Hoboken Real Estate Podcast with Steven Rosado Steven Rosado

In tabulating the total length of a conventional home sale, we must examine each separate phase of the transaction. Want to sell your home? Get a FREE home value report Want to buy a home? Search all homes for sale What kind of timeline can buyers and sellers expect in a conventional home sale? For a comprehensive look, let’s break the process down into each separate phase. The first phase is the attorney review. This takes place after an accepted offer has been put in place and both the buyer and seller sign off on the contract. The contract goes to both of their attorneys for review, after which the buyer’s attorney makes any revisions or recommendations they see fit and sends a rider to the seller’s attorney, which is basically a proposal in addition to the contract. The seller’s attorney then makes their own revisions and sends it back to the buyer’s side. Once both sides agree to the rider and sign off on it, you can exit attorney review. Phase length: five to seven days. From there, we move on to the inspection phase. Generally, a buyer will have a right to an inspection where their inspector will look at the home and make any recommendations for repairs. That recommendation will go to both attorneys. They’ll then decide if any repairs need to be made by the seller, any credits are due from the seller, or if the buyer will accept the home as-is. Phase length: eight to 10 days. After the inspection is completed, the appraisal phase begins. The appointed appraiser will reach out to the buyer or seller side and schedule the appraisal. They’ll measure the interior of the home and put a comparable report together to submit to the bank. Phase length: seven to 10 days. The next step is the mortgage commitment phase. This is the phase in which the appraisal is sent to the bank and goes to underwriting for approval. The underwriting department examines all the financial factors and checks the buyer’s criteria to make sure everything lines up with the loan. Phase length: 14 to 21 days. Conventional home sales take longer than cash purchases. After the mortgage commitment has been issued, the title search phase happens. The title company will take a look at the transfer history of the property and see if there are any additional parties that claim ownership of the property that haven’t been involved in the sale up until that point. Once those variables are settled and the title company deems the title clean and clear, they’ll issue title insurance. Phase length: seven to 10 days. From there, we come finally to the clear to close phase. This is the final review from the bank to make sure the buyer is financially stable. Phase length: five to seven days. Once the clear to close phase commences, each side is free and clear to complete the home sale. If you’ve been keeping your math at home, your total timeline for a conventional sale is 46 to 65 days. Keep in mind, a conventional sale means having a mortgage involved. If the home sale is a cash purchase, the appraisal and mortgage commitment phases aren’t necessary. Subtracting them makes a cash sale timeline anywhere from 20 to 27 days. Generally, you’ll see closing dates for those transactions set anywhere from 30 to 35 days out. Cash sales are typically more attractive to sellers. As always, if you have any questions, please feel free to give me a call or send me an email. I’m happy to help.

Mortgage rates have risen lately, but as you’ll see, this shouldn’t stop both buyers and sellers from getting a good deal. Want to sell your home? Get a FREE home value report Want to buy a home? Search all homes for sale What do rising mortgage rates mean for buyers and sellers in our market? In case you don’t remember, mortgage rates were historically low last year. In August, they were as low as 3.44%, and now they’ve risen up to about 4.12%. What does that mean in real terms? Basically, the same mortgage on a $250,000 house would’ve cost you about $100 per month less than it does this year. The overall term of that loan is also about $35,000 more on a 30-year mortgage. That’s a sizeable chunk of change, and I don’t want to downplay that, but it’s really not going to do too much harm to our market in the immediate future. Why is this? If you look at it in a historical context, the same loans 10 years ago averaged over 6.3%. If you go back to the 90s, they hovered anywhere between 7% to 10%. In the 80s, they rarely dipped below 16%. As you can see, they’re still extremely low compared to the past. Yes, mortgage rates have risen lately, but this is nothing to be scared of. If you’re a buyer, now is still a great time to buy. You’ll still get a great rate and there are plenty of loan products available to you. It’s just a matter of connecting with the right agent and finding the right home. If you’re a seller, now is a great time to sell as well. Your home will very likely sell quickly and you’re very likely to get top dollar since there are so many folks interested in buying and we currently have a limited inventory. The market did slow down in December, but that was more due to a lack of inventory than mortgage rates. Whether you’re a buyer or seller, if you have any questions or are thinking about making a move in our market soon, please don’t hesitate to give me a call or send me an email. I look forward to hearing from you and I hope you have a great day!

If you’re a serious buyer or seller, you should never trust a Zestimate. Here’s why.  Want to sell your home? Get a FREE home value report Want to buy a home? Search all homes for sale Today I want to tell why you should never trust a Zestimate. To clarify, Zestimates can be helpful to people who are dabbling in real estate, but if you’re serious about buying or selling a home, it can be very misleading and cause you to leave a lot of money on the table. I’ve seen this happen many times, and here are three recent examples that I’ve been involved with. The first involves a home we recently sold at 49 Chestnut Street in Weehawken. The Zestimate for this home was $700,353. If we listed it at that price, the property would’ve been on the market for years because it wasn’t worth anywhere near that amount. Instead, we listed the property at $410,000, and in less than 10 days, we had three offers and eventually sold it for $425,000. The second example involves a buyer I’m working with to close on a home on Lydia Drive in Guttenberg whose Zestimate is $632,407 but got listed at $609,000. We haven’t closed yet, but my buyer has negotiated the price down to $590,000, and you can be sure he’s happy the owner didn’t go off the Zestimate value because that may have led him to believe that $609,000 wasn’t a bad list price. Trusting a Zestimate can cost you a lot of money in a transaction. The third example involves a single-family home in Hoboken that we recently helped sell. The Zestimate for it was $1.433 million, but we listed it at $1.525 million, received multiple offers, and sold it in less than 10 days. As you can see, these are huge swings in prices. The reason for this is that a Zestimate is a tool that’s based solely off an algorithm. In calculating the value of a single home, it takes into account the values of the surrounding homes but not much else. Crucial details like an upgraded kitchen or bathroom get left out of a Zestimate. If you’re serious about buying a home or getting an accurate value of a home you plan to sell, please feel free to reach out to me. I’d be happy to help!

Today, I’m explaining what influence Trump will have on the real estate market and going over my 2017 predictions. Want to sell your home? Get a FREE home value report Want to buy a home? Search all homes for sale With the election over, I’m going to answer a couple questions about the future of the market. The first question is, “What kind of influence will the new president-elect have on the real estate market?” I’m also going to talk about my real estate market predictions for 2017. So, what influence will the new President-elect have on the real estate market? If there is anything we know about Donald Trump, it’s that he has a weird hairdo, he sends out horrible tweets at three in the morning, and he really knows real estate. If there is a silver lining at all, it’s that he is a real estate mogul. He is very good at predicting real estate markets and he understands our industry like nobody we have seen in office before. He is going to put a $550 billion infrastructure and transportation plan into effect that will boost jobs and wages. This will allow people to purchase more homes. According to an article in The Wall Street Journal, only 63% of people own homes, which is the lowest in history since the United States started tracking that statistic back in 1963. He will also implement a lot of tax code changes, which are expected to be the largest tax code changes a President has introduced since Ronald Reagan. He is going to offer a $30,000 tax exemption to married couples, which will make the tax reduction for mortgage loan interest less lucrative. This means there will be less incentive to buy. Next year is going to be a fantastic year for real estate. So, the tax code changes are going to be a wash for real estate, but the infrastructure and transportation plan should give people more of their bottom line income to spend. Now, for my market predictions for 2017. Next year is going to be a fantastic year for real estate. The real estate market in the United States is predictable and it goes in a cycle. If you look at the chart, you can see there are peak and valleys, and then a crash, and this repeats. Almost like clockwork, every 18 years there is a cycle that is repeated. There is a recovery phase which we have already experienced, then there’s expansion, which I believe we are about a quarter of the way into. We do not have hyper supply; in fact, one of the big things driving prices is the lack of supply, and we have interest rates going up a bit, which will ward off inflation. The next crash in the market isn’t predicted to happen until 2024. That means the market has a lot of room to run. Sellers should be confident in selling, and buyers should be confident in buying. The rates are going to be fantastic for both. Click here for the source of this information. If you have any other questions about real estate, feel free to reach out to me by giving me a call or sending me an email. I would be happy to help you!

We’ve got a few quick updates for you today about the technology we use and how it helps you in your home search. Want to sell your home? Get a FREE home value report Want to buy a home? Search all homes for sale I’ve got two quick updates for you today about some of the new technology we are using in our business. The first is our new iPhone and iPad app with Keller Williams. It’s much better than what you’ll find on Zillow and Trulia. You can search for nearby homes, nearby rentals, and more. You can see what open houses are going on this weekend, where all the homes are located, and even use a mortgage calculator to estimate your monthly payment. Type http://app.kw.com/KW2Q08TPW into your iPhone browser to download app for free. Secondly, we had some problems with our home value tool, so we installed a new one! All you have to do is enter your address and a few details and it will provide you with a quick evaluation. If you want a more in-depth evaluation, we can help with that, too. If you have any questions for us or are looking to buy or sell in the area, give us a call or send us an email. We look forward to hearing from you.

Are you curious about when to get pre-approved or what might happen to interest rates after the election? Baret Kechian has all the answers and more. Want to sell your home? Get a FREE home value report Want to buy a home? Search all homes for sale Today I’m joined by Baret Kechian, one of the best lenders in the country, to answer some questions you might have about the lending process if you’re thinking about buying a home. When should you get pre-approved? The best time for that is usually around three months before you start looking at houses. That way, if there is something amiss regarding your credit, you can address that problem and remove it before it’s time to buy. Why use a smaller lender like Mortgage Master over a bigger firm like Wells Fargo or Bank of America? The main benefit is that a lender like Mortgage Master has a lot more flexibility and a lot more products than a bank. If there is a program that comes into play or a situation that arises that requires something out of the norm, Mortgage Master would be better-equipped to take care of it. They also know the local market well and their appraisers are well-versed with condos and other properties, so they’re better at evaluating those properties correctly. Condos are probably the biggest thing that would cause a problem with a loan in this market, so the fact that they are experts on them and have access to their information earlier than a bank would is a major advantage. In terms of underwriting and acquiring a mortgage, how important is the down payment? As one of the three major phases of the whole lending process (the other two being income and credit), it’s critical. A lot of people assume that they need 20% down to buy a property, but for anyone buying in the $400,000 to $500,000 range, that’s not the case. You can buy with as little as 5% down and still get great mortgages with reasonable PMI rates. You can even utilize a lender-paid PMI program that gets built into the interest rate. Don’t assume you need 20% down to buy a property. A 5% or 10% loan gets underwritten the same way as long as you cover the PMI cost. Some folks fall into the trap of waiting for that magical 20% number when they should have been buying a home earlier and building equity. On some of the larger loans, such as $1 million or $1.5 million, it’s more critical to have 20% down because that will give you more options. After the election, what will happen with interest rates? The reason interest rates are staying as low as they are right now is because of the uncertainty surrounding the election. From where they are, though, there’s only one place they can go, and that’s up. If you’re a buyer, you should consider that in making your decision. After the election, rates shouldn’t skyrocket, but there should be some kind of upward trickle effect once it’s determined who will take office. You could see some rates going up as much as .25% or .5%, so if you’re a buyer, taking advantage of where things stand right now is crucial. The numbers are so good, borrowing money at these rates is almost cheaper than renting. If you want to get in touch with Baret to know more about the lending process, you can call his office at (201) 796-6441 or email him at baret@mortgagemaster.com. If you have any other questions, feel free to give me a call or send me an email. I look forward to hearing from you!