With the several changes we have seen in 2022, real estate is no exception in the year. One impact that we have all seen is an increased desire to own more than one home. According to the recent Luxury Market Report from Luxury Home Marketing:

    “As trends such as remote working and flexi-hours took hold in 2021, so too did the flexibility of relocating as well as the growth of second homeownership.”

This may be because the pandemic has altered the way many think about where we live. Where we live has become, more than ever, our getaway or an alternative. A rise in remote work, helps more people reconsider where they want to live and buying second homes to give them greater flexibility. If you fall in that category, here are just a few of the perks you’ll enjoy, and how owning a second home may be a great decision for your lifestyle and your future.

Enjoy the Outdoors More

When you have two homes, you can alternate between them as the weather changes or as you crave different scenery. Do you want to live in an area with a particular season? Would alternating between a resort and a suburban setting be ideal? With two homes, you have those options. Being able to move between homes based on which location best suits you at the time gives you added flexibility and variety that can help increase your happiness.

Building Equity Builds Wealth Faster

You may have heard that home equity is skyrocketing, thanks to ongoing home price appreciation. CoreLogic reports that the average homeowner gained $56,700 in equity over the last year. With home prices projected to continue rising, if you purchase a second home, you could benefit from rising equity on both properties to build your wealth (and your net worth) even faster.

Being Closer to the Ones we Love

The pandemic has also reignited the importance of being near our loved ones. One option worth exploring is whether you want your second home to be near the people who matter most in your life. This makes it easier to see your loved ones but still gives you your own dedicated, private space so you can be nearby for major life events or longer visits.

Locking in Your Expenses for the Future

Buying a second home today and locking in your mortgage rate may be a good option if you’re looking to stabilize your housing costs for the long haul. If you’re approaching retirement or are looking to use your second home as your permanent residence in the future, buying that house now with today’s rate and price may be a good financial decision. That way, no matter what happens with rates and prices in years ahead, your monthly payment is locked in for the next 15-30 years.

Having more than one home has considerable benefits. If owning a second home is something you’re interested in, let’s connect to explore your options and discuss the benefits here in Ruidoso, New Mexico. Take the next step to start your home search.

Since the pandemic began, many have reevaluated the meaning of the word HOME. That has led some to realize the many benefits of homeownership, including the feelings of security and stability and the financial benefits that come with rising home equity. At the same time, many current homeowners have decided their house no longer meets their needs, so they moved into homes with more space inside and out, including a home office for remote work.

However, not every purchaser has been able to fulfill their desire for a new home.

Here are two obstacles so me homebuyers are facing:

1) The ability to save for a down payment

2)The ability to qualify for a mortgage at the current lending standards

This past week, both of those challenges have been mitigated to some degree for many purchasers. The FHFA (which handles mortgages by Freddie Mac, Fannie Mae, and the Federal Housing Administration) is raising its loan limit for prospective purchasers in 2022. The term used to describe the maximum loan amount they will entertain is the Conforming Loan Limit.

What Is the Difference Between a Conforming Loan and a Non-Conforming Loan?

Investopedia explains the difference in a recent post:

Conforming loans are the only loans that meet the requirements to be acquired by Fannie Mae and Freddie Mac. Jumbo loans, which exceed the conforming limit, are the most common type of nonconforming loan.

What Difference Does It Make to Me as a Home Buyer?

A Forbes article earlier this year explains the benefits of a conforming loan and why they exist:

Since lenders can't sell non-conforming loans to Fannie Mae or Freddie Mac to free up their cash, they're a bit riskier for the lender. This is especially true for jumbo loans, which aren't backed by any government guarantees. If you default on a jumbo loan, it's a huge blow to the lender.

Thus, lenders generally charge higher interest rates to compensate, and they can have even more requirements. For example, lenders who give out jumbo loans often require that you make a down payment of at least 20% and show that you have at least six months' worth of cash in reserve, if not more.

What Happened Last Week?

The FHFA has significantly increased its Conforming Loan Limits for 2022. Sandra L. Thompson, FHFA Acting Director, explains in the press release that:

Compared to previous years, the 2022 Conforming Loan Limits represent a significant increase due to the historic house price appreciation over the last year. While 95 percent of U.S. counties will be subject to the new baseline limit of $647,200, approximately 100 counties will have conforming loan limits approaching $1 million.

This means that more homes now qualify for a conforming loan with lower down payment requirements and easier lending standards – the two challenges holding many buyers back over the last year. The Federal Housing Administration (FHA) also increased its Conforming Loan Limits for 2022. That could also mean an easier path to homeownership for many prospective buyers.

As the Forbes article explains:

FHA loans can be very beneficial if you don't have as much savings, or if your credit score could use some work.

It all boils down to buying your first or your next home may have just gotten much easier (less stringent qualifying standards) and less expensive (possibly lower mortgage rate). Let's connect to discuss how these changes may impact you.

Resources:

1. To get more information on the new FHFA Conforming Loan Limits, click here.

2. To get more information on the new FHA Conforming Loan Limits, click here.

The past year and a half has brought about life changes and challenges. For some, it meant entering retirement earlier than expected. Recent data shows more people retired this year than anticipated. According to the Schwartz Center for Economic Policy Analysis, 2021 saw a retirement boom:

    “At least 1.7 million more older workers than expected retired due to the pandemic recession.”

If you’ve recently retired, your home may not fit your new retirement lifestyle. The good news is, you’ve likely built-up a decent amount of equity that can fuel your next move. According to the latest Homeowner Equity Insights report from CoreLogic, homeowners gained more than $50,000 in equity over the past 12 months alone. That, plus today’s sellers’ market, presents a great opportunity to sell your house and address your evolving needs.

You Can Move Closer to the Ones You Love

The 2021 Home Buyers and Sellers Generational Trends report from the National Association of Realtors (NAR) provides a look at the reasons people buy homes. For those reaching retirement age, the number one reason to buy is the opportunity to be closer to loved ones, friends, or relatives. If you find yourself farther from your loved ones than you’d like to be, retirement and the equity you’ve built in your home may enable you to move closer to the people in your life who matter most.

You Can Find the Right Home for Your Needs

Not only can your equity power a move to a new location, but it can also help you purchase the right size home. Lawrence Yun, Chief Economist at NAR, says many homebuyers 55 and older choose to downsize – or buy a smaller home – when they make a purchase:

    “Clearly from the age patterns, young people want to upsize, and the older generation is looking to downsize. . . .”

You Can Cut Costs

If you are still facing a mortgage payment in your retirement, you can off load that burden by making a move. This will allow for move money in your budget to do what you have always wanted to do. Not to mention being free from debt will also bring a whole new joy and relaxation. 

Whatever your home goals are, a trusted real estate advisor can help you to find the best option for your situation. They’ll help you sell your current home and guide you as you buy your next one while you move into this new phase of life. Get a better sense of how to find a home that will match your situation, connect with us today.

Not sure you’ll have the time to list your home for sale as the holidays draw near? Consider this: even as the holiday season approaches, there a lot of buyers out there still hunting for a place. Here’s why selling this winter is a win for you.

Today’s buyers are still dealing with a limited number of homes for sale. There are only 24 site-built homes listed in Ruidoso, NM under $400k. With this continued low inventory, buyers here are competing with one another for a good home. If your house is one of the few on the market in good shape, it will rise to the top – and it will be worth it.

According to the latest data from the National Association of Realtors (NAR), the average seller received 3.7 offers on their house in September. For a view into what’s happening locally in the Ruidoso area see the graph below. The number of homes listed is significant because it means you’ll likely have multiple offers to pick from if you sell your house this season. To put things into perspective, no matter where you live, remember that you really only need one good offer to close the deal.

Any offer you receive will likely be from a highly motivated buyer who’s doing everything they can to beat the competition. The stakes for buyers are higher than in the past. They’ve been looking for a house and they want to lock in their dream home before prices and mortgage rates rise even further next year. Chances are, they’ll get creative with the terms of their offer, which is great news for you.

If you’re on the fence about when to sell, remember your home is a hot commodity this season. As other sellers take a break for the holidays with plans to re-list their homes in the new year, you can put your house in front of motivated buyers by making your move today. That means your house will be the center of attention, giving you more opportunity in today's market.

As a renter, in today's market your faced with a dilemma: keep renting for another year or purchase a home? Your answer will depend on your current situation and future plans, but there are a number of benefits to homeownership everyone should consider. Here are a few things to muse about before you settle on renting for another year.

1. Rents Are Rising Quickly Nationwide

Rent increasing each year isn’t new. Looking back at Census data confirms rental prices have gone up consistently for decades. If you’re a renter, you’re faced with payments that can climb each year. Realtor.com recently shared the September Rental Report, and it shows price increases accelerating from August to September and are still on the rise. It’s important to keep this in mind when the time comes for you to sign a new lease, as your monthly rental payment may increase substantially.

2. Renters Miss Out on Equity Gains

One of the most significant advantages of buying a home is the wealth you build through equity. This year alone, homeowners gained a substantial amount of equity, which, in turn, grew their net worth. As a renter, you miss out on this wealth-building tool that can be used to fund your retirement, buy a bigger home, downsize, or even achieve personal goals like paying for an education or starting a new business.

3. Homeowners Can Customize to Their Heart’s Content

This is a big decision-making point if you want to be able to paint, renovate, and make home upgrades. In many cases, your property owner determines these selections and prefers you don’t alter them as a renter. As a homeowner, you have the freedom to decorate and personalize your home to truly make it your own.

4. Owning a Home May Provide Greater Mobility than You Think

You may choose to rent because you feel it provides greater flexibility if you need to move for any reason. While it’s true that selling a home may take more time than finding a new rental, it’s important to note how quickly houses are selling in today’s market. According to the National Association of Realtors (NAR), the average home is only on the market for 17 days. That means you may have more flexibility than you think if you need to relocate as a homeowner.

Deciding if it’s the right time for you to buy is a personal decision, and the timing is different for everyone. However, if you’d like to learn more about the benefits of homeownership, let’s connect so you can make a confident, informed decision and have a trusted advisor along the way.