Real Estate
Nearly a Third of Home Sellers’ Top Stressor is Buying, Selling at the Same Time
Written by CRISSINDA PONDER
Edited by DEBORAH KEARNS
Published on: July 27th, 2020
For many home sellers, the most anxiety-inducing part of the home-selling process is trying to simultaneously sell their current place while buying their next dream home.
That’s according to findings from a new survey commissioned by LendingTree, which also found that sellers are planning to spend an average of more than $10,000 on repairs and upgrades to sell their home.
Key findings
The No. 1 stressor for nearly one-third (29%) of home sellers is buying and selling a home at the same time.
Another 16% of sellers report that costly repairs and upgrades are the most stressful part of selling a home, and 15% stress most about failing to sell their home.
More than 1 in 5 (22%) of home sellers have felt pressure from their agent to accept a lower-priced offer.
Another 22% felt their real estate agent pressured them to spend a significant amount of money on repairs and upgrades before selling their home. Still, 31% of sellers reported not feeling any pressure at all.
When broken down by age group, millennials (70%) were more likely to feel some sort of selling-related pressure than older generations such as Gen X (49%) or baby boomers (14%).
More than 4 in 10 (43%) strongly agree that the home-selling process is more expensive than they anticipated.
Another 43% of home sellers somewhat agree that they’re spending more than expected on their home sale. Meanwhile, more than half (51%) of millennials strongly agree with that sentiment, compared with just 28% of baby boomers.
Other takeaways
Nearly 1 in 5 (18%) millennials said the top stressor of selling a home is deciding on an asking price, compared to just 10% of Gen Xers and 6% of baby boomers.
More than 1 in 5 (21%) baby boomers are most stressed about making costly home repairs and upgrades to sell their home. Another 22% of baby boomers fear that their home won’t sell, compared with 15% of Gen Xers and 10% of millennials.
When asked how long they think their home will stay on the market before it’s sold, more than 4 in 10 (44%) sellers said one to three months. More than 1 in 4 (27%) think it will take four to five months to sell their home.
Home sellers expect to spend more than $10,000 on average for repairs and upgrades in order to sell their home. Millennial sellers anticipate spending $13,727 on average, which is the highest amount of all age groups.
After removing decorations and decluttering, the top three repairs and upgrades home sellers have made are:
- Fresh interior paint (48%)
- Bathroom upgrades (45%)
- New kitchen appliances (45%)
4 factors to consider when selling your home
The cost to sell a home can reach more than $20,000, depending on your home’s sales price. Keep the following factors in mind as you prep for a home sale:
- Be mindful of your timeline. If you’re buying a home while selling your current one, it’s important to bake in enough time to find your new home. The average time close on a home purchase is 47 days, according to Ellie Mae’s June Origination Insight Report.
- Get a home inspection. Before you list your home for sale, pay for a home inspection to identify issues with your home’s condition that may need to be addressed right away. If the buyers discover the issue during their inspection, negotiating repairs could postpone or derail the sale.
- Negotiate your selling costs. You’ll have to pay several closing costs, including commissions for both your and the buyer’s real estate agent. It’s in your best interest to negotiate these fees, as they can cost several thousand dollars.
- Reduce your mortgage debt. Your mortgage will need to be paid off first before you receive any sales proceeds. In the months before you begin the home-selling process, consider dedicating any bonuses, refunds or windfalls to paying down your outstanding loan balance.
Methodology
For this survey, LendingTree commissioned Qualtrics, an experience management firm, to gather responses from 964 home sellers, with the sample base proportioned to represent the overall population. The survey was conducted April 24-30, 2020.
Generations were defined by the following age ranges:
- Millennials are ages 24-39
- Generation X are ages 40-54
- Baby boomers are ages 55-74
Our survey also included responses from members of Generation Z (ages 18-23) and the silent generation (ages 75 and older). Their responses were factored into the overall percentages but excluded from the generational breakdowns, due to the low sample size among both age groups.
Sierra Lifestyle Team Note: A good Real Estate Team on your side is essential to reducing your stressors as you prepare to sell your house and go through the process. Your agent(s) should be prepared to discuss their value proposition to assist you in selling your home, maximize your offer price, and minimize the time frame for selling.
Real Estate
Market Observations
September 2020
Lack of inventory in Nevada County continues to be a feature of the current real estate market.
The numbers are nearly identical to previous months. 641 houses for sale August 2019 vs 265 houses for sale August 2020. That’s a reduction from 4.6 months of inventory to 1.3 months of inventory. A very strong SELLER’S MARKET continues, especially considering Nevada County’s attractiveness as one of the premier work-from-home communities.
The average SOLD price per square foot is up 6% year to year ($233 vs $239). Average price sold is up 13.4%, from $463,000 to $524,000. Higher list prices are prevailing.
Nevada County continues to be strongly attractive to buyers looking for safer havens, especially coupled with the myriad lifestyle opportunities and community connections the foothills offer.
We are seeing multiple offers for good listings here, with a number of houses going for over asking prices. If you are contemplating selling a property, we have rarely seen a better time!
Don’t hesitate to call us for evaluations of your home’s value or to tour homes on the market you have interest in. We are here for you, and Alisa always answers her cell phone, 530-559-4871.
ON SOCIAL MEDIA
by Karissa Johnson
Social Media has many benefits, especially for businesses.
It is a tool that many people tend to overlook. Having a good social media presence is especially important as we move further and further into a world dependent on technology. Perhaps the best way to get business is by word of mouth and advertising, social media combines those. When a business posts something on social media, not only is it being spread to more people than you can reach with typical advertising, but it also creates a personal connection between the business and the consumer making them more likely to pick that business over any other. Social media can help businesses grow immensely in size, and reach new younger customers that are essential to keeping a business alive.
Overall, Social Media is only a positive for businesses looking to grow, reach more customers, and to create more personal connections with customers.
The Sierra Lifestyle Team utilizes our robust Social Media skills to benefit the sale of your home, reaching thousands of qualified buyers on Facebook. We don’t rest on our laurels…and are pleased to announce a new INSTAGRAM manager, Karissa Johnson.
Karissa will head up our new Instagram program to highlight your properties to thousands of interested buyers, giving you significant new exposure to interested real estate buyers.
Brought to you by Johnson’s Sierra Lifestyle Team!
Sellers Are Calling the Shots, But for How Much Longer?
September 11, 2020
The housing market continues to outperform historical standards as prices accelerate to new highs and homes sell faster, according to realtor.com®’s latest Weekly Recovery Report.
“Sellers are calling the shots in today’s market,” says Danielle Hale, realtor.com®’s chief economist. “Prices are rising and housing inventory is vanishing almost as fast as it appears.”
However, Hale points to two housing indicators that may hint at a turn in the market.
Housing demand from buyers has cooled slightly, while new listings showed a smaller decline than previous weeks, Hale says. “This could be a hiccup in weekly activity, or, if these trends continue, they could signal a shift in market dynamics leading into the fall when political, economic, and health-related uncertainties abound,” she says.
Realtor.com®’s Housing Market Index reached a reading of 107.7 for the week ending Sept. 5. That’s 7.7 points higher than its pre-COVID-19 baseline in January. Buyer demand dropped 3.3 points since last week, and inventory showed improvement, rising 3.2 points higher—though it still remains below its pre-COVID-19 baseline.
Meanwhile, home prices continue to escalate.
Median listing prices are up 10.8% annually, which is the fastest pace of growth in more than two years, realtor.com® reports. Time on the market is now 12 fewer days than a year ago. “Buyers are moving much faster than this time last year to beat out competition and lock in low mortgage rates,” realtor.com® reports. “This means homes are sitting on the market for much less time, despite notably higher price tags.”
Nevada County, Real Estate
Market Observations
August 2020
Lack of inventory in Nevada County continues to be a feature of the current real estate market.
621 houses for sale July 2019 vs 297 houses for sale July 2020, a significant 52.6% decline. That’s a reduction from 4.3 months of inventory to 1.3 months of inventory, a very strong SELLER’S MARKET.
THE average SOLD price per square foot is up 6.7% year to year ($255 vs $239). Average price sold is up 13.4%, from $493,000 to $559,000. Higher list prices are prevailing.
Units PENDING are up 86.3%. While Nevada County has long been a magnet for buyers from the SF Bay Area, and to a lesser extent, the Los Angeles region, we believe the relative safety of our area continues to drive interest and sales. The pending numbers support that.
If you are contemplating selling a property, we have rarely seen a better time!
Don’t hesitate to call us for evaluations of your home’s value or to tour homes on the market you have interest in. We are here for you, and Alisa always answers her cell phone, 530-559-4871.
Fed ‘Not Even Thinking’ About Raising Rates, Real Estate on the Rebound
By Liz Dominguez
The Federal Open Market Committee (FOMC) met this week, leaving interest rates near zero to help buoy an economy heavily hit by the current health crisis.
“The path forward for the economy is extraordinarily uncertain and will depend in large part on our success in keeping the virus in check,” Fed Chair Jerome H. Powell said in a statement, adding that the “pace of recovery looks like it has slowed,” as more states continue to battle a second wave of increasing coronavirus cases.
The Fed will continue to monitor the markets but, as of now, is not “even thinking about” raising rates and will keep rates low “until it is confident that the economy has weathered recent events.”
Recent data shows just how much the coronavirus pandemic has impacted the economy. According to the Commerce Department, the U.S. GDP (gross domestic product) fell 9.5 percent in the second quarter of the year—on an annualized basis, GDP fell at a rate of 32.9 percent.
“As expected, economic activity collapsed in the second quarter due to the total virus-lockdown in April and only partial re-openings in May. The GDP contraction of 33 percent on an annualized basis is the steepest ever experienced in the U.S.,” said Dr. Lawrence Yun, chief economist, National Association of REALTORS® (NAR). “Even with the stimulus and enhanced unemployment benefits, consumer spending collapsed by a massive 35 percent. Business spending also collapsed by 27 percent. Even residential investments—comprising of home sales, home building and remodeling activity—dropped by nearly 40 percent.
“This morning’s advance report on second quarter GDP showed that the economy contracted 32.9 percent—the largest single quarter drop on record—as COVID-19-driven business closures and restrictions on in-person activity sharply reduced consumer spending and business investment,” said Joel Kan, AVP of Economic and Industry Forecasting, Mortgage Bankers Association (MBA). “In recent weeks, housing demand has rebounded sharply, and we expect the rest of the economy to recover in the second half of the year.
Third quarter data should be more optimistic as states began reopening amid a decline in COVID cases.
“The good news is that this data is backward-looking. Third quarter data will show a massive increase. Personal savings rates are the highest ever, with massive deposits at banks,” said Yun. “There will be an unleashing of spending in the upcoming months as economies open further. Home sales have already been rising strongly and will continue to do so. GDP growth in the third quarter could be as high as 30 percent. Note: This data will come out three days before the November election.”
However, with the last few weeks showing deterioration across various states, the economic rebound could slow. Unemployment filings totaled 1.43 million last week, according to the Labor Department—the second weekly increase.
“The adverse impacts to the job market and hardships for many households may persist—especially if virus cases continue to rise in several parts of the country,” said Kan. “There are still many workers who have not returned to work, households in need of mortgage or rent forbearance, and an overall sense of uncertainty ahead. We expect the Federal Reserve to keep rates low, and monetary policy supportive, until there are clearer signs of an economic recovery.”
An upside to the Fed’s near-zero lock-in? Fed rates can indirectly influence mortgage interest rates, which just decreased slightly according to Freddie Mac’s Primary Mortgage Market Survey® (PMMS®).
“It’s Groundhog Day in the mortgage market as rates continue to remain near historic lows, driving purchase demand over 20 percent above a year ago,” said Sam Khater, Freddie Mac’s chief economist. “Real estate is one of the bright spots in the economy, with strong demand and modest slowdown in home prices heading into the late summer. Home sales should remain strong the next few months into the early fall.”
Here’s the breakdown:
– 30-Year Fixed-Rate Mortgage: Averaged 2.99 percent with an average 0.8 point for the week ending July 30, 2020, down slightly from 3.01 percent. A year ago at this time, the 30-year FRM averaged 3.75 percent.
– 15-Year Fixed-Rate Mortgage: Averaged 2.51 percent with an average 0.7 point, down from last week when it averaged 2.54 percent. A year ago at this time, the 15-year FRM averaged 3.20 percent.
– 5-Year Treasury-Indexed Hybrid Adjustable-Rate Mortgage (ARM): Averaged 2.94 percent with an average 0.4 point, down from last week when it averaged 3.09 percent. A year ago at this time, the 5-year ARM averaged 3.46 percent.
“We expect that the Fed may strengthen their forward guidance on the future path of interest rates at their September meeting, providing more explicit signals as to which factors could lead them to eventually raise short-term rates,” said Mike Fratantoni, SVP and chief economist of MBA. “In the meantime, we expect mortgage rates will stay near all-time lows. These record-low mortgage rates will continue to provide stimulus to homeowners who refinance and lower their monthly payments, while also boosting homebuyer demand and their purchasing power.”
Liz Dominguez is RISMedia’s senior online editor.
Important News and Info
Living where we do in the foothills, among the trees and beauty of nature means that we may at some time be faced with the threat of wildfire. What can we do to be prepared if that time arises?
Well, let’s think about your situation. Do you have pets, medications, pictures, and important documents? Of course, you do! We all have something we couldn’t bear to lose or at the very least would make life difficult if we did. Let’s make a list and prepare a bag now. My emergency checklist may be different than yours so really think about it and make changes as needed so you don’t have to think about it when under the pressure of evacuation. Get your emergency go bag ready, NOW. Here is a sample checklist. Print the PDF and hang it up where you can easily see it. Place items in a bag or laundry basket where they are easy to grab on your way out the door.
Pack your go bag so you can grab it and go!
Emergency Go Bag Checklist
Important documents
Supplies
Medications- prescription and non-prescription
Pets
Personal items
Items that cannot be replaced
Special photographs
Family Recipes
Other items to consider adding to your emergency go bag
Eyeglasses, contacts, contact solution
Infant formula, wipes, bottles, diapers
Sleeping bags or blankets and pillows for each person in the household
Feminine hygiene items
Paper plates, bowls, plasticware, cups
Paper and pen
Books, games, puzzles
Let’s make a list and prepare a bag NOW.
Click here for a printable version
Real Estate
Mortgage demand spikes 33% as rates set another record low
PUBLISHED WED, JUL 8 2020
Diana Olick@IN/DIANAOLICK@DIANAOLICKCNBC@DIANAOLICK
KEY POINTS
- Mortgage applications to purchase a home rose 5% for the week and were a remarkable 33% higher than a year ago.
- Home prices gains continue to accelerate, so low mortgage rates are giving buyers much-needed help.
Homebuyers rush back into the market as mortgage rates hit new low
After a brief pullback at the end of June, homebuyers rushed back into the mortgage market last week, taking advantage of record-low mortgage rates.
Mortgage applications to purchase a home rose 5% for the week and were a remarkable 33% higher than a year ago, according to the Mortgage Bankers Association’s index, which was seasonally adjusted, including for the Fourth of July holiday.
Buyer demand has been incredibly strong since mid-May, after the coronavirus shut down most housing activity in April. The only thing standing in the way of more sales is the record low supply of homes for sale.
Home prices gains continue to accelerate, so low mortgage rates are giving buyers much-needed help. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of up to $510,400 dropped to 3.26% from 3.29%. Points, including the origination fee, for loans with a 20% down payment decreased to 0.35 from 0.36.
“Mortgage rates declined to another record low as renewed fears of a coronavirus resurgence offset the impacts from a week of mostly positive economic data, such as June factory orders and payroll employment,” said Joel Kan, an MBA economist. “The average purchase loan size increased to $365,700 — also another high — as borrowers contend with limited supply and higher home prices.”
Applications to refinance a home loan, which are generally more sensitive to weekly interest rate moves, rose just 0.4% from the previous week but were 111% higher than one year ago. Because interest rates have been low and refinance demand has been strong for so long, only a limited number of borrowers can still benefit significantly from even the new record low rate.
The refinance share of mortgage activity decreased to 60.1% of total applications from 61.2% the previous week.
Mortgage rates continued to drop at the start of this week, especially after the stock market sell-off Tuesday. Mortgage rates loosely follow the yield on the 10-year Treasury.
“Prediction is tough, but what I can say is that a lot of us who watch the market very closely are on high alert for signs that the low rate environment is under imminent threat,” said Matthew Graham, chief operating officer at Mortgage News Daily. “While that could change with even one major coronavirus headline, we’re not seeing that threat as of today.”
Credit: CNBC
After plunging to nearly the lowest level in its history in April, an index measuring consumer sentiment in the housing market bounced back significantly in June. Renters were especially optimistic about homebuying.
The share of consumers who think it’s a good time to buy a home increased from 52% to 61% month to month, according to the Fannie Mae survey, while fewer Americans said it was a bad time to buy. Renters drove much of that improvement.
“The share of renters who say it’s a good time to buy a home is now at its highest level in five years, suggesting favorable conditions for first-time homebuying, consistent with the recent rebound in home purchase activity,” said Doug Duncan, Fannie Mae senior vice president and chief economist.
Current homeowners are also getting slightly more optimistic about the sales market, especially given the lack of housing supply. The percentage of respondents saying now is a good time to sell a home increased from 32% to 41%, although nearly half still think it’s a bad time to sell.
Home sales jumped dramatically in May, after grinding to a halt in March and April. While new listings are coming on the market, the total inventory of homes for sale at the end of May was 19% lower than May 2019, according to the National Association of Realtors. Pending sales in May, which represent signed contracts on existing homes, jumped a record 44% compared with April.
“However, this activity may cool again in the coming months, depending on the extent to which it can be attributed to consumers having chosen to delay or to accelerate homebuying plans due to the pandemic,” said Duncan. “We believe the continuing uncertainty regarding the coronavirus’ containment suggests an uneven and potentially volatile course toward economic recovery.”
Consumers are still very concerned about their job security, even as the employment picture improves slightly. Renters and homeowners with a mortgage are particularly worried, according to the survey, given the sudden record-high unemployment brought on by the pandemic.
More Americans now think home prices will strengthen, which is a double-edged sword in the market. Home prices were already elevated going into the pandemic, and affordability was weakening despite record-low mortgage rates.
On that front, more respondents said they expect mortgage rates to rise over the next year.
What does this mean to us? First, it may a good time to re-finance. Second, Real Estate will continue to be one of the best investments available for years to come.
