What Is the #1 Financial Benefit of Homeownership?

What Is the #1 Financial Benefit of Homeownership? | MyKCM

There are many financial and non-financial benefits of homeownership, and the greatest financial one is wealth creation. Homeownership has always been the first rung on the ladder that leads to forming household wealth. As Freddie Mac explains:

“Homeownership has cemented its role as part of the American Dream, providing families with a place that is their own and an avenue for building wealth over time. This ‘wealth’ is built, in large part, through the creation of equity…Building equity through your monthly principal payments and appreciation is a critical part of homeownership that can help you create financial stability.”

Odeta Kushi, Deputy Chief Economist at First American, also notes:

“The wealth-building power of homeownership shows that home is not only where your heart is, but also where your wealth is…For the majority of households that transition into homeownership, the most recent data reinforces that housing is one of the biggest positive drivers of wealth creation.”

Last week, CoreLogic released their latest Homeowner Equity Insights Report, which reveals the surge in wealth created over the last twelve months through increased home equity. The report makes five key points:

  1. Roughly 38% of all homes are mortgage-free
  2. The average equity gain of mortgaged homes in the last year was $26,300
  3. The current average equity of mortgaged homes is greater than $200,000
  4. There was a 16.9% increase in total homeowner equity
  5. Total homeowner equity reached over $1.5 trillion
What Is the #1 Financial Benefit of Homeownership? | MyKCM

Here’s a map that shows the equity gains by state:Increasing equity is giving homeowners the power to better manage the challenges of the pandemic, especially for those spending more time at home. In the report, Frank Nothaft, Chief Economist for CoreLogic, explains:

“This equity growth has enabled many families to finance home remodeling, such as adding an office or study, further contributing to last year’s record level in home improvement spending.”

The financial advantage homeowners have has not gone unnoticed. In the same report, Frank Martell, President and CEO of CoreLogic, states:

“This growing bank of personal wealth that homeownership affords was noticed by many but in particular for first-time buyers who want a piece of the cake.”

Increasing wealth benefits more than just homeowners.

Last year, the Rosen Consulting Group released a report outlining the benefits of homeownership. In that report, they explained what an increase in net worth – which they call the “wealth effect” – means to the economy:

“In economic literature, the wealth effect is a term used to describe the fact that individuals have a tendency to increase their spending habits when their actual or perceived wealth increases. For homeowners, the latent savings achieved by building equity in their home and the growth in home values over time both contribute to increased net worth. Through the wealth effect, this in turn translates to households having a greater ability and willingness to spend money across a wide range of other types of goods and services that spur business activity and provide a positive multiplier effect that creates jobs and income throughout the economy.”

Bottom Line

Homeownership builds wealth through equity, and this creates a positive impact for homeowners and their communities. Let’s connect today if you’re ready to invest in a home of your own.

Get started on your path to home ownership by calling or texting me today at 401-932-7844 or email me at OceanStateLiving@gmail.com!

I can’t wait to hear from you!



The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice.

3 Powerful Reasons to Buy a Home Now

Whether you are a first-time buyer or looking to move up to the home of your dreams, now is a great time to purchase a home. Here are three major reasons to buy today.

1. Affordability

Many people focus solely on price when talking about home affordability. Since home prices have appreciated throughout the past year, they assume homes are less affordable. However, affordability is determined by three components:

  • Price
  • Wages
  • Mortgage Interest Rate

Prices are up, but so are wages – and interest rates have recently dropped dramatically (see #2 below). As a result, the National Association of Realtors’ (NAR) latest Affordability Index report revealed that homes are MORE affordable throughout the country today than they were a year ago.

“All four regions saw an increase in affordability from a year ago. The South had the biggest gain in affordability of 6.9%, followed by the West with a gain of 6.0%. The Midwest had an increase of 5.8%, followed by the Northeast with the smallest gain of 1.8%.”

2. Mortgage Interest Rates

Mortgage rates have dropped almost a full point after heading toward 5% last fall and early winter. Currently, they are below 4%.3 Powerful Reasons to Buy a Home Now | Simplifying The MarketAdditionally, Fannie Mae recently predicted the average rate for a 30-year fixed mortgage will be 3.7% in the second half of 2019. That compares to a 4.4% average rate in the first quarter and 4% in the second quarter.

With mortgage rates remaining near historic lows, Fannie Mae and others have increased their forecasts for housing appreciation for the rest of the year. If home price gains are about to re-accelerate, buying now rather than later makes financial sense.

3. Increase Family Wealth

Homeownership has always been recognized as a sensational way to build long-term family wealth. A new report by ATTOM Data Solutionsreveals:

“U.S. homeowners who sold in the second quarter of 2019 realized an average home price gain since purchase of $67,500, up from an average gain of $57,706 in Q1 2019 and up from an average gain of $60,100 in Q2 2018. The average home seller gain of $67,500 in Q2 2019 represented an average 33.9 percent return as a percentage of original purchase price.”

The longer you delay purchasing a home, the longer you are waiting to put the power of home equity to work for you.

Bottom Line

With affordability increasing, mortgage rates decreasing, and home values about to re-accelerate, it may be time to make a move. Let’s get together to determine if buying now makes sense for your family.

Get started on your path to home ownership by calling or texting me today at 401-932-7844 or email me at OceanStateLiving@gmail.com!

I can’t wait to hear from you!

What to Repair in your Home Before you List

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A lot of money goes into buying a new house so it is understandable if a seller feels hesitant investing even more money to fix up their current house prior to selling.
However, sellers may not realize that some of the issues they live with everyday and consider minor, such as the hallway light switch or the kitchen sink that has plumbing issues, may actually be considered major to home buyers. These issues may even prevent buyers from making an offer on a home or making a lower offer. It’s crucial to keep your house presentable and in good shape before you list it on the market.
That being said, read on to find out what repairs you might want to consider before you list on your house on the market.

Roof Problems
A roof is one of the most important components of a home, protecting all that is underneath. Additionally, roofs are major expenses to replace.
Therefore, it is imperative to keep the roof well maintained and free of damage and leaks. Issues like water and sun damage, clogged gutters, and rotting will lead to bigger issues if not fixed timely. Tending to these items immediately will help prevent further damage and help present the home well.

Poor Maintenance
Minor issues such as damaged flooring, paint chipping, and old carpeting can be easily fixed to give your home a renovation. Your goal is to make your home appealing so start by replacing anything that is heavily worn and adding a fresh coat of paint. And these minor upgrades can be inexpensive because you’ll most likely see a return on investment.

Plumbing
Plumbing problems can result in minor or major issues and it is very important to take care of these issues right away as they can lead to further problems. Bigger problems such as water damage can lead to mold and easy fixes to leaky faucets can be replaced inexpensively.

Wiring
Electrical problems can cause a wide variety of problems. Smaller fixes such as faulty switches, missing wire nuts, or damaged junction boxes can be fixed with a good electrician. Replacing a circuit breaker might be needed if they don’t match the amperage of your home. Some repairs are obvious to see and others aren’t so it’s a good idea to run a pre-inspection of your house before listing. After, review it with your realtor because they can advise on which ones are the first priority.

And if you are still looking for a Realtor, I’d love to be considered!
With over 17 years of real estate experience, my focus has always been integrity, hard work, ethics and care for my clients’ best interests. My passion is helping both buyers and sellers meet their real estate dreams.

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Data Says April is the Best Month to List Your Home For Sale

The spring housing market is off to the races! The inventory of homes for sale is increasing, buyers are out in force, and interest rates have remained low, piquing the interest of buyers and sellers previously on the fence about making a move.

New research from realtor.com shows that the first week of April is actually the best time to list your house for sale! The report used “trends in median listing prices, views per property on realtor.com, home price drops, median days on market, and number of listings on the market over the last three years,” to determine a ranking for every week of the year.

Listing your home in the first week of April contributes 14x more property views, 5% less competition from other home sellers, and results in the home being sold 6 days faster!

Below is a graph indicating the average score for each month of the year.

Data Says April is the Best Month to List Your Home for Sale | Keeping Current Matters

It should come as no surprise that April and May dominate as the top months to sell. The second quarter of the year (April, May, June) is referred to as the Spring Buyers Season, when competition is fierce to find a dream home, often leading to bidding wars.

If you’re thinking of selling your home this year, the time to list is NOW! According to the National Association of Realtors, 41% of homes sold last month were on the market for less than 30 days! If you list now, you’ll have a really good chance to sell in April or May, setting yourself up for the most exposure!

Call me anytime for a Free property market analysis!

401-932-7844

March Mortgage Rate Update

March 26, 2019

Rates are the lowest they have been in over a year thanks to the Feds decision to halt all interest rate hikes for the remainder of 2019.

3d image of house with graph falling• At the end of last week, the average top-tier 30yr fixed mortgage rate quote was 4.625%.
• As of today, the exact same scenario would be at 4.375%–a quarter of a percentage point lower.
• That’s an uncommonly big move for a single week, but it’s one we’ve been tracking eagerly in recent days.

Why is it happening?
• The first phase of the move had to do with the Fed’s surprisingly friendly policy
announcement on Wednesday.
• Due to the time of day that the Fed news came out, markets didn’t have a chance to fully react to it until Thursday.
• Even so, the drop in rates was already much bigger than average. But this
morning took it to the next level.
• In the middle of the night (in the US, anyway), economic data for Europe was
released that showed a serious slowdown in German and French manufacturing.
• The Fed has repeatedly cited European growth concerns as a reason for its
aggressive policy changes, so the news was all the more meaningful.
• European bonds tanked by the time US markets opened (“tanked” in this context refers to rates moving lower).
• Early in the domestic trading session, US economic data was similarly weak, thus
reinforcing another warning from the Fed about European weakness spilling over
to the US.
• With that, bond yields fell rapidly at home and abroad–to the point where there
was a bit of a frenzied rush to buy (when traders buy bonds, rates move lower).

Will this continue to happen?
• There’s never any way to know if a certain move in rates is sustainable or susceptible to a quick bounce.
• In general, it will be up to the incoming economic data.
• After all, whether we’re talking about Fed policy or the global growth
implications themselves (both things that rates care about), it’s the economic data
that will cast the biggest votes.

Thank you to Adam Dellemonico of Movement Mortgage for keeping me in the loop!
direct: 339-234-2988
email: adam.dellemonico@movement.com

If you are looking for a great lender, he’s your guy!  Tell him Jeannine sent you!

Why Do Real Estate Agents Ask If You’re Pre-approved?

pre approvedHave you ever walked into an open house, or called a real estate agent about a listing, and within minutes, they’re asking you if you are “pre-approved” for a mortgage?

If you haven’t, then you have never walked into an open house or called an agent. Or at least enough of them…

Just wait. It’ll happen.

And you’re going to feel like it’s pretty pushy for them to ask that.

It’s like a joke.

It makes you feel like telling real estate agents this knock-knock joke…

You: Knock-knock.

Real estate agent: Who’s there?

You: Nunya.

Real Estate Agent: Nunya who!?

You: Nunya business if I’m pre-approved or not! Just show me the house, and I’ll get pre-approved if I even like the house. I can definitely get approved for a mortgage. Probably way more than this stupid house anyway. So, stop asking if I’m pre-approved.

Try it…maybe the agent will laugh! Or, maybe not. Depends…

But it’s no joking matter.

It depends on the agent. Agents have different personalities. They all come across different ways. They all handle how they meet, greet, and chat with consumers in different ways. There’s no one way to “be”, as a real estate agent.

But every single real estate agent should be asking you if you’re pre-approved. But many do not. Because they feel like it is a bit pushy and forward. Because he or she worries about offending you. But they should ask…

…because it’s entirely relevant for them to know.

…because it’s entirely important for you to be pre-approved.

It might come across as a pushy, or invasive question. Maybe that is because of how an agent asks the question. Or when the agent asks the question. Or, simply because you don’t know that it’s a question that should be asked.

But it is not a joking matter.

And you should expect the question, be prepared to say that you are pre-approved, and…you should actually want the agent to ask you that question.

It’s not like a first date.

If you were going on a first date with someone, and one of the first things the person asked about was how much money you make, and can you afford the date, you’d feel like that was pushy and weird.

Rightfully so. You don’t go in for a kiss the minute you meet each other, let alone ask for a hand in marriage. There’s some build-up.

Beyond that, there’s some time that needs to be spent together before probing questions about finances are asked. That kind of stuff comes way after even the first kiss, because finances are a pretty private, intimate subject. Even more intimate than a kiss…

Which is why it seems so invasive when an agent you’ve just met asks you if you’re pre-approved. It feels like they’re asking you some pretty private, intimate stuff that’s none of their business.

But asking for a pre-approval isn’t like going in for a kiss. It isn’t a marriage proposal. And it isn’t probing on the part of the agent.

It is a necessary question, and an important piece of information for the agent to know. And for you!

Why does an agent ask you if you’re pre-approved?

Agents aren’t asking you if you’re pre-approved because they’re looking to size up how much you can spend. (At least not most agents…)

They want and need to know that you are serious, and qualified to buy a house.

And they certainly have their reasons for wanting to know…

  • Real estate agents need to make sure they’re working with someone who can actually buy a house. They don’t get paid until and unless the person they’re working with buys a house. So, this is a matter of being careful about who they spend their time with. It might sound selfish…but you can’t fault them for that. They’re in business. Nobody cuts them a paycheck. And showing people houses is not a public service or charity work. Even working with someone who is pre-approved doesn’t guarantee them that they’re going to make any money. But at least it’s an indication that the person they are working with can do something.
  • Agents also need to know how much you’re pre-approved for in order to advise you as well as possible. Picture an agent showing you houses for weeks, and months. You finally find “the one”! You get all excited about the house, and you want to make an offer, only to find out then that there’s no way you could afford the house. This leads to heartbreak and aggravation…for both of you. It doesn’t do either of you any good to go through all of that only to find out you can’t afford the houses you were looking at…or even buy one at all.
  • And, to a degree, this is a safety precaution. You might not believe this, but agents are in a pretty risky position. If they just say OK to every person who calls and asks to go see a house, with absolutely no proof or verification of who the person is, that puts them at risk. Sure, a pre-approval won’t necessarily stop an evil person from doing something, but this is a pretty basic precautionary request.

Why you should want an agent to ask if you are pre-approved.

Even if you have just started browsing for a home just a little bit, and haven’t gotten pre-approved (yet)…at least expect the question. Don’t be offended when you’re asked if you are.

In fact, pay closer attention to the agents who do ask if you’re pre-approved! The ones who ask make it easy for you to find a great agent to work with.

Because if they’re asking that question, it’s a good sign that they are thorough and thoughtful about how they do their business. That’s the type of agent you want to have on your side when you’re buying a house — one who’s careful from the get-go. One who pays attention to the details. One who isn’t going to waste your time any more than their own. Or allow your heart to be broken when you fall in love with a house you can’t do anything about.

And if you want to get some really good attention and service from the best agents you come across, don’t even let them have to ask if you are pre-approved…

Get pre-approved before you even start looking. And let the agent know you’re pre-approved before they even ask. You’ll set yourself apart from almost every buyer the agent has ever met.

Contact me anytime for questions or market information. 401-932-7844 or email oceanstateliving@gmail.com

Thanks for visiting!

Top 4 REAL Reasons We Buy A Home

We often talk about the financial reasons why buying a home makes sense. But, more often than not, the emotional reasons are the more powerful or compelling reasons.

No matter what shape or size your living space is, the concept and feeling of home can mean different things to different people. Whether it’s a certain scent or a favorite chair, the emotional reasons why we choose to buy our own homes are typically more important to us than the financial ones.

1. Owning your home offers stability to start and raise a family

From the best neighborhoods to the best school districts, even those without children at the time of purchase may have this in the back of their minds as a major reason for choosing the location of the home that they purchase.

2. There’s no place like home

Owning your own home offers you not only safety and security, but also a comfortable place that allows you to relax after a long day!

3. You have more space for you and your family

Whether your family is expanding, an older family member is moving in, or you need to have a large backyard for your pets, you can take this all into consideration when buying your dream home!

4. You have control over renovations, updates, and style

Looking to actually try one of those complicated wall treatments that you saw on Pinterest? Tired of paying an additional pet deposit for your apartment building? Or maybe you want to finally adopt that puppy or kitten you’ve seen online 100 times? Who’s to say that you can’t in your own home?

Bottom Line

Whether you are a first-time homebuyer or a move-up buyer who wants to start a new chapter in your life, now is a great time to reflect on the intangible factors that make a house a home.

RI Real Estate Market – End of Year 2018 Report

2018 mls statsIn 2018 we experienced a:

  • 6% decline in the number of homes SOLD from 11,308 in 2017 to 10,640 in 2018.
  • 6% increase in the average sales price, from $325, 590 in 2017 to $346,087 in 2018.
  • 6% decrease in the number of Expired homes, from 965 in 2017 to 909 in 2018.

Projected For 2019

RI lingers behind the NY/Boston markets.  Although prices are still high, in Manhattan we’ve seen a decline in the number of SOLD as well as in Boston.  Having such a high price per square ft in Boston is obviously helping our RI market to hold prices.  However, all signs and stats are showing a slow down in sales and an increase in inventory.  Currently the number of available homes for sale in RI is higher than in January of 2018. Another sign of a weakening market is when DOM (days on market) increase and how long it takes to sell a home (increase in DOM on all major East Coast cities).

Be Careful When Pricing Your Home

We are now seeing a slow flip from Seller’s market to Buyer’s market, expected to be completed in the second half of 2019.
In 2019, it will be tougher to price your property.  In a decline market, when a lot of homes are available and inventory is increasing, it is more difficult to figure out the real value of a home.  I don’t think the market will show any dramatic movements or dramatic decline, but a more subtle increase in inventory which naturally results in more options for buyers.  More options will automatically slow down decision making processes and will result in an increase of DOM.  Motivated sellers will start dropping prices.  The result will be lower sale prices.
Sellers – don’t expect bidding wars and over asking offers like we experienced in 2018.  This year, especially the second half, will get slower.

There are many factors that contribute to real estate trends and as much as we like to think we can predict what will happen, without a crystal ball, it’s all extrapolation from various experts and sources.

Regardless of what’s in store, whatever your plans – buying your first home, selling your starter home and moving up, and all those plan in between, in order to put yourself in THE BEST position, always seek out the expertise of an experienced full-time Realtor.  Home purchases and sales are complex and unpredictable.  Having someone by your side who handles these major transactions on a daily basis, is priceless.

I wish you all the best in 2019 and if you are looking to make a move, I’m available whenever you need me!

Happy New Year from Jeannine Harrington Homes at The Brown Group Realty!