Are your buyers or Sellers hesitant?  With the combination of rates being at the highest levels for years and prices up, and the Media putting a negative spin on EVERYTHING… Can we blame them?  Probably not… but we certainly can educate them.First up: Prices are not likely to go down. Take a look at this chart:For the past 40years we have averaged 2-2.5 million units listed for sale in the country. We have been struggling with less than half that average for a few years. What you can’t see on this chart is; of that current inventory number, over 30% is under contract so the available number is more like 700,000 homes.  In 2007 as the bubble popped, we had nearly quadruple the inventory with about 36,000,000 less people in the country.  Prices have gone up because of basic supply and d... 11/27/2023

The latest numbers for Case Shiller and FHFA are out and both show strong increases in home prices. Zillow did report a small decline in September of 0.1% .Over all 2023 is shaping up to be another good year for home prices:You've probably heard over and over again the simple Economics 101 Supply and Demand argument stating that we still have demand and we don't have enough inventory.  I have even written about this one and included population numbers, household formations and more that also support housing prices... Here is another piece to consider: Mortgage Delinquencies are at a 25 year low.This is a Chart from FRED.Stlouisfed.org which is a great spot to dig for data if you want to do a little research of your own.  There is also Core logic, but you can only find year over year cha... 10/31/2023

 A common theme today: Sellers are reluctant to list their homes because they do not want to give up their low mortgage rate. There are a few things to consider before you make that knee jerk reaction: Why do I want to move? Would a move give me a better quality of life? More space, less space, better location etc?Would the answer to any of the above make life better? (why wait?) Do I have any other debt?It is easy to get tunnel vision and focus on JUST the current mortgage rate. In reality the average home owner is sitting on more credit card debt than every before in history, and at some crazy high rates. The average interest rate on a credit card is 25% with many major cards sitting at 29.9%.  Home equity lines are also Much higher than mortgage rates are today. Would you move if sel... 10/09/2023

 Price Reductions do not mean home prices are going down.Price reductions do not mean values are downHousing Wire and Altos Research had an article last week that suggested that price cuts could be a leading indicator of future home prices.  The facts do not support that at all.In 2018-2019 home prices were up even with increasing price reductions (approximately 30 % of listings had a reduction in price.)2020 home prices rose while price reductions were steady from the previous year, averaging over 20% of listings reducing their list price.2021 Home prices went up 19% for the year with sharply higher price reductions.2022, home prices skyrocketed in the first half of the year even with a significant increase in price reductions, in the second half we did see prices decline 3% from the p... 09/11/2023

It has been a recurring theme the past few years where potential buyers are waiting because of home prices being too high, in hopes that they will go down.  In previous posts I provided a lot of population data and economic data to show how that is very unlikely.Here's a different twist with over 100 of the top economists in the country surveyed with their forecasts for the next 5 years.The survey from all respondents (and I think it was 150 this year) they have this years forecast at a conservative 3.3% which I believe we will easily beat, I think we are over that already with the data we have. The most interesting piece is the 5 year look forward where the consensus is they expect to see a cumulative 18% return on Real Estate over 5 years.  Putting that into Dollars, a $500,000 home i... 08/29/2023

 For all that are waiting for Home Prices to drop before you buy, it is not likely to happen.If you are waiting for Rates to Drop before you buy-  You will pay significantly more when interest rates drop. Housing prices are at all time highs, nationally prices are increasing at about 0.6%/month  Put that into perspective a $500,000 home today will be worth $518,000 in 6 months or $535,000 in a year. Here are the numbers for 2023 for all the major housing prognosticators (averaged out the pace is 7.4% for 2023 or 0.617%/month)Our housing market is seriously under supplied and the population is growing at about 1.2million people per year.The last time we saw inventory this low was in the 1970s when the population was about 203,211,000 people as of the 2020 census we were at 331,449,000peo... 08/08/2023

JUST CLOSED! I'm thrilled to announce the successful closing of 286 Jill Court, Toms River NJ.   A BIG congratulations go out to my amazing buyers, as they embark on an exciting new chapter in life. I am truly honored that you selected me as your realtor, and I want to express how much I enjoyed the entire experience of representing you. It was an absolute pleasure working with both of you! I sincerely wish you nothing but the very best!   #justsold #njbuyers #newbeginnings #tomsrivertownship #coldwellbanker #essiecruztherealtor #silvertonnj #justclosed #itsagoodlife #HappyBuyers #realtorforlife #njrealesateagent #monmouthcounty #oceancounty #middlesexcounty   "Oh, by the way, I'm never too busy for your referrals!"       06/26/2023

Educate yourself, you probably need less money than you thinkAre you renting a home? Would you like to own your own home? What is holding you back?  According to a recent survey done by the National Association of Realtors:Only 11% of current renters know they can purchase a home with 5 % or Less as a down payment.A WHOPPING 89% got the answer wrong thinking you need more than a 5% down payment.Scarier yet:  Almost 45% of renters believe you need to put at least 20% down to buy a home.Is this misconception keeping you from purchasing a home?You probably can get away with a lower down payment than you think, Here are the current minimum down payments available to qualified buyers for common programs: Conventional Loans as little as 3% down  FHA Loans 3.5% down (FHA also reduced its mortg... 04/24/2023

USDA announced it is reviewing the Rural Areas, It appears that in NJ we may lose a few eligible areas.Every 5 years USDA does a review and adjusts the designated areas of eligibility. Why is this important? USDA is one of the BEST ways to purchase a home with no down payment.  There are geographical restrictions and income limits, but at the end of the day- they are reasonable and offer buyers an option for a great market interest rate and No PMI, just an inexpensive Guarantee fee that is a fraction of typical Mortgage insurance.In NJ these are the areas we may lose eligibility:I have highlighted the ones I feel will hurt the most, and common areas I use the USDA program for my clients.If you are curious about other areas of the country that are facing changes you can see the full list... 03/28/2023

 FHA Loans Just got MUCH more affordable After years of being one of the more expensive options for mortgage insurance this is welcome news.  In many cases FHA will now be the less expensive option for mortgage insurance for low down payment borrowers vs conventional mortgages.The typical 3.5% down FHA loan will  see the Monthly Mortgage Insurance Premium dropping from .85 to .55. (for loans under $726,200)What does that all mean in English?In my market a typical FHA borrower will likely have a $400,000 mortgage.   Prior to this change the MIP would cost about $283/month and after the change it will be about $183/month - A WHOPPING $100 less per month!The FHFA that oversees the agencies has made it a mission to make homes more affordable for all. We can see that in recent changes to Con... 02/28/2023

LLPAs/Add-ons Significant increases!For Conventional Mortgages there have been Loan Level Price adjustments since 2008. Simply put- not everyone gets the same rate with these adjustors adding price for risk.While there has always been some minor adjustments to the LLPAs each year this is the biggest change since the advent of LLPAs. We will start seeing these changes on rate sheets in the next few weeks for 60 day locks... Here are some of the highlights:The negative side: Ever since we had LLPAs 740 was the magic number for credit scores. This will be a significant change with 2 new credit buckets 760+ and 780+  So the new magic number for Credit score is 780. There are higher add-ons for most loans with credit scores between 680-779 Refinances will be significantly more expensive VS a... 02/01/2023

Down payment assistance, for everyone?? Well, maybe not for everyone but darn close.At Homebridge we have a new program that can help buyers that are tight on cash and provide them either 3.5% or 5% down payment assistance. There is the possibility the DPA can be forgiven after 5 years of on time payments, but there are a few ways to structure things that may  be a better fit for you.  This program is available with NO income restrictions, and you do NOT have to be a First time buyer.It will be based on an FHA loan with FHA MIP and generous ratios. and based on FHA loan limits for your area.Do you think this will be a good fit for you? If so, reach out to me, I would be happy to help.  And if you want to see 30 seconds of my talking head you can find me on  IG: @Robrauf  (IG is definite... 01/13/2023

 Now & LaterI’m sure you’ve heard variations on the theme: Marry the house, date the mortgage…. Well, we have a Program for that - Our Now & Later program (not the candy!!). When your clients buy and finance a home with me and close by April 1, 2023 we will give them a $1,500 coupon towards their future refinance. Here’s the details:  Buyer buys a home and closes their mortgage with Homebridge by 4/1/23 Pays their mortgage on time, every time for at least 7 months. Buyer then submits a refinance with me/Homebridge by 12/31/24 (a two year window) We pay $1500 towards there refinance closing costs This applies to FNMA, FHLMC, VA, FHA and USDA, not for Bonds or Simple Access programs. Buy the house, begin building equity and refinance it when rates drop.  The markets feel we will see inter... 12/06/2022

 Buydowns: Don’t get caught up in the Hype. Buydowns are NOT the greatest thing since sliced bread. They aren’t new, in fact they are an ancient tool we put at the bottom of the toolbox 30yrs ago because it doesn’t work as well as others at our disposal.   Here’s why: In today’s world a seller MUST pay for the buydown.  Last I checked it is still a seller’s market (at least it is in my market) and seller concessions are not the norm. You will also have to qualify at the note rate, so the highest years rate is where your ratios are based so qualifying may actually be more difficult with a buydown. Back in the 80s and early 90s we used 2/1 buydowns all the time as a tool to qualify at a lower rate. When guidelines changed and didn’t allow for that anymore we stopped using them.  With inte... 11/09/2022

PENDING! EYE APPEAL, LOCATION, EXPANSION POSSIBILITIES...all make homes sell! This home has all three! Enjoy the heart of summer living in this gracefully middle-aged Cape Cod situated on a corner lot just blocks from the best restaurants and amusements LBI has to offer! This charming shore home offers south-facing windows in the spacious living area that bathe the room in light, large kitchen with adjoining utility room and laundry room, along with exterior access to large, fenced backyard for those afternoon barbecues. The oversized detached garage with work bench is perfect for those families with hobbies offering ample storage area for surf boards, beach chairs and bikes. This Island Retreat boasts 2 bedrooms with hardwood flooring, cable hookup and room for your king-size furniture... 11/06/2022

The Sky is NOT falling, and the bubble is not going to pop.I have seen so much doom and gloom in the Real Estate world, and a lot of it is in the Mainstream Media.. Nothing sells better than a negative headline, and unfortunately news is a business that sells advertising.So, are housing prices falling as some have said?  I don't see it.  We are seeing price reductions on listings, but that is because they were priced wrong to start with, not because there are not buyers out there willing to pay market price.  Inventory is up, so prices must be going down.. Ummmm, again- look at the data yourself. Yes we have more inventory.. but it was at abysmal levels and arguably still is. Take a look at this graph of inventory for single family homes:This is as far back as inventory data goes, but I... 10/14/2022

NEW CONFORMING LIMIT ANNOUNCEMENT With prices continuing to climb for residential Real Estate, it is no surprise to see another increase in the conforming limit.  We are up a little more than 10% from last years limit with a Maximum loan amount for a single family conforming loan now at $715,000 ($1,073,000 for Alaska and Hawaii). We will begin offering this loan amount for single family homes immediately for new applications.  High Balance loan limits or 2-4 family Loan limits will stay the same until we receive more information from Fannie and Freddie.  We do anticipate the High Balance limit will be over 7 figures, matching AK and HI above.Fun Fact: When I first started in the business the Conforming loan limit was $153,100 ad we didn't have a high balance option.  Anything above $15... 09/13/2022

 With the latest Fannie announcement today (SEL-2022-08) we have new acceptable sources for gifts:Assets and verification of assets  has always been Strict on Mortgages. FNMA has made Gift giving a little easier with this latest update. FNMA now has 3 categories of donors: Relative Unmarried Partner (new) Unrelated Friend (new) The 2 new categories are for non-relatives that share a familial relationship with the borrower.  These are defined as A domestic partner of the borrower An individual engaged to marry the borrower A former relative of the borrower A Godparent of the borrower A relative of the domestic partner of the borrower previously we were not allowed to accept gifts from anyone other than a relative so this is certainly an improvement on the guidelines.  Keep in mind that c... 09/07/2022

Buyer Fatigue: Our buyers have not had it easy in this market and they are tired. We need to keep them engaged and optimistic. (I think we may even have some agent Fatigue as well?) While inventory is not great, it is improving.  Bidding wars still exist but not to the extent they were last year.  Buyers: It is still a good time to buy, especially with the big increase in rent payments we have been seeing. Agents: Use the tools we have available - There is a true cost to waiting. Reach back out to your tired buyers and reconnect With news overload and a difficult market there is less competition, while still a seller's market it is becoming more friendly to buyers and every forecast is still showing home prices increasing for years to come.Rates, Inflation, etc… Fed Chair Powell spooked... 08/30/2022

Not Human Arms, but Adjustable Rate Mortgages, ARMs for short.(Because everything in the mortgage world is an acronym)With the uptick in interest rates this year we have had numerous inquiries about Adjustable Rate Mortgages.. but we have really not been using them for our traditional buyers at all.For most of 2022 the Yield curve has been very flat, meaning there has been almost no difference between long term and short term interest rates. This has caused ARMs to be effectively non existent. In recent weeks we have seen the yield curve invert significantly... In English: Long term rates have actually been lower than Short term rates.  Here is an example from this morning: Yesterday this was even worse with the 10 year being 0.55% lower than the 2yr which is opposite what you would exp... 08/19/2022