What's the Latest on Interest Rates?

Mortgage rates have fallen by over a full percentage point since Q4 of 2018, settling at near-historic lows. This is big news for buyers looking to get more for their money in the current housing market.According to Freddie Mac’s Primary Mortgage Market Survey,

“the 30-year fixed-rate mortgage (FRM) rate averaged 3.60 percent, the lowest it has been since November 2016.”

Sam Khater, Chief Economist at Freddie Mac, notes how this is great news for homebuyers. He states,

“…consumer sentiment remains buoyed by a strong labor market and low rates that will continue to drive home sales into the fall.”

As a potential buyer, the best thing you can do is work with a trusted advisor who can help you keep a close eye on how the market is changing. Relying on current expert advice is more important than ever when it comes to making a confident and informed decision for you and your family.

Bottom Line

Even a small increase (or decrease) in interest rates can impact your monthly housing cost. If buying a home is on your short list of goals to achieve, let’s get together to determine your best move.

10 Facts to Know When Buying New Construction

No matter where you drive around the west side of Portland, you pass areas where new homes are being built. NW Portland, Beaverton, Hillsboro, Cornelius, Forest Grove all have development sites underway and North Plains recently approved a large development to begin construction soon.

Buying a newly constructed home is enticing, it's sexy, it's the way to go for some buyers.  It seems the perfect opportunity for buyers to get what they want without the headaches of redoing or repairing a previously owned home.

However, just like when purchasing a re-sale home, new construction has it's own hitches in the process.  The whole process, starting with selecting the development, picking the floor plan and lot to selecting interior features and waiting for county inspection approvals can be overwhelming.  It requires patience and managing expectations throughout the build process.  

Cara Ameer, a Realtor in Florida, recently wrote an article for Inman on 10 things that may help to facilitate the journey of buying a new construction home. Below is a summary of the key points.  Read the full article at Buyers thinking of new build? 10 facts they should know first.

1. Using an agent to represent you doesn't cost more money.  

Many buyers believe that if they use the agent on site they will get a 'better deal'.  What is important to know is that the site agent represents the seller/builder - not the buyer.  Having your own representation ensures your interests and needs are taken into account in the purchase.  

2. Relationships matter

The relationships between the site agent and your agent can be key to ensuring a smooth transaction and good customer service throughout the transaction.

3. Offerings are subject o change at any time.  

You may have seen advertisements about special pricing, available lots, extra features included in the sale, etc. but by the time you visit the site a few months later, those offerings may not be available.  Incentives offered by the builder are subject to changes depending on level of sales activity and buyer demand for homes in the development. They also may vary depending on if the site is newly opened or if they only have a few more homes to sell.

4. Contracts might not be negotiable.  

Many builders have their own contract to use for a purchase versus using the Oregon Residential Sale Agreement.  Their contracts are designed to protect the builder and focus more on what they are not responsible for or do not warrant.  Some builder contracts also don't allow for 'outs' from the purchase like the Oregon Residential Sale Agreement does - such as for inspections or financing.  Be sure to read the contract carefully, and possibly have an attorney review the terms, to ensure you are aware of the financial implications and buyer obligations you are accepting.

5. Financing a new build has some caveats

Builders may offer an incentive for using their in-house lender or preferred lender. Be aware of what the incentives really are and if they also come with additional fees that you may not incur if you used an outside lender. Your Realtor may be able to negotiate some of the lender incentives into the sale agreement even when using your own selected lender.

6. The initial list price is probably much different than the final price.  

Often with new builds, you have the option between several selections of possible lots or interior features.  There may be a premium charged for special lots or upgraded interior features. For those builders who allow for structural modifications, such as moving a wall to enlarge a room, there will be a change in price.  The final price will be driven by buyer decisions for the final product, which may result in a higher home price.

7. Upgrades can be costly. 

I have yet to work with a buyer on a new construction home who hasn't been surprised how quickly the home price increases by selecting options that are not standard. Buyers need to understand the cost differences of the options and to budget accordingly.

8. Choosing design elements can be overwhelming.  

It is so exciting to go into a builder's design center to look at all the options available to put into your new home.  It can also be mind boggling!  Plan to take notes during your visit to the design center capturing the names/colors/manufacturers of the materials you select and possibly take photos to remind you later on what exactly what you chose.

9. Changing your mind might not be possible. 

Once selections are made and the home plan is signed off, it may be very difficult - or expensive - to make any changes.  Cabinets and flooring may be ordered right away preventing a change, structural changes may need architectural reviews and permits may be required, etc. If the builder does allow for the change, there most likely will be delays in completion and additional cost to the buyer.

10. You might need an attitude adjustment

Building a home can be exciting - and stressful.  A lot of decisions need to be made in a short period of time.  Buyer visits to the construction site may create concerns about quality of workmanship. Workers are humans and occasionally will make errors and most builders will address issues before moving forward. Building materials may be in short supply or back ordered causing delays. It is important for buyers to understand the limitations and realities of the builder and be realistic with their expectations throughout the build process. 

7 Myths Buyers Actually Believe (7of7)

Simple Changes Lead To A Better Environment

EPA studies show that the interiors of our homes have levels of a dozen pollutants two to five times greater than the air outside.  If your home is well sealed to conserve energy, fumes from upholstery, carpets, paint, building materials, etc. build up and get trapped inside.  The effects on your health may range from mild headaches to respiratory illness.  Just taking small steps within your home will help you breathe easier and stay healthier.

The Kitchen

• Place any toxic cleaners, used infrequently, in an outdoor shed or in the garage. Replace as many chemical-laden cleaners as possible with green soaps and cleaners.
• Check the stove’s gas lines for leaks or blockages annually to ensure carbon monoxide is not being released into the air.  Install a carbon monoxide detector.
• Opt for appliances that save energy and water.  Use your exhaust fan to expel moisture and gases from cooking

The Living Areas and Bedrooms

• Decorate with natural air cleaners such as houseplants that may help remove airborne toxins.  Dracaena, English Ivy and Peace Lily are good plants to have in the home. Keep the leaves and surface soil free of dust and debris.
• Use cedar hangers or blocks as a safe pest-deterrent alternative to mothballs.
• Paint the interior walls with low-VOC (Volatile Organic Compound) paint and avoid synthetic wall-to-wall carpeting, which off-gasses the greatest amount of chemicals.
• Switch to eco-friendly pest and odor controls versus toxic sprays or powders.

The Bathrooms

• Cut down on chlorine-based cleaners which can irritate the eyes, lungs and skin. Opt instead for non-chlorine bleaches and cleaners based on hydrogen peroxide or sodium percarbonate.
• Clean glass and mirrors with a solution of white vinegar mixed with water rather than ammonia-based products.
• Replace PVC-based vinyl shower curtains which may release gases for years and can trap moisture that breeds mold and mildew.  A healthy alternative are the white nylon shower curtains that can be tossed into the washing machine.

For more information on protecting the indoor air quality in your home, go to epa.gov/iaq and download the EPA’s free booklet The Inside Story: A Guide to Indoor AirQuality.

Buying a Home: Do You Know the Lingo?

Buying a home can be intimidating if you’re not familiar with the terms used throughout the process. To point you in the right direction, here’s a list of some of the most common language you’ll hear when buying a home.

.

Let me know if you have questions about any aspect of buying a home!

Housing Supply Not Keeping Up with Population Increase

Many buyers are wondering where to find houses for sale in today’s market. It’s a true dilemma. We see an increase in buyer demand, but the supply available for purchase isn’t keeping up.

The number of new housing permits issued prior to the great recession increased for 15 years until 2005 (from 1.12 million in 1990 to a pre-recession peak of 2.16 million in 2005). According to Apartment List,

“From 1990 to 2005, the number of single-family permits issued more than doubled, while the number of multi-family permits grew by 49 percent.”

When the housing market crashed, the number of new homes permitted decreased to its lowest level in 2009 (see below):Since then, supply and demand have been out of balance when it comes to new construction. According to the same report,

“Construction of single-family homes has recovered much more slowly — the number of single-family housing units permitted in 2018 was barely half the number permitted in 2005.”

Why is new construction so important?

As the U.S. population increases, there is also an increase in the need for new homes. Today, new construction is not keeping up with the increase in the nation’s population. The report continues:

“The total number of residential housing units permitted in 2018 was roughly the same as the number permitted in 1994, when the country’s population was 20 percent less than it is today.”

Essentially, the dip in home building coupled with the steadily increasing U.S. population means there is now a selling opportunity for homeowners willing to list their current houses.

Bottom Line

If you’re considering selling your home to move up, now is a great time to get a positive return on your investment in a market with high demand. Let’s get together to determine the specific options available for you and your family.

7 Myths Buyers Actually Believe (6of7)

July 2019 Real Estate Market Statistics

(For the past few years, I've used my photographs for the headline photos on the monthly market updates, using local area scenes in 2017 and roof tops of homes sold in 2018.  This year I'm featuring public art that can be found in our local communities.)

The following is the latest Real Estate Market Statistics for July 2019.
Click here for the full report

• Sales:   2,944 in July 2019 vs 2,736 last July:  7.6 %

• Pending Sales:   2,998 in July 2019 vs 3,017 last July:  -2.4%

• New Listings:   3,966 in July 2019 vs 4,312 last July:  -8.0%

• Average Sales Price:   $458,300 in July 2019 vs $453,600 last July:  1.0%

• Total Market Time: 43 days in July 2019 vs 36 days last July:  20.5%

• Inventory in Months: 2.3 months in July 2019 vs 2.4 months last July

Inventory by Area:

• NW Washington County   2.39 months
• Beaverton/Aloha               1.68 months
• Hillsboro/Forest Grove     1.98 months

3 Expert Insights On Inventory In The Current Market

The current housing landscape presents greater home values, low interest rates, and high buyer demand. All of these factors point to the strong market forecasted to continue throughout the rest of the year.

There is, however, one thing that may cause the industry to tap the brakes: an overall lack of housing inventory. Buyer demand naturally increases during the summer months, but the current supply is not keeping up.

Here is a look at what a few industry experts have to say:

Lawrence Yun, Chief Economist at National Association of Realtors

“Imbalance persists for mid-to-lower priced homes with solid demand and insufficient supply, which is consequently pushing up home prices.”

Mark Fleming, Chief Economist of First American

“Market conditions are ripe for increasing home sales with one glaring exception. The supply of homes for sale remains tight, keeping existing home sales below potential.”

Danielle Hale, Chief Economist of Realtor.com

“We're not seeing as many new listings come up on the market…It was only 18 months ago that the number of homes for sale hit its lowest level in recorded history and sparked the fiercest competition among buyers we've ever seen.”

Bottom Line

If you’re thinking of selling, now may be the time. Demand for your house will be strong during a period when there is very little competition, ideally leading to a quick sale and a great return on your investment.

7 Myths Buyers Actually Believe (5of7)

Two Awesome Homes - Ready for New Owners!

41800 NW Covey Lane, Banks Listed at $1,299,000 MLS# 19235173

Spectacular Tuscan retreat placed on top of the hill with amazing valley views and surrounded by a working vineyard. Huge screened in porch with a fireplace creates a magical indoor/outdoor living space. Luxurious master suite that includes an enormous shower with a tub inside the shower! The master closet has extensive built-in organizer, separate vanity and washer/dryer. There is an RV garage with septic hook-up, propane back-up generator, greenhouse, separate office, art studio, water features, extensive landscape lighting, dual heating systems, fire suppression tank, relaxing screened in hot tub that takes advantage of the amazing views. This is a home and property that the current owner has loved and created over the years with great vision and execution. (My Buyer is selling her Banks, OR home. Listed by C. Currin)

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280 NW Pacific Grove Drive, Beaverton  Listed at $679,900  MLS# 19326858

Desirable Stonegate at Waterhouse home! Primarily main level living with master & additional bedroom, 2 baths, laundry, kitchen and living areas on the main floor. Daylight basement provides Two additional bedrooms and large bonus room with kitchenette - potential for separate living area to support multi-generational living. Big windows allow in plenty of natural light. Kitchen updated with new countertops and appliances in 2016. Spacious deck in back to enjoy peaceful mornings and evenings looking onto walking path, green space and creek. Easy access to shopping, Hwy 26, THP&R center, walking trails and local parks. Convenient commute to Nike, Intel and more.

Creating Your Back to School Command Center

Keep your family organized this school year with a back to school command center. It will help your family keep track of important dates, events, and school items! Some things you may want to include in your back to school command center include: 

• Calendar with important reminders 
• Clipboard to attach items for signatures 
• Hooks for backpacks and lunch boxes 
• Homework and chores lists 
• Morning/afternoon/evening checklist 
• Basket for shoes/extracurricular activity accessories 
• Bucket of pens/pencils 
• Folder holder 

You can take your back to school command center a step further and include cubbies where you can pre-plan each day’s outfit for the week to keep your kids even more organized and efficient in the mornings. 

It won’t be long before summer ends and school starts back up, but there’s still time to get into your dream home before you have to stockpile pencils and crayons for your back-to-school command center. If you’re looking to make a move, call today and let's get started!

Open House on Bald Peak - Saturday Aug 10th, 1-3pm

Stunning custom home with master on main floor, greatroom plan, large kitchen with SubZero, gas cooktop & walls of windows to take in the distant views. Wonderful craftsman detailing with natural woodwork & extensive built-ins thru-out. Great entertaining space on lower level includes theater, indoor sportcourt/gym, & access to the expansive yard. Located just 20 mins from Hillsboro or Newberg on a paved road.

4525 sq ft  4 bedrooms, 4 full baths  4.87 acres

Stop by during the open house  

Saturday, August 10th, from 1-3pm

17871 SW Sunrise Peaks Ln., Hillsboro

For more information: http://beckywagar.com/residential/rml/19521909/17871-sw-sunrise-peaks-ln-hillsboro-or-97123

Tips For Maintaining Your AC System in the Heat of Summer

We've had some pretty hot days recently in the Portland, OR area, which means increased use of air conditioning systems. To keep the system running efficiently and prolong its life, it is importand to maintain the AC unit on a regular basis.

With simple household tools like a natural bristle paint brush, a garden hose, and a dry/wet vacuum, it is easy to remove debris as well as clean and dry the unit's coils and fins.

American Homes Shield's video, below, provides some basic cleaning tips for your air conditioning system to help ensure it keeps you cool for the rest of the summer.

3 Actions to take now if Planning to Sell in the Fall

Fall is typically the second busiest time of the year for selling homes. After Labor Day weekend, we often see more homes come on the market and more buyers hoping to find their next home before the year-end holiday season.  If you are thinking of selling this fall, here are a few actions you can take now to be sure your home is ready and make the process of selling easier, faster and more profitable.

1. ACT LIKE A BUYER. 
For a few weekends, tour some open houses of homes that are similar to yours or are in a similar price range as what you believe your home will sell.  Get a feel for what condition the homes are in from a maintenance perspective, what features homes offer in your price range and how the exterior is maintained.

2. NOW TOUR YOUR HOME.  
Walk through your own home with a buyer's perspective. Identify any areas that may need some pre-sale fixing, such as:

a. Structural and operational issues - consider having a pre-list home inspection done to identify any structural or maintenance items that may need to be addressed. As homeowners, we often 'live' with things, or overlook 'issues', until they are called out by someone else. The pre-inspection allows you to address necessary repairs without time pressures and ensures the buyers inspection contingency will be released on time.

b. Cosmetic flaws - Take one room at a time to ensure the whole house shines before buyers begin to preview.  Do a deep cleaning, touch up trim paint, wash all windows to allow in natural light.  Do the walls need a fresh coat of paint?  Do floors need refinishing?  Don't forget the exterior as well - paint, clean gutters, remove moss from the roof, power wash driveways and sidewalks.  Curb appeal is critical to entice buyers to want to see the inside. 

c. De-Clutter - Begin packing up non-essential items, collectibles, excess furniture and valuables, label them well and ensure they are stored in a safe place. Consider hiring a stager to help create a list of furnishings and accessories that would be best to put into storage and how to best position the remaining items to highlight room features and create an appealing look to potential buyers.

3. PREPARE MENTALLY FOR THE SALE.  
Begin transitioning from a mindset of 'living in this home' to letting go and preparing the home for the next homeowner.  It can be challenging to continue living in a staged home as many of your treasured belongings will be packed for the move and it may feel de-personalized.  Plan a fun getaway for the first week, or at least the weekend, your home will be on the market to allow easy access for showings, broker tours, open houses.  Also, have a plan for how you can continue to live comfortably in the home while keeping it 'Parade Ready' for last-minute showing requests.  Having a plan will help considerably in managing the stress when your home is on the market for sale.

Having taken some time to prepare for selling your home, once you have put it on the market for sale, you are in a much better position for accepting an offer, finishing the packing, arranging for movers, transfering utilities, etc. and making the move.

7 Myths Buyers Actually Believe (4of7)

How to Judge the Impact of the Next Economic Slowdown on Housing

We’ve experienced economic growth for almost a decade, which is the longest recovery in the nation’s history. Experts know a recession can’t be too far off, but when will this economic slowdown actually occur?

Pulsenomics just released a special report revealing that nearly 6 out of 10 of the 90 economists, investment strategists, and market analysts surveyed believe the next recession will occur by the end of next year. Here’s the breakdown:

• 9% believe a recession will occur this year
• 50% believe it will occur in 2020
• 35% believe it will occur in 2021
• 6% believe it will occur after 2021

When asked what would trigger the next recession, the three most common responses by those surveyed were:

1. Trade Policy
2. Stock Market Correction
3. Geopolitical Crisis

How might the recession impact real estate?

Challenges in the housing and mortgage markets were major triggers of the last recession. However, a housing slowdown ranked #9 on the list of potential triggers for the next recession, behind such possibilities as fiscal policy and political gridlock.

As far as the impact the recession may have on home values, the experts surveyed indicated home prices would continue to appreciate over the next few years. They called for a 4.1% appreciation rate this year, 2.8% in 2020, and 2.5% in 2021.

Bottom Line

On the same day, in the same survey, the same experts who forecasted a recession happening within the next 18 months also claimed housing will not be the trigger, and home values will still continue to appreciate.

August 2019 Homework Series

 If you need help finding professionals who can assist you with this checklist, I can provide you with a list of preferred contractors and vendors!  Just give me a call at 503-956-3505.