Martin Lopez Home Loans

Why You Should Think About Listing Prices Like an Auction’s Reserve Price 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 o...f 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 a 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 or finance 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.

HOW UPSET SHOULD YOU BE ABOUT 3% INTEREST RATES Last Thursday, Freddie Mac announced that their 30-year fixed mortgage rate was over 3% (3.02%) for the first time since last July. That news dominated real estate headlines that day and the next. Articles talked about the negative impact it may have on the housing market. However, we should realize two things: 1. The bump-up in rate should not have surprised anyone. Many had already projected that rates would rise slightly as ...we proceeded through the year. 2. Freddie Mac's comments about the rate increase were not alarming: 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. A muted rise in rates will not sink the real estate market, and most experts agree that it will be a strong spring sales season. What does this mean for you? Obviously, any buyer would rather mortgage rates not rise at all, as any upward movement increases their monthly mortgage payment. However, let's put a 3.02% rate into perspective. Here are the Freddie Mac annual mortgage rates for the last five years: 2016: 3.65% 2017: 3.99% 2018: 4.54% 2019: 3.94% 2020: 3.11% Though 3.02% is not as great as the sub-3% rates we saw over the previous seven weeks, it's still very close to the all-time low (2.66% in December 2020). And, if we expand our look at mortgage rates to consider the last 50 years, we can see that today's rate is truly outstanding. Here are the rates over the last five decades: 1970s: 8.86% 1980s: 12.7% 1990s: 8.12% 2000s: 6.29% 2010s: 4.09% Being upset that you missed the best mortgage rate ever is understandable. However, don't throw the baby out with the bathwater. Buying now still makes more sense than waiting, especially if rates continue to bump up this year. Bottom Line It's true that you may not get the same rate you would have five weeks ago. However, you will get a better rate than what was possible at almost any other point in history. Let's connect today so you can lock in a great rate while they stay this low.

Home Prices: What Happened in 2020? What Will Happen This Year? The real estate market was on fire during the second half of 2020. Buyer demand was way up, and the supply of homes available for sale hit record lows. The price of anything is determined by the supply and demand ratio, so home prices skyrocketed last year. Dr. Lynn Fisher, Deputy Director of the Federal Housing Finance Agency (FHFA) Division of Research and Statistics, explains: House prices nationwide recorded ...the largest annual and quarterly increase in the history of the FHFA Home Price Index. Low mortgage rates, pent-up demand from homebuyers, and a limited housing supply propelled every region of the country to experience faster growth in 2020 compared to a year ago despite the pandemic. Here are the year-end home price appreciation numbers from the FHFA and two other prominent pricing indexes: Federal Housing Finance Agency House Price Index Report: 10.8% CoreLogic Home Price Insights: 9.2% S&P Case-Shiller U.S. National Home Price Index: 10.4% The past year was truly a remarkable time for homeowners as prices appreciated substantially. Lawrence Yun, Senior Economist at the National Association of Realtors (NAR), reveals: A typical homeowner in 2020, just by being a homeowner, would have accumulated around $24,000 in housing wealth. What will happen with home prices this year? Many experts believe buyer demand will soften somewhat as mortgage rates are poised to bump up slightly. Some also believe the inventory challenge will ease as more listings come to market this year. Bottom Line Home price appreciation will be strong this year, but it won't reach the historic levels of 2020. Let's connect if you'd like to make a move in 2021 TalkWithMartin.com

What Are the Benefits of a 20% Down Payment? If you're thinking of buying a home this year, you may be wondering how much money you need to come up with for your down payment. Many people may think it's 20% of the loan to secure a mortgage. While there are plenty of lower down payment options available for qualified buyers who don't want to put 20% down, it's important to understand how a larger down payment can have great benefits too. The truth is, there are many programs a...Continue reading

I'm Curious - Can You Really Change The World. I'm asking because this week's Guest Peter Anthony says YES! YOU Can Change The World. So what is it going to take to make the shifts inside of ourselves and then ultimately make a change in the world? This week we are going to Deep Dive into that topic. Together We Can Change The World.... Special Guest @PeterAnthonyWynn After the show: Please stop by Clubhouse. and HANGOUT with us again 11:00 AM (Pacific Standard Time) Event Link https://www.joinclubhouse.com/event/xXlEZ6Rx