Median U.S. Home Price Hit an All-Time High of $434,000 in April

Like most of the country, Michigan experienced a red-hot real estate market during the pandemic as people reallocated funds to housing and took advantage of low interest rates. Now, with rates up, fewer people are selling their homes. That has reduced inventory but not prices, as buyers compete for fewer properties.\

The median U.S. home sale price rose 6.2% year over year in April to $433,558—the highest level on record, according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

Today’s housing market is much slower than it was during the pandemic homebuying boom, but prices continue climbing because there still aren’t enough homes to go around.

New listings increased 1.7% month over month in April on a seasonally adjusted basis and rose 10.8% year over year. Still, they were roughly 20% below pre-pandemic levels, in large part because many homeowners don’t want to sell, as they feel “locked in” by the low mortgage rate they scored during the pandemic.

It’s worth noting that last April, new listings were at the lowest level on record aside from the start of the pandemic, which is one reason they’re now posting such a large year-over-year gain.

Home sales were little changed from a month earlier (0.2%) in April on a seasonally adjusted basis but were down 1.4% from a year earlier.

Homebuyers are getting hit by the one-two punch of high prices and elevated mortgage rates. The average 30-year-fixed mortgage rate was 6.99% in April. That’s up from 6.82% in March and 6.34% in April 2023, and is more than double the all-time low of 2.65% during the pandemic.

“It’s not all bad news for homebuyers. Mortgage rates are already inching lower in response to this week’s inflation report, which signaled that the Fed may cut interest rates this summer—a possibility that just weeks ago many thought was off the table,” said Redfin Economics Research Lead Chen Zhao. “In certain parts of the country, buyers also have room to negotiate as homes linger on the market, prompting sellers to slash their asking prices and provide concessions.”

Housing Supply—While Historically Low—Hit a Four-Year High in April as Homes Lingered on the Market

Active listings rose to the highest level since December 2020 in April. They were up 0.3% from a month earlier and up 7.5% from a year earlier on a seasonally adjusted basis, though remained far below pre-pandemic levels.

While new listings represent the number of homes that were listed for sale during a given month, active listings represent the total number of homes that were for sale during a given month. That means that the latter metric includes homes that have been sitting on the market for a while.

Nationwide, 43.9% of homes that went under contract in April did so within two weeks of being listed, down from 46.9% a year earlier.

18% of Home Sellers Are Cutting Their Asking Prices

Nearly one in five (17.6%) homes for sale in April had a price cut, meaning the seller lowered the asking price after putting their home on the market. That’s up 5.6 percentage points from 12.1% a year earlier—the biggest gain in over a year.

“Most sellers in Las Vegas are willing to negotiate—anywhere from 5% to 10% off their list price,” said local Redfin Premier real estate agent Fernanda Kriese. “Sellers are offering buyers money for mortgage-rate buydowns, along with other concessions. Homes that are listed below market value get multiple offers and are snatched up in two to four days, but homes that are priced $5,000 to $10,000 over market value are sitting for 30 to 60 days longer.”

Las Vegas, like many pandemic boomtowns, has seen its housing market cool following the homebuying frenzy of 2021 and 2022.

But other markets haven’t cooled as quickly, and some are seeing substantial competition between homebuyers. In San Jose, CA, for example, three in four homes (75.8%) that sold in April went for more than their asking price. That’s up from 61.6% a year earlier and is the highest share among the metros Redfin analyzed. Next came Rochester, NY, at 72.8%, and Oakland, CA, at 69.7%. Nationwide, one-third (33.5%) of homes that sold in April went for more than their asking price.

Redfin recently surveyed its agents and found that the majority of respondents (74.4%) think the 2024 housing market is shaping up to be more favorable for sellers than buyers. That’s likely in part because sellers are fetching record-high prices for their homes. The survey, conducted by Qualtrics in April-May 2024, was fielded to roughly 300 Redfin Premier agents.

April 2024 Highlights: United States

	April 2024	Month-Over-Month Change	Year-Over-Year Change
Median sale price	$433,558	3.2%	6.2%
Homes sold, seasonally adjusted	425,102	0.2%	-1.4%
New listings, seasonally adjusted	522,713	1.7%	10.8%
All homes for sale, seasonally adjusted (active listings)	1,617,980	0.3%	7.5%
Months of supply	2.3	-0.2	0.1
Median days on market	35	-5	-2
Share of for-sale homes with a price drop	17.6%	1.9 ppts	5.6 ppts
Share of homes sold above final list price	33.5%	3.5 ppts	0.1 ppts
Average sale-to-final-list-price ratio	99.7%	0.4 ppts	0.2 ppts
Share of homes that went under contract within two weeks	43.9%	-1.4 ppts	-3 ppts
Average 30-year fixed mortgage rate	6.99%	0.17 ppts	0.65 ppts

Note: Data is subject to revision

Metro-Level Highlights: April 2024

Data in the bullets below came from a list of 85 U.S. metro areas with populations of at least 750,000. A full metro-level data table can be found in the “download” tab of the dashboard in the monthly section of the Redfin Data Center. Refer to Redfin’s metrics definition page for explanations of metrics used in this report. Metro-level data is not seasonally adjusted. All changes below represent year-over-year changes.

• Prices: Median sale prices rose most from a year earlier in Buffalo, NY (24.3%), Anaheim, CA (22.8%) and Rochester (15%). They fell in just five metros: San Antonio (-1.6%), Memphis, TN (-0.7%), Birmingham, AL (-0.7%), North Port, FL (-0.2%) and Austin, TX (-0.1%).
• New listings: New listings rose most in San Jose (46.9%), Tacoma, WA (38.3%) and Oakland (38%). They fell in one metro Redfin analyzed: Greensboro, NC (-1.6%).
• Active listings: Active listings rose most in Cape Coral, FL (50.6%), North Port (49.1%) and Fort Lauderdale, FL (42.2%). They fell most in Raleigh, NC (-12.3%), New Brunswick, NJ (-8.7%) and Lake County, IL (-7.4%).
• Closed home sales: Home sales rose most in San Jose (38.2%), San Francisco (30.4%) and Stockton, CA (23.2%). They fell most in Fresno, CA (-3.5%), Jacksonville, FL (-3%) and Albany, NY (-2.6%).
• Sold above list price: In San Jose, 75.8% of homes sold above their final list price, the highest share among the metros Redfin analyzed. Next came Rochester (72.8%) and Oakland (69.7%). The shares were lowest in North Port (6.8%) West Palm Beach, FL (7.1%) and Cape Coral (9.3%).
• Off market in two weeks: In Rochester, 84.6% of homes that went under contract did so within two weeks—the highest share among the metros Redfin analyzed. Next came Seattle (75.9%) and Buffalo (74.5%). The lowest shares were in Honolulu (7.4%), Tucson, AZ (16.6%) and Chicago (16.9%).

To view the full report, including charts, please visit: https://www.redfin.com/news/housing-market-tracker-april-2024/

How to Save for a Down Payment While You’re Renting

 

Rent prices continue to rise throughout the U.S., which creates a disheartening and discouraging scenario for many people.

As of  January 1st, median rents for one- and two-bedroom units are up 13% and 16%, respectively, since 2019.

One-bedroom rentals are at an all-time median high right now.

High rental prices coincide with a housing market that’s overheated. Demand, inflation, and reductions in home construction have led to record-setting home prices. Potential homebuyers are being priced out, requiring them to stay in the rental market, putting pressure on rent prices.

For renters, it can seem like a difficult cycle to break—how can you save for a down payment when such a large chunk of your income is going toward rent? Homeownership feels unattainable for a large portion of the population.

It’s decidedly not an easy issue to work your way out of, but it is possible.

Figure Out What You Need

The first thing you can do is start to crunch the numbers. If you have a concrete number for the down payment you need, it will be easier to work toward your goals. If you don’t have a plan in mind or a set number to work toward, you’re going to feel scattered, and it will be much harder to get out of the rent cycle.

The down payment will depend on the type of loan you hope to get and where you plan to buy.

There are mortgages with a down payment as low as 3%, giving you opportunities to save up in a shorter period of time.

You may have to pay for private mortgage insurance if you don’t put down 20%, however.

You have to think about other costs that you’ll need upfront money for to buy a home. These costs include closing fees and the costs of moving.

Open a Dedicated Down Payment Savings Account

Once you have a concrete number in mind and have explored the mortgage options available to you, and know which you’d like to ultimately get, you can create a savings account. This account will only be for your down payment and nothing else.

It should be liquid but separate from anything else so that you aren’t tempted to spend the money in it.

Deal with Debt

You’re going to need to find ways to cut costs if you want to put more money aside to buy a house. Cutting your debt is going to be one way to do that.

If you have a balance on a credit card with a high interest rate, you might try to do a balance transfer. You can transfer the expensive debt to a card with a zero-percent interest period.

If buying a house is your goal, try not to add any more debt during this time.

To qualify to get a mortgage, you’ll have to meet the debt-to-income requirement.

Find Ways to Cut Back

It’s hard to give things up, but if you’re putting a fair amount of money into your rent, there’s not a lot you can do about that unless you’re willing to move.

You’ll have to find other ways you can cut your costs. That might mean skipping meals out or delivery food or going through your subscriptions to see what you can eliminate.

Think About Moving

We mentioned moving above, and you may not be willing or able to do it, but if you can, cutting down on what you’re paying for rent is one of the best ways to have more money to put toward a down payment.

If you can’t move to a smaller or less expensive home, you might try to renegotiate your lease with your landlord, or you could get a roommate. If you can move, along with getting a smaller place, another option is to move outside of the center city area, if you live there currently. Typically, the further out you move from the central area of your town or city, the lower the rent.

Explore Assistance Programs

Finally, many mortgage lenders have programs and loans for first-time homebuyers that cover part or all of a down payment. There are also grants, which require you to complete a homebuyer education course before you get the financial assistance.

If you work in certain fields, like as a first responder or teacher, homebuying assistance programs are often available.

A lot of lenders are looking to reach out to underserved communities to help them make homeownership a reality, so make sure to explore everything that’s out there.

The Pros and Cons of An Adjustable-Rate Mortgage

 With mortgage rates rising rapidly and coming off years of record lows, many potential

homebuyers are looking for ways to beat the situation. One available option is an adjustable-rate mortgage. An adjustable-rate mortgage has pros and cons, and both have to be carefully weighed before making a decision.

An adjustable-rate mortgage is also known as an ARM. These home loans have an interest rate that adjusts over time based on what’s happening with the market. These loans will often begin with a lower interest rate than a comparable fixed-rate mortgage, and the interest rate doesn’t stay the same forever.

Your monthly payment can fluctuate after your initial period.

A fixed-rate mortgage offers predictability and certainty because, for the life of the loan, the interest rate stays the same, regardless of what’s happening with the market.

An ARM, by contrast, can become more expensive or less expensive.

There are two periods with an ARM. There’s a fixed period, usually the first 5, 7, or perhaps ten years of the loan. During this set period, your interest rate doesn’t change. Then, there’s an adjustment period. Your interest rate during the adjustment period can go up or down based on changes in the benchmark.

Mortgage rates are influenced by a range of factors, including personal factors like your credit score and broad factors such as economic conditions. You might get a teaser rate upfront that’s much lower than the rate you could pay later on in the life of the home loan.

The benchmark in your ARM loan would be the basis of your rate. The contract may name the rate benchmark the U.S. Treasury or the secured overnight finance rate (SOFR). The named benchmark will, at some point in the life of your loan, be the starting point to calculate resets.

The benchmark is used, and the loan is priced at a markup or margin. The margin applied to your ARM will depend on your credit history. A rate cap may be in place with an ARM, which would be the maximum interest rate adjustment your loan would allow at any particular time.

The Pros of Adjustable-Rate Mortgages

Adjustable-rate mortgages can be a good option if your initial goal when buying a home and getting a loan is the lowest interest rate. Your teaser rate isn’t forever, but you’ll get lower initial payments, so you’ll improve your cash flow. You might also be able to put more toward your principal balance every month.

If you’re planning to move fairly soon after buying a home, you might not have to worry about the adjusting interest rate. An ARM can be a good option for someone buying a starter home. You may have plans to upgrade, so you can sell your home before the fluctuation of the interest rates, which keeps your risks pretty low with this type of loan.

When you’re paying less monthly, you have more flexibility in your budget to meet other financial goals.

If you think you’re moving somewhere that you won’t stay for more than five years, an ARM is often the best option.

The Cons of an Adjustable-Rate Mortgage

The biggest downside of this type of mortgage is that you’re taking a risk that your interest rate will go up. That’s highly likely, meaning eventually, your monthly payments will increase. It’s hard to predict what your financial situation will be in the future, and you might at some point find it’s a struggle to make your monthly payments if they’re higher.

There’s also an inherent sense of uncertainty that can cause anxiety for some buyers.

Finally, you also have to consider the risk that if you are planning to stay in your home for five years or fewer, you may not be able to sell it before your rate adjustment. If you’re in an ARM situation and can’t sell it, an alternative would be to refinance to a fixed-rate loan or maybe a  new adjustable-rate mortgage.

How To Prepare For A Bidding War

With the housing market being a seller's market on steroids, due to lack of homes are the market, you need to be prepared to have to fight multiple buyers competing for the same home.  Here is how to prepare for a bidding war.

 

What The New FICO Credit Score Changes Mean

Fair Isaac, the giant credit score company, recently announced the biggest change since 2014 in how it determines its FICO credit scores. This new FICO 10 system — expected to go into effect by year’s end — could affect your home buying and credit borrowing in big ways, possibly for the worse and possibly for the better.

But there are a few things you can do to help prevent it from lowering your credit score.

Having good credit is especially important in retirement. It can save you thousands of dollars — with a lower interest rate on a mortgage, car loan or credit card — at a time of life when every penny really counts. And a high credit score could help you get a rewards credit card or a better interest rate with one, making travel in retirement less expensive. Insurance premiums, utility bills and apartment rents may also be more affordable when your credit is in good shape.

Conversely, having a poor credit score could keep you from getting a mortgage on a retirement home or raise your monthly expenses due to higher borrowing costs.


What the New FICO Credit Score Changes Will Do
According to FICO, about 40 million people could see their credit scores rise 20 points or more with the new system. But another 40 million could see their scores drop 20 points or more. And about 110 million people could see their credit scores go up or down by under 20 points.

What’s behind FICO 10? Something known as credit score inflation.

A few years ago, due to a legal settlement, the three major credit reporting agencies (Equifax, Experian and TransUnion) agreed to remove tax liens and judgments from credit reports. That caused millions of Americans to see a boost in their credit scores. The average FICO score climbed to an all-time high of 706 in 2019; scores typically range from 300 to 850.

But lenders weren’t thrilled with this development. Some argued the credit score increases weren’t deserved and could lead some people to get loans and credit cards they wouldn’t be able to pay on time.

According to FICO, a credit card issuer might be able to lower its number of defaults by up to 10% under the new scoring model, though. One reason: FICO 10 will put more weight on a borrower’s rising debt levels. So, if you switched from paying off your cards in full each month to carrying growing balances, you may well see a lower credit score.

3 Ways FICO 10 Could Hurt Your Credit Score
Here are three ways the FICO 10 changes could hurt your credit score:

1. Late payments could trigger a bigger credit score drop than before.

2. If you have a history of not paying off your credit card debt in full every month, your credit score may decline.

3. Personal loans might damage your credit score, especially if you use them to consolidate credit card debt, but then run up credit card balances.

That said, many of the general rules you’ve learned about earning a good credit score still apply under FICO 10. For example, it will still help to pay your bills on time, keep credit cards open and review your credit reports for errors often.

How to Change Your Credit Habits Due to FICO 10
But you may want to tweak your approach to credit management in light of the new scoring changes to come. Here’s how:

Be sure not to be late on your loan and credit card payments. Even the occasional late payment might be a bigger issue under FICO 10.

Make paying off credit cards a bigger priority. FICO 10T (an alternative version of the new scoring system) will look back at how you’ve managed your credit cards over the last 24 months. If you have a history of paying off card balances every month, this good habit should work in your favor.

Be careful how you use personal loans. Using a low-rate personal loan to consolidate credit card debt may still be a smart financial move. However, it will be more important than ever to avoid getting back into credit card debt because a personal loan consolidates your debt.

If you start following the good habits and steering clear of bad ones, you may be able to avoid potential credit score problems in retirement.

Easy Curb Appeal Updates For 2020

Does curb appeal matter if you are trying to flip a house? Yes it does! Research claims that buyers can decide if they would be willing to buy a house within the first eight seconds of seeing the property. What will potential homebuyers see in the first eight seconds after driving up to your property? If you’re listing a house soon and want to see immediate interest, give the below tips a try in order to update your curb appeal and get your home sold fast.

Tidy Up The Yard
You may not have the time or the money to invest in brand new landscaping, but that doesn’t mean that you can’t make the yard look clean. You can buy mulch in bulk at Home

Depot for cheap. Having mulch is the easiest way to transform your yard and make it look neat and fresh. Plant some new flowers in pots placed near your front door, and add a new welcome mat. Finally, Mow the lawn and trim branches.

Clear The Pathways

It's simple enough to get out the hose and spray away all leaves from sidewalks and walkways. Large piles of leaves in the backyard and front can be a turnoff to potential homebuyers because it may make them think that the yard is hard to take care of or that the home is unkempt.

Paint or Power Wash?
Take a walk around your home and inspect the exterior. Do you notice any peeling or chipped paint? It may be time to consider repainting the exterior. Check the walkways, windows, and smaller details that are looking drab. A fast power wash can help transform these areas without costing a fortune. You can easily rent a power washer if you don’t have one.

Add Color

Consider updating your front door for a fresh, new look. Add a pop of color by painting your front door if you don’t have the funds to update the whole house with a fresh paint. A new entry can return between 75–100% of your investment. Follow the above tips for some easy curb appeal fixes to sell your home quickly in 2020. Good luck!

How to Make Your Valentine’s Flowers Last Longer

There is nothing quite like a floral display to add a touch of love and warmth to a room. Receiving a glorious bouquet of

flowers definitely puts a smile on our face and since it’s February, our thoughts turn to Valentine’s Day, romance and that special someone in our life. 

So when that special someone in your life gives you a big bunch of fabulous red roses this weekend and has that silly grin on their face that asks – "Did I do good?", you can give them a winsome smile and let them know how much you love and care for them. 

Try These Tips to Help Your Flowers Stay Fresh
The love that you receive on Valentine's Day can indeed last a lifetime. Don't you wish those romantic roses you receive did too? So when you receive your Valentine’s Day flowers, here are a few tips to keep them looking fresh and beautiful for as long as possible:

Before you start, make sure that your vase is clean. Then remove any leaves from the lower part of the stems that will be submerged in the water.

Trim about 1cm from the end of each stem, at a 45o angle and do this under water. This stops air getting into the stem and makes it easier for the flowers to draw fresh water into their stems.

Re-trim the ends of the stems every day or so, to keep the ends fresh.

Give your flowers the right nutrients to keep them fresh and healthy for longer. Some florists include little packets of flower food with each bouquet. Make sure to use it. Add one packet of flower food every time you refresh the water – either daily or every second day.

Lastly, add a few drops of bleach to the water to help keep the water clean. Remember, only a couple of drops or you will damage the flowers.

More Pro Tricks to Keep Valentine's Day Flowers Blooming

Fresh Flowers need just the right temperature to remain vibrant and blooming. Avoid placing your Valentine's day roses directly under the air conditioner, in direct sunlight, or near a heat source. Natural indoor lighting works just fine for your flowers as long as you're following the tips we've listed above.

Most important of all, make sure to wash the vase clean with soapy and dry it thoroughly each time you want to replace the water. This will help get rid of the bacterial growth and help your flowers stay fresh longer.

That’s the secret to keeping your Valentine’s Day flowers in tip top shape for as long as possible. Happy Valentine’s Day everyone!

U.S. Citizens Will Need to Register to Travel to Europe Starting in 2021

Do you like to travel?  Do you travel to Europe?  If so, you need to read this article...

Here’s what you need to know about the new ETIAS travel authorization requirements.

Europe is the most-visited region in the world, with countries like France, Spain, Italy, and Germany each welcoming more than 37 million international visitors in 2017 alone. In addition to offering some of the world’s best cuisine, museums, and architecture, Europe is a popular destination for U.S. travelers, who don’t need a tourist visa to visit most countries.

But the rules are about to change. Starting on January 1, 2021, all U.S. citizens who want to travel to the 26 members of Europe’s Schengen Zone will need to register with the European Travel Information and Authorization System (ETIAS) or risk being turned away at the border.

Here’s everything you need to know about the new process:

Why is the process changing?
With ongoing terrorism threats, the European Union decided to implement this new travel authorization program to protect and strengthen its borders. By requiring visitors to register, the EU will be able to identify any possible threats or risks associated with travelers coming into these countries before they arrive. U.S. citizens will still be able to enter Europe without registering until January 1, 2021.

Does this mean I need a visa to travel to Europe?
This isn't a visa. European Commission and U.S. State Department officials confirmed to the Washington Post that ETIAS is a travel authorization for visa-free visitors, similar to the U.S. Electronic System for Travel Authorization (ESTA).

According to a fact sheet the European Commission released in July 2018, “The ETIAS authorization is not a visa. Nationals of visa liberalization countries will continue to travel the EU without a visa but will simply be required to obtain a travel authorization via ETIAS prior to their travel.”

“An ETIAS travel authorization does not reintroduce visa-like obligations,” it continues. “There is no need to go to a consulate to make an application, no biometric data is collected and significantly less information is gathered than during a visa application procedure.”


Which European nations will require ETIAS authorization to visit?
The new travel authorization applies to those entering any member country of Europe’s Schengen Zone. Currently, that includes 22 countries that are also members of the EU, four non-EU countries, plus three European micro-states. That means that you’ll need to register starting in 2021 to enter Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and Switzerland. The micro-states of San Marino, Vatican City, and Monaco will also require the registering.

While Romania, Bulgaria, Croatia, and Cyprus aren’t currently Schengen countries, they are in the process of joining and will be subject to the same requirements once they do.

However, there are still many European nations that aren’t part of the Schengen Zone, mostly in Eastern Europe. That means you’ll still be able to travel to Albania, Andorra, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Georgia, Kosovo, Macedonia, Moldova, Montenegro, Serbia, Turkey, and Ukraine without an ETIAS.

How long will an ETIAS take to process?
Once the ETIAS application is available online, it should only take about 10 minutes to fill out, according to schengenvisainfo.com. To apply, you’ll need a valid passport, an email address, and a debit or credit card to pay the nonrefundable €7 application fee (there are no other fees associated with the program). After you fill out your application online with the personal information on your passport, and answer a series of security and health-related questions, it should be approved and sent to your email address within a few hours after it is checked across security databases like Interpol and Europol. While children under the age of 18 will be required to have an ETIAS, they will not be charged the application fee.

Will you have to reapply for each trip to Europe?
No. After you apply for the first time, your ETIAS will be valid for three years—or until your passport expires, whichever comes first. Because the ETIAS is valid for short-term stays of up to 90 days for both leisure and business travelers, you’ll be able to re-enter Europe multiple times within that three-year period without renewing it, as long as your stay doesn’t exceed 90 days within a 180-day period. Those who want to study or work in Europe will need to apply for a proper visa.

Who else will need ETIAS authorization?
This new program isn’t limited to U.S. citizens. In fact, there are 62 countries whose citizens will be required to have an ETIAS when visiting countries in the Schengen Zone. The list of ETIAS-eligible countries includes Canada, Mexico, Australia, and many more.

Six Key Buying Strategies

Is 2020 the year you finally decide to buy your first home? How much practical, valuable real estate advice did you ignore in 2019? What’s your intent for 2020?


Here are Six Key Buying Strategies to consider when deciding on your first-home buying strategy. This is the thinking to do before you zero in on decor “must haves” like dream kitchens and spa-like bathrooms.  

1. Location, location, location is no joke
Location is the most permanent aspect of real estate; buildings can always be changed. Buy the best location you can afford. Do your homework and talk to real estate professionals to fully understand what location means in the communities and neighborhoods you’re considering for your first home.

Buy at the low end in the best location to ensure your real estate appreciates in value. The most expensive house on a street or in a neighborhood usually has its value suppressed by lesser homes near it. Buy the “least house” on a street or one in the mid-value range and your home may be bumped up in value as high-end homeowners continue to up-grade their castles.

2. Don’t buy your “forever home” too soon
If you are determined that your first home will be your “forever home,” you may be taking on too much. First homes should be financial stepping stones to that ultimate lifestyle realization. Wisely buy and sell two or three homes over many years—building equity as you go—to solidify your financial stability. If you start with a “forever home” and skip this progression, you are searching for a home and a neighborhood to spend 60 or more years in. Really? In a world that changes so rapidly each year, each month, each day, how can you be so sure of what you’ll need and enjoy decades down the road? Buy a very large home for the many kids you want to have and you may overspend for the family you have now or be forced to move out of your too-big, too-much-work “forever home” when the kids leave.

If you’re thinking long term, search out stable economic areas and homes that can be easily modified to add and convert income-generating units. Flexibility of lifestyle and income is what survives over time.

3. Buy in moderation
Maxing out financially on your first home may not be the best real estate strategy. “House rich, cash poor” is not the ideal state to live in to fully enjoy your first home. Spending to the limit leaves no room to improve the home and increase its value. Being cash stretched may put you at financial risk if a big repair like a leaky roof or failed furnace pops up.

Because you qualify for a big mortgage does not mean you have to borrow or spend to the limit. Because you like the expensive home more, does not mean that’s the one you should buy. Is keeping monthly payments manageable more valuable to you than impressing visitors?

Consider your first home as the first financial stepping stone on the way to a mortgage-free forever home. Ask your real estate professional to share a range of financial options with you instead of directing them to “buy as much as I can.”

4. Stop waiting til Spring
Retail shopping has trained shoppers to think seasonally. With real estate, “now” may be the best time to buy. When you’re ready, go. Search and purchase when the masses are not and you may get a terrific buy from a seller who must move immediately and can’t wait for Spring.

Wintery weather may mean less traffic through builders’ sales centers and more attention paid to you. You may even find a few buying incentives thrown in. Wait until Spring and you may pay more and feel very pressured in the process.

5. Buying the country
Can you see beyond idyllic stereotypes of country living when considering "the big move" to cheaper, non-urban real estate? Moving into the suburbs or out into the country may mean you get a bigger house for your budget. If square footage is what matters most now and in the future, away you go.

However, if lifestyle, career opportunities, education choices, internet access, health services, and appreciating real estate value are key considerations, look closely at what you gain and give up by moving out of an urban neighborhood. How many urban problems will you really leave behind? Small town and rural homeowners face many of the challenges city owners do: rising food and fuel costs, rising taxes, and environmental challenges. Which rural concerns like water quality, black outs, less convenience, and scarcity of services may significantly affect your home and lifestyle?

6. What’s your buying style?
If your search for a new home or cottage uses criteria set by “what's on trend," you are following the herd rather than leading yourself. For instance, open concept living space is "in," but not without compromises. If you're not aware what you give up to get "open concept," you have not explored all the options open to you.

Wanting housing similar to or better than your peers may be a sign of compatibility, but make sure you’re not extending yourself financially for superficial reasons. Showing off is not a sound investment strategy. Learn where those you follow originally got the ideas that define their lives. Their reasons for acting may not match yours.

Everyone has to discover what real estate styles and ownership type are right for them. As you learn, be ready to get in there and explore all your options, not just the trendy ones.

MSHDA Step Forward $7,500 Down Payment Assistance

• MI HOME LOAN

  The MI Home Loan is a mortgage program for first-time
  
  homebuyers statewide and repeat homebuyers in targeted areas. My friends Burney and Rosemarie Ashley at Capital Mortgage Funding can help you get your started.  Call them at 586-585-2626 and tell them that I sent you. 
  
  
  
  • Down Payment Assistance up to $7,500. (Homebuyer Education class required.)
  • Available to first-time homebuyers (have not owned a home in the previous three years) statewide and repeat homebuyers in targeted areas.
  • Household income limits apply and can vary depending on family size and property location.
  • All adults in the household MUST apply and credit qualify (except dependents 18 years of age and older that are full-time students).
  • Maximum sales price is $224,500.
  • Minimum credit score of 640 required or 660 for multiple-section manufactured homes.

• MI HOME LOAN FLEX

  The MI Home Loan Flex is a mortgage program available statewide. This mortgage may be a better option for some borrowers because it has more flexible eligibility requirements.
  The overall eligibility requirements are:
  • Down Payment Assistance - 4% of the purchase price, not to exceed $7,500 (Homebuyer Education class required.)
  • Available to homebuyers statewide.
  • All adults in the household DO NOT need to apply, only qualifying borrowers will be underwritten for credit, assets and income.
  • Collections and judgments DO NOT necessarily need to be paid off; the lender will follow the AUS findings.
  • Household income limits can vary depending on family size and property location.
  • Maximum sales price is $224,500.
  • Minimum credit score of 660 required.

• MORTGAGE CREDIT CERTIFICATE (MCC)

  The Mortgage Credit Certificate (MCC) program provides housing assistance by issuing a federal tax credit to first-time homebuyers statewide and repeat homebuyers in targeted areas.
  • Qualified homebuyers can credit 20% of their annual mortgage interest paid against their year-end tax liability. A tax credit is a dollar for dollar reduction in tax liability.
  • The tax credit is allowable every year for the life of the original mortgage (up to 30 years).
  • Available to first-time homebuyers statewide and repeat homebuyers in targeted areas.
  • Household income limits can vary depending on family size and property location.
  • Maximum sales price is $224,500.

• HOUSING EDUCATION

  Lender Referred Individual Counseling
  Borrowers already working with a MSHDA Lender can be referred to a MSHDA or HUD approved agency by the Lender. This 3-hour maximum Homebuyer Education session is based on the borrower’s individual needs, and mortgage product.
  
  
  Borrowers electing this type of Homebuyer Education must provide a completed Lender Referral Document to the MSHDA or HUD agency at the time of the service. Because housing educators providing this service work with many clients each day, borrowers must contact the agency well in advance of loan submission to secure an appointment, and ensure they don’t encounter delays in the closing of their mortgage. Your clients can locate a MSHDA or HUD Housing Education Agency within their community by visiting our Housing Education Locator or the HUD website to find a local agency.
• Online Homebuyer Education
  MSHDA or HUD approved Housing Education Agencies may also offer online Homebuyer Education. To utilize the online education option, borrowers must contact an approved MSHDA or HUD approved agency to obtain information on the registration process. Agencies providing this service can be found by visiting our Housing Education Locator.
  
  Once borrowers complete this four-to six-hour online course, which includes quizzes, they must contact the MSHDA agency and speak with a certified counselor. The counselor will provide a review of the session content, the borrowers’ mortgage documents and discuss other topics like PITI, budgeting and savings, moving costs and foreclosure.
• Homebuyer Education Workshops
  Another option for homebuyers is to attend a Homebuyer Education Workshop at a MSHDA or HUD approved agency. Workshops require a six to eight hour commitment.
  Visit MSHDA’s Housing Education Locator or the HUD website to find a local agency.
  Regardless of the type of Homebuyer Education completed, the agency providing the services will issue a Certificate of Completion to the borrower. This document must be submitted to MSHDA along with all loan documents.

• AM I READY TO BUY A HOME?

  
  Buying a home is a big step. Whether it’s your first home or your next home, my good friends Burney & Rosemarie Ashley

  
  

  of Capital Mortgage Funding who can help determine if you’re ready and be a resource for you throughout the process.  Call them at 586-585-2626.
  
  

  
  
  
  
  
  

  I make a good salary. Am I still eligible?

  These programs are more accessible than you may think. MSHDA loans are available to potential homebuyers with an annual household income as high as $123,620. First-time homebuyers and previous homeowners are eligible.

  What homes can be purchased?

  Your dream home is within reach. Homes priced up to $224,500 are eligible for a MSHDA loan and a Michigan down payment. Your home can be a new or existing single-family home, new or existing multiple-section manufactured home (built after 6/14/1976), or a condominium.

  Is this a grant or a loan?

  The Michigan down payment loan is a second mortgage loan that is due back to MSHDA when the first mortgage is paid in full, the house is sold, refinanced or homeownership interest is transferred. Since no interest accrues and there are no payments, you may find this loan a better option than borrowing from your retirement fund, depleting your savings account or using money from family. The Michigan down payment of up to $7,500 can only be used in conjunction with a MSHDA mortgage. Review program details | See if you are eligible >