mortgages

Conditions are favorable for home sales

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Stepping back from my usual Glen-specific blog content, I thought I would share with you some thoughts about the state of the housing market generally.

The environment for home sales remains strong as it has been for the last couple of years. Jobs are critical to a strong housing market, so I was heartened to see that the nationwide unemployment rate recently dropped to 5.1% which is the lowest rate in many years. Consumer confidence, which of course is influenced by low unemployment, is strong; and that means that people feel good about spending money…and in the context of housing, to purchase their first homes or to purchase higher priced homes.

The other hugely positive factor that is impacting housing is available credit. Sure, it’s not like the wild, wild west days that fueled the build-up to the bubble, and that’s good. But slowly and surely lenders are becoming more reasonable about lending standards, making mortgages more readily available to prospective home buyers. Specifically as it relates to The Glen – which has an abundance of high price point homes – many of the largest banks have loosened credit standards for jumbo mortgage loans which exceed conventional loan limits.

So all of this is good news for home sellers and home buyers. If you have any questions or comments, please get in touch with me. I am an award-winning Realtor with @properties who lives in the Glen (in Glenview Illinois), and I would be delighted to discuss the benefits of living here.

Margaret Ludemann            847-4-1-1802   margaretludemann@gmail.com

Surprise Fed Announcement Good News for Home Sales

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I have an excuse for knowing about Gomer Pyle, Jim Nabors’ hayseed character on the 1960’s Andy Griffith show.  My husband is older than me (!) and he watches re-runs on ME-TV.  I bring this up because of his call to me Wednesday in his spot-on impression of Gomer’s signature adage…Sur-prise Sur-prise Sur-prise!  He had just heard of The Fed’s surprise announcement that it would continue its easy money, stimulus policy to, among other things, drive down mortgage interest rates which had been moving up the last couple of months.  This was indeed a surprise decision; and for the housing market it was most welcome.

While housing sales have been robust this year (in The Glen and elsewhere), there was universal concern that sales would slow and price increases would moderate as interest rates continued to climb.  None of us want another housing bubble, but home values are still below pre-crash levels so all homeowners would like to see continued improvement.

What does this mean for homeowners who may want to sell their homes?  Two things.  One, as interest rates fall more buyers can afford your home because they will be able to secure mortgages of higher values.  (Every 1% rise in interest rates reduces buying power by 11%.)  Two, sellers will have to move; and they will be able to afford higher priced homes.

The bottom line is this:  If you want to sell your home in this vastly improved housing market, the odds are very high that it will sell; and it is likely to sell at a decent price, certainly better than had it sold last year.  The market will remain robust until about Thanksgiving, so if you want to sell this year you should get your home on the market in the next few weeks.  The market will pick up again in March; and if that is a better time for you, plan to list your home in late February.