Listing Courtesy of Re/Max Point Realty
In case you set your alarm clock to go off when it was time to buy a home, that clang you may be hearing from somewhere in the distance could be it (figuratively speaking, of course). The reason has to do with the direction of Lewes mortgage rates (among others).
Now, I realize this could come across a little bit like Aesop’s boy who cried ‘Wolf’ since a year and a half ago the experts were unanimous in predicting that mortgage rates would rise throughout 2014 (to at least 5%, if I remember correctly). And not only did they not jump—after a short rise, they actually fell!
The experts were wrong. To the extent I agreed with their call, I was, too—but at least I wasn’t lonely. And I also try to be clear that predicting the future of any financial movement is never a sure thing. The same is true today…but…
Last week, less than a week after the Federal Reserve monetary policymakers emerged from their meeting, Bankrate web commentator Janna Herron published a view that sent alarm bells ringing in my head. It makes so much sense, I feel compelled to share it. Already publicized in the rest of the media was the announcement that 15 of the 17 Fed officials now agree that they expect to raise the federal funds rate at some point within the next 6 months (and one expert was quoted as expecting that as early as September or October). Fifteen out of 17 is a 88% majority, so it couldn’t get much clearer. The funds rate has been cemented to the ground at precisely zero for almost seven years. Since 2008.
Lewes mortgage rates are based upon that Fed funds rate. When it rises, mortgage rates have to rise, or lenders would have to be reclassified as charitable enterprises (not likely). The reasons given for the Fed governors’ near-unanimous prediction are both the rise in the pace of job gains and, as was reported, “The Fed also noted improvement in housing.”
Now, that news may have prompted Lewes mortgage-rate watchers to sit up and take notice—but not necessarily have them hearing alarm bells going off. But there were two other pieces of information:
· First, the current national mortgage rates reported last week rose. They were pegged at just over the 52-week average for 30-year fixed loans, but at 4.13% it remained below the 4.33% of a year before. In other words, still (perhaps momentarily) in the historically basement-level range.
· Second, new mortgage activity began to rise, moving 1.6% up from a week before. Applications had been dropping, but now they were on the move. This while home builder confidence levels soared, with expectations hitting the highest levels in nearly a decade.
As with any batch of economic numbers, the signs can be interpreted in multiple ways, but one way sure does seem to stand out: mortgage rates are attractive now, housing activity is almost certainly on the rise, and mortgage rates and monthly payments are very likely to become more expensive. The same thought may be occurring to more and more people as we enter the summer home-buying season: “What if I could pay less every month for the same home…for the next 30 years…”
Note to Lewes home-buyers. Listen carefully: that could be the sound of your own alarm bell going off! If you think you hear it, now would be a great time to give me a Call/Text me Russell Stucki at (302) 228-7871, email me at firstname.lastname@example.org, visit more listings at www.beachrealestatemarket.com
This year, all signs point to Sussex County real estate market being a sizzling hot one. For anyone who will be selling a property soon, it’s time to take stock of the factors that will influence how attractive (and competitive) their offering will turn out to be,
Always near the top of the list is, of course, location: location as geography (how close it is to Sussex County’s key shopping, parks and recreation areas) and location as setting (how desirable is the surrounding neighborhood).
And when it comes to location, a stubborn fact of life is that selling a property in a rundown neighborhood can be a real challenge. Sometimes, neglectful neighbors can be the problem. According to the President of the Appraisal Institute, a property with an overgrown yard or peeling paint can readily reduce a neighbor’s sale price by 5%-10%. In run-down neighborhoods where foreclosures are common or crime levels are high, selling a local property for what would be an otherwise reasonable price can be all but impossible. Even so, there are some steps that can be taken.
Establish a preferred route…
Most marginal neighborhoods are a mix of unsightly and good areas. To insure that potential buyers are first aware of the positive elements in your neighborhood, be sure you and your agent are on the same page for providing the most attractive route to reach your property. Sooner or later any future buyer will certainly be exposed to the less desirable blocks—but that first impression should be the best it can be.
…avoid overspending on improvements…
When selling a property in a bad neighborhood, it’s always tempting to compensate by spending on renovations. But perspective should come into play: there is likely to be an upward limit that any house in a challenging neighborhood can sell for. By not overspending on improvements, wise sellers maximize their flexibility when it comes to negotiating price.
…even tidy up a neighboring property!
The thought of taking responsibility for a neighboring property is hardly appealing. It’s not your fault that they have let their yard become overgrown or allowed their front fence to be peeling paint. But if you judge that a relatively simple amount of effort will greatly improve a neighboring property’s appearance, consider telling the neighbor that you will be selling a property and wonder if you could give them a hand with their yard. If you are tactful enough, some neighbors will even volunteer to solve the problem themselves.
Selling a Sussex County property in a less-than-stellar neighborhood is undeniably a challenge. The key is to fix the things that you can while avoiding overspending on improvements. Often selling a property in a run-down neighborhood comes down to a question of price: determining that in advance can make the best outcome most likely.
Thinking of buying or selling soon? Call/text 302-228-7871 or email me, Russell Stucki, REALTOR ® of Beach Real Estate Market to provide detailed information on Delaware homes for sale, investment and commercial properties, luxury and waterfront homes, condos/townhomes, new construction, lots and land, farms and equestrian properties located in but not limited to Bethany, Bethel, Bridgeville, Dagsboro, Delmar, Ellendale, Fenwick Island, Frankford, Georgetown, Greenwood, Harbeson, Laurel, Lewes, Lincoln, Milford, Millsboro, Millville, Milton, Ocean View, Rehoboth Beach, Seaford, Selbyville, Delaware.