buy homes. If a recession sets in the numbers may change.
Terminating A Real Estate Contract
The real estate market is always in a state of change. Whether it is a buyer’s market or a seller’s market there are times when one party to the transaction wants to cancel it. Up until the closing paperwork has been signed there is always the ability for one party to walk away from the transaction. Whether the walking away can be legally done within the terms of the contract is another story. This article looks at how buyers and sellers can terminate a real estate contract.
Buyer Termination Within the Terms of the Real Estate Contract
The buyer in a real estate contract usually has more options that allow them to terminate than the seller does. Depending on how the contract is written the buyer can terminate during the inspection period, due to a low appraisal, inability to get insurance on the property, and the inability to get financing. Those situations do not usually result in an automatic termination though (depending on the contract language). Instead the buyer needs to take active steps to sign a release of contract and then send over to the seller for their signature. The contract release basically provides that both the buyer and the seller agree to terminate the contract and go their separate ways.
The contract release will usually contain terms as to how the...
How Large Multi-Family Buildings Should Be Marketed
Large multi-family buildings need a different marketing strategy than a typical home for sale would get. Owners of these properties often times go with who they know and end up listing their property with a real estate agent who specializes in residential real estate. That real estate agent may be an expert in their field of residential real estate but large multi-family buildings (5 or more units) fall into the commercial space and require a different set of skills. The owner of such large multi-family buildings who wants to sell their property would be better served by a real estate agent who understands the buying and selling of large multi-family buildings. This article explores the ways a large multi-family building should be marketed when putting it up for sale.
Get The Price Right
When looking for comps for large multi-family buildings sometimes looking for similar properties in the same neighborhood may not be feasible since there may not be any recent sales. Instead owners of large multi-family buildings need to be looking at what is the going price per unit or price per door for the building and use that to come to the asking price. The price per door that is set as the final price does need to take into account any deferred maintenance, the need for updates and more. Afterall one should not price their building at a premium and expect good offers when there is still work to be done to...
Tips For Saving Energy In and Around The House
With energy prices increasing along with the cost of everything else, saving energy in the home should be a priority for homeowners. During the extreme periods of hot and cold weather homeowners can save quite a bit of money but making energy efficient improvements in their home. As with anything the homeowner needs to weigh the cost of making the improvement versus the potential savings. Spending five dollars to save one dollar on a one-time basis is a bad investment. On the other hand spending five dollars to save one dollar a month for the foreseeable future would be a good investment. This article provides some tips on how to save energy in and around a home.
Adjust Your Thermostat
Are you used to cooler temperatures in the summer and warmer temps in the winter? Adjust the thermostat one degree above or below your normal setting is a great way to save on the heating/cooling bill. It will take a little getting used to body comfort wise but once changed and forgotten the money savings can add up over time. Couple that with using a programmable or smart thermostat and additional savings can be had. Some smart thermostats know when no one is home and can automatically adjust the temperature up or down to save money.
Mind Your Windows
When the weather outside is mild opening one’s windows is a great way to let the fresh air into the home. Inside air can get stagnant with cooking, household cleaning products...
May 2022 Greater Cincinnati Luxury Real Estate Market Report
Luxury home sales increased from last month even with rising mortgage rates. This can be explained with the fact that most homes that close in a particular month are usually contracted one to two months prior. In those prior months mortgage rates were lower as compared to May 2022. Homes going into contract in May will show up in June/July results. Prices for luxury homes in the Greater Cincinnati have been holding steady for the 2022 time frame.
Additional Articles To Read
- May Housing Bubble Update - See which markets had a run in prices and sales during the month of May 2022.
- Home Prices Set A Record - This article takes a look at home pricing and how it relates to CPI (Consumer Price Index which is a measure of inflation).
Top 10 Highest Commercial Properties For Sale in the Greater Cincinnati Area
The Greater Cincinnati area is a diverse market relatively smaller in size compared other large cities. Often overlooked by large investors there are plenty of oppotunities for investors looking for commercial real estate to buy. Check out some of the most expensive commercial property listings available on the Multiple Listing System (MLS). The commercial listings cover all the different categories such as retail, warehouse, office, industrial and more. If you want to learn more about the cash flow possibilities of any particular property be sure to get in contact today with Paul Sian who is local Cincinnati and Northern Kentucky Real Estate agent. (This list focuses on commercial properties in one location as opposed to a portfolio of properties spread around the city that are listed for sale as part of a package deal.)
Mortgage Payment and Interest Rates
The amount of a monthly mortgage payment will be directly impacted by the interest rate that is charged for the mortgage. Home buyers are usually looking at the total monthly mortgage payment to determine what their budget is for buying a home. Higher interest rates on mortgages means looking for a home with a sales price that can get to the desired monthly payment a buyer needs. This article looks at how the interest rate will impact the monthly mortgage payment.
Fixed Rate Mortgage
A fixed rate mortgage means that the interest rate for the mortgage will remain unchanged for the length of the loan. So if the mortgage is a 30 year fixed mortgage with a 5% interest rate that 5% will be the same the entire 30 years the homeowner has the mortgage for. The mortgage term can be also be 15 or 10 year terms depending on what the homeowner opted for when buying or refinancing the house. With the fixed interest the principal and interest payments will remain the same for the length of the loan but the actual mortgage payment can still be subject to change if the payment includes escrowed insurance and tax payments. Insurance rates can go up with the price of inflation and taxes as well can increase or decrease based on the value of the home. In most cases the taxes increase as the home price increases. What that means is that the portion of the monthly payment that is for taxes and insurance...
April 2022 Greater Cincinnati Luxury Real Estate Market Report
Mortgage interest rates are up, for non-jumbo mortgages rates in the mid 5 percent are what is being quoted today. With rates moving up at a steady pace some buyers are turning to Adjustable Rate Mortgages (ARM) as ARMs can start off with a lower overall interest rate. Month to month the Greater Cincinnati luxury real estate market has seen a slight increase in price and a decrease in average days on market from March 2022. Some buyers may be wanting to move their cash into real estate as a hedge against the quite high inflation numbers. As interest rates continue to climb expect the real estate market to face more pressures due to buyers stepping away due to costs going up.
Common Real Estate Investment Terms (and what they mean)
With any type of investment it is important to understand the terminology used so that the investor can appreciate everything there is to know about the investment. One should not be investing in anything without that knowledge. Real estate investment involves large sums of money that can also be highly leveraged which means plenty of risk. That risk can be reduced with a positive earning property. This article provides some key investment terms that real estate investors should know about.
Any real estate investment without positive cash flow is one an investor should walk away from. Unlike actively traded stocks real estate cannot be bought or sold with the click of a few buttons. Instead the act of buying real estate takes time to not only find the right cash flowing property but then to get all the post contract acceptance aspects in line prior to closing. Therefore if an investor makes a wrong decision one cannot simply sell their investment real estate without taking a loss due to the transaction costs involved.
The cash flow from real estate investment needs to not only be positive but large enough that the cash flow can be banked so that a reserve fund can be setup. If one already has a reserve fund setup to cover major expenses (like HVAC, roof, plumbing and more) that is great, but the cash flow is still required otherwise once a major expense does pop up that real estate investment will become a net negative investment. Real estate investors need to go in the mindset...
Different Statuses For Homes On The Market And What They Mean
When a home is on the Multiple Listing Service (MLS) listed for sale there are different statuses that are reported on the home. Those statuses help home buyers to know whether a home has accepted an offer, been sold, been removed from the market and even if the home has come back to the market after accepting an offer. Most MLS systems have similar statuses for real estate listed for sale in their market. This article looks at the different statuses and what each means.
Timing Of Status Changes
Generally any time the status of a home changes the change on the MLS must be made by some human input. A real estate agent who is listing the property is responsible for changing the status. Many MLS organizations require that the agents make their changes within a certain amount of time on the MLS after the status is updated in the real world. That means if an offer has been accepted by the seller the listing agent should be making that change in status sooner rather than later. By making the change sooner buyers can take that home off their list and look for other homes and save the time of buyers and sellers alike. Often, after accepting an offer home sellers want to stop the showings from happening in order to minimize the disruption it can cause.
One of the most common statuses on a home listed for sale is the active status. The active status means the home is on the market and still taking offers. As noted above there could...
How Will Higher Interest Rates Impact Real Estate?
With inflation reaching forty-year highs the Federal Reserve (Fed) has started increasing the federal funds rate as part of an attempt to control inflation. As interest rates rise that does affect the cost of things like mortgages (both residential and commercial), credit card rates, auto loan rates and more. The thought process is that higher rates will soak up some of the excess money that is out there which is causing inflation to go up. This article looks at how buyers of commercial and residential real estate will be impacted by higher interest rates.
When it comes to the individual homeowner with a fixed 30-year mortgage they will not see any difference in the payment of the principal and interest portion of the payment since their interest rate is fixed for the entire term of the loan. The mortgage payment can change with a 30 year fixed interest rate mortgage through taxes and/or insurance going up. If the homeowner decides to refinance their mortgage they could see an increase in the amount of their mortgage payment if the new interest rate is higher than the old interest rate or they also take some cash out the home’s equity thus increasing the loan amount. In the US adjustable-rate mortgages (ARM) for homes are not very common as compared to the past where more home buyers had the option of buying a home with an ARM.
If a homeowner has a Home...
Mortgage rates have bumped up quite a bit and the average mortgage rate as of writing this update is 5%. Mortgage applications and refinance applications have slowed down as a result. Inventory in the luxury market remains unchanged from last month but the median price is down a bit along with the days on market. As interest rates remain higher than a few months ago and even increase further compared to today's rate more buyers will pause their goal of buying a home or start to shop for homes priced at a lower point.
Tips For Understanding The Listing Contract When Putting Your Home Up For Sale
When working with a real estate agent for listing a home for sale (or even commercial real estate) the agent will present the owner with a listing agreement. The listing contract provides the terms and conditions the real estate agent will use to list the home for sale on the local MLS (Multiple Listing Service) where all homes are listed by agents. Understanding the listing contract is important for homeowners since the contract will contain the rights each party has in the transaction. This article looks at some of the important areas homeowners need to be paying attention to in the listing contract.
Basic Terms of the Listing Contract
Some of the important basic terms of the contract relate to things like making sure the correct address shown, understanding how long is the listing agreement for, and is the agreed upon commission rate correctly captured in the contract? Typos happen and while not a huge deal if the house is listed as 1234 Main Street when it should be 1233 Main Street, a commission rate of 8 percent when 5 percent was agreed upon could become a costly error if the contract is ever enforced in court. Just as with any contract everyone signing the contract should be reading the language and making sure they understand what they are signing. If there are questions, ask your real estate agent or get an attorney involved if there is some language in the contract that is not understood.
What Is Seller Financing?
When buying real estate the typical methods for paying are providing cash or getting a mortgage. One other method which is not very common is buying the property through seller provided financing. With seller provided financing the owner of the property is basically agreeing to sell the property to the buyer and take monthly payments in exchange. This article looks at seller provided financing to help buyers understand why it may or may not work.
Seller Financing Terms
With seller financing pretty much everything is negotiable. The buyer can negotiate how long they want the loan to be, how much down payment they should pay, what interest rate they will be paying and more. Of course, depending whether it is a buyer’s or seller’s market the negotiating position of the buyer to get the terms that want may or may not be the greatest. The seller is also the one offering the financing so regardless of the type of market they have more ability to control what they will or will not accept.
A traditional mortgage can have minimum down payments anywhere from 0-30% and terms are typically 7 to 30 years depending on type of real estate involved (commercial vs. residential). When using seller financing it is highly recommended that the buyer work with a real estate attorney to make sure their interests are being properly protected. Buyer’s should insist that the real estate title be transferred over to their name and the seller have their financing document be registered on the property as a mortgage lien to protect both sides.
Risks of Seller Financing...
Mortgage rates have trended downwards after the recent activity in Europe and the recent upward trend. Slightly more homes were sold in February and as the weather warms real estate sales in general should pickup. Real estate still faces a lot of headwinds from high inflation rates, the Federal Reserve intent on raising rates, and a declining stock market.
Is 4% The Rate That Breaks Reat Estate's Back? - In the past it took much higher rates to cause a drop in demand from buyers. This time around 4% may be that rate that slows things down.