Today’s Buyer or Seller of a Home in Collin County, Texas

We are every day experiencing an extreme sellers’ market, never before seen in the Dallas area.  This market creates some unusual opportunities for buyers and for sellers and this article is written to help you take advantage of this unusual market.

For Sellers:  It may be that you can sell your home for a significantly higher price than ever before.  If you have been seriously considering selling, right now is probably the most opportune time for you in the past 10 years.  I want to address my comments t

Moving out sellers
Moving up sellers
Moving down sellers

Moving Out Sellers:  Those who are looking to sell their Collin County home and relocate to New Mexico or Virginia or Florida.  Just know that you can sell your home right now at a higher price than at any time in the past 10 years.  Part of your selling strategy will be to carefully study past sales of homes in your subdivision and then set an asking price significantly higher than you would have estimated.  The market has so strongly shifted in favor of the seller that you might get a price 10 to 12% higher than one year ago.  This is indeed good for you as a seller who is moving out of the Collin County area.  You may expect a very high sales price; that’s wonderful, you will need every dollar when buying your new home in a distant location.  One word of caution, is, don’t mess with rookie real estate agents who do not really know and understand the current market.  It could cost you thousands of dollars to deal with a rookie real estate agent who does not understand today’s fast moving intense sellers’ market.

Moving Up Sellers: If you are considering selling your current home and moving to a significantly larger and more expensive home, we have some extreme maneuvering opportunities and recommendations for you.

To help you focus, consider two absolute facts that can help you increase your personal wealth by tens of thousands of dollars.

Fact 1    Pre-owned homes (5 years old or more) are increasing in value by about 1% per month (about 12% per year).

Fact 2    New homes in key locations within Collin County are increasing in value by about 2% per month.

Here is an extreme plan that will make you big bucks.  Let’s say your current pre-owned home now some 8 to 12 years old is valued today at about $220,000.  Go and select your new $310,000 home in a well planned community of homes.  Sign a sales contract to build your dream home, and negotiate the best possible price for a home to be completed and ready for occupancy in six months.  Your presently owned home may be worth another $13,000 by the time the new home has been completed.  Your new $310,000 home could easily be worth $40,000 more in six months when it has been completed.  You are enjoying the best of all market opportunities and you stand in a position where you may enjoy a $53,000 profit in 6 months.  The initial deposit to place a new home under contract will be no more than $3,000 to $5,000, to control the new home and to enjoy the fantastic appreciation in value that is happening now.

Use an experienced real estate agent to help you with every step of this investment decision.  Let your realtor represent you with the new home acquisition.  Don’t kid yourself, the sales representative at the builder’s office is there to represent his company, not you.  You need representation.

Moving Down Sellers:   Let’s consider that you are new empty nesters, or that you are experiencing some significant declining health issues, and for these reasons you are considering downsizing to a smaller less expensive home.  You will face two market realities which you must deal with in order to take advantage of today’s market.

First you will be able to sell your current home for a price significantly larger than you ever imagined.  (In our immediate neighborhood, homes are selling for prices about $60,000 higher than three years ago.)  Your equity may have increased dramatically in the past two or three years.

Second the smaller less expensive home that you have considered as an alternative to your present home, has also appreciated dramatically in the past three years.  It may have appreciated by $25,000 since you first considered it two or three years ago.  Your immediate concern might be:  Well, I did want to move to a less expensive home, but I can hardly believe that the home I wanted to move down to has gone up so much in value.

A rising tide floats all ships.  A rapidly appreciating market affects everyone.  Be happy, don’t lose sight of your goals.  You and your family want to move to a smaller, less expensive home – where utility costs, maintenance costs will all be lower, and you can settle into a different life style and possibly live with no mortgage or a very small mortgage.

For any of the above buyers, the above described selling strategies will work.  You can take advantage of the market opportunities that exist.  You need an expert real estate professional to help you.  Make an appointment with us today, or with one of our team members to set your dreams into motion and to make the best move possible for you and your family.

For Buyers          Step #1 is to recognize that you are not in control of the market.  A home that is in good condition, well located, and reasonably priced, may bring 4 to 6 written offers within the first 72 hours after hitting MLS.  Don’t play mindless games by preparing an offer of 90 to 95% of the asking price (unless the home is priced well above today’s market value).  You may painfully learn that besides your written offer there may be five other written offers, all structured at least $5,000 or more above the asking price.  Remember that the third place bidder gets absolutely nothing from this bidding experience.  Three years ago we had a five month supply of homes available in Collin County.  Today we have a one month supply of homes available in Collin County.

Recently, we have become aware of prospective buyers who are making written offers on two or three homes at the same time, hoping to get one home that suits their needs.  It might be said that when bidding on a home of your choice, you have one chance in five of being the successful bidder.

Here’s another suggestion, if you know the market well, and have lost in a competitive bid to acquire your dream home, be prepared along with your real estate agent, to take off from work in a 30 minute notice, to see a new home that just came on the market.  If you wait, foolishly thinking that you can see the home on Saturday, four days later, that particular dream home may already be under contract.

Be prepared to move fast, bid high and to close with no contingencies.  Have your mortgage loan already worked out – preapproved, subject only to locating the right home.

See why you need a full time experienced professional real estate agent working for you.  You earn nothing winning the third highest bid on a home that perfectly meets your needs.  Sorry, but this is not the time to work with your cousin who just got their real estate license.  You need an expert to help you accomplish your goals.

Best Time to Buy/Best Time to Sell

Best Time to Buy in Past 5 Years

Best Time to Sell in Past 5 Years

Sort of sounds like I am not truly clued into the market place?

Best time to buy.    Any of our prospects who buy right now, have the awareness that pre-owned homes in Collin County are appreciating at a rate of approximately 12% per year.  (That means that a pre-owned property, purchased at a price of $200,000 could increase in value by $24,000 over the coming one year term.)  By comparison, new homes sold in Collin County are appreciating at a rate of about 20% per year or greater.  A new home purchased in Collin County at a price of $200,000 may be worth $250,000 – at the end of one year from contract date.  If you are considering the purchase of a home today, know that we have not seen such appreciation in value at any time during the past 5 years.

Best time to sell.    Home values are up from 12% to 20% over their values one year ago.  This means that thousands of Collin County owners have a net equity in their home today, where they had zero net equity one year ago.  An example of a home owner with a market value of their home (March 2013) of $200,000 – with a mortgage balance of $185,000 would have realized zero from a sale, after real estate commission and seller closing costs.

But today, with an appreciated value of $230,000 a sale of such owner’s property might provide such owner with a net equity of $25,000 or more.

Now is the time to buy.  We can help you with choosing just the right home to purchase.

Now is time to sell.  We can get you a higher price than at any time during the past 5 years.

Joe C. Neel         Keller Williams        214-773-2246    Look4dallashomes.com

 

Begin Retirement Planning – Wealth Building Now

Begin Retirement Planning – Wealth Building Now

March 19, 2014

 Failure to Save

I heard a very disturbing news feature on Fox news this week.  The article was emphasizing the reality that so many couples will not be able to retire when they want to because of lack of sufficient funds.  According to the article:

25% of couples have less than $5,000 in savings
Another 25% have less than $50,000 in their savings/retirement accounts

 Here is a plan that will help you prepare for your future.  Combine home ownership with an aggressive mortgage payoff program.  If you do not own a home, you need to buy one.  Don’t waste your life and your future paying off your landlord’s mortgage.

Let’s suppose that if your goal is sufficiently important that you can save back $500 every month for the next fifteen years.  Interest rates are very low at this time.  You can buy a home with a 4% mortgage and you can earn about 2.0% on a savings accounts.

Savings Plan #1.  Open a savings account and faithfully deposit $500 every month for the next 15 years.  If you are 35 years old today, your nest egg will grow to $104,856 by your 50th birthday.  You may need to cut back on eating meals out, or drive an older car, but it will be a really happy birthday for your 50th birthday.  This is an exciting plan and it will certainly reward you well.  The only problem is that with retail prices escalating continuously you may find that your birthday cake, which you could buy today for $12.00 may cost you $22.00 for your 50th birthday party.  Inflation will be either your worst enemy or your best friend.  Inflation exists today and it will be there on your 50th birthday.

Savings Plan #2.  Buy a house now.  Buy a second (rental) house in 7 years.

 First Home $170,000 3 br/2 bath about 1,900 sq. ft. with a 96.5% loan to value FHA loan – mortgaged over 30 years.  You can get into the home with $6,000 down.  Monthly payments will be $782.96 for principle and interest.  If home values increase at 5% per year, at the end of year 15, the home will be worth about $370,000.

Your total monthly mortgage payment, including property taxes and homeowner insurance may run you about  $1,250/mo.  You would have to pay significantly more than that every month to lease a suitable home.

Your savings program includes a commitment on your part to pay extra principle payments of $500 every month.  If you increase your total principle and interest payment by $500 your mortgage will be paid off in only 14 years rather than 30 years.  Your total equity in your primary home will be $370,000 by your 50th anniversary.

 Second Home – at the end of year 7 (when you celebrate your 42nd birthday), buy a second home.  Buy a home valued at only $170,000, one that you can rent for about $1,200 per month.

If your mortgage lender insists on a 20% down payment for this second home (say $35,000) you need to make it happen.  Possibly you sell a car valued at $35,000 and use that money for the down payment.  This second home will likely increase in value by $80,000 by your 50th birthday.  So all together you see how you could have two houses with a combined equity of well over $450,000.  Now that’s enough to make it a very happy birthday.

What if you are already 50 years old?  Same plan.  You may or may not live to see your 65th birthday party, hopefully you will.

Summary.

  1. Don’t pay off your landlord’s mortgage – buy a home now.
  2. Pay extra principle payments of $500 every month.
  3. Buy a second home in 7 years.

Prepare yourself now for a really happy birthday in fifteen years.

Joe Neel    214-773-2246

Buy Your Home Now With a Credit Score of 580

As a real estate professional marketing homes in Dallas Real Estate, McKinney Real Estate, Frisco Real Estate, Allen Real Estate and Plano Real Estate, we have been hindered in helping our buyer prospects.  Our lenders have absolutely required credit scores of at least 640 in order to submit a prospective home buyer’s loan application.

Now, there is a completely new opportunity out there.  At least for now, we have available a mortgage lender who will fund a home purchase for a buyer with a lower average credit score – down to an average credit score of only 580.

For us that means twice as many closings are possible each month.

For many of our buyer prospects that means a “YES” instead of a “NO”.

With home values increasing every month, it means a drastically improved housing economy for Dallas County, Collin County and Denton County.

For a couple who have been renting for several years, bravely struggling to save their down payment and to boost their credit score up to 640, it may mean buying a home of their choice right now and watching the value of their home increase dramatically over the coming 12 months.

Don’t Pay Your Landlords Mortgage

Buy Your Dream Home Now