Is Buying a Home Today a Good Financial Move?

Article Courtesy of Keeping Current Matters/The KCM Blog

There’s no doubt 2020 has been a challenging year. A global pandemic coupled with an economic recession has caused heartache for many. However, it has also prompted more Americans to reconsider the meaning of “home.” This quest for a place better equipped to fulfill our needs, along with record-low mortgage rates, has skyrocketed the demand for home purchases.

This increase in demand, on top of the severe shortage of homes for sale, has also caused more bidding wars and thus has home prices appreciating rather dramatically. Some, therefore, have become cautious about buying a home right now.

The truth of the matter is, even though homes have appreciated by a whopping 6.7% over the last twelve months, the cost to buy a home has actually dropped. This is largely due to mortgage rates falling by a full percentage point.

Let’s take a look at the monthly mortgage payment on a $300,000 house one year ago, and then compare it with that same home today, after it has appreciated by 6.7% to $320,100:

Compared to this time last year, you’ll actually save $87 dollars a month by purchasing that home today, which equates to over one thousand dollars a year.

But isn’t the economy still in a recession?

Yes, it is. That, however, may make it the perfect time to buy your first home or move up to a larger one. Tom Gil, a Harvard trained negotiator and real estate investor, recently explained:

“When volatile assets are facing recessions, hard assets, such as gold and real estate, thrive. Historically speaking, residential real estate has done better compared to other markets during and after recessions.”

That thought is substantiated by the fact that homeowners have 40 times the net worth of renters. Odeta Kushi, Deputy Chief Economist for First American Financial Corporation, recently said:

“Despite the risk of volatility in the housing market, numerous studies have demonstrated that homeownership leads to greater wealth accumulation when compared with renting. Renters don’t capture the wealth generated by house price appreciation, nor do they benefit from the equity gains generated by monthly mortgage payments, which become a form of forced savings for homeowners.” 

Bottom Line

With home prices still increasing and mortgage rates perhaps poised to begin rising as well, buying your first home, or moving up to a home that better fits your current needs, likely makes a ton of sense.

Happy Thanksgiving 2020

 

 

This year, as we approach Thanksgiving, we are confronted with circumstances we never dreamed of.  

We have spent almost a year dealing with the COVID-19 pandemic and, truly, we are all growing weary. 

For sure, this will be a different Thanksgiving, but perhaps in many ways it will be especially meaningful.

However you and your family celebrate this year,

May you find peace and joy in the beauty and blessings of your life.

From my family to yours,

 

HAPPY THANKSGIVING

Pook         

NOVEMBER MID-MONTH UPDATE

It's been a whiplash kind of month here at SCCL, as the number of ACTIVE listings continue to change almost daily... sometimes several times a day.  October ended with 15 ACTIVE Single Family Residence (SFR) listings and dropped down to 14, 13, and then only 9 on November 10, with 7 UNDER CONTRACT.  On November 15th, there were 11 ACTIVE SFR listings, with 11 UNDER CONTRACT for the month.  November 17th there were 11 ACTIVE, 13 UNDER CONTRACT, and 13 CLOSED SFR listings.  Carriage Homes and Villas (CHV) showed more than usual activity, also.  While there were 5 ACTIVE CHV listings at the end of October, on November 17th, ACTIVE listings were down to two.

The holiday season is quickly approaching, with Thanksgiving only a week away.  Will sales slow down during the holidays?  No one can say for sure, but, last year 9 SFRs and 2 CHVs went UNDER CONTRACT in December.  Typically, folks who look at homes during the holiday season are serious about purchasing.  Many times out-of-town house guests are so impressed with Sun City Carolina Lakes that they decide to move here.  This year, with the limitations we face due to the COVID pandemic, that might not happen this year... but, it certainly hasn't slowed activity down over recent months, so who knows?  This might just be a very active holiday season.  

If you're thinking about selling or moving, or have friends or family that are contemplating a move, please contact me.  I'd love to discuss your plans and your options with you.  As many who decide to move have said, "If not now, when?"

3 Graphs That Prove We’re Not Headed for a Foreclosure Crisis

 Article Courtesy of Keeping Current Matters/The KCM Blog
 

We all know the saying about assumptions.

And if you don’t, well…just Google it.

With the massive surge of unemployment that happened this year, it’s natural to assume that a massive surge of foreclosures will follow.

However, history is not expected to repeat itself this time.

Here are 3 simple graphs that prove why we’re not headed for another foreclosure crisis.

The unique conditions that led to the 2008 market collapse and foreclosure crisis were in big part due to cashed-out equity. With many borrowers owing more than they could afford on their homes, mass foreclosures followed. 

Today’s market, however, looks a lot different. Instead, homeowners have an abundance of equity, and lending standards are much stricter. This means that instead of foreclosing and walking away, many homeowners are in a good position to protect their investment.

Looking at this graph, we can see that of those who requested forbearance, nearly 44% have either paid off their mortgage or opted out. It also shows that of all the homeowners in forbearance, only 80,000 are at risk of moving into foreclosures.

To drive this point home, Mike Fratantoni, Senior Vice President and Chief Economist at the Mortgage Bankers Association (MBA), said:

“Nearly two-thirds of borrowers who exited forbearance remained current on their payments, repaid their forborne payments, or moved into a payment deferral plan. All of these borrowers have been able to resume – or continue – their pre-pandemic monthly payments.”

After the 2008 financial collapse, we saw the worst foreclosure crises in history. The market was flooded with homes that had defaulted on their mortgage payments, spiking all the way up to over 500,000 at the peak in 2009.

Today, we are looking at a much different story. According to Black Knight, 91% of homeowners in forbearance have 11% equity in their homes. While that may not seem like a big number, that much equity means rather than foreclose, those homeowners can not only sell their homes but walk away with gains from it.

According to Odeta Kushi, economist for First American:

“Economic distress and a lack of equity are the two triggers of a foreclosure. Each trigger by itself is necessary, but not sufficient for foreclosure. The percentage of economically distressed homeowner households is highest in COVID-19 hotspots… However, the equity built up since the Great Recession can provide an important buffer for distressed homeowners.”

The big question is: what happens when forbearance inevitably expires? Many lenders are offering to help homeowners create a plan for the deferred payments. There are multiple options that homeowners can pursue at this point, and with the right planning and communication with their lender, they may be able to avoid foreclosure, especially if they have equity in their homes.

Bottom Line

The reality of the situation is this: through all of the hardship Americans have faced this year, people are going to fall into foreclosure.

However, the last thing anyone wants right now is another foreclosure crisis like 2008, and there are many factors that suggest it’s not going to be like last time.

By educating your clients with data and insights from market experts, you can help them make smart and calculated real estate decisions instead of those based on scary headlines or hearsay.

Anyone can drive a car really fast in a straight line. It’s those that can navigate the twists and turns that cross the finish line first.

That’s why we’ve put together the How to Succeed in a Changing Market eGuide. This free resource tells you everything you need to know about navigating a changing market so you can be the real estate agent your clients trust-especially when times are tough.

$1000 Veteran Credit

Thanks to Melissa Messick of Movement Mortgage for the following information.

Beginning 11/11/2020 any loan (including refinancing) submitted as a VA home loan will receive a $1000 credit towards closing cost. Eligible Borrowers include any current or past member of the armed services, including surviving spouses as defined by the Veterans Administration. This special will apply to any loan submitted between 11/11/2020 and 1/11/2021. Please call me for more details.

Melissa Messick| SENIOR LOAN OFFICE / NMLS 97916

Office (980) 777-1042 
Mobile (704) 905-4009

Melissa.Messick@movement.com 

    

 

 

For information about V.A. Loans, click HERE.

VETERANS DAY 2020

It is with grateful appreciation that we give heartfelt thanks to the men and women who have served in our armed forces, protecting our nation, and preserving the freedoms we cherish.

When those of us now referred to as "seniors" were young, we celebrated "Armistice Day" to recognize the signing of the Armistice that ended World War I and to honor those who bravely served and those who made the ultimate sacrifice on foreign soil. The main hostilities of WWI were properly finished 102 years ago at the 11th hour of the 11th day of the 11th month of 1918, with Germany signing the Armistice. Red poppies were distributed by members of the American Legion Auxillary, as a remembrance of the sacrifices of those who served during the war.  

 

The symbolism of the red poppy began with the poem IN FLANDERS FIELDS, penned by Lieutenant Colonel John McCrae, MD (1872-1918) of the Canadian Army, after presiding over the funeral of a friend and fellow soldier and being moved by the poppy flowers that grew in the Flanders battlefields on the southeast edge of the town of Waregem, Belgium. The imagery created by that poem remains an important symbol of the sacrifices of war today. On June 1,1954, Armistice Day was changed to Veterans Day to honor all U.S. veterans.   

Beautiful tribute to our Veterans 
by Richard Kerry Thompson.   YOU RAISE ME UP

Lovely rendition honoring our Veterans
of HALLELUJAH by Sailor Jerri. 

HAPPY 245TH BIRTHDAY TO THE UNITED STATES MARINE CORPS

Each year it is my honor and privilege to offer birthday greetings and a heartfelt thank you to my husband and his special Marine Corps brothers and to all who wear or have worn the globe and anchor.  Once a Marine, always a Marine.  The Few.  The Proud.  Semper Fi.

"On November 10, 1775, the Continental Congress commissioned Samuel Nicholas to raise two Battalions of Marines. That very day, Nicholas set up shop in Tun Tavern (in Philadelphia). He appointed Robert Mullan, then the proprietor of the tavern, to the job of chief Marine Recruiter -- serving, of course, from his place of business at Tun Tavern. Prospective recruits flocked to the tavern, lured by (1) cold beer and (2) the opportunity to serve in the new Corps of Marines."
 
Source: http://www.usmcpress.com/heritage/usmc_heritage.htm

Since those earliest days when the "Continental Marines" fought for our country's independence at sea and on shore, the United States Marine Corps has responded to conflicts around the world, participating in combat operations and humanitarian relief efforts by air, land, and sea. Mandated by Congress to be our county's rapid response force, the United State Marine Corps has proudly served our country for 244 years. From the shores of Tripoli to Guadalcanal and Iwo Jima, Korea, the jungles of Vietnam, the mountains of Afghanistan, the Iraqi desert, and all the operations in-between, Marines from all walks of life have defended our nation.

Each year on November 10th, Marines around the world live up to the motto "Semper Fidelis" (Always Faithful) as they celebrate the birth of the Corps. Whether attending a formal Marine Corps Ball or a small informal gathering, or even with just a phone call or a handshake, those who share the bond of being one of "The Few. The Proud." proudly honor the values, traditions, and history of the Corps on this day by wishing each other  a Happy Birthday.

Each year Bob Parsons, founder of Go-Daddy, shares his love for "Mother Green" by presenting a birthday video to honor the United States Marine Corps.  Here is a link to this year's video: 2020 USMC VIDEO

Additionally, each year the Bob & Renee Parsons Foundation partners with the Semper Fi fund to raise funds to provide financial support for wounded, critically ill, and injured members of all branches of the U.S. Armed Forces.  Last year, they raised more than $20 million dollars.  Again this year, the Foundation will match donations dollar-for-dollar up to $10 million dollars. 

To donate, please visit: SemperFiFund.org/match

On a personal note...

In Loving Memory of  Bob "Heavy" Petrella

Today and always we remember with deep love and affection our dear friend, Bob "Heavy" Petrella, USMC Captain during the Vietnam War and recipient of 2 Purple Hearts and a Bronze Star for Valor. Heavy will always be with us in spirit.

SEMPER FI!

 

 

 

Celebrating Thanksgiving Safely

The following information comes from the South Carolina Department of Health and Environmental (DHEC).  Here is a direct link to the same information: SCDHEC

As many people in the United States begin to plan for fall and winter holiday celebrations, CDC offers the following considerations to help protect individuals and their families, friends, and communities from COVID-19. When planning to host a holiday celebration, you should assess current COVID-19 levels in your community to determine whether to postpone, cancel, or limit the number of attendees.

 

CDC's General considerations for fall and winter holidays

People who should not attend in-person holiday celebrations

People with or exposed to COVID-19
Do not host or participate in any in-person festivities if you or anyone in your household:

• Has been diagnosed with COVID-19 and has not met the criteria for when it is safe to be around others
• Has symptoms of COVID-19
• Is waiting for COVID-19 viral test results
• May have been exposed to someone with COVID-19 in the last 14 days
• Is at increased risk of severe illness from COVID-19

People at increased risk for severe illness
If you are at increased risk of severe illness from COVID-19, or live or work with someone at increased risk of severe illness, you should:

• Avoid in-person gatherings with people who do not live in your household.
• Avoid larger gatherings and consider attending activities that pose lower risk (as described throughout this page) if you decide to attend an in-person gathering with people who do not live in your household.

Thanksgiving

Thanksgiving is a time when many families travel long distances to celebrate together. Travel increases the chance of getting and spreading the virus that causes COVID-19. Staying home is the best way to protect yourself and others. If you must travel, be informed of the risks involved.

Lower risk activities

• Having a small dinner with only people who live in your household
• Preparing traditional family recipes for family and neighbors, especially those at higher risk of severe illness from COVID-19, and delivering them in a way that doesn’t involve contact with others
• Having a virtual dinner and sharing recipes with friends and family
• Shopping online rather than in person on the day after Thanksgiving or the next Monday
• Watching sports events, parades, and movies from home

Moderate risk activities

• Having a small outdoor dinner with family and friends who live in your community
  • Lower your risk by following CDC’s recommendations on hosting gatherings or cook-outs.
• Visiting pumpkin patches or orchards where people use hand sanitizer before touching pumpkins or picking apples, wearing masks is encouraged or enforced, and people are able to maintain social distancing
• Attending a small outdoor sports events with safety precautions in place

Higher risk activities

Avoid these higher risk activities to help prevent the spread of the virus that causes COVID-19:

• Going shopping in crowded stores just before, on, or after Thanksgiving
• Participating or being a spectator at a crowded race
• Attending crowded parades
• Using alcohol or drugs, which can cloud judgement and increase risky behaviors
• Attending large indoor gatherings with people from outside of your household

More Information

• Stress and Coping
• Travel During the COVID-19 Pandemic
• Know Your Travel Risk
• Know When to Delay Your Travel to Avoid Spreading COVID-19