Have You Considered Investing In Real Estate?

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Have you ever considered buying a property as an investment? The property market is not reserved for experts and millionaires – you too could use it to make the most of your hard-earned savings.

A lot of people only buy a house as a family home and find paying off their mortgage before they reach retirement a big financial burden. Sound like you? However, buying a house as an investment (not living in it and instead renting it out) can make you a lot of money. In fact, it’s been shown that property outperforms other investments such as stocks, shares and savings accounts to bring you a nice fat profit in the long-term.

Yet somehow we’re all too cautious about hopping on the property investment train. Why? There are a few common apprehensions, questions and ‘buts’ people have when first looking at property, but there are good answers to all of them. So, before the words ‘finance’, ‘invest’ and ‘mortgage’ turn you off, have a read of the below to get clued in on what property investment can do for you and your piggy bank

But I don’t have the money to invest in property!

It’s a common misconception that you need to have all the cash up front. US banks may lend up to 75% of the property purchase price for investors, so for a $250,000 purchase (the average housing price in Lewisville according to Zillow) the total capital you need is $62,500. IRA’s and 401K’s are ways to get the down payment.

But I don’t want to take out another mortgage!

Before you panic about taking out a second mortgage, remember that the tenants who will be renting at your property will be paying off the mortgage for you, and that taking out a mortgage to pay for your investment means making more money.

But isn’t it risky?

As with all investments, there are low-risk and high-risk options.

But how can I make money from my investment if all my pennies are tied up in the property?

1) The increase in the property’s value over time. A well-chosen property and market will see the value of your investment jump up significantly over the course of five-to-ten years. You can then choose to resell at that higher price, keep it for longer to increase profits further or pass on the investment to your children.

2) The rent your tenants will pay you. This can cover the mortgage and/or provide you with an additional regular income – remember, rents will also increase over time as the area you invest in becomes more popular.

But I don’t want to be a landlord!

You don’t have to be! There are property management companies that exist to take that responsibility off of your hands. They can handle everything, from decorating and tenanting to taxes and reselling, and you’ll still be able to make a healthy profit.

When you’re ready to learn more or if you’re already clued in and want some more in-depth market advice, contact Jim Trump & Associates today! (214) 609-7123 or jtrump@kw.com

Why You Should Sell Your House NOW!!

School is back in session, the holidays are right around the corner, you might not think that now is the best time to sell your house.  But with inventory below historic numbers and demand still strong, you could be missing out on a great opportunity for your family.

Demand is Strong

Foot traffic refers to the number of people out actually physically looking at home right now. The latest foot traffic numbers show that there are more prospective purchasers currently looking at homes than at any other time in the last twelve months which includes the latest spring buyers’ market. These buyers are ready, willing and able to buy…and are in the market right now! As we get later into the year, many people have other things (weather, holidays, etc.) that distract them from searching for a home. Take advantage of the buyer activity currently in the market.

There Is Less Competition Now

Housing supply is still under the historical number of 6 months’ supply. This means that, in many markets, there are not enough homes for sale to satisfy the number of buyers in that market. This is good news for home prices. However, additional inventory is about to come to market. There is a pent-up desire for many homeowners to move as they were unable to sell over the last few years because of a negative equity situation. Homeowners are now seeing a return to positive equity as real estate values have increased over the last two years. Many of these homes will be coming to the market in the near future. Also, new construction of single-family homes is again beginning to increase. A recent study by Harris Poll revealed that 41% of buyers would prefer to buy a new home while only 21% prefer an existing home (38% had no preference). The choices buyers have will continue to increase over the next few months. Don’t wait until all this other inventory of homes comes to market before you sell.

The Process Will Be Quicker

One of the biggest challenges of the 2014 housing market has been the length of time it takes from contract to closing. Banks are requiring more and more paperwork before approving a mortgage. Any delay in the process is always prolonged during the winter holiday season. Getting your house sold and closed before those delays begin will lend itself to a smoother transaction.

There Will Never Be a Better Time to Move-Up

If you are moving up to a larger, more expensive home, consider doing it now. Prices are projected to appreciate by over 19% from now to 2018. If you are moving to a higher priced home, it will wind-up costing you more in raw dollars (both in down payment and mortgage payment) if you wait. You can also lock-in your 30 year housing expense with an interest rate in the low 4’s right now. Rates are projected to be over 5% by this time next year.

It’s Time to Move On with Your Life

Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should? Only you know the answers to the questions above. You have the power to take back control of the situation by putting your home on the market. Perhaps, the time has come for you and your family to move on and start living the life you desire.

That is what is truly important. 

For professional real estate service, contact The North Texas Home Hunter at (214) 609-7123 or jtrump@kw.com

 

Does “Back To School” Really Affect The Real Estate Market??

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According to a 2013 survey by Trulia, two-thirds of adults with a child under the age of 12 have answered that school districts are the most important factor when looking for a home to purchase. Considering that these parents will also want to be settled in and have their child start at the beginning of the school year (as opposed to uprooting and possibly changing schools partway through the year), it is unsurprising that in 2014, an estimated 60% of all houses sold will have been sold between the months of May and August. 

This trend is only expected to rise as more and more Millennials are having families and buying homes. Millennials are looking for good school districts for their children and are less likely to compromise than the other generations. On a Realtor.com survey, 52% of them report that a poor school district is an absolute deal breaker when searching for a home. Compare this to only 31% of all other buyers answering the same. 

However, not all buyers will have children, and home buyers who do not have children are not influenced in the same ways, naturally. They have different moving time frames and different deal breakers. According to Zillow, more than half of home buyers aren’t married and aren’t operating on school timelines. They, obviously, aren’t concerned about living within a specific school district. To sell to this group of home buyers, the best time to list your home is around (and right after) the holidays, in December and January. 

Despite the large amount of home buyers who do not have children, 60% of people who do move into a new home continue to do so in the summer months—keeping spring as the number one season in which to sell a home. 

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With that in mind, if you want to buy a home and children aren’t a factor for you, conducting your home search in the winter months will mean less competition. Statistically speaking, January is shown to be the best month for making an offer on a home. There will be less competition from other potential home buyers and sellers tend to be more motivated, especially if they are feeling financially overextended from Christmas. 

Timing your listing can make or break a home sale, as you want to make sure you appeal to the right audience at the right time without leaving your home sitting on the market for too long. If you have any questions about what time is best for listing your home, I would love to speak with you! For professional real estate service, please contact me at (214) 609-7123 or jtrump@kw.com.

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Where Are Mortgage Rates Headed?

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The interest rate you pay on your home mortgage has a direct impact on your monthly payment. The higher the rate the greater the payment will be. That is why it is important to look at where rates are headed when deciding to buy now or wait until next year. 

According to a recent article in Kiplinger, 30 year mortgage rates are about to increase: 

“Now around 4.1%, rates will edge slowly toward 4.4% by the end of this year. Then they’ll follow the Treasury bond rate’s upward move in early 2015. Thirty-year home loans should end 2015 at around 5.1%, still low by historical standards.” 

Here is a graph created by using interest rate projections in Freddie Mac’s August 2014 U.S. Economic & Housing Market Outlook:

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How will this impact a mortgage payment? 

Research released this month by Zillow reveals: 

“We examined how a 1 percentage point rise in mortgage rates would impact monthly payments for the typical home in 35 metro areas, and found that the difference this year versus next year varies dramatically from market to market. In the San Jose/Silicon Valley area, for example, potential buyers should expect to see a monthly payment increase of more than $700 if they waited a year to buy the same home they were considering today. By contrast, in St. Louis, the difference is only $65 per month.” (Emphasis added) 

Bottom Line: 

Again, we turn to the Zillow research: 

“As rates rise, new home buyers will confront higher financing costs and monthly mortgage payments. For many, this will mean tightening their budgets and sacrificing some luxuries they may take for granted today.”

 The question one must ask themselves is, “Is it really worth it to wait?” You’ve missed the bottom of the rates, don’t get snowed under by the rising home prices and interest rates. Contact me immediately in order to professionally list your home for sale and find you your next castle! (214) 609-7123, jtrump@kw.com or find me at http://www.JimSellsFlowerMound.com 

5 Reasons To Hire A Real Estate Professional

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Whether you are buying or selling a home, it can be quite an adventurous journey. You need an experienced Real Estate Professional to lead you to your ultimate goal. In this world of instant gratification and internet searches, many sellers think that they can “For Sale by Owner” (FSBO). The 5 Reasons You NEED a Real Estate Professional in your corner haven’t changed, but have rather been strengthened in recent months due to the projections of higher mortgage interest rates & home prices as the market continues to recover. 

What do you do with all this paperwork?

Each state has different regulations regarding the contracts required for a successful sale, and these regulations are constantly changing. A true Real Estate Professional is an expert in their market and can guide you through the stacks of paperwork necessary to make your dream a reality. 

Okay, so you found your dream house, now what?

According to the Orlando Regional REALTOR Association, there are over 230 possible actions that need to take place during every successful real estate transaction. Don’t you want someone who has been there before, who knows what these actions are to make sure that you acquire your dream? 

Are you a good negotiator? 

So maybe you’re not convinced that you need an agent to sell your home. However, after looking at the list of parties that you need to be prepared to negotiate with, you’ll realize the value in selecting a Real Estate Professional. From the buyer (who wants the best deal possible), to the home inspection companies, to the appraiser, there are at least 11 different people that you will have to be knowledgeable with and answer to, during the process. 

What is the home you’re buying/selling really worth? 

It is important for your home to be priced correctly from the start to attract the right buyers and shorten the time that it’s on the market. You need someone who is not emotionally connected to your home to give you the truth as to your home’s value. According to the National Association of REALTORS, “the typical FSBO home sold for $184,000 compared to $230,000 among agent-assisted home sales.” Get the most out of your transaction by hiring a professional.

Do you know what’s really going on in the market? 

There is so much information out there on the news and the internet about home sales, prices, mortgage rates; how do you know what’s going on specifically in your area? Who do you turn to in order to competitively price your home correctly at the beginning of the selling process? How do you know what to offer on your dream home without paying too much, or offending the seller with a low-ball offer? Dave Ramsey, the financial guru advises: 

“When getting help with money, whether it’s insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman.”

Hiring an agent who has their finger on the pulse of the market will make your buying/selling experience an educated one. You need someone who is going to tell you the truth, not just what they think you want to hear. 

Bottom Line:

You wouldn’t hike up Mt. Everest without a Sherpa, or replace the engine in your car without a trusted mechanic. Why would you make one of your most important financial decisions of your life without hiring a Real Estate Professional?

Jim Trump is a Realtor, and a Certified Negotiation Expert in the state of Texas. Less than 2% of licensed agents nationwide receive this designation, so to get the most out of your home selling it, or to get the best deal in purchasing your next home, call (214) 609-7123 of jtrump@kw.com

 

 

 

Tips For Home Buyers In A Hot Sellers Market!

The increase in housing demand has created a Sellers’ Market; this being the case, it is extremely important that buyers are prepared when they decide to buy in 2014! In order to compete in a seller’s market, buyers need to have their ducks in a row and look as strong as possible to a potential seller. Buyers—Be Ready!

The following are some great tips for being ready to move when the right property becomes available:

  1. Get Prequalified – Choose a lender so you know how much you can afford to buy. Complete a loan application so the lender has all of your pertinent information. Consider all loan options available; FHA, VA and Conventional. Discuss the pros and cons of how much of a down payment you will need with your lender so that you are educated going into the buying transaction.
  2. Review Your Credit Score – Have a mortgage lender check your credit and discuss your credit score with you. Often an increase in credit score by 10 points can make a huge difference in your interest rates. Discuss possibilities to increase your credit score with your lender. Some increases can be accomplished in 72 hours.
  3. Get Documents in Order– Locate your previous years’ W-2s and tax returns. Start saving paystubs and bank statements.
  4. Review Bank Statements for Large Deposits – Lenders will require any large deposits that aren’t income-related to be documented with a paper trail. Sold a car recently? Received a gift from a family member? Make sure that you have the necessary documentation to support any large deposits.
  5. Find a Great Real Estate Agent– Not all agents are created equally, so it is important to find an agent that you feel comfortable working with! Call me at (214) 609-7123 so that we can set up a no obligation consultation. That way, we get to know each other and make sure that we will be on the same page.

HAPPY HOUSE HUNTING!!