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Can You Get Me the Best Price Available For My Home?

If we, in Westchester County go back to 2002, everyone wanted to buy a home, and we wanted everyone to be able to get a mortgage in order to buy a home. Unfortunately, we went too far in that direction and people who were not ready for homeownership entered into it. But there are times when we go too far in the other direction – when qualified people aren’t entering into homeownership. It’s up to us as Realtors to give good advice so our buyers don’t get caught in either situation (wanting a home they can’t afford or thinking they can’t achieve homeownership). We are counselors – we must educate with the heart of a teacher. Explaining that if prices are going up, they should buy before prices go up even more and if prices are falling, they shouldn’t necessarily run away from the idea of owning a home.
NAR has a Home Affordability Index. This index measures whether or not a typical family could qualify for a mortgage loan on a typical home based on price, mortgage interest rate, down payment and ratios to debt. Know what the current numbers are and be able to explain them to others. You see, if prices are falling, affordability is getting better.

There’s cost vs. price and you have to be able to look at the overall picture. Maybe the time to buy a home is in a difficult market. You shouldn’t be worried about price; you should be worried about cost. Cost is determined by price and interest rates. If the price falls but the interest rates go up, then cost may be greater. The price may sound good, but interest rates impact the cost in different ways. Even if prices fall, they would have to fall 10% to make up for just a 1% increase in interest rates to get the same mortgage payment.

At times, people are afraid to buy and may think they’re doing the right thing by renting. Let’s take a look at the Westchester  rent vs. buy situation. According to the Consumer Price Index, prices for rent of a primary residence in the Westchester area have increased at an average rate of a little more than 3% per year for the last ten years. Experts are projecting rents to increase by 5% annually over the next few years. If you buy a home with a 30 year fixed mortgage and you don’t refinance, you know what your payments will be for the next 30 years. There are no surprises. And, at least for now, homeowners enjoy significant tax savings if they are paying mortgage interest.

The reason people buy homes is the same generation after generation. It’s what Americans do. They want the best education for their children, the safety, the sense of community, and all the other benefits surrounding home ownership. They don’t need the studies and statistics, but you need them so you can prove to people that their gut feelings are already good and that they should consider homeownership if not now, in the future when it’s the right choice and possible for them.

People have fear when it comes to buying. This fear comes from not understanding and it can cause paralysis. It’s up to us as Realtors to make sure they understand these concepts.  We are the guardians of the American dream. Make sure everyone who wants to achieve this dream has a clear path and you have the lantern to light that path with knowledge.

Mortgage News Daily

  • MBS RECAP: Another One of Those Unofficial 3-Day Weekend Days

    Posted To: MBS Commentary

    These sorts of days (where nothing happens) happen. If you had to bet on a day of the week and a time of year to see them, Summertime Mondays would probably be the safest bet. Overnight volume was almost nonexistent, with much of Asia closed. Domestic volume and volatility was effectively nil with today's trading range falling easily inside Friday's. On a positive note, despite the low volume, any day where bonds begin a new week holding onto gains from the end of the previous week is better than nothing. In that sense, the fact that yields remained well under Friday's 2.937% ceiling in 10yr Treasuries was better than the alternative. That said, I'd look at it more like an unofficial 3rd day of the weekend than a new and meaningful trading session. MBS Pricing Snapshot Pricing...(read more)

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  • Mortgage Rates Little-Changed to Begin Quiet Week

    Posted To: Mortgage Rate Watch

    Mortgage rates were sideways to slightly higher today, depending on the lender. The underlying bond market (which dictates rates) was exceptionally quiet. On the heels of last week's important events and without much on the calendar this week, markets may take a couple days to relax. To put that in context, rates have been holding somewhat steady just below long-term highs. Their next major decision will be between pushing into new long-term highs or attempting to move lower for more than just a week or two. "Relaxation," in this context, means we're not likely to see evidence of either this week. Loan Originator Perspective Bonds coasted through a flat session Monday as rates hovered near unchanged. There's scant meaningful data this week to inform markets, I'll be surprised to see much movement...(read more)

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  • Builder Confidence: Tariffs on Lumber Hurting Affordability

    Posted To: MND NewsWire

    Builder confidence in the market for new single-family homes ended a three-month slide in May , as the Housing Market Index ticked up two points. This month that two-point gain evaporated as the index slid back down to 68. The National Association of Home Builders (NAHB) said the retreat of the measure, which it sponsors in conjunction with Wells Fargo, in June was, in large part, due to elevated lumber prices. "Builders are optimistic about housing market conditions as consumer demand continues to grow," said NAHB Chairman Randy Noel. "However, builders are increasingly concerned that tariffs placed on Canadian lumber and other imported products are hurting housing affordability . Record-high lumber prices have added nearly $9,000 to the price of a new single-family home since January 2017...(read more)

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  • MBS Week Ahead: Bonds Try to Confirm Last Week's Victory

    Posted To: MBS Commentary

    Post-Italian drama, bond yields rose for 2 straight weeks heading into last week's Fed and ECB announcements. They both proved friendly and the positive momentum continued on Friday. The timing of the Italian drama was important because it began helping bonds right as US 10yr yields were hitting 7-year highs. As yields rose back toward those highs early last week, it was fair to wonder if Italy had merely delayed a move to even weaker levels. The response to last week's central bank events suggested--if not proved --that bonds don't need to re-test high ceilings just yet. Moreover, there may even be a chance to rally. To reiterate a word of caution I've offered a few times, the fundamentals--at the very least--would not make a sustained rally easy. It's the sort of thing...(read more)

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  • Compliance and Construction Products; Legal Changes for Lenders on the East Coast

    Posted To: Pipeline Press

    Rumors continue to swirl. Will a top-10 bank really terminate hundreds, possibly a thousand, of its retail originators in late July/early August for not meeting minimum production standards? Is Houlihan Lokey out there marketing a well-known company (a provider of compliance outsourcing solutions to lenders and servicers) to Radian, Black Knight, or overseas firms? Are hundreds of lenders engaged in small-scale unpublicized layoffs to eliminate overstaffing? Maybe I am merely making this stuff up. Maybe not. Lender Products and Services The American Bankers Association announced its endorsement of Built Technologies, a Nashville-based fintech company focused on simplifying the administration of residential and commercial construction loans through secure, cloud-based software. Built’s...(read more)

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  • Americans Sitting on Trillions in Tappable Equity

    Posted To: MND NewsWire

    Americans are sitting on a nearly unprecedented level of untapped wealth - or maybe sitting IN it is more to the point. A report from Black Knight notes the first quarter of this year saw the "tappable" equity Americans have in their homes rose at what could be a record pace. The company says tappable equity growth is a different metric than simple equity growth as it is the amount that homeowners can actually use. That is, it is the amount of a home's value that can be borrowed against before reaching a combined loan-to-value (CLTV) ratio of 80 percent. Tappable equity grew by $380 billion in the first quarter of 2018. That 7 percent increase is the largest single quarter growth in Black Knight's records, which go back to 2005. Equity growth is usually greatest in the first and second quarters...(read more)

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  • MBS RECAP: Trade Fears Help Bond Rally Extend

    Posted To: MBS Commentary

    Fresh fears of trade wars pushed stocks and bond yields lower in the overnight session as the White House promised another wave of tariff announcements in the morning. China retaliated by promising its own tariffs and markets slumped accordingly. By "accordingly," I mean they slumped as much as they have for any other trade war headline after the initial shock wore off--i.e. not too terribly much. Case in point, stocks ended up bouncing back and nearly erasing all of the losses. Bonds, on the other hand, got a bit of an extra boost from the overall momentum following 2 decent days of central bank news, as well as weaker economic updates out of Europe overnight. 10yr yields rallied all the way to 2.889 before bouncing up to 2.922% by the close (still 2.4bps lower on the day). MBS underperformed...(read more)

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  • Mortgage Rates Inch to Week's Best Levels

    Posted To: Mortgage Rate Watch

    Mortgage rates fell again today, bringing the average rate just slightly lower on the week. Unlike the past 2 days, there were no big ticket calendar events today. Instead, motivation came from market jitters of new tariff announcements and the ensuing retaliation from China. Markets ultimately decided it wasn't the end of the world (yet) and bounced back in the other direction (higher stocks, higher rates) during the 2nd half of the day. Fortunately, the bounce in rates (via the bond market) wasn't big enough to force mortgage lenders to adjust their rate sheets for the worse. That knife cuts both ways though. If bonds were to merely hold flat by the start of Monday's trading, the implication would be for slightly higher rates to begin the day. Loan Originator Perspective Rally makes it time...(read more)

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  • MBS Day Ahead: Here We Go Bonds, Now, Here We Go!

    Posted To: MBS Commentary

    Bond markets have their rally caps on after making it through both central bank announcements this week without suffering any crazy damage. In fact, each day brought modest improvements and now today stands the chance of bringing enough of a rally to "confirm" those improvements from a technical standpoint. That's about the size of it at the moment. We're watching and waiting with fingers crossed. It's much the same as a sporting event where our team just made a good defensive stand and now has the ball on offense . They may or may not score, as always, but it's nice to have a chance! The only thing that troubles me about rooting for a bigger rally is that the justification for sustained improvement will be really hard to come by without something changing about the...(read more)

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  • Compliance, Fraud Prevention Products; Lenders' Digital Notes and Closings

    Posted To: Pipeline Press

    Taking a tour around the nation…No one has ever used the term “bespoke” in describing any place I’ve stayed. I barely know what it means. But if you’ve got the bucks, and want a nice place to bunk down in Hawai’i, here you go . Marlin jerky? 5,100 miles and six time zones away, a Martha’s Vineyard house that the Obamas have vacationed in sold for $15 million , $7.5 million under original asking. Falling demand on the high-end? In-between, here’s an article on the lay-offs to expect in the Dallas-Fort Worth lending industry. But Freddie Mac announced a new partnership with re-employment solutions company NextJob to provide job search assistance to current and aspiring homeowners living in high-needs and other persistent poverty areas . Digital...(read more)

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Bonnie Koff  |  Licensed Associate Real Estate Broker  |  William Raveis Legends Realty Group  | Tarrytown Office 
914-332-6300  |  37 Main Street, Tarrytown, New York 10591  |  Email