JUDY McALISTER-REALTOR*

93% of Americans Believe a Home Is a Better Investment Than Stocks 93% of Americans Believe a Home Is a Better Investment Than Stocks | MyKCM A recent Survey of Consumer Finances study released by the Federal Reserve reveals the net worth of homeowners is forty times greater than that of renters. If you’re wondering if homeownership is a good investment, the study clearly answers that question, and the answer is yes.... Do Americans believe a home is a better investment than stocks? In a post on the Liberty Street Economics blog, the Federal Reserve Bank of New York notes that 93.3% of Americans believe buying a home is definitely or probably a better investment than buying stocks. Here’s how the results break down: 93% of Americans Believe a Home Is a Better Investment Than Stocks | MyKCM The survey also shows a wide range of reasons why Americans feel that way (respondents were able to pick more than one answer): 93% of Americans Believe a Home Is a Better Investment Than Stocks | MyKCM Bottom Line The data show how strongly Americans believe in homeownership as an investment. That belief is warranted. The Liberty Street Economics blog put it best by saying: Housing represents the largest asset owned by most households and is a major means of wealth accumulation, particularly for the middle class.

4 Major Reasons Households in Forbearance Won’t Lose Their Homes to Foreclosure 4 Major Reasons Households in Forbearance Won’t Lose Their Homes to Foreclosure | MyKCM There has been a lot of discussion as to what will happen once the 2.3 million households currently in forbearance no longer have the protection of the program. Some assume there could potentially be millions of foreclosures ready to hit the market. However, there are four reasons that won’t happen....Continue reading

Your Tax Refund and Stimulus Savings May Help You Achieve Homeownership This Year Your Tax Refund and Stimulus Savings May Help You Achieve Homeownership This Year | MyKCM If you’re planning to buy a home this year, saving for a down payment is one of the most important steps in the process. One of the best ways to jumpstart your savings is by starting with the help of your tax refund.... Using data from the Internal Revenue Service (IRS), it’s estimated that Americans can expect an average refund of $2,925 when filing their taxes this year. The map below shows the average anticipated tax refund by state: Your Tax Refund and Stimulus Savings May Help You Achieve Homeownership This Year | MyKCM Thanks to programs from the Federal Housing Authority, Freddie Mac, and Fannie Mae, many first-time buyers can purchase a home with as little as 3% down. In addition, Veterans Affairs Loans allow many veterans to put 0% down. You may have heard the common myth that you need to put 20% down when you buy a home, but thankfully for most homebuyers, a 20% down payment isn’t actually required. It’s important to work with your real estate professional and your lender to understand all of your options. How can your tax refund help? If you’re a first-time buyer, your tax refund may cover more of a down payment than you realize. If you take into account the median home sale price by state, the map below shows the percentage of a 3% down payment that’s covered by the average anticipated tax refund: Your Tax Refund and Stimulus Savings May Help You Achieve Homeownership This Year | MyKCM The darker the blue, the closer your tax refund gets you to homeownership when you qualify for one of the low down payment programs. Maybe this is the year to plan ahead and put your tax refund toward the down payment on a home. Not enough money from your tax return? A recent paper from the National Bureau of Economic Research found that, of the households that received a stimulus check last year, One third report that they primarily saved the stimulus money. If you had the opportunity to save your Economic Impact Payments, you may consider putting that money toward your down payment or closing costs as well. Your trusted real estate professional can also advise you on the down payment assistance programs available in your area. Bottom Line Saving for a down payment can seem like a daunting task, but it doesn’t have to be. This year, your tax refund and your stimulus savings could add up big when it comes to reaching your homeownership goals.

What It Means To Be in a Sellers’ Market What It Means To Be in a Sellers’ Market | MyKCM If you’ve given even a casual thought to selling your house in the near future, this is the time to really think seriously about making a move. Here’s why this season is the ultimate sellers’ market and the optimal time to make sure your house is available for buyers who are looking for homes to purchase.... The latest Existing Home Sales Report from The National Association of Realtors (NAR) shows the inventory of houses for sale is still astonishingly low, sitting at just a 2-month supply at the current sales pace. Historically, a 6-month supply is necessary for a ‘normal’ or ‘neutral’ market in which there are enough homes available for active buyers (See graph below): What It Means To Be in a Sellers’ Market | MyKCM When the supply of houses for sale is as low as it is right now, it’s much harder for buyers to find homes to purchase. As a result, competition among purchasers rises and more bidding wars take place, making it essential for buyers to submit very attractive offers. As this happens, home prices rise and sellers are in the best position to negotiate deals that meet their ideal terms. If you put your house on the market while so few homes are available to buy, it will likely get a lot of attention from hopeful buyers. Today, there are many buyers who are ready, willing, and able to purchase a home. Low mortgage rates and a year filled with unique changes have prompted buyers to think differently about where they live and they’re taking action. The supply of homes for sale is not keeping up with this high demand, making now the optimal time to sell your house. Bottom Line Home prices are appreciating in today’s sellers’ market. Making your home available over the coming weeks will give you the most exposure to buyers who will actively compete against each other to purchase it.

Buyer & Seller Perks in Today’s Housing Market Buyer & Seller Perks in Today’s Housing Market | MyKCM Right now, the housing market is full of outstanding opportunities for both buyers and sellers. Whether you’re thinking of buying your first home, moving up to a bigger one, or selling so you can downsize this spring, there are perks today that are powering big moves for people across the country. Here are the top two to keep on the radar this season....Continue reading

Why You Should Think About Listing Prices Like an Auction’s Reserve Price Why You Should Think About Listing Prices Like an Auction’s Reserve Price | MyKCM For generations, the homebuying process never really changed. The seller would try to estimate the market value of the home and tack on a little extra to give themselves some negotiating room. That figure would become the listing price of the house. Buyers would then try to determine how much less than the full price they ...could offer and still get the home. The asking price was generally the ceiling of the negotiation. The actual sales price would almost always be somewhat lower than the list price. It was unthinkable to pay more than what the seller was asking. Today is different. The record-low supply of homes for sale coupled with very strong buyer demand is leading to a rise in bidding wars on many homes. Because of this, homes today often sell for more than the list price. In some cases, they sell for a lot more. According to the Home Buyers and Sellers Generational Trends report just released by the National Association of Realtors (NAR), 45% of buyers paid full price or more. You may need to change the way you look at the asking price of a home. In this market, you likely can’t shop for a home with the old-school mentality of refusing to pay full price or more for a house. Because of the shortage of inventory of houses for sale, many homes are actually being offered in an auction-like atmosphere in which the highest bidder wins the home. In an actual auction, the seller of an item agrees to take the highest bid, and many sellers set a reserve price on the item they’re selling. A reserve price is the minimum amount a seller will accept as the winning bid. When navigating a competitive housing market, think of the list price of the house as the reserve price at an auction. It’s the minimum the seller will accept in many cases. Today, the asking price is often becoming the floor of the negotiation rather than the ceiling. Therefore, if you really love a home, know that it may ultimately sell for more than the sellers are asking. So, as you’re navigating the homebuying process, make sure you know your budget, know what you can afford, and work with a trusted advisor who can help you make all the right moves as you buy a home. Bottom Line Someone who’s more familiar with the housing market of the past than that of today may think offering more for a home than the listing price is foolish. However, frequent and competitive bidding wars are creating an auction-like atmosphere in many real estate transactions. Let’s connect so you have the best advice on how to make a competitive offer on a home in our local market.

To Renovate or Not To Renovate Before You Sell To Renovate or Not To Renovate Before You Sell | MyKCM When thinking about selling, homeowners often feel they need to get their house ready with some remodeling to make it more appealing to buyers. However, with so many buyers competing for available homes right now, renovations may not be as vital as they would be in a more normal market. Here are two things to keep in mind if you’re thinking of selling this season....Continue reading

What Is the Strongest Tailwind to Today’s Recovering Economy? What Is the Strongest Tailwind to Today’s Recovering Economy? | MyKCM Last year started off with a bang. Unemployment was under 4%, forecasters were giddy with their projections for the economy, and the residential housing market had the strongest January and February activity in over a decade.... Then came the announcement on March 11, 2020, from the World Health Organization declaring COVID-19 a worldwide pandemic. Two days later, the White House declared it a national emergency. Businesses and schools were forced to close, shelter-in-place mandates were enacted, and the economy came to a screeching halt. As a result, unemployment in this country skyrocketed to 14.9%. A year later, the economy is recovering, and the U.S. has regained more than half of the jobs that were originally lost. However, some businesses are still closed, and many schools are still struggling to reopen. Despite the past and current challenges, there is one industry that’s proven to be a tailwind helping to counter all of these headwinds to our economy. That industry is housing. Remarkably, the residential real estate market (including existing homes and new construction) has flourished over the last twelve months. Sales are up, prices are appreciating, and more new homes are being built. The housing market has been a pillar of strength in an otherwise slowly recovering economy. How does the real estate market help the economy? At the beginning of the pandemic, the National Association of Realtors (NAR) released a report that explained: Real estate has been, and remains, the foundation of wealth building for the middle class and a critical link in the flow of goods, services, and income for millions of Americans. Accounting for nearly 18% of the GDP, real estate is clearly a major driver of the U.S. economy. The report calculated the total economic impact of real estate-related industries on the economy as well as the expenditures that resulted from a single home sale. At a national level, their research revealed that a single newly constructed home had an economic impact of $88,416. Here’s how it breaks down: What Is the Strongest Tailwind to Today’s Recovering Economy? | MyKCM The map below shows the impact by state: What Is the Strongest Tailwind to Today’s Recovering Economy? | MyKCM The impact of an existing home sale is approximately $40,000. Real estate has done more for our economic wellbeing than virtually any other industry over the last year. It’s been a beacon of light during a very challenging time in our nation’s history. Bottom Line Whether you’re buying a newly constructed home or one that already exists, you’re making a positive economic impact in your local community and it’s a step toward your homeownership goals as well.

February 2021 Data for MLSListings Counties (from North to South): In San Mateo County, the median Residential Common Interest home cost $850,000 and sold in 16 days for 101% of the list price based on 106 sales in February 2021. Inventory was up 5% from January, and up 63% from February 2020 with 204 homes available, compared to 125 homes last year. The market sped up - Average days on market (DOM) decreased -3 days from 39 to 36 days or -8%; median DOM decreased -8 days... from the month before. Number of new listings for the month of February decreased -8% over January and is down -3% from February of last year. Closed sales increased 14% from January from 93 to 106, and up 43% from February 2020. In Santa Clara County, the median Residential Common Interest home cost $850,000 and sold in 12 days for 102% of the list price based on 344 sales in February 2021. Inventory increased by 6% from January, and is up 75% from February 2020 with 556 homes available, compared to 317 homes last year. Average days on market (DOM) decreased -5 days from January from 38 to 33 or -13%; median DOM dropped -10 days from the month before. Number of new listings for the month of February increased 5% over January and was up 33% from February of last year. Closed sales increased 27% from January from 270 to 344 but up 30% from February 2020. In Santa Cruz County, the median Residential Common Interest home cost $625,000 and sold in 19 days for 101% of the list price based on 39 sales in February 2021. Inventory was down -19% from January but is down -45% from February 2020 with 59 homes available, compared to 107 homes last year. Average days on market (DOM) increased 20 days from 38 to 58 or 53%; median DOM increased by 8 days from the month before. Number of new listings for the month of February increased 8% over January but is down by -22% from February of last year. Closed sales increased by 4% from January from 27 to 28, but was up 56% from February 2020. See more

Will the Housing Market Bloom This Spring? Will the Housing Market Bloom This Spring? | MyKCM Spring is almost here, and many are wondering what it will bring for the housing market. Even though the pandemic continues on, it’s certain to be very different from the spring we experienced at this time last year. Here’s what a few industry experts have to say about the housing market and how it will bloom this season. Danielle Hale, Chief Economist, realtor.com:... Despite early weakness, we expect to see new listings grow in March and April as they traditionally do heading into spring, and last year’s extraordinarily low new listings comparison point will mean year over year gains. One other potential bright spot for would-be homebuyers, new construction, which has risen at a year over year pace of 20% or more for the last few months, will provide additional for-sale inventory relief. Ali Wolf, Chief Economist, Zonda: Some people will feel comfortable listing their home during the first half of 2021. Others will want to wait until the vaccines are widely distributed. This suggests more inventory will be for sale in late 2021 and into the spring selling season in 2022. Freddie Mac: Since reaching a low point in January, mortgage rates have risen by more than 30 basis points However, the rise in mortgage rates over the next couple of months is likely to be more muted in comparison to the last few weeks, and we expect a strong spring sales season. Mark Fleming, Chief Economist, First American: As the housing market heads into the spring home buying season, the ongoing supply and demand imbalance all but assures more house price growthMany find it hard to believe, but housing is actually undervalued in most markets and the gap between house-buying power and sale prices indicates there’s room for further house price growth in the months to come. Bottom Line The experts are very optimistic about the housing market right now. If you pressed pause on your real estate plans over the winter, let’s chat to determine how you can re-engage in the homebuying process this spring.

Will Forbearance Plans Lead to a Tsunami of Foreclosures? Will Forbearance Plans Lead to a Tsunami of Foreclosures? | MyKCM At the onset of the economic disruptions caused by the COVID pandemic, the government quickly put into place forbearance plans to allow homeowners to remain in their homes without making their monthly mortgage payments. Today, almost three million households are actively in a forbearance plan. Though 29.4% of those in forbearance have continued to stay c...Continue reading

4 Reasons People Are Buying Homes in 2021 4 Reasons People Are Buying Homes in 2021 | MyKCM According to many experts, the real estate market is expected to continue growing in 2021, and it’s largely driven by the lasting impact the pandemic is having on our lifestyles. As many of us spend extra time at home, we’re reevaluating what home means and what we may need in one going forward....Continue reading

What Does 2021 Have in Store for Home Values? What Does 2021 Have in Store for Home Values? | MyKCM According to the latest CoreLogic Home Price Insights Report, nationwide home values increased by 8.2% over the last twelve months. The dramatic rise was brought about as the inventory of homes for sale reached historic lows at the same time buyer demand was buoyed by record-low mortgage rates. As CoreLogic explained:... Home price growth remained consistently elevated throughout 2020. Home sales for the year are expected to register above 2019 levels. Meanwhile, the availability of for-sale homes has dwindled as demand increased and coronavirus (COVID-19) outbreaks continued across the country, which delayed some sellers from putting their homes on the market. While the pandemic left many in positions of financial insecurity, those who maintained employment and income stability are also incentivized to buy given the record-low mortgage rates available; this is increasing buyer demand while for-sale inventory is in short supply. Where will home values go in 2021? Home price appreciation in 2021 will continue to be determined by this imbalance of supply and demand. If supply remains low and demand is high, prices will continue to increase. Housing Supply According to the National Association of Realtors (NAR), the current number of single-family homes for sale is 1,080,000. At the same time last year, that number stood at 1,450,000. We are entering 2021 with approximately 270,000 fewer homes for sale than there were one year ago. However, there is some speculation that the inventory crush will ease somewhat as we move through the new year for two reasons: 1. As the health crisis eases, more homeowners will be comfortable putting their houses on the market. 2. Some households impacted financially by the pandemic will be forced to sell. Housing Demand Low mortgage rates have driven buyer demand over the last twelve months. According to Freddie Mac, rates stood at 3.72% at the beginning of 2020. Today, we’re starting 2021 with rates one full percentage point lower than that. Low rates create a great opportunity for homebuyers, which is one reason why demand is expected to remain high throughout the new year. Taking into consideration these projections on housing supply and demand, real estate analysts forecast homes will continue to appreciate in 2021, but that appreciation may be at a steadier pace than last year. Here are their forecasts: What Does 2021 Have in Store for Home Values? | MyKCM Bottom Line There’s still a very limited number of homes for sale for the great number of purchasers looking to buy them. As a result, the concept of supply and demand mandates that home values in the country will continue to appreciate.

Turning a House into a Happy Home Turning a House into a Happy Home | MyKCM We talk a lot about why it makes financial sense to buy a home, but more often than not, we’re drawn to the emotional reasons for homeownership.... No matter the living space, the feeling of a home means different things to different people. Whether it’s a certain scent or a favorite chair, the feel-good connections to our own homes are typically more important to us than the financial ones. Here are some of the reasons why. 1. Owning your home is an accomplishment worth celebrating You’ve likely worked very hard to achieve this dream, and whether it’s your first home or your fifth, congratulations are in order for this milestone. You’ve earned it. 2. There’s no place like home Owning your own home offers not only safety and security but also a comfortable place where you can simply relax and kick-back after a long day. Sometimes, that’s just what we need to feel recharged and truly content. 3. You can find more space to meet your needs Whether you want more room in your home for your changing lifestyle (think: working from home, virtual school, or a personal gym), or you simply prefer to have a large backyard for socially-distant entertaining, you can invest in a location that truly works for your evolving needs. 4. You have control over renovations, updates, and your style Looking to try one of those complicated wall treatments you saw on Pinterest? Tired of paying an additional pet deposit for your apartment building? Maybe you want to finally adopt that fur-baby puppy or kitten you’ve been hoping for. You can do all of these things in your own home. Bottom Line Whether you’re a first-time homebuyer or a move-up buyer who wants to start a new chapter in your life, now is a great time to reflect on the intangible factors that turn a house into a happy home.

Why It’s Important to Price Your House Right Today Why It’s Important to Price Your House Right Today | MyKCM Even in today’s sellers’ market, setting the right price for your house is one of the most valuable things you can do. According to the U.S. Economic Outlook by the National Association of Realtors (NAR), existing home prices nationwide are forecasted to increase by 4.5% in 2021. This means experts anticipate home values will continue climbing next year. Danielle Hale..., Chief Economist for realtor.com, notes: We expect price gains to ease somewhat in 2021 and end 5.7% above 2020 levels, decelerating steadily through the spring and summer, and then gradually reaccelerating toward the end of the year. How to Price Your House When it comes to setting the right price for your house, the goal is to increase visibility and drive more buyers your way. Instead of trying to win the negotiation with one buyer, you should price your house so that demand is maximized and more buyers want to take a look. As a seller in today’s market, you might be thinking about pricing your house on the high end while so many of today’s buyers are searching harder than ever just to find a home to purchase. But here’s the thing a high price tag does not mean you’re going to cash in big on the sale. It’s actually more likely to deter buyers. Right now, even when there are so few houses for sale, your house is more likely to sit on the market longer or require a price drop that can send buyers running if it isn’t priced just right from the very beginning. Why It’s Important to Price Your House Right Today | MyKCM It’s important to make sure your house is priced correctly by working with a trusted real estate professional throughout the process. When you price it competitively from the start, you won’t be negotiating with one buyer. Instead, you’ll likely have multiple buyers competing for the house, potentially increasing the final sale price. The key is to make sure your house is priced to sell immediately. This way, it will be seen by the greatest number of buyers. More than one of them may be interested, and it will be more likely to sell at a competitive price. Bottom Line Let’s connect to price your house correctly from the start so you can maximize your exposure and your return.