Now that much of the dust has settled and the panic has waned, let’s take a look at what impact Britain’s exit from the European Union may have on the U.S. housing market.

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The most immediate impact of Brexit will be on mortgage interest rates. Interest rates have remained at historic lows for the last several years. Contrary to what many experts believed, rates have remained low throughout the first half of 2016.

Possible impact of Brexit on mortgage rates?

In a recent article, the Washington Post explained:

“Brexit has spawned the recent bout of volatility in global financial markets. That has anxious investors scurrying for safety — and few assets are safer than U.S. Treasuries. High demand for government debt pulls down interest rates.

That all translates into ultra-low mortgage rates for American households. And with Britain voting for Brexit, they could go even lower.”

However, the lower rates caused by Brexit may be short lived as Trulia Chief Economist Ralph McLaughlin pointed out in a recent post:

“While the departure of the UK from the European Union has driven down the 10-year bond, and thus mortgage rates, we expect them to rebound later in the year as uncertainty over the economic consequences of the departure lifts.”

Bottom Line

Rates are already at historic lows. The UK’s exit from the EU almost certainly guarantees they will remain low (and possibly go lower) over the next few months. If you were thinking of buying your first home or trading up to the house of your dreams, this may be the time to act. The cost of money may never be better for a potential buyer.

Want to pay your mortgage off faster and saves thousands in interest?

Here’s a real life example of how this All In One® Mortgage works:

Want me to run your scenario?  Call me today at 602-705-6293

www.SpencerAnglin.com 

Payoff Your Mortgage Faster!

Download the AIO Mortgage Brochure

Dont-Get-Trapped-KCM

There are many benefits to home ownership. One of the top ones is being able to protect yourself from rising rents and lock in your housing cost for the life of your mortgage.

The National Association of Realtors (NAR) released their findings of a study in which they studied “income growth, housing costs and changes in the share of renter and owner-occupied households over the past five years in metropolitan statistical areas throughout the US.”

Don’t Become Trapped

The study revealed that over the last five years a typical rent rose 15% while the income of renters grew by only 11%. If you are currently renting, this disparity in growth could get you caught up in a cycle where increasing rents continue to make it impossible for you to save for a necessary down payment.

The average renter in the United States pays 30% of their income on housing compared to that of a homeowner who can expect to spend 15%.

In many metro areas the percentage of income spent on housing is even higher and continues to rise every year. Like in San Francisco, CA, where the average renter spends 59% of their monthly income on housing or nearly 65% in Boston, MA.

Home buyers who purchased their home over the same five-year period locked in their housing costs and were able to grow their net worth as home values have increased and their mortgage balances have gone down.

Know Your Options

Perhaps, you have already saved enough to buy your first home. HousingWire reported that analysts at Nomura believe:

“It’s not that Millennials and other potential home buyers aren’t qualified in terms of their credit scores or in how much they have saved for their down payment.

It’s that they think they’re not qualified or they think that they don’t have a big enough down payment.” (emphasis added)

As we have reported last week, over 60% of Millennials who recently bought a home put down less than 20%; 36% put down less than 5%. Your dream home may be more attainable than you ever imagined!

Bottom Line

Don’t get caught in the trap so many renters are currently in. If you are ready and willing to buy a home, find out if you are able. Have a professional help you determine if you are eligible to get a mortgage.

Home-Equity-KCM

There has been much talk about homeownership and whether it is a true vehicle for building wealth. A new report looks at the impact owning a home has on the financial wellbeing of people closing in on their retirement years (ages 55-64).

In recently released study by the Hamilton Project, Ten Economic Facts about Financial Well-Being in Retirement, it was revealed that:

1. Middle-class households near retirement age have about as much wealth in their homes as they do in their retirement accounts.

“Over the past quarter century the largest single source of wealth for all but the richest households nearing retirement age has been their homes, which accounted for about two-fifths of net worth in the early 1990s and accounts for about one-third today.”

2. Home equity is a very important source of net worth to all but the wealthiest households near retirement age.

“Home equity is an important source of wealth for middle income households, accounting for more than one-third of total net worth for the second, third, and fourth quintiles of the net worth distribution… The fifth quintile has a much larger share in business equity—almost a quarter—than any other quintile. (The figure leaves out the bottom quintile of households because they have negative net worth. It is likely that these households will rely almost exclusively on Social Security in retirement.)”

Here is an asset breakdown for the middle 20% of Americans determined by median net worth ($165, 720):

Components-of-Net-Worth

Obviously, the data again proves that homeownership has a big role in building wealth for American families.

The latest Home Price Expectation Survey results are out!

Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists about where prices are headed over the next five years. They then average the projections of all 100+ experts into a single number. 

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Brought to you by Spencer Anglin

Cost-of-Interest

Some Highlights:

  • Even a small increase in interest rates drastically impacts your budget.
  • Securing a mortgage now while rates are still low means you can get more house for your money.
  • Spend your money on your dream home, not on interest.

Brought to you by Spencer Anglin

It’s time for the next Home Price Expectation Survey!

Brought to you by Spencer Anglin

Download Your Own Winter 2015 Home Buyer and Home Seller Guides!

FM2015

December2014-31

I heard it all last spring and again this summer, “I’m waiting to see if rates will get better.” or “I think that home values might be going down soon.”

Well let me dispel those rumors for you here:

Brought to you by Spencer Anglin

November2014-13

This past Spring 2014, I had heard some people say that they were waiting for rates to come back down into the 3’s and that they could not find anything worth buying.  Have I got some news for you for this Summer!

Well there is much more inventory to look at nowadays:

July2014-28

Rates are rising and home prices have leveled out with regular appreciation:

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The cost of waiting for rates or home prices to go down (they’re going up actually):

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The rates we have today are really good compared to our parents:

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WHEN BUYING A HOME:
HOME BUYERS NEED A REAL ESTATE PROFESSIONAL

Many people wonder whether home buyers should hire a real estate professional to assist them in buying their dream home or if they should first try to go it on their own. In today’s market: you need an experienced professional!

You Need an Expert Guide if you are Traveling a Dangerous Path

The field of real estate is loaded with land mines. Home buyers need a true expert to guide them through the dangerous pitfalls that currently exist. Finding a home that is priced appropriately and ready for you to move in to can be tricky. An agent listens to your wants and needs, and can sift out the homes that do not fit within the parameters of your “dream home”.

You Need a Skilled Negotiator

In today’s market, hiring a talented negotiator could save you thousands, perhaps tens of thousands of dollars. Each step of the way – from the original offer, to the possible renegotiation of that offer after a home inspection, to the possible cancellation of the deal based on a troubled appraisal – home buyers need someone who can keep the deal together until it closes.

Remember that having a buyer agent represent you costs you nothing and those real estate commissions are generally paid for by the seller. Also realize that when an agent is negotiating their commission with you, they are negotiating their own salary; the salary that keeps a roof over their family’s head; the salary that puts food on their family’s table. If they are quick to take less when negotiating for themselves and their families, what makes you think they will not act the same way when negotiating for you and your family? If they were Clark Kent when negotiating with you, they will not turn into Superman when negotiating with the buyer or seller in your transaction.

Bottom Line: Home Buyers Need a Professional

Famous sayings become famous because they are true. You get what you pay for. Just like a good accountant or a good attorney, a good agent will save you money…not cost you money.

The best way for home buyers to avoid any headaches is to work with a professional real estate agent. The agents I work with can walk you through every step of the home buying process so you have the most positive buying experience possible. Call me and I will introduce you to an agent familiar with the area in Arizona where you want to look!  

Brought to you by SpencerAnglin.com 

Home Buyers Need a Professional

Home Buyers in Phoenix

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