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Some are reporting that there is trepidation regarding the real estate market in the United States. Apparently, the American people are quite comfortable.
Porch.com, a major network helping homeowners with their renovation projects, recently conducted a survey which asked Americans:
“What do you believe is the safest investment over the next 10 years?”
U.S. housing came in at number one, beating out other investments such as gold, stocks, bonds, and savings.
Here is a graph showing the top five investments Americans selected:
The findings of the Porch.com survey also coincide with two previous surveys done earlier this year:
Based on all three surveys done this year, we can see that Americans still believe in homeownership as a great investment, and that feeling continues to grow.
Did you know that each year in the United States, we celebrate “National Roof Over Your Head Day” on December 3rd?
As noted on the National Calendar, it was “created as a day to be thankful for what you have, starting with the roof over your head. There are many things that we have that we take for granted and do not stop to appreciate how fortunate we are for having them.”
From bungalows to cottages, and farmhouses to treehouses, today we show our appreciation and gratitude for the places we call home. Owning the roof that shelters us is something many renters still aspire to, knowing there are so many financial and non-financial benefits to homeownership.
According to the 2019 State of the Nation’s Housing from the Joint Center for Housing Studies of Harvard University,
“Cost-burdened renters now outnumber cost-burdened homeowners by more than 3.0 million. In addition, renters make up 10.8 million of the 18.2 million severely burdened households that pay more than half their incomes for housing.”
Homeownership drives many benefits, including providing families with a place to feel secure. It also helps promote confidence that they are investing proactively in themselves and their communities. That is why there are 77.7 million owner-occupied housing units in the United States.
Many, however, fear it is too expensive to own a home. In reality, however, it’s actually more expensive to rent. Here’s the breakdown as a percentage of income necessary for both – affording median rent and owning a home:
Today we pause to appreciate the places we call home, and all of the other reasons we have to be truly thankful. For those who don’t own yet and would like to, it’s a wonderful time to start identifying the steps to take toward homeownership. Let’s connect today to begin creating your plan.
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There are great advantages to owning a home, yet many people continue to rent. The financial benefits are just some of the reasons why homeownership has been a part of the long-standing American dream.
Realtor.com reported that:
“Buying remains the more attractive option in the long term – that remains the American dream, and it’s true in many markets where renting has become really the shortsighted option…as people get more savings in their pockets, buying becomes the better option.”
Here are the top 5 financial benefits of homeownership:
Studies have also shown that a homeowner’s net worth is 44x greater than that of a renter.
A family that purchased a median-priced home at the start of 2019 would build more than
$37,750 in family wealth over the next five years with projected price appreciation alone.
Some argue that renting eliminates the cost of taxes and home repairs, but every potential renter must realize that all the expenses the landlord incurs are already baked into the rent payment – along with a profit margin!
Owning a home has many social and financial benefits that cannot be achieved by renting. Let’s connect to determine if buying a home is your best move.
Around this time each year, many homeowners decide to wait until after the holidays to list their houses. Similarly, others who already have their homes on the market remove their listings until the spring. Let’s unpack the top reasons why listing your house now or keeping it on the market this winter may be the best choice you can make.
It may make the most sense to list your home this holiday season. Let’s get together to determine if selling now is your best move.
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Success is something often worth repeating, and Brent Sutherland, a Certified Financial Planner and Real Estate Investor, has certainly made his way in a momentum-driving direction. Here are 3 tips he shares from a recent piece in Business Insider on the benefits of owning real estate:
“While it is certainly important to be properly diversified with your investments, it is even more important to be diversified with your income. This is because the largest financial risk for most of you is the loss of your primary source of income, which is typically in the form of a day job.”
The article highlights how having multiple sources of income, such as those derived from real estate investments, can eventually lead to relying less and less on a day job. Sound dreamy? It can be. When done well, real estate investments may eventually open up your time and the financial freedom to explore other things, like travel and other aspirations you may have for the future, particularly in the golden years of retirement.
“You can achieve and feel the results almost immediately. Property improvements are visible and tangible. You can cash, spend, and invest rent payments. Today! Not 30 years in the future.”
Currently, home prices are appreciating in all price ranges, and just last week CoreLogic announced their 12-month home value projection at 5.6%, an increase from 4.5% noted earlier this summer. With that in mind, real estate today is definitely driving immediate results!
“If you need $40,000 a year to live, you could alternatively invest in assets that generate an 8% cash-on-cash return. This is a very reasonable assumption. And it means you would only need to save a total of $500,000 (instead of $1 million). Yet, your investments would still meet your annual household living needs.
While returns, taxes, and inflation can, of course, affect your timeline, cash-flowing real-estate is a clear asset.”
Homeownership is a form of ‘forced savings.’ Every time you pay your mortgage, you’re contributing to your net worth by increasing the equity in your home, bringing you one step closer to true financial independence.
If you want to increase your savings and overall net worth, real estate is a great way to go. To learn how you can make it happen, let’s get together to discuss the process.
Sutherland was 35 when he bought his first single home to rent out for income, less than five years later, he owns eight additional properties and part of a commercial real estate project.
In a recent article, First American shared how millennials are not really any different from previous generations when it comes to the goal of homeownership; it is still a huge part of their American Dream. The piece, however, also reveals,
“Saving for a down payment is one of the biggest obstacles faced by first-time home buyers. Dispelling the 20 percent down payment myth could open the path to homeownership for many more.”
Buyers often overestimate how much they need to qualify for a home loan. According to the same article:
“Americans still overestimate the qualifications needed to get a mortgage, resulting in qualified potential buyers not even considering homeownership. Indeed, the Urban Institute report revealed that 16 percent of consumers believed that the minimum down payment required by lenders is 20 percent or more, and another 40 percent didn’t know at all.”
While many potential buyers still think they need to put at least 20% down for the home of their dreams, they often don’t realize how many assistance programs are available with as little as 3% down. With a little research, many renters may actually be able to enter the housing market sooner than they ever imagined.
In addition to down payments, buyers are also often confused about the FICO® score it takes to qualify for a mortgage, believing a ‘good’ credit score is 780 or higher.
To debunk this myth, let’s take a look at Ellie Mae’s latest Origination Insight Report, which focuses on recently closed (approved) loans.
As indicated in the chart above, 50.23% of approved mortgages had a credit score of 500-749.
Whether buying your first home or moving up to your dream home, knowing your options will make the mortgage process easier. Believe it or not – your dream home may already be within your reach.
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