Tripp's Take on Real Estate: Episode 56

I encourage you to read through today’s e-mail all the way through to the end. Lots of content today - even more on the video. Missed last week’s episode, check it out here: https://www.thedomusgroup.com/blog/tripps-take-on-real-estate-episode-55/ 

As a Realtor who works with people needing housing, imagine the mental challenge reconciling the need to help those who can afford a home with those who can’t. I’ll talk a bit more about this at the end, and show how this holiday season we can help those less fortunate year round.

Do you own your own business, or have a side hustle? I want to chat with you. 

On the video, I cover additional topics including: 

1) If you’re contemplating selling an investment property (or any property for that matter) in the spring. Watch here [link to YT chapter] 

2) There were recent changes that allow you to buy a multi-family investment with little down. Watch here: [link to YT chapter]

3) Are you thinking about buying soon? The inventory may not be there for you. Watch here: [link to YT chapter]

Our main article today focuses on several questions buyers should be asking. I’ll cover three, but like I said last week, know there are probably 100+ questions that could/should be asked. These will be a good primer - but I welcome a full conversation with you whenever you have questions…and I’ll buy the coffee.

Jon Signature

3 Buyer Questions Asked & Answered

The range of questions for buyers will be determined by whether or not they’ve ever bought a home before. Naturally, first-time homebuyers will have tons of questions and less knowledge of the process whereas someone who has bought before should have questions, especially if it has been some time since their last transaction. All three questions here are applicable.

1. What’s the initial step in purchasing a home?

So glad you asked. Because for the longest time you’ve been stalking Zillow and Realtor.com and getting all of the listing updates and endless autosuggestion emails from them. Well, the practical answer is you need to establish what you qualify for before taking any next steps. It’s like building a house…you have to follow the right steps. Understanding how you’re going to finance a home purchase is step one.

Before any next steps, there are a ton of micro actions that need to be taken to lock your financing in. Otherwise if you don’t, the house is going to collapse when you’re going to move in. I can’t imagine how frustrating it is for someone to think they’re moving into a new place only to find that the lender they selected wasn’t able to get their loan funded for closing.

Know your finances, what you qualify for and have a trusted professional handling your loan.

2. What are my options if my offer is turned down?

Multiple offer situations, mismanaged expectations and poor education by your hired professional real estate team will make this particular question painful. If not handled properly, you’ll find yourself discouraged and sitting it out “waiting for prices to fall” or “interest rates to drop.”

The same advice we were given when we were kids, which seems almost out of date, really applies here. If you fall off a horse, get back on.

You need to expect that you will get an offer rejected. Especially if it’s a hot property and there are tons of people looking at the place.

I’ll tell you what I tell my clients: when you find the right place, pull out all the stops to get the best chance at winning it. Put an offer in immediately. Make sure it is competitive and in line with other recent sales in the area. A good Realtor will be able to keep you on the rails [both from over offering but also low-balling and having no chance at winning].

When a home comes on the market, whether coming soon or live, you need to be on it. Should you make a pre-market offer? Maybe. There’s so many things that your agent can/should be doing proactively to enhance your chances…but you have to be committed and ready to buy (otherwise what are you out there looking for?).

3. With home prices are going down, should I wait to buy?

Flag. I call a foul. Who says prices are going down? If you start with bad information, you’ll make bad decisions.

Bad premise and it’s not correct.

Fannie Mae did a poll of consumers, and 23% feel prices are going to fall over the next year (down from 37% in January). That’s just not based in reality. The facts show that home prices were up last year 4.5% to 6.6+% [through end of September]. Conservative estimates show that home appreciation will be around 2.5% in 2024.

So to answer the question you asked, why wait? Well, wait if you don’t have money to buy a home. You should be fiscally prepared to take on the mortgage, maintenance and ownership responsibilities. Because if you’re not, then maybe you shouldn’t move out of that rental or where you’re currently living. 

Maybe you live in a home you own and are asking about waiting to buy the next property. You’ll have realized equity gains, so it’s much less of a case to make for you. Don’t get stuck on yesterday’s numbers and the fact that you can’t buy a home for $200k anymore. As long as wages are rising, inflation is in check and mortgage rates improving, the long term picture seems very clear.

Be sure you’re asking these and more questions. Reach out to discuss any questions you have and let’s put data and context to the answers.

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Mortgage Rate Update

The mortgage interest rate (at close of business Monday) on a $500k home (with 20% down and a credit score of ~750) for a 30-year fixed-rate mortgage is 7.431%. 

This is down slightly from the previous weeks. Keep in mind that the Fed is meeting tomorrow. While it is expected that they’ll keep rates unchanged, let’s see how that impacts the markets. Doing nothing sends a message. Keep an eye out for that tomorrow.

And speaking off mortgages, check out the changes Fannie Mae made that could open opportunities for those of you who want to become investors. More in the video version.

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Do you own your own business or have a serious side hustle?

I’d love for you to share this with me so I can support you. I’d like to talk with you more about it…message me or email me to discuss. 

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The 25th Project

My business is in helping folks with housing. But when you’re dealing with someone who is homeless, that’s a bit of a different matter.

Clearly I want people to be able to be housed in a place that suits their needs. But when finances, decisions and life challenges prevent someone from even having a place to call home, that presents a tough challenge.

I’m pleased to present The 25th Project, created 21 years ago by my good friend Jay Herriot. Jay has a heart to help those down on their luck. He has given himself to help homeless in the Northern Virginia area. Throughout the year he is constantly working to help the homeless with employment, meals and temporary housing (tents). The 25th Project is always in need of supplies that will help support his mission. And I’m asking you to please look into this opportunity to help those less fortunate. This isn’t a Christmas thing. This is something they need throughout the year.

For those of you looking for a place to contribute year end gifts, would you join me in giving to The 25th Project. The Domus Group will be making a contribution of $500 to The 25th Project. Would you join us?

Learn more at https://www.the25thproject.org/ 

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As always, thanks for sticking with me throughout. Have a great week. Email me or reach out with questions.

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