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Renting Your Delaware Home Has an Emotional Dimension

Jul 20, 2017

From our earliest days, everybody in Delaware is inundated with tale of transformations. It started with those grade school day trips to science places with exhibits showing the improbable progression of fish (well, pollywogs) into frogs. There were nature TV shows with sped-up motion films demonstrating the unlikely truth that icky caterpillars DO turn into graceful butterflies. In fact, Delaware cable TV is littered with the Discovery Channel and the Science Channel and PBS and the NatGeo Channel—all of which seem to be dedicated into making sure we won’t forget that Nature is full of every day metamorphoses and how ugly ducklings will one day become swans.

We’ve been brainwashed into accepting that transformations are unstoppable.

So it’s only natural that when some Delaware homeowners have found themselves a new home, they don’t hesitate to assume it would be no big deal if they decide to change themselves from homeowner into landlord. Since Delaware rental rates are projected to keep rising, renting the current house out rather than just selling it surely makes sense. If Nature is any guide, the transformation from homeowner to landlord doesn’t seem like there’s much to think about. Their Delaware home has been a good investment, so why not try renting it? It’s a natural progression, isn’t it?

The answer is yes and no. Renting your Delaware home can be a terrific move if you are ready to add the landlord’s role to all the other activities that currently fill your day. It starts with making a stream of decisions: Will you allow pets? Chihuahuas? Rottweilers? What will your deposit agreement look like? When will you be available to take repair calls? What happens in emergencies?  

Decisions are one thing, but once the rules are set, not everyone is comfortable being the person who has to enforce tough business realities—even if they are perfectly fair. How comfortable will you be about having to insist on inspections now that your house is another family’s home? How often? And if back-to-school time expenses cause your tenant to have trouble scraping up September’s rent, how will you feel when you have to hold them to their obligation?

Pollywogs don’t consider their temperamental disposition before they turn into frogs, but renting—the homeowner-to-landlord transition—is more complicated. Even if the financial equation will allow hiring a professional management company to handle the day-to-day supervisory details, the renting decision—transforming the family homestead into an investment vehicle—can have overtones that aren’t immediately obvious.

I’m here to help you in all your Delaware real estate matters—starting with arriving at decisions that let you feel comfortable. I hope you’ll give me a call! Call/Text me Russell Stucki at (302) 228-7871, email me at russellstucki@remax.net, visit more listings at www.beachrealestatemarket.com

Week of Mortgage Rate Speculation Ends on High Note

Jul 20, 2017

Last week there was another interest rate development—though it was a slightly whipsawed kind of development. Since mortgage interest rates are so important to the bottom line in all but all-cash Delaware residential home sales, the direction rates are headed is something worth watching closely.

Last Wednesday was one of those days that come about twice a year. It was the occasion when the Federal Reserve Chairman is called upon to testify before Congress. The date is set as a biannual marker for revealing what’s likely to lie ahead for interest rates. If the Fed is going to decide to raise the Fed Funds rate, it’s usually the single strongest pointer to higher mortgage interest rates. All things being equal, that would eventually slow Delaware’s real estate market activity by making mortgage payments more expensive.

As the appointed hour for the testimony neared, Reuters weighed in early. At about 8:30 in the morning, they reacted to the advance copy of Chairman Yellen’s prepared remarks. Reuters reported on some key paragraphs citing the continued gathering strength of the economy—which would, therefore, “warrant gradual increases in the federal funds rate over time.”

Not great news for Delaware mortgage rate watchers—or was it? Reading more closely, there were those “gradual” and “over time” phrases. Wouldn’t that lead one to think the raises would be slow and gradual? Possibly more slow and gradual than previous Fed hints had led us to believe?

Ninety minutes later came the actual testimony, followed by questioning from the congressional committee. CNBC saw good news for Delaware mortgage applicants: “Fed stands ready to slow down rate hikes” was their takeaway. Sooooo, the Fed was going to raise the Fed funds rate (bad), but more slowly than expected (good).

But by the end of the week, the picture was a little clearer. Summing up last Friday, the Mortgage News Daily pointed to newly released retail sales and consumer inflation reports as “economic data that coincides with rates moving lower.” And despite anything the public hearing had produced, in MND’s opinion, “the Fed is less likely to flip the switch on those plans.”

Sure enough, by the close of business, they were able to headline “Mortgage Rates End Week at Best Levels.” So Delaware buyers and sellers could head into the weekend with few worries about interest rates, which remain at appetizingly low levels. If you are thinking of taking a look at some of the terrifically affordable Delaware home buys they make possible, today would be a good time give me a call! Call/Text me Russell Stucki at (302) 228-7871, email me at russellstucki@remax.net, visit more listings at www.beachrealestatemarket.com

Buying Delaware Luxury Homes on a Tight Budget

Jul 20, 2017

The content the National Association of Realtors® publishes is usually staid and non-controversial. After all, what they put out there has to ring true for the real estate industry in every nook and cranny of the country: in communities large and small, coast to coast—from Podunk to Peoria, Manhattan to Delaware. Real estate is, after all, the most massive industry in the country, so you’d expect the Association that represents its professionals to be hyper-cautious in its pronouncements.

So it was eye-widening to come across an article in the Realtor website that was a how-to on buying a luxury home without having to pay a lot of money for it. I’m of the opinion that Delaware luxury homes are more expensive than less-luxurious homes—so I was eager to see what in the world they were talking about.

Surprisingly, they had a point—in fact, several good ones. In truth, the “6 Sneaky Tips for Buying a Luxury Home Without Wads of Cash” are mainly variations on becoming a shrewd shopper, but putting them in one list was a clever way of presenting that idea. And I can add a few more along the same lines for future Delaware luxury home shoppers.

Their six tips started with timing: waiting for the darkest, dankest days of winter, possibly around Christmastime, when few other prospects are out there competing. Then look for evidence of a motivated luxury home seller who has recently reduced price a couple of times. Then see if the motivated seller will finance at least a piece of the mortgage (although this slightly contradicts a previous tip, which was to “make your bid straightforward”).

Both of the last two tips call for disclaimers: to check out foreclosure listings and to be ready to borrow from your retirement funds. The first tip is not “sneaky” at all—but should carry a disclaimer that, as with all foreclosure buys, it’s a good idea to check that the property won’t ultimately involve “wads of cash” to rehabilitate. Likewise, raiding your retirement plan requires the utmost of caution (and probably professional guidance).

A (non-sneaky) tip I would add is to be realistic when budgeting the upkeep costs your Delaware luxury home will generate. Maintaining luxury can be relatively expensive—and allowing it to deteriorate, even more so. Another tip: be patient, and think long term. Be willing to start with a non-luxury home you can improve, and start the process of working your way up. It’s non-sneaky in the extreme—and it’s the way most Delaware luxury home owners wind up luxuriating!

One last tip is equally non-controversial: reach out to an experienced Delaware real estate professional who understands your goals and stands ready to help—not just now, but for the future, as well. Call me to start that process! Call/Text me Russell Stucki at (302) 228-7871, email me at russellstucki@remax.net, visit more listings at www.beachrealestatemarket.com