Listing Courtesy of JACK LINGO REHOBOTH
Suppose you are a Rehoboth Beach homeowner who intends to move to a different home eventually, but for the moment, you aren’t under any particular deadline pressure that would dictate when you have to put your home on the market. In that case, you’re likely to keep tabs on overall market conditions, awaiting what looks like circumstances favor those with homes for sale.
Twice a year, the National Association of Realtors® issues their economists’ midyear forecast—it appeared last week. For those with homes for sale in Rehoboth Beach (or anyone thinking about adding theirs to the homes already for sale), the outlook was heartening.
The forecast was for the greater U.S. economy to improve, bouncing back from the weather-blasted winter stall which made the first quarter a disappointment. Subsequently, consumer spending opened up, causing expectation that the GDP would rise in the remainder of the year. Overall, the forecast for 2015 was positive, though lukewarm. As a whole, the year promises to be “not bad but not great.”
On the other hand, focusing narrowly on the outlook for U.S. housing market activity—homes for sale—the upside momentum was already decidedly more in evidence. The prospects for any single one of the Rehoboth Beach homes for sale depend upon a combination of factors, but if national activity is any reflection, the latest numbers packed what you could call a “6-7-8-9 punch”:
· Existing home sales in May notched a high water mark not seen in 6 years (and the 2009 level had been artificially inflated because of an $8,000 homebuyer tax credit).
· New home sales hit the highest level in 7 years.
· Housing permits to build new homes registered an 8 year high.
· Pending contracts to buy existing homes for sale reached a 9 year high.
Examining the demographics behind the figures, it was clear that, for the first time in quite a while, first-time buyers are back. Last year during the same period, only 27% of buyers were first-timers. They now make up a more normal 32%. As prices brought by homes for sale continued to rebound, institutional investors were disappearing from the scene, creating a more typical mix of buyers.
A major part of the reason why homes for sale were fetching “stronger than normal home price growth” had to do with a shortage of inventory—ascribed to the volume of new homes being built (or not being built). The rule of thumb is generally for about 1.5 million new homes to be constructed per year, a mark that’s failed to be realized for a number of years. In 2009, only 550,000 home were built—and the total had barely reached a million through last year. But now, with optimism among homebuilders at newly robust levels, it’s expected that normal output will have fully resumed by 2017.
The other major factor boosting sale prices was the specter of mortgage rate increases. Rising mortgage rates “initially rush buyers to decide”—just the kind of sign that could tip the scales for a homeowner who’s been waiting to add their property to the homes for sale in Rehoboth Beach. Should you decide that this summer is shaping up to have just the conditions you’ve been waiting for, I hope you’ll give me a call for a no-obligation consultation! Call/Text me Russell Stucki at (302) 228-7871, email me at email@example.com, visit more listings at www.beachrealestatemarket.com.
For Sussex County renters who are beginning to investigate the possibility of buying a first house, the prospect can look like more than just a steep hill to climb—it can look more like a cliff! Just last month, the Daily Real Estate News cited recent research that indicates in most places (512 counties surveyed, in fact) it can take the average family more than twelve years to save up for a 20% down payment. When you consider the significant financial advantage that a first house brings its Sussex County owner, the situation seems like a Catch-22. How can you save any faster when that big tax advantage goes only to the existing homeowners?
If a decade-plus wait sounds unreasonable, there’s a lot you can do to trim the delay—
1) (Obvious) Cut excess spending
If you take notes for a month or so about how you really spend your money, you find that the little things really add up: morning coffee, daily lunches, planned and unplanned shopping expeditions all put serious dents in your wallet. Spot the expenditures, you can cut back on, then reduce or eliminate them as soon as possible.
2) (Less Obvious) Create a ‘First House’ account
Create a separate savings account with the single purpose of holding your first house down payment. Watching it grow month by month will more than make up for the inconveniences caused by scrimping on daily and other spending.
3) (Way Less Obvious) Pick up extra work
You may never have considered it, but sometimes moonlighting is a great way to add additional income that quickly build your First House account. If you have a hobby that lends itself to web sales, think of starting a store on sites like Etsy or Amazon.
4) Reduce your current bills
There are those bills that you can't quite get rid of -- cell phone, credit cards and other bills don't just go away because you're saving for a new Sussex County house. For some bills, though, there are options for slimming down your monthly payments. Try negotiating a lower APR or reducing your phone or cable plan.
5) Make (and stick to) a budget
Those notes you made up there on 1) can be the raw material for making a detailed budget that separates necessary expenditures from extras like gifts, trips and special nights out. Find creative ways to entertain yourself and get together with your friends. Hosting movie nights, finding free concerts, and moving cocktail hour to home are all surprisingly doable.
It may seem counterintuitive: why would you decrease the size of your current digs? If you can temporarily scale back, the lowered rent can materially boost your savings. If it’s at all practical, living with relatives might move the process along even more quickly!
The kind of scaling back that builds for a local first house down payment is a lot more fun if you can see quick progress. And the possibility of qualifying for a smaller than 20% down payment is also currently increasing. Give me a call for a realistic discussion of your own Sussex County first house purchase!