From White Picket to Upcycled Pallet Fences: Millennials and Housing

by Jim Harney

Critiques and defenses about Millennials abound. However, I think an overlooked aspect of the kerfuffle over Generation Y is the question “Why?” Although it is great to spur the generation on to great heights, it is crucial we understand some of the hurdles they are facing, economically and socially in order to anticipate how the market will have to change and adjust to accommodate a new generation’s capabilities and values.

Educational Debt & Credit

No big newsflash here: millennials are facing unprecedented levels of debt, between the various recessions, housing bubbles, and explosion of educational debt. New legislation in the works is attempting to help set up a more stable higher education financing system as well as relieve the staggering debt loads. Although debt forgiveness is the big buzzword these days, most students will still face shouldering a majority of their debt. Fortunately for the economic outlook, the legislation focuses on creating more income-based repayment plans that won’t put millennials on the street. However, the big question that remains is how will this affect their credit?

Public vs. Private Sector

With the specter of the 2008 housing bubble burst looming over everyone’s head, the situation is no longer about whether or not millennials are willing to take on more debt or have the income to cover minimum payments, it is about if lenders are willing to take on the risk. President Obama has rolled out plans that Fannie Mae and Freddie Mac will be gradually diminished, leaving the private sector to provide the backbone of risk management. With first-time buyers being edged out of the market due to new credit requirements, we could see a short-term slowdown in home-buying.

Uncertainty

Surprisingly, the instability recently exhibited by the U.S. government shutdown and continued clamor over the debt ceiling may actually work in the market’s advantage. Millennials, wary of being overly reliant on vacillating government promises, might become increasingly inclined to use their savvy to explore home equity loans and carefully consider newly-revised reverse mortgages as part of their retirement plans. Having front-row seating for the recent economic meltdowns, the newest generation will be more inclined to do their research and not bite off more than they can chew, meaning they might, actually, leave a positive legacy for the housing industry.

American Dream

Homeownership is still an important idea to many Americans.  If the government and the private sector work together to slowly adjust the system and increase stability, which is already the direction we are driving in, we can expect to see homeownership continue to increase with this generation.  However, we should expect to hold the memory of Desi and Lucy fondly in our hearts, and leave them there as the face of home buyers will be forever changed.

It is a pervasive misconception that millennials are thoroughly disenchanted with the concept of settling down. The revitalized home-making movement—as evidenced on social media platforms like Pinterest–within more progressive millennial circles would indicate that although it might take a bit longer for the birds to return from their explorations, they will inevitably nest.

Furthermore, the creativity and frugality of Generation Y will provide them fresh incentives to invest in housing as home ownership opens up new avenues hosting friends and international travelers. As this new group of home-buyers realizes that a mortgage doesn’t necessarily clip their wings, we should be able to anticipate a new, stronger, and invigorated market of responsible borrowers. These iPod-wearing, tweeting, bicycle-riding youngsters just might be the market we’ve been looking for.

Please contact us with any of your real estate related questions, we would love to help you out in any way we can!

Steve Hill and Sandra Brenner
Windermere Real Estate/FN
Seattle-Northwest
122502 Greenwood Ave N
Seattle WA 98133
call/text: 206-769-9577
email: stevehill@windermere.com

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BrennerHill.com
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Seattle Real Estate Statistics
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Posted on November 23, 2013 at 3:00 pm
Steve Hill and Sandra Brenner | Category: First Time Home Buyer | Tagged , , , , , , , , , , , ,

Chicken Little is Wrong: Homeownership Still the American Dream

After the harrowing challenges experienced by so many homeowners over the last few years, many housing experts had predicted that the belief in homeownership as a major element of the American Dream would soon die. There is now conclusive evidence that these experts were wrong. As we reported back in September, The Joint Center of Housing Studies at Harvard University completed a study which concluded:

The long term cultural preference for owning seems to have weathered the recent housing crisis.”

Now, a second source recently announced similar results. Fannie Mae just released their National Housing Survey of Delinquent Mortgage Borrowers. The survey asked questions about the value of homeownership to the most sensitive of all groups – those delinquent on their mortgages. Here is what they found:

Of those delinquent borrowers:

  • 74% still see homeownership as better than renting when building up wealth
  • 71% still see homeownership as better than renting when saving for retirement
  • 73% still see homeownership as better than renting for overall financial stability
  • 80% still see homeownership as better than renting as an investment plan
  • 70% still see homeownership as better than renting for creating an overall tax strategy

Bottom Line

Homeownership has always been and will always be a crucial piece of the American Dream.

Are you interested in The American Dream? Give us a call, email or text, we would love to help you fullfill your dream!

‚Äč-Steve and Sandra

Steve Hill and Sandra Brenner
Windermere Real Estate/FN
122502 Greenwood Ave N
Seattle WA 98133
call/text: 206-769-9577
email: stevehill@windermere.com

Check out these useful links:

BrennerHill.com
Best In Client Satisfaction
Windermere Housing Trends Newsletter

Our Preferred Lenders

George Runnels
Washington First Mortgage
WaFirstMortgage.com
call/text: 206-604-4545

Jackie Murphy
Cobalt Mortgage
CobaltMortgage.com
call/text: 425-260-6834

Posted on November 4, 2013 at 3:02 pm
Steve Hill and Sandra Brenner | Category: Home Ownership | Tagged , , , , , ,

4 Things All Buyers Should Keep in Mind

No matter how you slice it, buying real estate is a complicated process that takes time and hard work to get right. Whether you’re looking for your dream home or an investment property to help build your retirement nest egg, here are a few things to keep in mind.

Mortgage interest rates are still low

Mortgage rates have bumped up a little lately, but they are still low by historical standards. Many people have stopped chasing their dream home or investment property because of the recent rate increases, but they’re making a huge mistake. Rates will likely head even higher over the next few years, and you’re going to kick yourself for failing to secure a 30-year fixed interest rate loan before those even higher rates kick in.

It sounds cliche, but real estate is buyer beware

Your real estate agent can guide you to make a smart purchase, but it’s your job to make every decision and do all the analysis that goes along with purchasing property. You’ve got to make sure it is a smart financial move to buy the property. You’ve got to review the title documents, mortgage loan documents and disclosures, homeowners association docs, home inspection reports, seller disclosures, etc. Each document contains important information that you need to understand to avoid problem properties. It’s a real challenge, but you must do the hard work needed to reduce your risk.


You should never buy a property that you don’t love

If you don’t love it, don’t buy it. Real estate is likely the most expensive and complicated purchase you will ever make. So don’t buy a property if it isn’t a great fit for what you want. Don’t buy if your attitude is “we just want to get something even though this isn’t a perfect property for us.” Note: No property is perfect — especially not at the price you’d like to pay — so be realistic when determining which property you “love.”

Shop properties for at least 4 to 12 months

Take your time. Look at dozens of properties. Drive the areas you like during the day, night and on weekend. Talk to neighbors. You’re probably risking your entire net worth when purchasing property, so make sure you are adequately educated on what you are buying — and that takes time!

When you are ready to purchase or sell a home, give us a call, we can guide you through every stage of the home buying and selling process.

Steve Hill and Sandra Brenner
5 Star Rated – Zillow.com
Windermere Real Estate
BrennerHill.com
call/text 206-769-9577
 

Posted on September 6, 2013 at 2:01 pm
Steve Hill and Sandra Brenner | Category: Home Inspection | Tagged , , , , , ,

Should I Wait for Interest Rates to Come Back Down?

Above is a graph of the movement of the 30 year fixed mortgage rate since the beginning of 2012.

Some buyers are waiting to see if interest rates will come back down before making a decision about buying a home. Though no one can guarantee where rates will be in a few months, we don’t believe waiting is a good strategy.

Most experts believe rates may actually move higher. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison projecting that rates will continue to climb.

With home prices increasing and interest rates projected to also increase, the cost of buying a house could quickly increase rather dramatically.

If you are searching for today's best rates on home mortgages, give George Runnels at Washington First Mortgage a call, he can find you the best terms for new or refinancing a home loan. 206-604-4545

Curious about interest rates and how they can affect your purchasing power? Give us a call or text to learn more.

Steve Hill and Sandra Brenner
Best In Client Satisfaction
Windermere Real Estate
call/text 206-769-9577
BrennerHill.com

Posted on September 3, 2013 at 1:39 pm
Steve Hill and Sandra Brenner | Category: Mortgage and Interest Rates | Tagged , , , , , , , , ,

When to Buy a House? Right Now!

traffic lightsAfter witnessing the housing bubble ‘pop’ just a few years ago, many would be buyers may be hesitant to pull the trigger. Today, we want to explain that the greatest risk a buyer can take right now is actually waiting to buy a home.

We realize that every purchaser wants to be able to get the best deal. They want a great price and the lowest mortgage interest rate possible because those to items together will determine the monthly cost their family will pay. Let’s look at each one:

Are home prices rising?

Just last week, the Case Shiller Pricing Index was released. The index revealed that U.S. home prices increased by 10.2% over the last twelve months. Last month, theHome Price Expectation Survey was released predicting that home values would increase by at least an additional 3.5% for each of the next five years.

If you were waiting for the absolute bottom of the home price declines, you already missed it.

Are interest rates rising?

According to Freddie Mac’s Weekly Primary Mortgage Market Survey, the 30 year mortgage rate shot up to 3.81% last week – the highest level in over a year. This is an increase of a half of a percentage point in the last six months. And the Mortgage Bankers AssociationFannie Mae and the National Association of Realtors all predict that rates will continue rise over the next eighteen months.

Conclusion

If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings.

Considering Buying?
Give us a call and let our experience save you time and money.

Steve Hill and Sandra Brenner
Best In Client Satisfaction – Seattle Magazine
Windermere Real Estate Seattle Northwest
Call/Text: 206-769-9577

Posted on August 18, 2013 at 4:23 pm
Steve Hill and Sandra Brenner | Category: Seattle Home Buying | Tagged , , , , , ,

A Message to Millennials for Our Future

by Justin DeCesare

I spend a lot of time defending the work habits and dedication of my generation. Yet, I still wonder at times why we aren’t all as cynical and jaded as the media would like to portray us.

Everything from the PRISM scandal to the everyday politically motivated Washington gridlock on items such as student loan rates have left many of us feeling weary of our place in the political and economic infrastructure.

In Walter Hickey’s article on Business Insider, he quoted President Obama in his recent interview with Zillow CEO Spencer Rascoff as saying:

Jacob looked like a pretty young guy, renting is probably the best option.”

While I don’t think this quote was meant to minimize the economic struggle of Millennials, it just seems to add to the stream of media attention that fails to see the impact we will have on the overall recovery.

We are at a turning point in our society. Prices have bottomed, affordability indexes are low, and jobs are coming back on line.

No matter your age, if you have the financial ability to buy a house, do so right now. Not a year from now…right now. By the time the media finally says Millennials are buying houses, they will be a year behind in their reporting.

Take Action. Today.

Whoever thinks they have a crystal ball is lying to you. No one knows exactly what will happen with the government’s bond buying programs or new housing starts and inventory. However, we do know this:

  • For Now, Money is still Cheap
  • Rental Prices Will Keep Rising

To my Co-Gen-Yers who may come across this blog:

Lifelong wealth is created with a certain amount of risk; however, if you fail to take that risk you will always be stuck in your present situation.

Years from now, there will be people who look back and think to themselves, “I should have bought when I could…That was the perfect time to buy.”

Every type of Real Property is going to appreciate over a 10-20 year period, from commercial buildings, to multi-units, to single family homes.

Our generation is set to play an important role in our economy as there is an ever-growing necessity for technologically advanced degrees and laborers. It is up to you as to whether or not you want this economic growth to shape the rest of your own personal life as well.

Much like the greatest generation at the close of WWII, we have a duty to re-establish a vibrant economy. No one else will do it for us. I realize the economy has not yet fully recovered. But, if everything the media and the politicians say is true, none of us will own houses or have babies until our 50s.

No matter what any pundit says, it is going to take young business people, humanitarians, laborers, and entrepreneurs to take the lead and recreate an America that the Greatest Generation would be proud of.

Leave the cynicism to someone else. It fails in action as much as it does in belief.

Now, it’s our turn.

Considering buying a home? Give us a call, let us share how we can help you find your new home and save you time and money.

Steve Hill and Sandra Brenner
Five Star Professionals
Windermere Real Estate/FN
Call/Text: 206-769-9577

Posted on August 15, 2013 at 8:01 pm
Steve Hill and Sandra Brenner | Category: First Time Home Buyers | Tagged , , , ,

Renters Thinking More about Owning a Home, Say Homeownership is a Top Priority

WASHINGTON (July 25, 2013) – Americans overwhelmingly believe owning a home is a good financial decision and a majority of renters say homeownership is one of their highest priorities for the future, according to a survey by the National Association of Realtors®. The 2013 National Housing Pulse Survey also found that renters are thinking more about purchasing a home now than in past years, while the number of people who say they prefer to rent has declined.

“Homeownership matters to Americans who consistently realize the many benefits it provides to communities, families and the nation’s economy,” said NAR President Gary Thomas, broker-owner of Evergreen Realty, in Villa Park, Calif. “Due to high housing affordability and today’s interest rates it makes sense for people to consider homeownership over renting. In fact, in many parts of the country it’s cheaper to own a home than to rent one. Therefore, it’s no surprise that renters recognize that owning a home offers tremendous long-term benefits and is an investment in their future.”

The survey, which measures consumers’ attitudes and concerns about housing opportunities, found eight in 10 Americans believe buying a home is a good financial decision and more than two-thirds (68 percent) said now is a good time to buy a home. Since the last survey in 2011, more renters are now thinking about purchasing a home, up from 25 percent to 36 percent, while those who say they prefer to rent dropped from 31 percent to 25 percent. Half of renters say that eventually owning a home is one of their highest personal priorities, up from 42 percent to 51 percent.                                                                          

Attitudes toward the housing market have also improved over the years. Nearly four in 10 Americans (38 percent) identified an increase in activity within their local housing market in the past year, compared to just 22 percent who reported a slowdown in activity. By contrast, in 2011 some 51 percent reported a slowdown in activity. There was also less concern than in the past about the drop in home values; a majority said housing prices in their area are more expensive than a year ago.

In addition to these improved attitudes about the housing market, respondents also showed an improved outlook about the national economy. Just under half (48 percent) said job layoffs and unemployment are a big problem, down from 61 percent in 2011. The concern over foreclosures showed a steep decline from 2011 when 47 percent characterized distressed properties as “very” or a “fairly big problem”; today only 29 percent say it’s a problem.

For many Americans, the perceived obstacles to homeownership have remained unchanged over the years; low wages, student loan debt, and little savings for a down payment and closing costs continue to make it difficult for many to become homeowners. Respondents across the board – young and old, college graduates and non-graduates – consider student loan debt to be a large obstacle.

“Student loan debt is a concern for many consumers in today’s market, especially first-time buyers,” said Thomas. “Buyers with student loan debt may find it difficult to access mortgage credit, as well as save for a down payment. Pending mortgage finance regulations requiring higher down payments could also contribute to the already tight lending environment. Realtors® are working with regulators to address this issue and are committed to making sure those who are willing and able to own a home have the opportunity to pursue that dream.”

When asked for reasons why homeownership is important, respondents’ top reasons underscored basic American values and freedoms; they were building equity, wanting a stable and safe environment, and the freedom to choose where to live. While these reasons have remained virtually unchanged since 2011, they do vary slightly according to demographics. The top scoring reason for African-Americans and Hispanics was that homeownership provides stability and a safe environment; women also placed more emphasis on environmental factors than men. Non-college graduates placed stronger emphasis on public schools, owning a home before retirement, and living in a safe and stable environment.

The 2013 National Housing Pulse Survey is conducted by American Strategies and Myers Research & Strategic Services for NAR’s Housing Opportunity Program, which aims to position, educate and help Realtors® promote housing opportunities in their community, in both the rental and homeownership sectors of the market. The telephone survey polled 2,000 adults nationwide and has a margin of error of plus or minus 2.2 percentage points.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.

Considering buyuing a home? Give us a shout, we'd love to help you, Check out our client reviews HERE.

Steve Hill and Sandra Brenner
Windermere Real Estate/FN
206-769-9577

Posted on August 14, 2013 at 8:00 pm
Steve Hill and Sandra Brenner | Category: First Time Home Buyers | Tagged , , , ,