Archives for October 2013

Texas-Sized Housing Boom

The Texas A&M Real Estate Center reports a huge increase in home values and bidding wars in Houston and Dallas.  Over 15% median price increases in Dallas and 14% in Houston represent the highest year over year increases in over a decade.  Although it doesn’t mention anything about Austin, we’ve had our own share of bidding wars and multiple offers for the better half of 2013 and still going on in many pocket neighborhoods.

A hot real estate market can be a difficult ocean for both sellers and buyers alike to navigate so if you need an experienced and savvy real estate agent to sell or purchase a home in a hot market, give me a call.

Source: http://realtormag.realtor.org/daily-news/2013/10/10/everything-including-housing-boom-bigger-in-texas?om_rid=AACLKS&om_mid=_BSVxHPB81u25$z&om_ntype=RMODaily

Do Home Owners Have Mineral Rights

Most likely, no.

Home owners own the home and builders own the minerals beneath.

Why would builders want to keep the mineral rights?

If you have shale formations, that means lots and lots of moolah.  Oil and natural gas can be extracted by a process called hydraulic fracturing, or fracking.  The movie Promised Land is like a tip of the iceberg to fracking.  More than building and selling homes.

How does this affect you?

It only affects you if you have shale formations under your home.  You probably don’t, and there’s nothing you can do about it anyway unless you’re purchasing land.  Actually, builders will disclose this to all buyers so you’ll have to sign an extra paper or two.

Source: http://realtormag.realtor.org/daily-news/2013/10/10/you-own-home-builders-own-whats-under-it?om_rid=AACLKS&om_mid=_BSVxHPB81u25$z&om_ntype=RMODaily

Rising Interest Rates Means Homes are More Expensive

With interest rates at historic lows, home buyers have been taking advantage of “cheap” money for the past couple years.  But interest rates are set to rise with the federal reserve’s decrease in bond purchasing.  The availability of cheap money will be gone soon so if you’re on the fence about purchasing, take a hard look at the following numbers:

Example: A buyer gets a 30-year fixed-rate mortgage at a 5 percent interest rate on a $300,000 loan.

Monthly payment: $1,610.46
Total payment: $579,569.69
Total interest: $279,769.69

Example: A buyer gets a 30-year fixed-rate mortgage at 6 percent interest rate on a $300,000 loan.

Monthly payment = $1,798.65
Total payment = $647,515.44
Total interest = $347,515.44

Just a 1% rise in interest rate increases the monthly payment $188 and the total interest almost $68,000.  To avoid this increase, give me a call today!

Source: http://realtormag.realtor.org/daily-news/2013/10/10/why-it-might-be-cheaper-buy-now?om_rid=AACLKS&om_mid=_BSVxHPB81u25$z&om_ntype=RMODaily

Government Shutdown Effects on Real Estate

With interest rates steadily rising, the government shutdown has caused a slight dip in interest rates to its lowest figures in four months.  For the week ending October 3, national averages of mortgage rates went down for a third straight week.  Freddie Mac reports the following averages:

30-year fixed: 4.22%
15-year fixed: 3.29%

These are approximately 0.5-0.75% higher than the rates 12 months ago, which we all know were historically low.

The other big effect is most FHA, USDA, and VA loans are experiencing delays in closing since the… government… is… shut… down.  Trust me, it’s not that obvious to everyone.

Source: http://realtormag.realtor.org/daily-news/2013/10/04/gov-t-shutdown-pushes-mortgage-rates-down?om_rid=AACLKS&om_mid=_BSTyVLB81mOjB$&om_ntype=RMODaily

Starstruck in Austin

Have you ever wondered what are the top five cities in the U.S. you are most likely to run into a celebrity?  Probably not.  But Rent.com did and guess which major city in Texas made the list.  That’s right.  Austin, Texas, is the #5 city in the U.S.  Yet another reason why so many California residents are changing addresses.

1. Los Angeles, California
2. New York, New York
3. Wilmington, North Carolina
4. Boston, Massachusetts
5. Austin, Texas

Source: http://realtormag.realtor.org/daily-news/2013/10/03/5-best-celebrity-cities-besides-la-and-nyc?om_rid=AACLKS&om_mid=_BSTdPPB81kybEn&om_ntype=RMODaily

Rental Vacancy Rates Lowest in Ten Years

Nationwide rental vacancy rates are now the lowest in the past ten years, according to real estate research firm Reis Inc.  Current vacancy rates are 4.2%, the lowest since 2001 when it was 3.9%.

If you’re looking to diversity your funds into real estate to generate instant cash flow and build long-term wealth, call Edwin Lui at 512-554-9594.

Source: http://realtormag.realtor.org/daily-news/2013/10/03/rental-vacancy-rate-lowest-in-more-decade?om_rid=AACLKS&om_mid=_BSTdPPB81kybEn&om_ntype=RMODaily

Top Ten Rental Markets for Investors

According to RealtyTrac and RentRage, Williamson County, Texas, is the fourth best rental market nationwide for investors.  The stats are based on gross yield percentages.  If you’d like more information on investing in Texas real estate, call Edwin Lui, a licensed Texas Realtor with an Economics degree that might be of use when determining gross yield.  He’s also a fellow investor.

Williamson County, Texas:
Median market value: $158,000
Median rent value: $1,403
Gross yield: 10.7%

Source: http://realtormag.realtor.org/daily-news/2013/09/20/top-10-hidden-gem-single-family-rental-markets?om_rid=AACLKS&om_mid=_BSPKI6B81T4DuK&om_ntype=RMODaily

VA and FHA Loans – Additional Selling Tools for Homeowners

Homeowners who purchased their homes with a VA or FHA loan can use their low interest rates as an extra incentive to buyers.  By assuming the current loan terms, buyers can take advantage of low interest rates and, in most cases, lower closing costs.  Another advantage is that the loan is further down the amortization schedule, which means more of their payments go toward principal.

Sellers can now offer a great home with a low interest rate that other homes cannot compete with.  Just remember that with VA loans, your VA eligibility is tied to the home as long as the loan exists.

If you are a homeowner in a similar situation, contact me for details.

Source: http://realtormag.realtor.org/daily-news/2013/09/20/sellers-can-use-their-fha-va-loans-marketing-tool?om_rid=AACLKS&om_mid=_BSPKI6B81T4DuK&om_ntype=RMODaily

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