Home Mortgage Rates Are Rising...Should I Rent or Buy?

As you listen to the news or surf the internet no doubt you have heard that interest rates are rising. In fact they have finally climbed back over 4%. Yes, I did say 4%. Potential home buyers are getting nervous tht the increae in rates will hinder them from buying a home. The truth is that interest rates were to low and had to eventually climb back up as the federal government startign stepping back form backing the mortgage loans and private insurers are now doing it. The reason is the government stepped in to help spur the housing market and drag us kicking and screamig out of the housing recession. It took a lot longer than anyone thought but it finally has started to work. Now with prices increasing gradually and the market stabilizing it is time for them to step away and let private investors back in. The problem is they want a larger return on thei investmetn than the government does. Thus the increase in interest rates. But just becuase rates have increased over 4% should you not buy a home? Three and half years ago I purchased a home at 5% interest rate and nver thought I see a rate in the four's when I got that. But just becuase rates ahve increased slightly does not mean you should not be looking to buy a home. I read a few articles that talked about this and did soem research in the Charlotte, NC. market to see what I could find out on buy versus rent. The average rent for a three bedroom apartmetn in Charlotte is $1086.00 a month. The average rent for a three bedroom house is $1450.00 a month. Depedning on the area and neighborhood you are looking in that price could be signifcantly higher. Factor i that you can buy a $150,000 to $250,000 house for the same payment that a rent would cost you on an apartmetn or a house. Would you rather own and gain equity and other beneftis to owning a hoime or rent and let someone else make money off of you? Even with interest rates over 4% it still is better to buy than rent. In fact a few economists said thsat with average home prices in the top 20 cities and average rents in the same cities that the inerest rate would have to hit almost 10% for it not to be worth owning a home....That is a signifcant increase in rates that I do not think we will see. I beleive the time is right to own a home. The question is not whether you should buy; but do you want to buy a home. A lot of peopl for a variety of reasons do not want to own a home right now. That is fine. But if you are on the fence now is the time to pull the trigger. Prices have been steadily increasing over the past few months, inventory levels are at all time lows, and interest rates are rising. If you were waiting to see the bottom. We were there a few months ago and now are climbing out. Evidence suggests that we will be only going up form here as well... Dave diCecco Realtor/Broker Coldwell banker United Cell:704-519-7895 ddicecco@cbunited.com www.davedicecco.com

Charlotte, NC. Housing Market Trends May 2013

There is a lot of talk about the housing market in Charlotte, NC. and whether it is improving or if this is a smoke screen. Being one of the largest metro areas in the United States and one of the fastest growing this trend plays a vital impact on home sellers and home buyers alike. So I decided to do a monthly analysis versus the previous year and two years ago during the same month and see where the trends are and how they are impacting the housing market in Charlotte, NC. here are the stats for May 2013: First, let's look at inventory of available homes buyers have to choose from in the Charlotte, NC. region. In 2011 there were 25085 homes for sale in May. In 2012 there were 20443 homes for sale in April. Last month there were 16032 homes for sale. That is a decline of 38% in two years of available homes buyers have to choose from. Second, the average sale price of homes in the Charlotte, NC. region for May 2011 was $206,227. In 2012 the average sale price was $202,419 and last month the average sale price was $212055. That is an increase of 2.8% in the average sale price in the Charlotte, NC. market. Third, let’s look at days in inventory. How long are houses sitting on the market? In 2011 the average home sat on the market for 13.4 months before being sold. In 2012 the number improved to 10.6 months and last month it improved to 6.5 months. That is a dramatic drop in inventory of over 48.5% in two years. What the trends are showing is that the housing market is out of the recession and available homes for sale have decreased to the lowest levels we have seen in over 5 years coupled with prices slowly creeping back up and more buyers out there than homes available and you have signs of a robust market in Charlotte, NC. If all three factors were trending equally it could be the market fixing itself. But the fact that inventory has declined 25% less than average days on market means we are getting more buyers out there than homes right now and it is starting to cause prices to go up. This is a good thing for the housing industry and the economy. Coupled with the fact, home prices are not skyrocketing to adjust for decrease of inventory and interest rates continue to be at all time lows is keeping a stable growth in the Charlotte, NC. market. However; in comparison to last months trends the numbers seem to be reflecting that the housing market has stabilized and some prices are starting to come down. Generally this time of the year we start to see home prices slowly decline a little bit as sellers are little more motivated to sell when school is out and want to take advantage of moving the kids during the summer. In fact I have noticed it on homes I have shown that if they did not get an offer with in the first 30 to 45 days they are starting to reduce the price to compensate for the market. A lot of home owners were trying to capture a little extra in terms of price but now are starting to bring their prices down to where they should have been and correcting themselves in this market. Dave diCecco Realtor/Broker Coldwell Banker United Cell: 704-519-7895 ddicecco@cbunited.com www.davedicecco.com

Should A Seller Have A Pre-inspection Before listing Their Home?

A question I started to ask myself recently was should a seller have an inspection prior to listing their home on the market? I started thinking about this when one of my listings transactions fell through because of buyer financing. The buyer had done an inspection and provided me with the inspection report. We did all the repairs that were on the request (which was everything) and it cost the seller less than $500 to do. Upon terminating the other contract I rewrote the description to include inspection report and repairs done. I had four showings in the next few days after that and multiple offers...we received a price higher than we anticipated for the house. When he deal closed last week I asked the buyer's agent why they chose that house and came up so high over the asking price. The Realtor told me it was because of the condition of the house and the inspection report showed only minor items and the seller had already repaired them...We felt confident going in that the house was not going to have any issues.... That made we start thinking...Should I have sellers do a pre-inspection on their homes before I list them? Can I increase the value of the house? Or if there are issues the seller does not want to address will they lower their expectations on what the price should be? I think a pre-inspection can add value and benefit to a home....It can help put at ease some buyers concerns if the house is older and not as updated that everything is either working fine or if there are issues that the asking price reflects the work to be done to the house. Thinking about it had me looking at some listings I had done where the seller has done major renovations to their home in the past five years...it adds tremendous value to the home. Buyers feel more at ease when they know going in that all the items are newer. I really could not see the disadvantage to having a pre-inspection done to a home unless it is newer home or recently renovated. Even then the inspector is going to find something wrong with the house...(they all do). However; my experience has shown that the items they find wrong are minimal. Now though, you have a buyer looking at a house with an inspection report knowing the home was cared for and taken cared of...it makes the house more attractive to the buyer and more expensive as well...The unknown condition of the house is now gone form the equation. Dave diCecco Realtor/Broker Coldwell Banker United Cell:704-519-7895 ddicecco@cbunited.com www.davedicecco.com