Our Blog, Articles, and News

Coastal Dreams Real Estate Team's News, Market Trends, Research, and Articles.

You’ll find our blog to be a wealth of information, covering everything from local market statistics and home values to community happenings. That’s because we care about the community and want to help you find your place in it. Please reach out if you have any questions at all. We’d love to talk with you!

March 1, 2024

Why Today’s Housing Supply Is a Sweet Spot for Sellers

Why Today’s Housing Supply Is a Sweet Spot for Sellers




Wondering if it still makes sense to sell your house right now? The short answer is, yes. And if you look at the current number of homes for sale, you’ll see two reasons why.

An article from Calculated Risk shows there are 15.6% more homes for sale now compared to the same week last year. That tells us inventory has grown. But going back to 2019, the last normal year in the housing market, there are nearly 40% fewer homes available now:

a graph with red and blue squares

 

Here’s a breakdown of how this benefits you when you sell.

1. You Have More Options for Your Move

Are you thinking about selling because your current house is too big, too small, or because your needs have changed? If so, the year-over-year growth gives you more options for your home search. That means it may be less of a challenge to find what you’re looking for.

So, if you were holding off on selling because you were worried you weren’t going to find a home you like, this may be just the good news you needed. Partnering with our team can help you make sure you’re up to date on the homes available in your area.

2. You Still Won’t Have Much Competition When You Sell

But to put that into perspective, even though there are more homes for sale now, there still aren’t as many as there’d be in a normal year. Remember, the data from Calculated Risk shows we’re down nearly 40% compared to 2019. And that large a deficit won't be solved overnight. As a recent article from Realtor.com explains:

“. . . the number of homes for sale and new listing activity continues to improve compared to last year. However the inventory of homes for sale still has a long journey back to pre-pandemic levels.”

For you, that means if you work with our team to price your house right, it should still get a lot of attention from eager buyers and could sell fast.

Bottom Line

If you're a homeowner looking to sell, now's a good time. You'll have more options when buying your next home, and there's still not a ton of competition from other sellers. If you’re ready to move, let’s connect to get the ball rolling.

Posted in Top Pro Tips
Feb. 23, 2024

Why We Aren't Headed for a Housing Crash

Why We Aren't Headed for a Housing Crash




If you’re holding out hope that the housing market is going to crash and bring home prices back down, here’s a look at what the data shows. And spoiler alert: that’s not in the cards. Instead, experts say home prices are going to keep going up.

Today’s market is very different than it was before the housing crash in 2008. Here’s why.

It’s Harder To Get a Loan Now – and That’s Actually a Good Thing

It was much easier to get a home loan during the lead-up to the 2008 housing crisis than it is today. Back then, banks had different lending standards, making it easy for just about anyone to qualify for a home loan or refinance an existing one.

Things are different today. Homebuyers face increasingly higher standards from mortgage companies. The graph below uses data from the Mortgage Bankers Association (MBA) to show this difference. The lower the number, the harder it is to get a mortgage. The higher the number, the easier it is:

a graph showing a line going up

 

The peak in the graph shows that, back then, lending standards weren’t as strict as they are now. That means lending institutions took on much greater risk in both the person and the mortgage products offered around the crash. That led to mass defaults and a flood of foreclosures coming onto the market.

There Are Far Fewer Homes for Sale Today, so Prices Won’t Crash

Because there were too many homes for sale during the housing crisis (many of which were short sales and foreclosures), that caused home prices to fall dramatically. But today, there’s an inventory shortage – not a surplus.

The graph below uses data from the National Association of Realtors (NAR) and the Federal Reserve to show how the months’ supply of homes available now (shown in blue) compares to the crash (shown in red):

a graph of a number of people

 

Today, unsold inventory sits at just a 3.0-months’ supply. That’s compared to the peak of 10.4 month’s supply back in 2008. That means there’s nowhere near enough inventory on the market for home prices to come crashing down like they did back then.

People Are Not Using Their Homes as ATMs Like They Did in the Early 2000s

Back in the lead up to the housing crash, many homeowners were borrowing against the equity in their homes to finance new cars, boats, and vacations. So, when prices started to fall, as inventory rose too high, many of those homeowners found themselves underwater.

But today, homeowners are a lot more cautious. Even though prices have skyrocketed in the past few years, homeowners aren’t tapping into their equity the way they did back then.

Black Knight reports that tappable equity (the amount of equity available for homeowners to access before hitting a maximum 80% loan-to-value ratio, or LTV) has actually reached an all-time high:

 a graph of a growing graph

 

That means, as a whole, homeowners have more equity available than ever before. And that’s great. Homeowners are in a much stronger position today than in the early 2000s. That same report from Black Knight goes on to explain:

“Only 1.1% of mortgage holders (582K) ended the year underwater, down from 1.5% (807K) at this time last year.”

And since homeowners are on more solid footing today, they’ll have options to avoid foreclosure. That limits the number of distressed properties coming onto the market. And without a flood of inventory, prices won’t come tumbling down. 

Bottom Line

While you may be hoping for something that brings prices down, that’s not what the data tells us is going to happen. The most current research clearly shows that today’s market is nothing like it was last time.

Feb. 2, 2024

Why You Want an Agent’s Advice for Your Move

Why You Want an Agent’s Advice for Your Move




No matter how you slice it, buying or selling a home is a big decision. And when you’re going through any change in your life and you need some guidance, what do you do? You get advice from people who know what they’re talking about.

Moving is no exception. You need insights from the pros to help you feel confident in your decision. Freddie Mac explains it like this:

“As you set out to find the right home for your family, be sure to select experienced, trusted professionals who will help you make informed decisions and avoid pitfalls.”

And while perfect advice isn’t possible – not even from the experts, what you can get is the very best advice out there.

The Power of Expert Advice

For example, let’s say you need an attorney. You start off by finding an expert in the type of law required for your case. Once you do, they won’t immediately tell you how the case is going to end, or how the judge or jury will rule. But what a good attorney can do is walk you through the most effective strategies based on their experience and help you put a plan together. They’ll even use their knowledge to adjust that plan as new information becomes available.

The job of a real estate agent is similar. Just like you can’t find a lawyer to give you perfect advice, you won’t find a real estate professional who can either. That’s because it’s impossible to know everything that’s going to happen throughout your transaction. Their role is to give you the best advice they can.

To do that, an agent will draw on their experience, industry knowledge, and market data. They know the latest trends, the ins and outs of the homebuying and selling processes, and what’s worked for other people in the same situation as you.

With that expertise, a real estate advisor can anticipate what could happen next and work with you to put together a solid plan. Then, they’ll guide you through the process, helping you make decisions along the way. That’s the very definition of getting the best – not perfect – advice. And that’s the power of working with a real estate advisor.

Making a Move

Maybe you have a real estate need in another market, let a Pro find you a Pro; nobody else will have better insight and see through the fog or fluff.  We know how to personally interview top agents in other markets and see through the "influencer" types to find the real producers.

Bottom Line

If you’re looking to buy or sell a home, you want an expert on your side to help you each step of the way.   Let’s connect so you have advice you can count on.

Jan. 26, 2024

It’s Time To Prepare Your House for a Spring Listing

It’s Time To Prepare Your House for a Spring Listing




If you're thinking of selling your house this spring, now is the perfect time to start getting it ready. With the market gearing up for its busiest time of year, it'll be important to make sure your house shines bright among the competition.

Here are some valuable tips you can use to get your house market-ready.

Declutter and Organize

First impressions matter, and if your house is a mess, that can easily turn off potential buyers. Before listing, take the time to declutter and organize each room. Decluttering is about more than just tidying up – it's about creating a sense of space and openness that allows potential buyers to envision themselves living in your home. According to Moving.com:

Decluttering and organizing your space will go a long way in appealing to potential buyers. . . .decluttering will help the buyers see themselves living in your home. Less clutter inside a home also helps a place appear larger and cleaner, which should attract more buyers.”

Deep Clean Your Kitchen and Bathrooms

The kitchen and bathrooms are focal points for many buyers, and often influence their overall opinion of the house. Ensure these spaces dazzle by giving them a thorough deep cleaning. Pay attention to details like scrubbing grout lines, polishing fixtures, and decluttering countertops. A sparkling kitchen and bathroom can leave a lasting positive impression on potential buyers.

Maintain Your Yard

Your home’s exterior is the first thing potential buyers see, so it’s important to make a good impression from the moment they arrive. A well-maintained yard not only enhances curb appeal, but also shows buyers the home has been well taken care of.

Take the time to spruce up your yard by mowing the lawn, trimming bushes, and clearing away any debris or dead plants. Remember, the goal is to create a welcoming environment that entices buyers to step inside and imagine themselves living there. U.S. News says:

“A beautifully landscaped front yard can elevate an ordinary house into a charming home and will help homes sell faster and for more money.”

Find a Listing Agent

A skilled, experienced, local listing agent is your partner in minimizing stress when selling your home. That's where we come in.  Lean on us for advice on decluttering, staging, and enhancing your home's appeal to potential buyers. Our insights into market trends and recommendations for reliable contractors and staging ideas are invaluable.  And we hire only the best photographers as part of our service to you!   As Realtor.com says:

“A good listing agent will help you price your home . . . recommend a photographer and stager to make it look its best, and put your home on the multiple listing service.”

Bottom Line

By decluttering, deep cleaning, and tidying up your house, you can create a welcoming environment that resonates with buyers and increases your chances of a successful sale. Let’s connect on what you need to do to get your house ready to sell this spring.

Posted in For Sellers
Aug. 22, 2023

How Appreciation and Amortization Benefit Homeowners.

How Appreciation and Amortization Benefit Homeowners

Owning a home is not only a place to live but also a valuable asset that can contribute to long-term wealth accumulation. Two key factors that play a vital role in increasing a homeowner's wealth are appreciation and amortization. Understanding how these factors work can provide homeowners with insights into building substantial financial equity over time.

Appreciation refers to the increase in the value of a property over time. Real estate markets tend to experience appreciation in the long run, although it can fluctuate in the short term. This appreciation can significantly benefit homeowners' wealth accumulation in several ways.

As a property appreciates, the homeowner's equity, which is the difference between the property value and the mortgage balance, increases. This equity serves as an asset that can be leveraged for future financial endeavors.

Capital Gains: When homeowners decide to sell their property, the appreciation becomes recognizable. The difference between the purchase price and the selling price results in a capital gain, which can be taxed at favorable rates. Homeowners benefit from an exclusion of up to $500,000 of capital gain for married taxpayers filing jointly.  If the gains exceed the exclusion, they are taxed at a lower capital gains rate.

Amortization refers to the gradual repayment of a mortgage loan over time. It is facilitated through monthly mortgage payments, which consist of both principal and interest. With each mortgage payment, a portion goes towards reducing the principal balance of the loan. This reduction in debt increases the homeowner's equity in the property, effectively building wealth over time.

Amortization acts as a form of forced savings. Homeowners are essentially paying themselves by building equity with each payment, rather than paying rent to a landlord. As the mortgage balance decreases, homeowners gain ownership of a more significant portion of the property, leading to increased wealth.

As equity grows, homeowners can access it through home equity loans or lines of credit, allowing them to invest in other ventures or make home improvements that can further enhance the value of their property.

Understanding the dynamics of appreciation and amortization is crucial for homeowners looking to accumulate wealth through their real estate investments whether it be a home or a rental. Appreciation allows for capital gains and the growth of equity, while amortization steadily reduces debt and builds equity over time. By leveraging these two factors effectively, homeowners can secure their financial future and take advantage of the long-term wealth-building potential of homeownership.

Aug. 18, 2023

Equity is a Game Changer for Sellers

Equity Is a Game Changer for Homeowners Looking To Sell




If you’re a homeowner, you might be torn on whether or not to sell your house right now. Maybe that’s because you don’t want to take on a higher mortgage rate on your next home. If that’s your biggest hurdle, understanding your equity may be exactly what you need to help you feel more comfortable making your move.

What Equity Is and How It Works

Equity is the current value of your home minus what you owe on the loan. And recently, that equity has been growing far faster than you may expect.

Over the last few years, home prices rose dramatically, and that gave your equity a big boost very quickly. While the market has started to normalize, there’s still an imbalance between the number of homes available for sale and the number of buyers looking to make a purchase. And it’s because homes are in such high demand that prices are back on the rise today. Rob Barber, CEO of ATTOM, a property data provider, explains:

“Equity levels were high even during the recent downturn, and now they are going back up and better than ever.”

How Equity Benefits You in Today’s Market

With today’s affordability challenges, that equity can be a game changer when you move. Here’s why. Based on data from ATTOM and the Census, nearly two-thirds (68.7%) of homeowners have either paid off their mortgages or have at least 50% equity (see chart below):

That means roughly 70% have a tremendous amount of equity right now.

Once you sell your house, you can use your equity to help with your next purchase. It could be some (if not all) of what you’ll need for your next down payment. It may even be enough to allow you to put a considerably larger down payment on your next home, so you don’t have to finance quite as much. And, if you’ve been in your current house for years, you may have even built up enough equity to pay in all cash. If that’s true for you, you’d be able to avoid borrowing altogether, so you wouldn’t have to worry about today’s mortgage rates.

How To Find Out How Much Equity You Have

The best way to learn how much you have is to reach out to a trusted real estate agent for a Professional Equity Assessment Report (PEAR).  Let's Talk!  Call us at 910.612.5312

Bottom Line

If you’re planning to make a move, the equity you’ve gained can make a big impact. To find out just how much equity you have in your current home and how you can use it to fuel your next purchase, let’s connect.

Aug. 13, 2023

Home Prices are Back on the Rise

Home Prices Are Back on the Rise [INFOGRAPHIC]




Some Highlights

  • Looking at monthly home price data from six expert sources shows the worst home price declines are behind us, and they’re rising again nationally.
  • If you’ve put your plans to move on pause because you were worried about home prices crashing, this rebound is good news.
  • Let’s connect so you know what’s happening with prices in our area.
Aug. 11, 2023

The Dual Forces Building Homeowner's Wealth

When it comes to wealth accumulation, homeownership offers a unique advantage through the combined forces of appreciation and amortization. These two factors work hand in hand to contribute significantly to a homeowner's financial journey towards building long-term wealth.

Appreciation refers to the increase in the value of a property over time. While real estate markets can experience fluctuations, historically, properties have shown a tendency to appreciate over the long term. Homeowners enjoy the benefits of appreciation, which directly impacts their overall wealth accumulation.

As property values rise, homeowners build equity, which is the difference between the home's market value and the remaining mortgage balance. This equity can serve as an asset which can be tapped into for various purposes, such as funding education, starting a business, or investing in additional properties.

Amortization refers to the process of gradually paying off a mortgage loan over time. Each monthly payment made by a homeowner consists of both principal (the amount borrowed) and interest (the cost of borrowing). As time goes on, the proportion of each payment dedicated to the principal increases, while the portion allocated to interest decreases.

This gradual reduction of the mortgage balance is a significant advantage for homeowners. With each payment, equity in the property grows, and the homeowner's wealth increases. Additionally, the principal payments made towards the mortgage are essentially a form of forced savings, allowing homeowners to accumulate wealth in the form of home equity.

One of the primary advantages of homeownership is the ability to leverage home equity for financial opportunities. As mentioned earlier, appreciation and amortization work in tandem to build equity in a property. Homeowners can utilize this equity through various means, such as home equity loans or lines of credit, cash-out refinancing, or selling the property altogether.

These options allow homeowners to access their accumulated wealth to invest in other ventures, pay for major expenses, or consolidate high-interest debt. By leveraging home equity strategically, homeowners can further expand their wealth accumulation and achieve their financial goals.

Understanding the dynamics of appreciation and amortization is vital for homeowners seeking to accumulate wealth. Appreciation builds equity by increasing property values over time, while amortization allows homeowners to steadily pay down their mortgage and build home equity. By harnessing the power of these dual forces, homeowners can leverage their accumulated equity for financial opportunities and enjoy the long-term benefits of wealth accumulation.

Aug. 7, 2023

Market Forecast

Housing Market Forecast for the Rest of 2023 [INFOGRAPHIC]




Call Us to find out EXACTLY how the current Market is affecting your Real Estate Needs.  910.612.5312

 

Some Highlights

  • Want to know what experts say will happen in the rest of 2023? Home prices are already appreciating again in many areas. The average of the expert forecasts shows positive price growth.
  • Where mortgage rates go for the rest of the year will depend on inflation. Based on historical trends, rates are likely to ease as inflation continues to cool.
  • Even though low inventory continues to be a challenge, experts project 5 million homes will still sell this year. That pace should pick up if rates come down.
July 28, 2023

Key Housing Market Trends

Key Housing Market Trends [INFOGRAPHIC]




Some Highlights

  • If you’re considering buying or selling a home, you’ll want to know what’s happening in the housing market.
  • Housing inventory is still very low, prices are climbing back up, and homes are selling fast when priced right.
  • If you want more information about our local area and what the trends mean for your plans to buy or sell, let’s connect.