KentuckyHomesByJudy-Blog

Nobel Prize recipient, Richard Thaler, in his research into seemingly irrational economic behaviors, "found that consumers generally search too little, get confused while evaluating complex alternatives, and are slow to switch from past choices, even if it costs them." "Why are consumers leaving money on the table?" Based on this behavior, a borrower securing a mortgage might depend on their existing banking relationship or a single referral from a friend or agent rather than shopping multiple lenders. When shopping for a lower mortgage rate, consider that not all lenders share the same business practices.   Some may lure unsuspecting borrowers to a rate, knowing full well that they cannot deliver on it.   After making a loan application and supplying information necessary for approval, they reveal that the rate is not available for "whatever" reason. They're counting on the borrower wanting to get into the home because the closin...

A person's decision to sell their home comes with a lot of other decisions causing an owner to stress or procrastinate.   Early in the process, the owner will consider selling the home "As Is" to avoid the looming issues that accompany selling a home. From a seller's standpoint, "as is" means the buyer will purchase the home in its current condition without asking for any repairs.   While it is convenient for the seller to take this approach, the normal trade out is the property will not result in the highest possible sales price. Regardless of how the home is sold, the seller is required to disclose all defects which include repair history, condition of systems and appliances, water damage, pest infestation, radon, and other things that affect the value and livability of the home. From a buyer's point of view, they may think there is something wrong with the home which could result in them avoiding the home completely or making a substantial...

Doing nothing may be a lot more costly than doing something.   With rates twice what they were in 2021 and the first half of 2022, many buyers are sitting on the sideline.   For some, it has to do with not being able to afford the home they want at today's mortgage rates and for others, it is not willing to accept that the low rates that were available are not only gone, but may never be available again. In the late 70's, rates were around 10% and in the early 80's went up to 18%.   Interestingly, many buyers went ahead and purchased at those record level highs and refinanced a few years later when rates came down.   By the end of the decade, prices had continued to increase so that buyers had a significant equity in their home. Tenants who waited for the rates to go down didn't see savings because the price of homes had gone up.   More importantly, they missed the opportunity to build equity in their home through amortization and appreciation. I...

Sales in February 2023 were up 14.5% month over month and still down 22.6% year over year according to the NAR Housing Snapshot.   The median sales price dipped 0.2% to $363,000 and there are 2.6 months supply of homes on the market compared to 1.7 months a year ago. "Inventory levels are still at historic lows, and consequently, multiple offers are returning on a good number of properties." According to Lawrence Yun, Chief Economist for the National Association of REALTORS�. It is still important to have a strategy for potentially competing with other buyers on the house you want to buy.   The plan should include several available provisions and options, so that at the time of drafting the sales offer, you can consider exactly what to include based on the situation. Unless a person is paying cash, you need to be pre-approved by a trusted mortgage professional long before you start looking at homes.   Include the written pre-approval letter along ...

The housing market in 2021 and part of 2022 was anything but normal.   Mortgage rates were at all time lows and may never reach those levels again.   Double-digit appreciation drove prices to new heights.   Low inventories fueled by high buyer demand made multiple offers a normal expectation. As we look at the market snapshots provided by MLS in the various markets across the U.S., it appears that things may be returning to normal, but not necessarily in all areas.   While there are more homes on the market now than a year ago, there are less sales due primarily to the doubling of mortgage rates in 2022. Time on the market is lengthening but that can be explained by the removal of approximately 15 million homebuyers who now have affordability issues.   When the market shifted, sellers expectations for what they thought their home is worth are not keeping pace with current conditions. Some sellers who didn't put their home on the market in 2021 and...

Like with any professional, there are tools and techniques available to help with particular situations.   They might be more popular at certain times and might even be put aside or forgotten at others. For real estate professionals, one of those is the backup offer.   In a situation where there are multiple offers, the seller can accept any offer for whatever reasons are important to them, leaving the makers of the other offers disappointed.   There is always some uncertainty that the buyers on a contract will close accordingly.   To hedge on that possibility, the seller may choose to make a counteroffer to one or more of the other offers to be a backup should the primary contract not close. From a buyer's perspective, the purpose of a backup offer is to be next in line to have the chance to purchase the property should the first contract fall through. The benefit is that you'll be next in line to purchase the home without having to submit another offe...

If you've ever been in a Monopoly game after most of the properties have been purchased and developed, it can be a relief to land on Free Parking, knowing the dice must rotate to the next player giving you a respite from paying rent.   Like the game, in real life, it would be nice to avoid paying rent and even better to have people paying you rent for property you own. Winning in the game of Monopoly is all about investing.   If you travel around the board, trying to buy the ultimate property and pass Go to get another $200, you're missing the opportunity to purchase good properties along the way that could lead to upgrading into your dream home. Starting early to buy your first home gives a buyer a chance to acquire a property with a minimum down payment, and inevitably, have a lower payment than paying rent for a similar home.   As the home appreciates and the loan amortizes, the equity grows.   Within a few years of average appreciation, the down pay...