No, We are Not Headed Towards a Housing Crash: Here’s Why

In the past few months, you may have heard whisperings about an incoming housing market crash. We’re here to put you at ease: we are not headed towards a crash!

A lot of this concern comes from average home prices slowing in growth across the country. We wrote a blog about it last week, but this is not a bad thing! It just means the market is shifting back towards normal.

The Three Most Important Factors

A luxury home interior with a fireplace.

Today’s market is wildly different than the pre-crash housing market of the late 2000s. We’re going to show you why and how using three important metrics that measure the Raleigh real estate market.

Home Prices

Beginning in 2008, average home prices in the U.S. dropped almost 29% over a four year period. That’s drastic, and it’s what spurred the housing market crash!

Today’s average home prices are not depreciating. It’s just that the level of appreciation is slowing down. Over the last year, homes have increased by more than 4%.

While this is less than the 6-7% prices appreciated over years prior, it in no way indicates that we’re headed towards a crash!

Mortgage Standards

A white table with a checkbook and small stack of money.

In the current real estate market, it’s considered easier to get a loan from the bank than in years prior. Many are concerned that these “lenient standards” will contribute to a housing crash.

However, the Urban Institute’s Housing Finance Policy Center released a quarterly index that details the percentage of home purchase loans that are likely to default. When this rate is very low, it indicates that lenders are unwilling to tolerate defaults. This makes it much harder to get a loan.

When that percentage is higher, it indicates that lenders are more lenient so it is easier to get a loan.

In another report called the Housing Credit Availability Index, the Urban Institute also revealed that there is still ample space to expand the housing market credit box. Even if the current risk of default was twice what it currently is, it would still be well within the pre-crisis standard of 12.5%.

Foreclosure Rates

In the last 10 years, foreclosures and short sales have made up 35% of all home sales. That’s huge!

At the end of the fourth quarter of 2018, the percentage of loans in the foreclosure process was just 0.95%. It hasn’t been that low since 1996!

Ready to Explore the Raleigh Real Estate Market?

Linda Craft & Team REALTORS® is ready to help. Give us a call today to learn more about the best way to buy a home in the greater Raleigh market.

Rely on our expertise, our extensive resources, and our proven track record with buying homes in Raleigh. We’ll guide you towards a successful outcome in the Triangle, guaranteed.

The Real Estate Market is Returning to “Normal:” Here’s Why That’s a Good Thing

In the past couple of months, we’ve written about how the Raleigh real estate market is primed for sellers. That’s because of a discrepancy between housing demand and housing supply.

When there aren’t enough homes for sale to satisfy buyer demand, home prices rise. In fact, over the past few years, home price appreciation has averaged around 6% across the country. These conditions are known as a “seller’s market.”

So What’s Changing?

A spacious, luxurious kitchen with a huge island in the center.

The market is starting to level out a bit. Home price growth has begun to cool down, with a recent report by CoreLogic showing that prices have only risen by 4.7% over the last year.

While housing prices have by no means stagnated, many buyers and sellers are still worrying that this recent activity means another housing crash is on the horizon.

Don’t Worry, the Market is Doing Just Fine

A business professional showing a client shifting trends in market activity.

Sure, the market is cooling off a bit, but that’s not a bad thing! It also does not indicate that we are headed for a crash.

It means that the real estate market is returning to “normal.” The inventory of homes for sale is growing to meet buyer demand, so housing prices aren’t increasing dramatically.

This is good for buyers: it means that housing prices aren’t skyrocketing, so more people will be able to afford homes in their preferred neighborhood.

Will Housing Prices Go Up Again?

Sold house sign in Midwest suburban setting. Focus on sign.

Most likely, yes! The Joint Center for Housing Studies at Harvard University estimates that over 30 million new households will enter the market from now through 2040.

Is Now the Right Time to Buy a Home in Raleigh?

Yes! If you’re interested in buying a home in Raleigh, or anywhere else in the NC Triangle, now is the time to act. Here at Linda Craft & Team REALTORS®, we have the resources and expertise to assist.

Just give us a call today to learn more! You can also browse our home-buying resources, see what homes are currently going for in Raleigh, and explore specific communities in the Triangle.

Why 2019 is THE Year to Sell Your Raleigh Home

A couple touring a home for sale with a real estate agent.

If you stay up to date on real estate trends, you’ve probably noticed that interest rates and home prices are rising. Many homeowners are taking this as a sign that it’s a bad time to sell their homes because buyers won’t be as interested.

However, that couldn’t be further from the truth! Buyers are still highly motivated—especially in the greater Raleigh area.

Buyers are Out in Full Force

Elderly couple talking with a real estate agent.

According to NerdWallet’s 2018 Home Buyer Report, around 32% of Americans are planning to buy a home in the next five years. Millennials in particular are most likely at 49%.

Homebuyers have their own personal reasons for buying real estate. Of those Americans surveyed by NerdWallet, 44% want to buy a home because they think it’s a good investment.

They’re not wrong! We’ve written about it many times before, but buying a home is the most efficient way to build your wealth. When you own a home and pay off your mortgage every month, you’re really paying yourself. You’re building up your equity for the long term, and you can expect your hard work to pay off!

That’s Why Now is the Time to Sell

Home with a red "SOLD" sign out front.

Let’s review. Not only are buyers highly motivated, more and more sellers have decided that now is not the time to sell. What does that mean for you?

There’s less competition AND more buyers out! You don’t have to wait on the market if you want to sell now.

Sell Your Raleigh Home for Top Dollar this Spring

Ready to make a tremendous return on your real estate investment? Then it’s time to list your Raleigh home with Linda Craft & Team REALTORS®.

We offer a wide array of home-selling services, resources, and tools to better assist you in selling your Raleigh area home. With more than 30 years of unparalleled experience in the Raleigh and Greater Triangle real estate market, we know exactly what it takes to sell your unique home for top dollar. Contact us today to learn more.

First Comes Love… then Comes Your First Mortgage Payment!

Every year, the National Association of Realtors® conducts a survey to determine the profile of home buyers and sellers across the country.

The 2018 profile is interesting because the majority of recent homebuyers (a whopping 63%!) are married couples!

The Majority of First-Time Buyers are Married Couples

A married couple standing on the porch of their new home.

It’s true! According to the NAR, 54% of first-time buyers in 2018 were married couples.

However, if you’re still single, there’s no need to worry. 18% of first-time home buyers in 2018 were single women, while 10% were single men. In addition, about 16% of these buyers were unmarried couples.

Homeownership is Within Your Grasp!

Spacious living room with beige sectional sofa and a coffee table.

Even if you haven’t saved up an enormous down payment, you likely still have plenty of options for buying a home in the greater Raleigh area!

Many homes for sale in Raleigh, and the Greater Triangle area, qualify for loans that don’t require huge down payments. You may be able to use an FHA loan or a USDA loan to purchase a home in one of Raleigh’s orbiting cities—in communities like Angier, Fuquay-Varina, and Apex.

These loans are popular because they only require a down payment that’s 1 – 3% of the home’s overall price. And, if you’re in the military, you have even more options!

Let’s Buy Your Dream Home Together

A hand holding a pair of house keys in front of a home.

If you’d like to explore your home-buying options in the greater Raleigh area, please give us a call at Linda Craft & Team REALTORS®. Whether you’re a first-time buyer or looking to invest in your fifth real estate property, we have the resources and expertise to assist.

Let’s set up a time to talk about your plans! In the meantime, feel free to explore the Greater Raleigh area with our free home-buying guides.

How Homeownership Makes the Biggest Difference

If you’re looking for the most surefire way to build your wealth, become a homeowner. We’ve blogged about this in the past, but it really is one of the most effective (and simplest) ways to build your wealth for the long term.

The majority of homeowners take out a mortgage loan to buy their home. By paying off your home’s mortgage every month, you’re building your wealth. Although it feels like you’re paying somebody else (the bank) you’re actually putting money into a forced savings account.

And forcing yourself to save money pays off. Big time.

It Helps You Achieve the American Dream

A core part of what many consider “The American Dream” is owning a home. Owning your own home brings a myriad of benefits, both financial and non-financial.

Financially speaking, buying a home and becoming a homeowner increases your net worth. Every time you make a mortgage payment, your net worth goes up a little.

Here’s an example: in a study performed by The Joint Center for Housing Studies at Harvard University, researchers found that the difference in net worth between homeowners and renters over 65 was 47.5 times greater.

In that study, nearly half of those homeowners’ net worth came from their home equity!

It’s a Huge Retirement Benefit

Studies show that homeowners over 65 are more financially prepared for retirement. Even if they choose to sell their home and downsize for retirement, they have the added bonus of owning their home for a long time—meaning their home has likely increased in value.

Now, when they choose to sell their home, they’ll make an even bigger return on their investment.

Although renting may seem like an affordable option short-term, it’s less lucrative in the long term. This is especially true when you consider that median rent prices have increased substantially every year.

Plus, It Has Emotional Benefits

You deserve to love where you live. That’s the biggest emotional benefit you get from owning your home: you get to put down roots and invest in a community that will improve your quality of life.

When you buy a home in a community like Raleigh and the NC Triangle, you’re signing up for an exciting, well-rounded lifestyle! The Triangle has plenty of small towns, gorgeous real estate options, and maybe even a major city or two.

Ready to Become a Homeowner?

We’re ready to help. Start building your wealth and guaranteeing yourself a more successful retirement by buying your dream home in the greater Raleigh area.

Just call us, Linda Craft & Team REALTORS®, today to get started. You can use our free home-buying resources, easily search for homes in the area, and see popular Raleigh homes for sale.

A Quick Study Guide on What “Affordability” Means in Raleigh Real Estate

A calculator next to an outline of market trends.When we talk about “affordability,” a lot of definitions may come to mind. For real estate specifically, affordability is something of a hot topic.

While it is true that buying a home is less affordable today than it was at any other time in the past decade, that has a lot to do with the real estate market crash of 2008.

If you’ve been in the real estate game for a while, you probably remember the flood of distressed properties that hit the market at this time. Due to the poor state of the economy, foreclosed and short sale homes were going for a huge discount. This rush of distressed homes actually damaged the value of other homes within a neighborhood.

Lucky for everyone involved in the real estate industry, things have since changed!

The Market Has Changed Since Then

A woman holding a tablet and looking at how the market has shifted over the past 10 years.Over the past decade or so, the market has recovered and prices have gone up right along with it. This isn’t a bad thing! A strong economy is good for everybody, especially those trying to sell their home for what it’s worth in the Triangle.

As such, both home prices and mortgage rates have increased. To make the best possible decision in the Raleigh real estate market, it’s important to have plenty of resources to rely on.

So Mortgage Rates Have Shifted

An open door with a set of house keys hanging from the key hole.When most buyers think of a home’s “affordability” they’re picturing two things in particular: the listing price of the home and the mortgage rate they’ll have to pay.

According to a CoreLogic report written by Andrew Lepage in late January, the “typical mortgage payment is a good proxy for affordability because it shows the monthly amount that a borrower would have to qualify for to get a mortgage to buy the median-priced U.S. home…”

While mortgage rates are slowly increasing, they are nowhere near the gargantuan rates of the 2006 housing boom (think an average monthly payment of $1,275…)

By the end of 2019, experts have projected the typical monthly mortgage payment to be about $963.

What Does That Mean for Buyers and Sellers?

Whether you’re thinking of buying or selling a home in Raleigh, please know that this is one of the most advantageous times to invest in real estate!

At Linda Craft & Team REALTORS®, we have the market expertise necessary to help you make a highly valuable transaction in this area. Please give us a call today to learn more about your Raleigh real estate options.

You Should Be Building Your Own Wealth… Not Your Landlord’s

There’s no doubt about it: buying a home is a daunting task. In fact, many potential buyers are nervous about the commitment and obligation that comes with buying a home.

If you’re more comfortable renting because you think you can’t afford buying a home, we should talk. The truth is, even when you’re a tenant, you’re still paying a mortgage. Unless you live completely rent-free with a relative, you’re helping someone build their equity and pay off their mortgage with your rent money every month.

You’re paying your landlord’s mortgage, and giving them a little extra for themselves each month. Wouldn’t you rather be building your own wealth?

If You’re Serious About Your Finances, You Should Buy a Home

Stacks of coins growing consecutively in size until they reach a large pot.Buying a home is one of the most surefire ways to build wealth for the long-term. Additionally, it gives you significant benefits to your credit score, as well as a sense of security.

When you own your home, you’re not at the mercy of your landlord—who may raise your rent whenever they see fit. Plus, owning your home means you can decorate and renovate it to match your unique tastes! You have complete freedom over what goes in and what comes out.

In Fact, It’s a Great Time to Buy in Raleigh

A white kitchen countertop with red flowers and a candle.The spring home-buying season is shaping up to be a good one. Interest rates are still historically low, while inventory only continues to grow. That means this spring will be a wonderful time to buy a home in Raleigh.

Get a head of the competition by beginning your home search today! Do some research and come up with an idea of what kind of home you’d like to buy.

If you need any help locating potential homes for sale in the area, please don’t hesitate to give us a call. At Linda Craft & Team REALTORS®, we have the inside scoop on the area’s best new listings.

Join the Home-Buying Ranks

It’s never too late (or too early!) to buy a home in Raleigh. Trust us, if you can afford to pay rent every month, you can afford to buy a home.

Plus, there are plenty of mortgage options out there that require little to no down payment! There’s no excuse not to take advantage of excellent market conditions and become a homeowner.

Guess What? You Do Not Need a 20% Down Payment to Buy a Home in Raleigh!

Many people believe that they can’t afford to buy a home because they can’t afford the down payment. Time and time again, I hear would-be homebuyers resign themselves to a life of renting because a 20% down payment just isn’t feasible.

However, this is one of the biggest myths of buying a home! The truth is, you do not need to put down 20% to buy a home. There are plenty of options for buying a home without a hefty down payment!

What You Need to Know

According to a recent study called “Barriers to Accessing Homeownership,” 39% of non-homeowners and 30% of those who already own a home think that they need more than a 20% down payment.

But that just isn’t true. In fact, there are a number of loans available that don’t require a down payment at all or require a very small one.

Did you know that the median down payment on loans approved in 2018 was only 5%? If you’ve spent the last couple of years saving up for your down payment, chances are you already have enough saved to buy now!

The Lowest Down Payment Loans Out There

A family of three holding a pink piggybank with coins spilling out.Here are three loans that offer low to zero down payments. There are certain eligibility requirements for each, but don’t feel discouraged if they won’t work for you! Please give us a call at Linda Craft & Team REALTORS®!

Chances are, we know of the perfect solution to fit your unique situation in the Raleigh real estate market.

VA Loan

It’s no secret that the VA loan is one of the best mortgage loans out there. It is available to qualified veterans, active-duty service members, certain spouses, and other specific members of the National Guard and Reserves.

The VA loan features a 0% down payment and does not require mortgage insurance. It is offered through a local lender, but guaranteed by the government. The borrower does have to pay a funding fee (anywhere from 1.25 to 3.3%) that can be included in the total loan amount.

USDA Loan

Attractive kitchen with hardwood floors, marble countertops, and hanging light fixture.This loan is available for certain eligible buyers. It has restrictions based on household income, as well as certain credit and employment requirements.

It is designed for people looking to buy a single-family residence in a suburban or rural area. The USDA has maps with specific eligibility information, so you can easily see if your property is eligible!

The USDA loan is one of the most popular loans available, and it isn’t uncommon for the total fund to run out before the end of the fiscal year. If you’re interested in using a USDA loan to buy a home in the North Carolina Triangle, check your eligibility requirements and then give us a call!

Federal Housing Administration

The FHA loan requires a minimum down payment of 3.5% and is a great option for would-be buyers that have a low credit score or history of poor credit.

While it charges a low down payment, it does require the borrower to purchase mortgage insurance upfront with a premium of about 1.75% of the total mortgage amount.

Your Dreams of Homeownership are Within Reach!

We know you can do it! Please know that you have plenty of options when it comes to buying a home in Raleigh or another popular Triangle community.

When you choose to work with Linda Craft & Team REALTORS®, you’re enlisting the help of the Triangle’s #1 real estate team. We have the resources and experience to help you buy the home of your dreams. No 20% down payment necessary!

Ready to begin exploring your home buying options? Please reach out to us today!

 

The Pros & Cons of a Buyer’s Letter: Standing Out in a Busy Market

Imagine, after weeks of searching, that you’ve finally found your dream home. It’s in the perfect location with the right features and exactly the amount of space you need. But after requesting more information, your agent informs you that there are already several offers made on the house. How do you stand out in a busy market and snag your dream home?

When buyers are looking to make a lasting impression on sellers, they often opt to submit a letter to the seller. In fact, a recent study found that buyers who submitted letters were 9% more likely to have their offer accepted.

A Buyer’s Letter can work both with you and against you, so it’s important to understand what they are and when you should use one.

What is a Buyer’s Letter?

A man typing on a laptopA Buyer’s Letter is pretty much what it sounds like — a letter written by the buyer for the seller in order to stand out in a busy market. The letter is your chance to make a case for why you should get the home over other buyers.

Many people opt to write about how they envision their lives in the home, how well they would take care of it, how much owning this specific home would mean to them, and similar sentiments.

You might also use this space to talk yourself up, bringing up steady finances, your down payment, and job security — things geared towards making the seller confident in choosing you.

Advantages of a Buyer’s Letter

A man and a woman shaking handsA Buyer’s Letter sets you apart from the crowd and makes you more than just an offer on a sheet of paper — it allows you to connect with the seller on a personal level. In a constantly growing and changing market, being able to stand out or connect puts you a big step ahead of other buyers.

Is the home close to a golf course? Does the seller have bikes in their garage? Are there signs of pets in the home? If you notice you have common interests, including them in the Buyer’s Letter can elevate your standing.

When you choose to forgo a Buyer’s Letter, you miss out on the chance to advocate for yourself, which can go a long way in the seller’s final decision.

Disadvantages of a Buyer’s Letter

A woman writing in a notebook. While there are plenty of pros to using a Buyer’s Letter, there are also pitfalls to consider. Making your case is great, but it does give the seller leverage. If you really love the house as much as you say, then what’s to stop the seller from raising the asking price?

Maybe the seller accepts your offer, and you move to the home inspection stage. If issues turn up, then the seller might refuse to make costly repairs, assuming that you’ll buy the house no matter what.

Another unexpected con of a buyer’s letter? It can be tricky for sellers to navigate around discrimination issues. If a seller picks a buyer of a certain race, religion, gender, or family status instead of another, they could face backlash. Be aware of this when writing your letter so as to not put the seller in an uncomfortable position.

Need Help Standing Out?

If you’re kicking off the home-buying process and need help standing out, we’ve got you covered. When you work with Linda Craft & Team REALTORS®, you’re enlisting the help of the Triangle’s #1 real estate team. We know exactly how to help you purchase the home of your dreams.

Get in touch with us today, and we’ll help you secure your dream home, and answer any and all of your questions in the process.

Want to Build Your Wealth? It’s Time to Buy a Home in Raleigh

The most surefire way to begin building your wealth in the NC Triangle? Become a homeowner.

Buying a home essentially forces you to build wealth. To purchase a home, you have to apply for a mortgage loan to pay for it. Then, every month, you pay off a percentage of that mortgage. Each mortgage payment brings you a little bit closer to fully owning the home on your own, and makes your equity a little big bigger. To be honest, your home is really just one big savings account.

So, owning a home and paying your mortgage every month builds your wealth for the long run.

Owning a Home Leads to Financial Security

A white table with a checkbook and small stack of money.According to many housing experts in the real estate industry, buying a home before the age of 35 leads to being better prepared for retirement at age 60.

If you’re a millennial in the greater Raleigh area, you may believe that you can’t afford to buy a home because of the massive down payment or the high mortgage interest rates. However, that’s not actually true!

If you can afford to pay rent every month, you can afford to buy a home. Plus, with so many different mortgage options available, it’s not always necessary to pay a huge 20% down payment!

Navigate the Triangle Real Estate Market

Cute interior decor.It’s never too early to begin planning for your retirement. And, the sooner you begin saving, the better off you will be when it’s finally time to retire!

It’s no secret that housing wealth is the largest single source of wealth currently available. Plus, the emotional benefits that come from buying a home are on the same level as the financial benefits!

If you’re interested in building your wealth by buying a home in the greater Raleigh area, then it’s time to contact Linda Craft & Team REALTORS®.

You Deserve a Successful Real Estate Transaction

When you choose to work with Linda Craft & Team REALTORS®, you’re enlisting the help of an all-star team that will stop at nothing to make sure you achieve success in the Triangle real estate market.

As the Triangle’s #1 Ranked Real Estate Team, we know exactly how to help our clients find the perfect home. Give us a call today to explore your real estate options in the greater Raleigh area!