Real Estate Information Archive

Blog

Displaying blog entries 1-10 of 88

What is the Cost of Waiting Until Next Year to Buy?

by Melissa Thompson

We recently shared that over the course of the last 12 months, home prices have appreciated by 7.0%. Over the same amount of time, interest rates have remained historically low which has allowed many buyers to enter the market.

As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.

The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Index Report, home prices will appreciate by 4.7% over the next 12 months.

What Does This Mean as a Buyer?

If home prices appreciate by 4.7% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:

Bottom Line

If buying a home is in your plan for 2018, doing it sooner rather than later could save you thousands of dollars over the terms of your loan.

Call at 901-756-8900 or visit my website to discover your new home!

By: KCM Crew

Housing and the Senate Tax Plan: What Now?

by Melissa Thompson

Members of the real estate industry are responding to the passage of the Senate tax plan, which chiefly includes a 20 percent corporate tax rate—down from 35 percent—and reduced rates for families and individuals over the next seven years. The development follows the House passage of its own plan in November.

Both bills challenge homeownership, industry members say. The bills extend the capital gains exclusion eligibility requirement that home sellers reside in the home from two of the last five years to five of the last eight. (The House plan, however, includes an income phaseout provision.) Both also raise the standard deduction, which has the potential to render the mortgage interest deduction (MID) useless.

“If eligibility rules for excluding the sale of a home from capital gains taxes are changed from requiring living in your home for two of the past five years to five of the past eight, selling the median U.S. home after four years of ownership would mean $2,363 in taxes, from $0 currently,” according to Skylar Olsen, senior economist at Zillow. An analysis recently released by Zillow reveals homeowners in high-priced markets would bear the brunt of costs from the lengthened tenure.

The MID itself is addressed in both plans, as well. The House plan caps the MID for new loans at $500,000 (and only for primary residences), whereas the Senate plan retains the current cap of $1 million.

Additionally, both bills cap local and state property tax deductions at $10,000.

According to the National Association of REALTORS® (NAR), the industry’s largest organization, homeownership incentives are jeopardized in the Senate plan.

“The tax incentives to own a home are baked into the overall value of homes in every state and territory across the country,” said NAR President Elizabeth Mendenhall in a statement. “When those incentives are nullified in the way this bill provides, our estimates show that home values stand to fall by an average of more than 10 percent, and even greater in high-cost areas. REALTORS® support tax cuts when done in a fiscally responsible way; while there are some winners in this legislation, millions of middle-class homeowners would see very limited benefits, and many will even see a tax increase. In exchange for that, they’ll also see much or all of their home equity evaporate as $1.5 trillion is added to the national debt and piled onto the backs of their children and grandchildren. That’s a poor foot to put forward, but this isn’t the end of the road. REALTORS® will continue to advocate for homeownership and hope members of the House and Senate will listen to the concerns of America’s 75 million homeowners as the tax reform discussion continues.”

“It’s time for homeowners to pay attention,” concurred Danielle Hale, chief economist of realtor.com®, in a statement. “While the House and Senate still need to agree to a single version of the tax plan, they are already aligned on provisions that take away homeownership incentives for the majority of owners, which we expect to reduce home sales and prices in markets across the country.”

Housing in general—but notably in several states—will suffer, Hale said.

“Homeowners in California, New York, New Jersey, and Maryland will be hit hard by the combination of changes in the proposal, which will lead to lower prices and sales in these housing markets,” said Hale. “High housing costs in California made it the state with the third-highest average mortgage interest deduction, behind Hawaii and the District of Columbia. Meanwhile, the elimination of the state income tax deduction for individuals will affect taxpayers in Maryland, the District of Columbia, Connecticut, New Jersey, Massachusetts, and Virginia, each of which saw 35 percent or more of tax payers take advantage of this provision. Lower-priced housing markets will also eventually be impacted, as these provisions are not indexed by inflation; thus, the few remaining tax benefits for homeownership will be eroded over time.”

The California Association of REALTORS® (C.A.R.) expressed its own concerns about the Senate plan in a statement.

“We are disappointed that the Senate voted to pass a tax hike bill on California homeowners,” said C.A.R. President Steve White. “If the goal of this bill is to help middle-class Americans keep more of their hard-earned money, this proposal fails miserably. We thank California Senators Dianne Feinstein [D-Calif.] and Kamala Harris [D-Calif.] for opposing this legislation that attacks homeownership by significantly reducing incentives for people to buy homes. California already has a severe housing affordability crisis, and this bill will make it that much harder for Californians looking to attain the American Dream.”

The National Association of Home Builders (NAHB) countered that the Senate plan “represents a step in the right direction” in an NAHB Now update. The NAHB opposes the House plan in part because it applies the MID only to primary residences, and imposes an income phaseout on the capital gains exclusion.

The Mortgage Bankers Association (MBA), meanwhile, applauded the Senate for considering mortgage servicing rights (MSRs) in its deliberations.

“I want to personally thank Majority Leader [Mitch] McConnell, [Senate Finance Committee] Chairman [Orrin] Hatch [R-Utah], Senator [Mike] Rounds [R-S.D.], [Senate Banking Committee] Chairman [Mike] Crapo [R-Idaho], and Senator [David] Perdue [R-Ga.] for working with us and commend them for their efforts on this important issue,” said MBA CEO and President David H. Stevens in a statement. “Because of the Rounds Amendment, this package will protect the ability of most Americans to obtain safe, decent shelter and affordable home mortgage credit without disruption. Had this language not been included, the change in tax accounting for MSRs would have had a devastating impact on the flow of capital that supports a robust and competitive real estate finance market, both single- and commercial/multifamily. We thank the Senate for its leadership on this issue.”

According to the National Low Income Housing Coalition (NLIHC), the affordability crisis will escalate under the Senate plan. Diane Yentel, CEO and president of the NLIHC, issued the following statement:

“The Senate tax plan not only fails to make any new investments to address the nation’s growing scarcity of affordable rental homes for America’s poorest families, but it would lead to deep funding cuts to existing affordable housing programs, threatening to worsen the severity of an affordable housing crisis that impacts every state and community.”

The differences between the House and Senate plans remain to be settled. Lawmakers are aiming to present a reconciled plan to President Trump by Christmas.

By and photo credit: http://rismedia.com/2017/12/04/housing-senate-tax-plan-what-now/#close

Median Days on the Market Drops to 34!

by Melissa Thompson

Some Highlights:

- The National Association of REALTORS® surveyed their members for their Confidence Index.

- The REALTORS® Confidence Index is a key indicator of housing market strength based on a monthly survey sent to over 50,000 real estate practitioners. Practitioners are asked about their expectations for home sales, prices and market conditions.

- Homes sold in less than 60 days in 44 out of 50 states, and Washington D.C.

- Homes typically went under contract in 34 days in October!

Contact your local expert’s at The Melissa Thompson Team 901-729-9526 or Melissa@YourKeyTomemphis.com for all your Real Estate needs!

By: KCM Crew

New Beginnings - Starting Traditions in Your New Home

by Melissa Thompson

If this is your first holiday in your new home, it is a perfect time to start some new traditions!  When you move, you don’t leave everything behind.  You bring your belongings and your memories and yes, your traditions.  But a fresh start in an unfamiliar house is just the inspiration you need to begin unique traditions that will make that house feel like your home.

Check out these fun ideas for creating new traditions:

  • Take and annual family photo. Choose a theme or a pose that you can recreate every year.  Label the photos with the date and create a photo book or framed collage with them.  It will be so much fun for your family to see how everyone changes through the years. Creative Family Photo Ideas
     
  • Incorporate a cultural tradition.  No matter what holiday you celebrate, you will find a cultural tradition to go with it.  Make it a family activity to research your heritage and make new discoveries about how your ancestors celebrated.  Multi-Cultural Holiday Celebrations
     
  • Gratitude. It’s not just for Thanksgiving. Sometimes we take all that we have for granted. A wonderful way to experience the holiday spirit is to express gratitude.  This can be a fun and meaningful activity for the whole family.  Go outdoors and find a branch to use to hold your “ornaments of gratitude”. Cut ornaments out of colorful paper and each day have family members write something they are grateful for on one. Then hang the ornaments on the “tree” to create a beautiful reminder of all that is right with your world!  Paper Ornament Crafts

If you are still in search of the perfect house to make your new home, contact Melissa Thompson for all your real estate needs! Happy Holidays!

http://www.yourkeytomemphis.com/Blog/Giving-Thanks-by-Giving-Back
http://www.yourkeytomemphis.com/Blog/Dont-Let-the-Holidays-Stress-You-Out
View our Video Blog

Bubble Alert! Is it Getting Too Easy to Get a Mortgage?

by Melissa Thompson

There is little doubt that it is easier to get a home mortgage today than it was last year. The Mortgage Credit Availability Index (MCAI), published by the Mortgage Bankers Association, shows that mortgage credit has become more available in each of the last several years. In fact, in just the last year:

  • More buyers are putting less than 20% down to purchase a home
  • The average credit score on closed mortgages is lower
  • More low-down-payment programs have been introduced

This has some people worrying that we are returning to the lax lending standards which led to the boom and bust that real estate experienced ten years ago. Let’s alleviate some of that concern.

The graph below shows the MCAI going back to the boom years of 2004-2005. The higher the graph line, the easier it was to get a mortgage.

As you can see, lending standards were much more lenient from 2004 to 2007. Though it has gradually become easier to get a mortgage since 2011, we are nowhere near the lenient standards during the boom.

The Urban Institute also publishes a Home Credit Availability Index (HCAI). According to the Institute, the HCAI:

“Measures the percentage of home purchase loans that are likely to default—that is, go unpaid for more than 90 days past their due date. A lower HCAI indicates that lenders are unwilling to tolerate defaults and are imposing tighter lending standards, making it harder to get a loan. A higher HCAI indicates … it is easier to get a loan.”

Here is a graph showing their findings:


Again, today’s lending standards are nowhere near the levels of the boom years. As a matter of fact, they are more stringent than they were even before the boom.

Bottom Line

It is getting easier to gain financing for a home purchase. However, we are not seeing the irresponsible lending that caused the housing crisis.

Let’s get together and find out how much house you can afford! 901-729-9526 or Melissa@YourKeyTomemphis.com

BY: KCM Crew

View our Video Blog

Top 4 Home Renovations for Maximum ROI

by Melissa Thompson

Some Highlights:

  • Whether you are selling your home, just purchased your first home, or are a homeowner planning to stay put for a while, there is value in knowing which home improvement projects will net you the most “Return On Investment” (ROI).
     
  • While big projects like adding a bathroom or a complete remodel of a kitchen are popular ways to increase a home’s value, something as simple as updating landscaping and curb appeal can have a quick impact on a home’s value.

Contact your local expert’s at The Melissa Thompson Team 901-729-9526 or Melissa@YourKeyTomemphis.com for all your Real Estate needs!

By: KCM Crew 

View our Video Blog

A Housing Bubble? Industry Experts Say NO!

by Melissa Thompson

With residential home prices continuing to appreciate at levels above historic norms, some are questioning if we are heading toward another housing bubble (and subsequent burst) like the one we experienced in 2006-2008.

Recently, five housing experts weighed in on the question.

Rick Sharga, Executive VP at Ten-X:

“We’re definitely not in a bubble.”

“We have a handful of markets that are frothy and probably have hit an affordability wall of sorts but…while prices nominally have surpassed the 2006 peak, we’re not talking about 2006 dollars.”

Christopher Thornberg, Partner at Beacon Economics:

“There is no direct or indirect sign of any kind of bubble.”

“Steady as she goes. Prices continue to rise. Sales roughly flat.…Overall this market is in an almost boring place.”

Bill McBride, Calculated Risk:

“I wouldn't call house prices a bubble.”

“So prices may be a little overvalued, but there is little speculation and I don't expect house prices to decline nationally like during the bust.”

David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices:

“Housing is not repeating the bubble period of 2000-2006.”

“…price increases vary unlike the earlier period when rising prices were almost universal; the number of homes sold annually is 20% less today than in the earlier period and the months’ supply is declining, not surging.”

Bing Bai & Edward Golding, Urban Institute:

“We are not in a bubble and nowhere near the situation preceding the 2008 housing crisis.”

“Despite recent increases, house prices remain affordable by historical standards, suggesting that home prices are tracking a broader economic expansion.”

Let’s get together to discuss your home buying and home selling needs. 901-729-9526 or Melissa@YourKeyTomemphis.com

By: KCM Crew

The Difference an Hour Makes in Real Estate

by Melissa Thompson

Every Hour in the US Housing Market: 

  • 624 Homes Sell
  • 347 Homes Regain Positive Equity
  • Median Home Values Go Up $1.13

Contact your local expert’s at The Melissa Thompson Team 901-729-9526 or Melissa@YourKeyTomemphis.com for all your home buying and home selling needs!

By: KCM Crew

The She Shed: A Place to Call Your Own

by Melissa Thompson

The she shed trend has arrived and it looks like it’s here to stay. And really, what took so long?  Men have had their “caves” for years.  Women should have their own space to get away and unwind too!  Whether a she shed is used for relaxation and contemplation, watching chick flicks, or as a space for hobbies, it is a long overdue oasis for hardworking women who deserve a peaceful space to call their own.  If you’re ready to create your own she shed, here are some ideas for you:

If you already have a backyard shed, you are going to need to clean it out.  Completely.  You will want a blank slate for designing your perfect environment.  Find new storage options for the items you are keeping and give away the rest.  If you don’t have a shed, you can build one with a build-your-own shed kit purchased online or from a local home improvement store.

Show off your one-of-kind sense of style by giving your she shed a fresh coat of paint.  Choose colors that you love.  Do you want a rustic look, or do you dream of a storybook cottage? The ideas for designing your own personal retreat are endless.  Remember, it’s all about YOU!

Think about what you want the purpose of your shed to be.  Will you use it as a peaceful sanctuary where you can curl up with a good book?  Perhaps you might set up an easel and use it as your art studio.  Whatever your intent, be sure to keep it in mind while coming up with your design. 

You don’t have to spend a lot of money to furnish and decorate your she shed.  Search antique stores and flea markets for unique pieces.  The idea is to make it feel relaxed and cozy.  You might already have everything you need, but just needed a special place for it all. 

Choose a spot in the yard that takes you away from your day to day grind and makes you feel surrounded by nature.  Lush plants and window boxes full of flowers will give you a tranquil ambiance that will provide the calm environment needed for quiet serenity.

The most important thing is to make your she shed a reflection of yourself. And remember…it’s a woman’s prerogative to change her mind, so as your interests and hobbies shift, your shed can transform with you and always be there to fulfill your needs and desires.

http://www.yourkeytomemphis.com/Blog/Maximizing-Small-Spaces

http://www.yourkeytomemphis.com/Blog/Popular-Flooring-Trends

http://www.yourkeytomemphis.com/Blog/Luxurious-Laundry-Rooms

View our Video Blog

Buying a Home Can Be Scary... Unless You Know the Facts

by Melissa Thompson

Some Highlights:

Many potential homebuyers believe that they need a 20% down payment and a 780 FICO® score to qualify to buy a home, which stops many of them from even trying! Here are some facts:

  • 40% of millennials who purchased homes this year have put down less than 10%.
  • 76.4% of loan applications were approved last month.
  • The average credit score of approved loans was 724 in September.

Let the experts at The Melissa Thompson Team help you decide if now is the right time for you to purchase a home! 901-729-9526 or Melissa@YourKeyTomemphis.com.

By: KCM Crew

View our Video Blog

Displaying blog entries 1-10 of 88

Contact Information

Photo of Melissa Thompson Real Estate
Melissa Thompson
Crye-Leike Realtors
6525 N Quail Hollow Road
Memphis TN 38120
(901) 729-9526
(901) 756-8900
Fax: (901) 435-0620