Real Estate News from Ben & Kate April 2018   

 
If your teen's heading off to college or university this fall, you’ll need to start thinking about accommodations. This month’s article explores the option of purchasing an investment property for them to live in and manage.
 
There’s also some advice on how to babyproof your home as well as a few spring home maintenance tips to help you get ready for the nice weather that’s right around the corner!

Thanks so much for checking out this month's newsletter. Please get in touch if you have any questions or comments regarding the articles, or real estate in general -- it'd be great to hear from you!

Ben & Kate

In this issue...
National Pending Home Sales Update 
National pending home sales snap back from last month.

Pending home sales snapped back in much of the country in February, but weakening affordability and not enough inventory on the market restricted overall activity compared to a year ago, according to the National Association of Realtors®.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, grew 3.1 percent to 107.5 in February from a downwardly revised 104.3 in January. Even with last month’s increase in activity, the index is 4.1 percent below a year ago.

Lawrence Yun, NAR chief economist, says the housing market has gotten off to an uneven start so far in 2018. “Contract signings rebounded in most areas in February, but the gains were not large enough to keep up with last February’s level, which was the second highest in over a decade (112.1),” he said.

“The expanding economy and healthy job market are generating sizeable homebuyer demand, but the miniscule number of listings on the market and its adverse effect on affordability are squeezing buyers and suppressing overall activity.”

Added Yun, “Expect ongoing volatility in the Northeast region at least through March. Although pending sales there bounced back in February following January’s cold weather-related decline, the multiple winter storms over these last few weeks likely put a chill on contract signings once again this month.”

With the start of the spring buying season in full swing, Yun believes that one of the top wild cards for the housing market in coming months will be how both buyers and potential sellers adjust to the steady climb in mortgage rates since late last year. Prospective buyers continue to feel the strain of swift price growth – up 5.9 percent so far in 2018 – and the higher borrowing costs will only add to the pressures placed on their budget.

Meanwhile, more would-be sellers deciding to balk at listing their home for sale out of uneasiness of losing their low mortgage rate – especially if they refinanced in recent years – would not be good news for any alleviation of the ongoing supply shortages in much of the country.

“Homeowners are already staying in their homes at an all-time high before selling2, and any situation where they remain put even longer only exacerbates the nation’s inventory crunch,” said Yun. “Even if new home construction starts picking up at a faster pace this year, as expected, existing sales will fail to break out if these record low supply levels do not recover enough to meet demand.”

For the year, Yun now forecasts for existing-home sales to be around 5.51 million – flat from 2017. The national median existing-home price is expected to increase around 4.2 percent. In 2017, existing sales increased 1.1 percent and prices rose 5.8 percent.

The PHSI in the Northeast surged 10.3 percent to 96.0 in February, but is still 5.1 percent below a year ago. In the Midwest the index inched forward 0.7 percent to 98.9 in February, but is 9.5 percent lower than February 2017.

Pending home sales in the South rose 3.0 percent to an index of 125.7 in February, but are 1.5 percent lower than last February. The index in the West climbed 0.4 percent in February to 96.9, but is 2.2 percent below a year ago.

Buying a College Crib for Your Kid 
This exciting life event could be a great investment opportunity!

There's an air of excitement when your kids move out to study at college or university but it can also be a very expensive time.

Purchasing an investment property may be one way to offset those expenses. The idea is to cover the mortgage payments with the rent collected from roommates while your child manages and maintains the property.

As with any home purchase, you’ll want to carefully evaluate local market conditions so it’s important to select the right real estate agent. If you don’t already have someone you feel comfortable with, let me know and I can refer you to a professional who has a firm grasp of the local market.

Local rents, vacancy rates and zoning laws should also be examined. Finally, it's important to consider your long-term goals and determine whether you plan on renting it out once your child graduates as this will affect the rate of appreciation.

Specific purchasing details such as co-signing the mortgage or listing your child on title should be discussed with your financial planner and mortgage advisor. There are pros and cons to different ownership scenarios so you'll want to examine what makes sense for your specific individual situation.

Purchasing an investment property that's managed by your child is a decision that shouldn’t be taken lightly but it's certainly an option worth considering. It could end up being a great opportunity but make sure you do your homework so you can carefully weigh up the risks and rewards. When you crunch the numbers, you may just find that purchasing a campus crib makes great cents :)

The Foolproof Way to Babyproof Your Home 
Little ones love to explore so be sure to properly prep your home.

The arrival of a new baby brings many responsibilities, one of which is babyproofing your home. Here are a few things to keep in mind when preparing your home for your new little bundle of joy:

  1. Slam Jam - Install door stops/holders so fingers don't get caught.


  2. Tie Up Loose Ends - Tie up blind and curtain cords so they’re out of reach.


  3. Cabinet Caution - Make sure cabinets and drawers are equipped with safety latches.

  4. Don’t Cut Corners - Cover any sharp corners such as those on coffee tables with foam.

  5. It's No Shock - Cover electrical outlets with safety plugs so that they're not able to shove keys or other objects into them.

  6. Strong Attachments - Securely tether any furniture that could tip over such as dressers and shelves so they won’t come tumbling down if your little one starts climbing.

  7. Supermax Security - Install a baby gate at the top and bottom of your staircase. Make sure they're attached directly to the wall and not just pressure mounted.

It’s best to babyproof your home before your little one arrives as it'll be the last thing on your mind when you're a tired new parent. Getting down on all fours and crawling around will help you see hazards from their perspective.

Spring Home Maintenance Tips 
It's the time of year to give your home a complete physical.

Spring has sprung so it's time to take a good look around your home, both inside and out and conduct some preventative maintenance. Here are just a few ideas to get you started:

  • inspect your attic for rodents and roof leaks

  • inspect your roof and the flashings around your chimney

  • check seals around windows/doors and fix damaged screens

  • repair fences, posts, steps, decks, railings and outdoor furniture

  • clean out your gutters and make sure all of the downspouts drain away from your foundation

Your home is likely your biggest investment so it's important to perform regular maintenance in order to keep it in tip-top shape. If you set aside a couple of days now, you'll be able to sit back, relax and enjoy your home when the summer finally arrives!



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Not meant to solicit clients already under contract.