If you’ve never owned a house, or haven’t owned one in three years, a new Federal Housing Finance Agency (FHFA) mortgage discount program, launched in late December of 2022, can cut up to 1.75 percent from your mortgage rate.
You can qualify for this discount program if you are buying your first home (or a home for the first time in three years) for your main residence and you are using a conventional mortgage. There is also an income requirement that you must earn less than the median income for your area.
The best mortgage rate discount of 1.75 percent goes to buyers with below-average credit scores who can make a 3 percent down payment on a fixed-rate mortgage. The higher the credit score, the lower the discount. So a buyer with a 620 credit score and 3 percent down gets a 1.75 percent discount. But a buyer with a 760 credit score and 3 to 20 percent down gets a .25 rate discount.
The income requirements are based on the mortgage giant Fannie Mae’s median income for the area. You can see what the median income is for an area by searching for the income tool. Median incomes are not necessarily low incomes. A small town in the Midwest, for example, might have a median of $76,000. Meanwhile, the median income in San Francisco is about $151,000, and FHFA offers a 20 percent income exception for this area.
There are also some exceptions to the first-time buyer requirement if the buyer is a displaced homemaker or a single parent whose prior residence was jointly owned with a spouse.
Finally, to get the discount, you must move in within 60 days of closing, and you must live in the home at least 180 days a year as your primary residence. Some exceptions apply for deployed military.
The Baby Boomer Conundrum: To Sell or Not to Sell Your Home
Weighing the Financial and Emotional Costs of Home Ownership in Retirement.
As baby boomers—those born between 1946 and 1964—reach retirement age, they face a question that has both financial and emotional implications: Should they sell their homes or hold onto them? With house prices hitting all-time highs, an impressive 85% of boomers report they’re clinging to their homes. Yet, the rising interest rates lurking around the corner could bring down property values. This presents an unsettling dilemma for seniors: Should they cash out now or risk missing potential gains?
Traditional wisdom advises seniors to aim for fixed costs during retirement as they’re often dealing with a fixed income. Owning a home offers some level of predictability—mortgage payments might be stable, but maintenance costs can go up annually. Renting, on the other hand, can be a dicey gamble. While it relieves one from the woes of property taxes and appliance repair, rents have been on an upward trend, with no signs of slowing down. In 2021, the average US house price clocked in at about $360,000, according to Market Watch, offering a tempting escape route to those willing to relinquish their homes and gain some financial breathing room. The question boomers should ask themselves is, “Can I afford unpredictability?” and professional services for these tasks come at a premium. Renting eliminates these headaches, transferring the burden to the landlord.
Furthermore, renting can provide flexibility that owning cannot. Want to move closer to the grandkids or find a place with a gentler winter? A lease allows for more freedom than a mortgage. According to recent data, baby boomers made up 53% of sellers and 39% of buyers between July 2021 and June 2022. These numbers indicate that relocation and downsizing are already in full swing among this demographic.
One aspect that statistics can’t capture is the emotional attachment to a home filled with decades of memories. This often overlooked element can weigh heavily in the decision-making process. For many, the home is more than four walls; it’s a capsule of life’s milestones.
The dilemma of whether to sell or keep the home during retirement is complex and influenced by a myriad of factors, including financial stability, physical ability, and emotional ties. What’s important is that the decision is tailored to meet the individual’s or couple’s unique needs and circumstances. Whether you’re a baby boomer pondering this decision or a family member assisting in the process, it’s essential to weigh all options and potentially consult with financial and real estate advisors to make the most informed choice.
Community News & Real Estate (Aug/Sept 2023) with Jen Avery, REALTOR
Celebrate Kids Day – Warren Coalition
- Sept 24 | 1pm – 4pm | Health & Human Service Complex (465 West 15th Street)
- We are excited for Celebrate Kids Day again this year by the Warren Coalition. It will be held on September 24th. I will be participating in the PITCH BURST once again. My goal will be at least $500 to be given the privilege to sit under the exploding balloon! There is a recent UPDATE to the $500 goal. It is now $1,000!!! Crystal Cline has upped the competition and we need to bring in at least $1,000 to be top fundraiser! Let’s do this! DONATE TO JEN
- Facebook Event Page
Boots & Bourbon – Rotary Club of Warren County
- Sept 30 | 6pm – 10pm | Warren County Fairgrounds
- Great cause this year. We will be fundraising for five $3,000 scholarships for Skyline High School seniors to go to college or trade school. Please pull on your favorite boots and come enjoy some bourbon with us! There will be line dancing, DJ, yummy food, mechanical bull riding competition and more!
- Facebook Event Page
Warren County Market Report for August 2023 with Jen Avery, REALTOR
Watch this video for a quick summary of Warren County real estate for August 2023. Could the market be improving? Looks like it from these numbers. In general summary:
- New Listings are UP 1.4%
- New Pending DOWN -20.3%
- Closed sales are EVEN 0%
- Average Median Sold $386,500
- Average Days on Market 34
*If you would like a copy of this report emailed to you, please send request to email@example.com.
Resource: August 2023 Market Stats by ShowingTime
Bright MLS: Statistics calculated September 2023
Jennifer Avery, REALTOR® “Your Happy Home Expert!”
BPOR, SRS, CNE, E-Pro Certified | Licensed in VA
firstname.lastname@example.org | 540-683-0790 | www.jenaveryrealtor.com
CRUM REALTY, INC| 318 S Loudoun St, Winchester VA 22601 | 540-662-0400
The Nitty-Gritty of Non-Qualified Mortgages: A Guide for the Self-Employed and Beyond
Navigating the Maze of Mortgage Options for Unconventional Borrowers.
Mortgages are often a significant milestone, yet they can be a tricky navigational course for those who don’t fit into the traditional borrower mold. If you’re self-employed, your lender might have told you that a Non-Qualified Mortgage (Non-QM) is your best shot at financing a home. But what exactly does this mean, and how is it different from a Qualified Mortgage (QM)?
First things first: QMs are mortgage loans that adhere to stringent guidelines set forth by the Consumer Financial Protection Bureau (CFPB). These are standardized, with limited fees, and are generally considered secure for both lenders and borrowers. However, they require comprehensive financial documentation—something not everyone can provide. Non-QMs, on the other hand, offer more flexibility, catering to borrowers with unconventional financial situations beyond the traditional W-2 form that most lenders seek.
The need for a Non-QM often arises from the very nature of being self-employed. These borrowers may not have W-2s, or their tax returns may not accurately reflect their actual income due to business-related deductions. Non-QMs enable such applicants to validate their income through bank statements and business records, thus providing a more accurate picture of their financial stability.
But the appeal of Non-QMs isn’t restricted to the self-employed. Commission-based salespeople, seasonal workers, and those seeking financing for investment properties can also benefit from this alternative, as it allows for income averaging over a specified period rather than relying solely on the most recent pay stubs.
Though they offer flexibility, Non-QMs are not without their drawbacks. These loans usually require higher down payments and carry higher interest rates compared to QMs. Moreover, borrowers seeking large loan amounts that exceed the conforming loan limits set by Fannie Mae and Freddie Mac may also need to opt for Non-QMs.
Non-QMs open up the housing market for those who don’t fit into traditional lending categories, but they come with their own set of limitations and risks. For self-employed individuals and others with non-traditional income, they can be a lifesaver, but it’s crucial to weigh the pros and cons carefully. Always consult with a financial advisor to determine if a Non-QM is the right fit for your financial landscape.
Navigating Property Tours: A Guide to Effective House Hunting
House hunting is an exciting journey filled with anticipation and a vision of the future. Central to this process is the property tour, a chance for potential buyers to walk through the home, assess its condition, determine its fit to their lifestyle, envision potential renovations, and potentially negotiate a better price.
To optimize these tours, a strategic approach is necessary. The first step begins at home, with diligent preparation. Reviewing the property’s online advertisement for critical information such as dimensions, asking price, and the year of construction can provide a starting point for your assessment. Take note of any missing elements or areas that require further clarification, and prepare a list of questions for the owner or the real estate agent.
However, understanding a property’s potential often extends beyond its current state. It’s important to keep an open mind during the tour, remembering that achieving your dream home may not always be a case of love at first sight. Some homes may require a few repairs or upgrades to realize their full potential, and it’s up to you to see that possibility.
An effective property tour is never rushed. Take the time to walk through the entire property, inspecting all areas, including the attic, shed, and garage. Investigate under the sinks, inside the electrical box, and inquire about any renovations carried out over the years. Note down your observations and impressions to aid your post-tour reflections.
Don’t forget to consider the property’s neighborhood and proximity to local amenities. Check whether public transportation, grocery stores, schools, and other facilities are within walking distance. Remember, when you buy a house, you’re also investing in a community.
Property buying can indeed be a complex process, and the tour forms a crucial step. To ensure a seamless experience, consider hiring a professional to guide you throughout the journey, helping you make an informed and confident decision.
Understanding the Role of Land Surveyors in Real Estate Transactions
When embarking on a journey to purchase land, understanding the property’s exact dimensions and boundaries is crucial. That’s where land surveyors come into play. They are highly trained professionals with a deep understanding of municipal bylaws and a keen eye for identifying property boundaries.
A land surveyor’s role often remains in the backdrop of real estate transactions, yet it is essential. These professionals measure plots of land to help buyers comprehend precisely where their property boundaries lie and what they include. This service ensures that buyers understand the exact plot they’re purchasing and safeguards their ownership rights should any disputes arise about property portions.
An integral part of the land surveying process involves a comprehensive examination of the property’s legal description and the history of the deed and title. Following this, the surveyor physically visits the property to measure each boundary and record all buildings or other structures present.
The culmination of these efforts is a detailed map showcasing the legal boundaries of the property. This includes a thorough description of the land and buildings, the street address, and the location of neighboring properties. It’s an indispensable document that gives the buyer a clear and accurate understanding of what they are investing in.
Though it is not always mandatory when purchasing a property, it is highly recommended to commission a land survey before finalizing the deal. Ideally, prospective land buyers should reach out to a land surveyor at least 20 days prior to signing the deed of sale. However, the earlier these experts are consulted, the better prepared you will be.
Land surveyors play a pivotal role in securing peace of mind for land buyers. Their work delineates clear property boundaries, helps avert potential disputes, and provides buyers with a precise understanding of their investment, making them an invaluable part of any real estate transaction.
Low Inventory of Available Homes in Virginia Drops Even Further
According to the July 2023 Virginia Home Sales Report released by Virginia REALTORS®, the number of active listings on the market is getting smaller again, and fewer new listings are coming on the market. Despite a brief uptick in inventory at the beginning of 2023, about 67% of counties and cities in Virginia had fewer active listings on the market at the end of July compared to a year ago, with Northern Virginia continuing to have the largest reduction in supply.
In total, there were 16,508 active listings across the commonwealth last month. This is 3,881 fewer listings than a year ago, a 19% drop. There were 10,948 new listings that came onto the market in July statewide, which is about 2,800 fewer new listings than last year, a 20.3% decrease.
“Inventory conditions are worsening in most local markets in Virginia,” says Virginia REALTORS® 2023 President Katrina M. Smith. “With mortgage rates at a 20-year high and a low supply of homes on the market to move into, some would-be sellers are choosing not to list their homes. However, it is a seller’s market, and most who do sell their homes are receiving multiple offers.”
In total, there were 8,985 homes sold in Virginia in July, a 20.8% decrease from last year, or 2,361 fewer sales. Despite the slowdown in sales, low inventory and strong buyer demand have kept upward pressure on home prices. The statewide median sales price rose $15,000 from July of last year to $400,000, an increase of nearly 4%. The median home price in Virginia is now more than $100,000 higher than it was at this time five years ago.
“So far in 2023, Virginia’s housing market has been slow but competitive,” says Virginia REALTORS® Chief Economist Ryan Price. “Overall transaction volume is way down, back to 2015 levels, but the results of our latest REALTOR® Confidence Survey indicate that sellers are getting more than three offers, on average, for their listings, a signal of competition in the market. These competitive conditions are driving up home prices and will likely continue to be a factor into the fall market and beyond.”
The Virginia Home Sales Report is published by Virginia REALTORS®. Click here to view the full July 2023 Virginia Home Sales Report.