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What to Expect for the Real Estate Market in 2023

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On January 9, 2023

In Investing, Real Estate

The real estate market has changed drastically over the last few years. The pandemic brought a surge in demand for houses, followed by a freeze in the market as inflation and interest rates rose. That begs the question, what should we expect from the following year?

Most experts believe 2023 will bring a new semblance of normalcy. That means the market will settle down and return to more normal levels. Inflation should reduce or at least balance out, while interest rates will slow down. Let’s take a closer look at what to expect this year.

Housing Prices

Experts are quick to weigh in with their opinion on housing prices and values. Unfortunately, not all experts agree on this. For example, Realtor.com believes that housing prices will increase by another 5.4%, while Zelman believes the value will decrease by 5.1%. Ideally, these two extreme estimates will land in the middle, providing us with a stable market.

In other words, if we balance out the expert opinions on prices, it indicates little change. This means we’ll see a flat or neutral appreciation in 2023. This is good for sellers and buyers, as the market will not change drastically. 

Rate Lock-In Phenomenon

Mortgage rates hit a record low a couple of years ago, countering the current higher rates we’re seeing. This results in homeowners with a low rate (below 6% in most cases and below 4% in exceptional circumstances). That’s great for those homeowners, but they will unlikely consider selling their homes with an average mortgage above 6%. 

Homeowners are unwilling to give up their low mortgage rate in exchange for a higher interest rate. Some homeowners will sell regardless, either because of need or desire. But a large percentage will stay at their current home to wait out this shift.

Ironically, this is going to affect another market. Homeowners that wait out this shift may choose to work on home improvement projects. This will ultimately encourage a stronger contract market and increase home values – if done carefully. 

Reduction in Building

There will likely be a reduction in the number of homes built over the next year or two. Specifically, experts believe that builders will cut back on the number of new single-family homes they are constructing. Likewise, building permits will likely decline as homeowners settle in and wait for rates to change. 

What to Know Before Renting to College Students

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On December 15, 2022

In Investing, Real Estate

Landlords, as a rule, rent their properties to many different subsets of people, including students. However, there are certain things that landlords and property owners must know before renting to students.

Renting to a student is a great way to quickly fill a vacancy, give a young person a chance, and potentially make a difference in the community. The downside is the higher risks associated with this sort of rental. Here is what you need to know before you get started.

The Risks

As mentioned above, there are certain risks associated with renting to students. For example, most students will only need to rent a space seasonally, so renting to them may create vacancies in the summer. Likewise, most students will not have an extended credit history, putting them at higher risk financially.

There are other risks to consider, such as their lack of experience (including a lack of experience paying bills) and potential noise concerns (consider the stereotypical student behavior, and this one is clear). 

Students may also not understand basic tenant responsibilities, such as how to file a maintenance request. This may result in a little problem growing in scale when it otherwise could have been prevented.

The Positives

Don’t worry; there are positives to help balance these additional risks. There is a generally higher demand for student housing, especially near school towns and properties. So filling vacancies shouldn’t be an issue. This has a secondary benefit as it reduces the need for expensive advertising. Word of mouth will do that for you.

Since students have little experience renting properties, they will not go into this process with inflated expectations. In other words, they’ll be happy to get an apartment and won’t demand all the latest bells and whistles. They will happily accept a simple property with no upgrades.

Finally, the possibility of multiple roommates in a property can help to mitigate any financial risk. The more people on the lease, the easier it will be for them to make their monthly payments. As this is a common social expectation for students, frequent arrangements are already in place for this sort of thing.

Lowering Risk

There are additional steps a landlord or property owner can take when renting to students. These steps will help reduce the overall risk. For example, requesting a cosigner or guarantor will minimize the risk of property damage and ensure that the rent gets paid. Likewise, periodic inspections can help spot damage or other repair needs before they become a more significant problem.

Finally, it is critical to set expectations in the lease. This means laying out any rules, regulations, or rules to follow. Doing so in writing will protect you and make it easier for the students to find information as they need it. 

Ways to Get Organic Leads as a Realtor

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On November 9, 2022

In Investing, Real Estate

Every industry has unique tactics and requirements for getting things done. This is especially true for realtors, who must handle several elements of their own business. One such concern is generating organic leads as a realtor.

It can be challenging to create these leads, especially at first. It takes time and practice for them to feel more comfortable and organic. However, once you get the swing of things and establish a pipeline of leads, you’ll have no problem succeeding in the industry.

Networking

One of the most important things for any realtor to consider is networking. Networking can easily generate the most leads and should never be overlooked. Neighbors, coworkers, friends, etc., can all help generate word-of-mouth advertising. Each new professional connection you create introduces new opportunities.

In other words, to create a base for organic leads, you have to network. There’s no way around it, so get it done. If networking is intimidating for you, take some time to research tips & tricks. This will help you understand your strengths and weaknesses.

Branding

You’ve likely heard the term branding regarding a company’s image – but personal branding is something to consider. A strong personal brand can generate leads while you sleep if done right. How? Your name will be out there, traveling out (by word of mouth, advertising, and other branding techniques), even without your active participation. 

Put another way, the better your personal branding strategy, the more consistent your work can be. People will approach you with work, creating more organic opportunities to follow through.

Referrals

Never underestimate the value of a good referral. They’re like gold, showcasing your talent and reliability to potential clients. Referrals come in many forms. For example, it may be a comment from a past client on your website. Or it may be an associate forging a connection between you and a prospective client. 

Don’t forget always to show appreciation for these referrals. Especially the ones that have gone above and beyond for you. Encourage this behavior by sending them a thank you note or showing appreciation.

Social Media

Finally, don’t forget about social media. Social media is a powerful tool, with varying effectiveness depending on your goals and utilization. When using social media to generate leads, be sure you’re picking the right platform for your goals. For example, you don’t want to be on TikTok if you’re looking for leads in older generations. 

Finding your stride with social media marketing may take a minute, but once you’ve nailed it, the leads will come in. Just keep working on it and be willing to adapt your strategies.

What to Do to Save for a Down Payment

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On October 15, 2022

In Finance, Real Estate

You’ve probably saved up for a new car or jewelry, but one of the most important things you can do to improve your financial situation is save for a down payment on a home. It can be hard to set aside a large amount of money for a down payment, especially if you’re a first-time homebuyer. However, following these simple strategies can easily hit your target.

 

Automate Savings

One of the most critical factors you can consider when setting aside a large amount of money for a down payment is automating your savings. This can be done through several different methods, such as direct deposits and recurring transfers.

 

Minimize Spending

Before you start saving for a home, you must have a good understanding of your current budget. This will allow you to make adjustments and reduce your spending temporarily. For instance, you can stop buying new clothes for a couple of months.

 

Increase Income

One of the best ways to increase your savings is by increasing your cash flow. If you feel confident about your current job performance, ask your supervisor about possible promotions or negotiations for a raise. After receiving a raise, direct the new money to your savings.

 

Another effective way to boost your income is by working a side job. This can be in the gig economy, or it can be in the form of a small business, such as selling products on an online retailer, Etsy. You can also work at a restaurant or shop part-time.

 

Eliminate High-Interest Debt

Getting into debt can make it hard to set aside a large amount of money for a down payment. One of the most powerful ways to reduce debt is by getting rid of high-interest debt. Refinancing your loans can lower both your interest rate and monthly payments and free up cash in your monthly budget.

 

Research Assistance Programs

First-time homebuyers can take advantage of various national and local programs that provide down payment assistance. For instance, through the HomeReady Mortgage program of Fannie Mae, you can make a down payment of only 3%.

 

Consider Retirement Funds

If you’re contributing a large chunk of your income to your retirement accounts, you may want to redirect some of it to your home savings. First-time homebuyers can take out an IRA for a down payment of up to $10,000 without penalty. Before doing this, make sure that a tax professional reviews the details.

Fall 2022 Interior Decoration Trends

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On September 15, 2022

In Finance, Investing, Real Estate

The era of the 1970s is back, and historically speaking, we are on track. As we enter the fall season, it’s clear that the 1970s are getting a more organic and cozy update. This is evidenced by the abundance of retro-inspired furniture and the vibrant and earthy colors that make their way into homes. We’ve identified the most prominent trends that will make their way into the home decor of 2022.

 

Bright 70s Palettes

The 1970s brings back the era’s feel with a wide range of colors and textures. The colors and textures used in this trend include mustard yellow, hunter green, and bamboo.

 

The trend that’s been making its way through the interior design world in the past couple of years is the green-based design trend. The muted sage variation is an excellent color for any room.

 

Fringe

The revival of the fringes is one of the most prominent home decor trends of the 1970s. The trend started even before the outfits worn by Elvis Presley became famous. It was also a familiar presence during the 1970s.

 

Adding fringe accessories to your home in small increments can bring this look into your house. For instance, you can add this look to your rugs and carpets. You don’t have to go overboard with this addition. To achieve this look, keep it simple and maintain a minimal yet elegant look. You can also add fringe accessories to your home by combining them with functional pieces such as mirrors.

 

Decorative Plates

Another exciting home decor trend celebrities are currently in love with is the use of plate walls. This looks great in both formal and informal spaces. The possibilities are endless with the help of plates.

 

This season, we’re seeing a variety of styles featuring hand-painted plates mixed with more modern offerings. This combination of styles is very visually stimulating. Having vibrant and playful plates can help balance the elements of the home.

 

Checkerboard

In 2022, checkers are making a big appearance all across the country. This look is sophisticated and elegant, from sleek black and white floors to timeless accessories. For autumn, this trend is expected to take a more muted approach.

 

A simple yet vibrant pattern like a checkered can add a bit of fun to a room. However, this look requires a lot of vision and restraint. You should avoid feeling like you’re in the circus. If you’re planning on adding this look to your home, try incorporating it into various accessories, such as vases and ceramic mugs.

 

Dark Woods

Blonde wood has been a popular design trend for the last few years. It was closely associated with the rise of Nordic-inspired designs still in use today. This trend is expected to shift this year and feature darker wood tones and moody paint colors.

 

If you’re a fan of white lacquer furniture, you’ll notice that the wood finishes are replacing the traditional white cabinets and tables this season. The use of dark wood is also seen in various areas of the home.

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