Author: Laura Cruger

Downsizing has been a popular option as many homeowners reach retirement age. But there are certainly other life changes that could make downsizing something for others to ponder on. For homeowners who have experienced a change in their lives or perhaps no longer feel their current house fits their new lifestyle change, may just see the benefit from downsizing as well. 

A significant shift in your life circumstances often brings about change. Perhaps for those who are newly single, empty nesters, or recent retirees often find themselves thinking about their current living space and start to ponder over the idea of downsizing.

I bring this up now for two reasons … 

Reason one – given where we are in the world of inflation, and how this has only made everything so much more expensive … saving money wherever we can does have a lot of appeal. This alone has gotten many thinking of more creative ways to saving money wherever they can. With that in mind, it might just be worthwhile to take a look at your current home and consider if downsizing could make sense for you.

Reason two – and what can make all this possible, is to consider the equity value so many have built up through the years – but quite honestly, in just over the last 2-3 years alone, home values have increased like we’ve never seen before, this primarily due to our housing inventory not meeting buyer demand. While the current market has calmed down a bit since the craze of the market over the last few years, what still rings true, is it is still leaning towards being a seller’s market – hint, hint. We are still seeing multiple offers on properties if priced well, due to supply still not meeting buyer demand. 

Getting back to savings … when you think about cutting down on your spending, odds are you think about your everyday purchases, like groceries and other goods and services, but when you downsize your house, you often end up downsizing the bills that come along with it, like your mortgage payment, energy costs, and other costs associated with maintaining the home. 

A smaller home typically will mean lower bills and less upkeep. Now, let’s take a moment and think again about the equity value that has been building up in your home that can make all this cost savings possible. If you’ve been in your house for a while, odds are you’ve developed a considerable amount of equity. Your home equity is an asset that you can then use towards the purchase of your next home that will better suit your needs of today. And if you are real lucky, you can buy that home with cash, from the equity gains from your current home. … get the picture 🙂 

So, if you’re thinking about downsizing, ask yourself these few questions:

• Do the original reasons why I bought my current house still hold true, or have my needs changed since then?

• Do I really need and want the space I have right now, or could somewhere smaller be a better fit?

• What are my housing expenses right now, and how much do I want to try to save by downsizing?

• And then lastly, what could downsizing mean, and do for me as I think forward on the possibilities?

Once you know the answers to these questions, and you think you want to delve a little deeper into what your options are, given today’s market – give me a call. As a trusted real estate advisor, I can speak to the current market, provide a comparable market analysis on your home so you have a good understanding of what value you hold in your current home today, that may make all things possible, and then how best to position your home that will give you that savings/win on your downsize. And then lastly, helping you to find the best location and size of your next home when you move forward. 

In short … you need to know where you’re going, and how you’re going to get there. To do that, you need to have a plan.  That’s where I come in … 

Laura Cruger

The Key To Your Real Estate Success

Helping buyers and sellers achieve their real estate goals

Let me first start off by saying … I am in no way shape or form a mortgage lender, or a finance expert – but I came across this information, and just thought I’d share. Now there may be some who are aware of this information, and then some who never knew you could do this, and if you did – you probably hadn’t realized the impact it could have on your overall mortgage picture, and then for others … perhaps just a reminder of what they already knew but hadn’t made the decision to act upon. But in these times, or in any time for that matter, if you have the wherewithal to lessen your debt without cramping your style do read on, and learn the many ways, you can pay your mortgage down saving you both time, and money. 

So, what’s the BIG secret you ask? 

There is a little-known mortgage payment strategy that could save you thousands of dollars over the life of your loan.  Did I get your attention? Paying your mortgage twice per month. Yes, I did say that, but to be perfectly clear … that doesn’t mean you should make your entire monthly payment twice, it just means pay half of the total monthly payment every two weeks. 

“This is called making bi-weekly mortgage payments, a strategy where mortgage loan customers pay their mortgage every two weeks, instead of once a month,” Experian says, “The idea is to chop down your mortgage payment more quickly, and in the process, lower the amount of interest you pay on your mortgage overall.”

So how does paying every two weeks cut down on your total amount and save you big time? In short, when you pay monthly, you make 12 payments per year. Pay every two weeks, and you will end up making 13 full payments. And that one extra payment is directed towards the loan’s principal. 

“Since the homeowner is reducing the amount of the loan balance quicker, they are also reducing the amount of interest charged over the life of the loan,” said MortgageCalculator.org.

What should you ask your lender

For many, this can be quite confusing. As I always say, we only know what we know now, and we don’t know what we don’t know. So, before you start changing the way you make your mortgage payments, I would suggest you speak with your mortgage holder first. In addiiton, I would recommend you speak with an experienced local lender for additional information and insights … information is power right, so why not? Having said that, getting good sound advice from the experts first before you start making that extra payment, would be wise, as you’ll want to know how that process will look for you and to make sure it’s allowed. Some lenders might not facilitate the process or don’t credit the payment more than one time per month. “Many lenders decide to hold partial payments in an account until the rest of it is received,” said MortgageCalculator.org. 

Other companies may allow bi-weekly payments but charge a fee. “Rarely, some lenders will charge you to make biweekly payments, since it’s essentially twice as much work for them to process,” said Magnify Money “If your lender does this, it may be better to stick with your normal monthly payment plan. If you want to make biweekly payments, you can still do so manually for free by setting aside a portion of your paycheck on your own, paying your normal monthly payment, and then submitting an extra payment once per year.”

How much can you save?

This scenario illustrates the type of long-term savings that make bi-weekly payments attractive. “Say, you have a 30-year fixed-rate mortgage for $250,000 with a 4 percent interest rate. Your monthly payment would be about $1,194, and the total interest paid over the life of the loan would be $179,673,” said Bankrate. “In the same scenario, using a biweekly mortgage calculator, your total interest paid over the life of the loan on a biweekly plan is $150,450.40. That means you’d save more than $29,000 and pay off your loan in 25 years instead of 30.

Another alternative

If making a payment every two weeks isn’t feasible, consider a lump sum payment once a year. Maybe you get a Christmas bonus, a merit bonus, or a tax refund. Using this windfall and allocating the equivalent of one mortgage payment would make a huge dent in your principal. “By paying one extra payment of $1,285.33 each year” on a “25-year loan of $250,000 with interest at 3.75%…the loan amortization schedule with extra payments shows that you would repay the loan 2 years and 11 months earlier and save $17,381.35 in interest,” said Interest.com.

Homeowners looking to cut their overall mortgage debt can get the job done more quickly by paying their mortgage every other week.

Savings Add up with Bi-Weekly Payments

Consider a traditional 30-year mortgage of $200,000 with an interest rate of 6.5%. Normally, that would require the homeowner to make a monthly payment of $1,264.14. By using a bi-weekly payment plan, the homeowner would pay $632.07 every two weeks and, in doing so, cut six years of payments off the mortgage loan and save $58,747 off the total amount of the loan. 

“A bi-weekly payment plan is far more effective than merely sending one additional payment per year,” says Michael Hausam, a realtor and mortgage broker in Newport Beach, Calif. “Your loan balance accrues interest every day and reducing that principal balance every 14 days (26 half payments per year) saves more in interest charges than one full additional payment every 12 months, even though the total amount in payments every year remains the same.”

Lisa Orban, an author, and an Illinois-based homeowner has been a regular bi-weekly mortgage payment payer since she purchased her residence and has a good reason for the strategy.

“I pay bi-weekly for a number of reasons, but the primary one is almost immediately more money is put towards the principal rather than the interest,” Orban says. “The payment on the first of the month more goes towards interest, but the payment on the 15th shifts and more money is put towards the mortgage loan principal.”

It’s important to note, however, that not all mortgage services allow bi-weekly payments. To find out where you stand, reach out to your lender and ask about your bi-weekly mortgage payment options. If they are permitted, then your lender can walk you through the process of setting up the new payment plan.

Alternatives to Bi-Weekly Mortgage Payments

Bi-weekly mortgage payments aren’t the only way to save money long-term on a home mortgage.

“I like three different scenarios,” says Elisa Meyer, a former real estate agent and personal finance specialist with At Your Pace Online, a digital-based education services provider. “Each can help you save money on your mortgage.”

• Come up with a way (whatever works for you) to set aside the money every two weeks, and then pay that money toward the mortgage each month.

• Use your year-end bonus, tax return, or other “windfall” money to make one extra payment each year.

• Take your monthly mortgage payment, divide it by 12, and add that amount to your monthly automatic payment. You’ll make an extra payment every year.

I don’t know about you, but for many, if you own a home, your mortgage payment is more than likely the highest expense you need to pay on a monthly basis. So, my thought is if there is a way to reduce my balance sooner rather than later could only be a good thing. And even if you are not planning on staying in the home for the long term … nothing lost, because you are paying towards your equity value. 

Just having a good understanding of the best “how” for you, and what that looks like for you in your grand scheme financial picture is important. Speak to your current lender to find out what their rules are and what you can do now to start paying down your home mortgage sooner rather than later, saving you time and a lot of money!

Laura

The Key To Your Real Estate Success

Helping buyers and sellers achieve their real estate goals

Even though activity in the housing market has slowed from the market craze we saw over the past couple of years, today’s low supply of homes for sale not meeting buyers demand, still make this a sellers’ market. Many experts say, market conditions today make this the perfect time for sellers to make their move, as they can only benefit in good equity gains with the low inventory market we are currently experiencing netting them the most value from their home sale.

Markets are determined and dictated by the months’ supply of inventory, Also known as the absorption rate. It starts with the number of homes available for sale. The latest Existing Home Sales Report from the National Association of Realtors (NAR) shows housing supply is still very low. Today, we have a 2.6-month supply of homes at the current sales pace. Historically, a 6-month supply is necessary to be considered a ‘normal’ market where there are enough homes available for buyers to purchase. Graph below gives you some perspective …

Source: NAR

What Does This Mean for You?

When the supply of homes for sale is as low as it is right now, it’s much harder for buyers to find a home to purchase. That creates increased competition among home buyers and keeps home prices on the upswing. Might I add, if buyers know they are not “the one and only” buyer interested in that home … because more than likely they are not – (aka – multiple offers) – they will put forth their best offer, in the hopes of making their offer appealing enough for the seller to accept. As this happens, sellers are positioned to negotiate deals that meet their ideal terms. Lawrence Yun, Chief Economist at NAR, says … “Inventory levels are still at historic lows. Consequently, multiple offers are returning on a good number of properties.”

Right now, there are buyers out there who are ready, willing, and able to purchase a home. Even with the rise in interest rates, with the guidance of their mortgage lender, informed buyers will do just fine. If you list your house right now in good condition and at the right price, it could get a lot of attention from competitive buyers, and the current equity value you have in your home, might just be all you need to help you make your “next move” possible.

If you are a seller and are contemplating “making a move” it would be a good time to have a conversation on what your goals are, and how best you can achieve them. I’d be happy to have that conversation with you … I am here to help!

Laura

The Key To Your Real Estate Success

Helping buyers and sellers achieve their real estate goals

I am sure many have heard the phrase “Oh, that’s a scam” … well truth be told … The scammers are definitely out there, and I have unfortunately experienced this firsthand. I won’t bore you with the details, all is good, thank GOD … but I did want to remind everyone to be mindful of this disturbing fact as you go about your everyday.

Let me just say, I am not one to sound the alarm bell, in fact quite the contrary. I am one that will always look to the good … that’s what keeps us going, right? With everything being done online these days, from online banking to online shopping, to social media, email, texting, to whatever … the list goes on and on. This is the world we live today but do understand in doing so we find ourselves putting so much of our own personal information out there, and for many, don’t even give it a second thought. And then, along comes those “scammers” who are giving it a lot of thought, as to how they can manipulate the system, pray on the unsuspected and take advantage of the innocent. Just shameful!!!

So, as we head into the spring market, and with tax season well upon us, we may find ourselves putting a lot of important, personal information out there online just as a matter of process. Whether its tax documents being sent to your tax accountant, or perhaps banking information being sent over the wires for your mortgage approval, all necessary and important … we should just be mindful about how you’re getting those documents over. Don’t just snap some pics of your personal data or important personal information because it’s easy – think of other ways wherever possible. Make sure your information is securely being sent over as best you can, and when in doubt and possible – “hand deliver” – Oh, what a concept!!! We may have to start thinking about when and where possible to go back to some of our “old ways” in this regard, or look to putting some better systems in place that will better secure your online day to day operations. 

We all have do what we have to do, this is just a small reminder to all to be careful and mindful of how and where you are doing your online business, whether it’s business or your personal business. 

Happy Spring!!

Laura

The Key To Your Real Estate Success

Helping buyers and sellers achieve their real estate goals

Currently the biggest challenge in the real estate market is the lack of inventory. Having said that … the biggest advantage to sellers in the real estate market is the lack of inventory.  Now let that set in a minute! So, what are you waiting for? If you are currently on the fence – it may be high time to think about getting off the fence, and spring into the market. Perhaps you have a few unanswered questions that cause you to pause – getting those questions answered, will only help you to move forward.

While we may be seeing the market shift a little bit to be a more “balanced market” it is still weighing in favor of sellers, due to the lack of inventory – but regardless it is not any less important for sellers to get their home “show ready” as best as they can. This exercise allows seller to achieve the best outcome when looking at their bottom-line sales price. For some, this can be a grueling and overwhelming task, but if you get organized and break it down it doesn’t have to be, and will very well be worth your while.

Below are some helpful tips and tricks that will help you through this process and make your home one the buyers will keep at the TOP of their A list.

First, walk through your home with a “buyer’s eye”, taking note of any items that need to be cleaned, repaired, or replaced. 

Make a checklist – Prioritize your tasks. Be sure to keep your list in plain sight so you can check off each item as you go – delegating tasks where you can. Seeing your progress can help you feel less overwhelmed. 

First impressions matter – and they start right at the front door. A fresh coat of paint on the door and trim, (if needed,) a seasonal wreath and a potted plant at the front door is a special touch, and one that will give the buyer that “welcoming feeling” of home. Tend to the landscape of the property, ensuring bushes are trimmed back and grass is manicured nicely. Pull weeds from flower beds and mulch as needed. A good first impression only happens once. So while buyers do their “drive by” of your home, as many will do prior to scheduling a showing – if the property looks tired and unkept, the home may not even make it to their show list. 

Cut the Clutter – I can’t stress this enough! We are all guilty of accumulating a lot of “stuff” through the years – some good stuff, some “I don’t need anymore” stuff. You don’t realize how much stuff you have, until you start “uncluttering the clutter”. Now is the time to sort through your belongings – box up what you plan to bring to your new home, the rest should either be tossed or sent to Goodwill or left in the home for staging purposes. There are so many great social media sites that allow you to either sell or “gift” those items you no longer don’t need or want to someone who may repurpose or treasure them as you did. The goal is to allow buyers to imagine their belongings in the home. 

If it’s broken – fix it or replace it. Repair or replace anything that is broken or in poor condition. Tend to inexpensive things like, a leaky faucet, loose doorknob, or the like. Make sure all light bulbs are working, and plumbing fixtures are in good shape. Check to make sure mechanicals & small appliances are in good working order. If you are not able to fix or replace the item, where appropriate it can be listed “as is.”

You want the buyer to feel that the home was well cared for, so as to not put any doubt in their mind of “what else” could be wrong with the home. These little items can save you a lot more money in the end.

Paint can go a long way – Putting a fresh coat of paint on walls and trim can change a room dramatically. Paint in neutral colors. This at a minimal cost, but money well spent. 

Clean, clean, clean – Clean from top to bottom and inside out!

Floors – Steam clean or shampoo carpets, and polish laminate, tile, or wood floors. 

Be mindful to the sense of smell – smells strongly affects emotions. Unpleasant aromas can overwhelm an otherwise perfect presentation. 

Wash windows – Windows let light and warmth inside and improves the view from any room. Clean every window thoroughly and don’t forget the sills, sashes and any blinds, curtains, or other accents.

Inspect Driveways – Seal cracks where possible. Pull weeds in or near these areas and trim grass along all edges.

Paint or clean exterior of the home – If time allows, a new coat of exterior paint, especially on window trim and accents can do wonders for your homes “curb appeal”. 

So your work is now complete and you have a good pricing strategy in place – Next step … Let the “Show” begin! 

During showings, open all window treatments to maximize natural light, and if the weather permits, open a window for fresh air. Turn on all interior lights, including those in bathrooms, hallways, and closets.

Following some of these small tips, along with a good pricing strategy from a real estate professional, will help make your house shine, and put you a step ahead of your competition – getting you home SOLD, for the most value, is always my goal, along with the most favorable terms, and getting you where you want to be on your time!

Laura

The Key To Your Real Estate Success

Helping buyers and sellers achieve their real estate goals

If you are still on the fence, trying to decide how you would like to move forward or not, now, or later – you get the idea. Waiting to see “what the market does” is not a good strategy, nor should it be the driving force in your decision-making process. It should only be about “your why?” It may be that your kids are grown, and are off to college, or starting their new chapter in life. Perhaps it’s time to start yours? Downsizing may be something to consider. Perhaps moving to warmer climate, or moving closer to family or friends? Some may want to make their lives a little bit easier, and want to live and enjoy a home that offers “one level living.” All are good reasons for your why! Perhaps you’re not sure where you’re going, or how you can get there. If that be the case, let’s talk! That may be a good place to start. 

So, while you are in “decision mode” get inspired! Get out your checklist and have at it! If you don’t have one, make one – and decluttering will always be at the TOP of that list … just saying! Doing those little things from painting a few rooms, sprucing up the bathroom with some nice new fixtures, or perhaps some new lighting fixtures to give your home a little personality. These are just a few small and inexpensive things, that can make a world of difference to you, should you decide to stay, or for when the time is right, and you go decide to sell. 

Whether you are thinking about selling your home, or perhaps you’ve just purchased a home – I thought I would give you a sneak peek back to The 2022 Remodeling Impact Report from the National Association of Realtors (NAR) which highlights popular home improvements and illustrate the rate of return they bring for that investment …. Good information to know if you currently own, thinking of selling, or after your purchase … Buy, Sell, or Stay?

Laura

The Key To Your Real Estate Success

Helping buyers and seller achieve their real estate goals

 

As we are all seeing the shift in the real estate market, it is important to keep a good pulse on it, especially if you are considering selling your home this year.  Good news for sellers … inventory still continues to be very low in our area, which in essence keeps home values in a good place. But with spring peeking its head out … and it may just be a little sooner than we think, this will be the bigger tell-tale to be mindful of as we look forward to the spring real estate market.

If you are in a place where now is the time to “make your move,” it is important to keep the following in mind …

Price It Right!

I can’t stress this enough! Pricing your home correctly on “Day 1” is key to getting the activity and interest needed to get your home under contract, and to the closing table! There are many factors that surround these strategies and speaking with a local real estate advisor such as myself, can help you navigate your way through the process. As those who know me, know my favorite saying is, “we only know what we know now,” and gathering all the information you need to know now to “move forward” is key. Perhaps there will be a few things you’ll need to do to get your home “show ready” prior to listing your home that will gain the most value for your home is good information to know now. On the other hand, there may be things you “think” you need to do to get your home “show ready,” that you really don’t. This is good information to know and conversations you should be having with your agent right from the get-go.

Set Expectations

We are getting back to basics – getting back to a more “normal market” if you will. No longer can we “price ahead of the market” and then expect to get at or over that asking price. The risk you bear for over-pricing a home in this shifting market is “time & money.” Don’t get me wrong – we are still very much in a seller’s market – but it is not the same “crazed” market that we had experienced the last 2+ years. If we are to be successful in this market, we must accept the fact that the market is changing, and we need to adjust our expectations along with that change.

First step, speak to a trusted real estate advisor, to discuss what your real estate goals are, and how your agent of choice will help you get there. You will want he/she to prepare a Comparative Market Analysis (CMA) on your home to see what your home’s value is in today’s market. Fast forward …once you have all your information, and a plan in place, and you have now made the decision to make your move – my best advice to you would be the following – aside from getting your home “show-ready,” price your home right! Homes that are priced right, will sell quickly. Pricing your home at market value based upon current market conditions will attract a larger buyer pool that could ultimately net you a higher price. Pricing your home right on “Day 1” is critical, and in not doing so, you may find yourself “chasing the market” and ultimately netting less than you would have had you only priced it correctly to begin with.

Case in point …

I just closed on a property, (under contract in less than a week) – where the sellers gained close to an additional $50,000 in equity value on top of their already built in equity … which was well over what they ever thought possible. How do you ask? By listening to my advice and pricing their home right!!! 

When I first met with my clients/aka friends … to go over the marketing and pricing of their condo prior to placing it on the market … I just asked them if they had any idea of where their value was, and where they believed their list price should be? Let’s just say, I was right … and they were happily very wrong!!! 

Are you wondering what the current market value of your home is? Feel free to contact me. I would be happy to provide you with a complimentary market analysison your home! 

Laura 

The Key To Your Real Estate Success

Helping buyers and sellers achieve their real estate goals

We all can agree that the spring is usually the busiest of seasons when it comes to the real estate market. Often we will see many buyers and sellers wait for spring to make their move. But knowing what we have experienced these last past two years – is this really the best strategy for buyers? When you think back on the last two years, where buyers either felt they had over-paid for a property, or just felt beaten down by the process with the multitude of offers and bidding wars on properties they were offering on – Do you really want to go down the road again? If you are a buyer, who is ready to buy a home but is waiting on spring market to make your move … you may want to consider these few things. 

It’s all about the competition …

Buyer Competition

The reality is, there are less buyers out there looking to buy a home in the winter months, giving “ready” buyers a little bit of the upper hand without feeling the pressure of buyer competition. Having said that, the same holds true for sellers, who tend to wait until spring to make their move, giving buyers less options to choose from. But keep in mind … it only takes “one house” that could be the perfect home for you! With the lack of inventory still being the driving force of the market, buyer competition can be a key factor to getting your offer accepted by the seller. During the winter months, sellers may be a little bit more willing to negotiate with you knowing the real estate frenzy of the last 2 years, for now, appears to be in the rear-view mirror. 

Spring vs Winter Market

In years past, the housing market has gone through predictable seasonal trends in market activity. Winter as we know it, typically is a quiet time of year for real estate, while spring will see an increase of buyers entering the market as they begin their home search. Experts predict that this year will be no exception. Thus, if you are a “ready” buyer” now may just be the right time to start or continue your home search before your competition grows as more buyers enter the market.

Sellers May Be More Motivated

Low demand from buyers means sellers may be more likely to work with you. In fact, sellers have been more willing to negotiate this winter because there are fewer buyers in the market. But keep in mind, the advantages buyers have this winter may be short lived. The competition you face could be greater come spring, if you wait to make a move … and with increased buyer demand gives the seller less motivation to negotiate with you

Laura

The Key To Your Real Estate Success

Helping buyers and sellers achieve their real estate goals

In an effort to bring down inflation, the Federal Reserve took action. In response to this action, mortgage rates jumped up rapidly from the record lows we saw in 2021, which was just up over 7% last October. As a result, buyers that were in the market early on came to realize that their purchasing power was less as interest rates increased. Buyers needed to make decisions based upon this reality, lower their purchase price to stay within their budget, or put a pause on their home purchasing plans and go into wait and see mode. 

Today, the rate of inflation is starting to slow, and as a result, we have seen mortgage rates follow suit dipping below last year’s peak. Sam Khater, Chief Economist at Freddie Mac, states “While mortgage market activity has significantly shrunk over the last year, inflationary pressures are easing and should lead to lower mortgage rates in 2023.”

This could be potentially great news if you’re a buyer looking to jump in/back into the housing market. Any drop in mortgage rates will give the buyer more purchasing power by bringing down your monthly mortgage payment. This means the lower mortgage rates that experts forecast for this year may just be what the buyers need to get off the sidelines and back into the game. 

While this is great news for the buyers, let’s set the expectations … yes, rates are expected to take a dip in 2023 – but they are not expected to drop back down to the rates we saw in 2021. Greg McBride, Chief Financial Analyst at Bankrate, states  “I think we could be surprised at how much mortgage rates pull back this year. But we’re not going back to 3 percent anytime soon, because inflation is not going back to 2 percent anytime soon.”

It’s important to have reasonable expectations of what you can expect this year when it comes to mortgage rates. Speak to a professional mortgage lender to get good sound advice as you start your journey towards homeownership. Remember, knowledge is power that enables you to put your best foot forward. You may be pleasantly surprised with even just a mild drop in mortgage rates on how that will affect your monthly mortgage payment.

If you are just getting into the market, I would suggest as a first step … speak with a professional mortgage lender and get pre-approved. From there, you will get a bit of an education on the process and a good understanding of what your budget will afford you as you start your home search. 

Laura

The Key to Your Real Estate Success

Helping buyers & sellers achieve their real estate goals