Real Estate: 2016 Will Be the Best Year in a Decade

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A few weeks ago, Jonathan Smoke, the Chief Economist at realtor.com, exclaimed: “All indicators point to this spring being the busiest since 2006.”

Now, Freddie Mac has doubled down on that claim and is saying that 2016 will be the best year that the real estate industry has seen in a decade. In their March Housing Outlook Report, Freddie Mac explained:

“Despite the challenges facing the housing market, we expect this to be the best year for housing in a decade. Home sales, housing starts, and house prices will reach their highest level since 2006 according to our latest forecast…Challenges remain, with low housing supply and declining affordability being a key concern in many markets, but on balance, the housing markets in the U.S. are poised for the best year since 2006.”

The key indicators that have given Freddie Mac such a positive outlook are:

  • Low interest rates
  • A resilient labor market
  • An increase in household formations
  • A projected increase in newly constructed homes

Bottom Line

2016 looks to be shaping up as a great year for residential real estate. Whether you are thinking of buying, selling or renting, now may be the time to sit down with a real estate professional to discuss the new opportunities that are arising.

How can I help you achieve your real estate goals so that you can live YOUR life?

About Carol Juntunen:
My name is Carol Juntunen and I'm a with Baird & Warner in the Chicago northwest suburbs. My intention is to provide insights and information to empower you to make informed real estate choices and decisions, and guide you through the home buying, selling or renting process.

If you're ready to buy, sell or rent, contact me:
Website: www.caroljuntunen.com
Email:   carol.juntunen@bairdwarner.com
Cell:    224-523-2217

Don’t Wait! Move Up To Your Dream Home Now!

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Now that the housing market has stabilized, more and more homeowners are considering moving up to the home they have always dreamed of. Prices are still below those of a few years ago and interest rates have stayed near historic lows.

Sellers should realize that waiting to make the move when mortgage rates are projected to increase probably doesn’t make sense. As rates increase, the price of the house you can afford will decrease if you plan to stay within a certain budget for your monthly housing costs. 

Here is a chart detailing this point:

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According to Freddie Mac, the current 30-year fixed rate is currently around 3.75%.With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5% (in this example, by $10,000).

Freddie Mac predicts that mortgage rates will be closer to 4.7% by this time next year.

Act now to get the most house for your hard-earned money.

How can I help you achieve your real estate goals so that you can live YOUR life?

About Carol Juntunen:
My name is Carol Juntunen and I'm a Realtor® with Baird & Warner in the Chicago northwest suburbs. My intention is to provide insights and information to empower you to make informed real estate choices and decisions, and guide you through the home buying, selling or renting process.

Ready to buy, sell or rent? Contact me:
Website:  www.caroljuntunen.com
Email:    carol.juntunen@bairdwarner.com
Cell:     224-523-2217  

 

2016 Home Sales Doing Just Fine!!

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Some of the housing headlines are causing concern for some consumers who are in the process of either buying or selling a home. Pundits are concerned over the lack of new construction or the month-over-month sales numbers. Let’s set the record straight; 2015 was a good year for residential real estate in the United States and 2016 is starting out stronger.

Here is a graph of total homes sold (new construction and existing homes) in the first two months in 2016 compared to last year:

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Will this momentum continue?

If we look at foot traffic (the number of purchasers currently out looking at homes), we can see that the spring buying market has started early and all indicators point to the fact that we may have the best spring in over a decade.

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Bottom Line

The 2016 housing market started out well and looks to be gaining steam. If you are thinking of buying or selling a home, now may be a great time.

How can I help you achieve your real estate goals so that you can live YOUR life?

About Carol Juntunen:
My name is Carol Juntunen and I’m a Realtor® with Baird & Warner in the Chicago northwest suburbs. My intention is to provide insights and information to empower you to make informed real estate choices and decisions, and guide you through the home buying, selling or renting process.

Ready to buy, sell or rent?
Contact me:
Website: www.caroljuntunen.com
Email:   carol.juntunen@bairdwarner.com
Cell:    224-523-2217 

Past, Present & Future Home Values

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In CoreLogic’s latest Home Price Index, they revealed home appreciation in three categories: percentage appreciation over the last year, over the last month, and projected appreciation over the next twelve months.

Here are state maps for each category:

The Past – home appreciation over the last 12 months:

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The Present – home appreciation over the last month:

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The Future – home appreciation projected over the next 12 months:

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Bottom Line

Homes across the country are appreciating at different rates. As I have mentioned before, the rate of home price appreciation across the country is due to a strong housing market reacting to supply and demand, and not a new housing bubble.

If you plan on relocating to another state, and are waiting for your home to appreciate more, you need to know that the home you will buy in another state may be appreciating even faster.

Ready to buy or sell? Let’s meet so that I can guide you through the next steps and help you decide what’s right for you.

How can I help you achieve your real estate goals that you can live YOUR life?

About Carol Juntunen:
My name is Carol Juntunen and I’m a Realtor® with Baird & Warner in the Chicago northwest suburbs. My intention is to provide insights and information to empower you to make informed real estate choices and decisions, and guide you through the home buying, selling or renting process. 

Contact me:
Website: www.caroljuntunen.com
Email:   carol.juntunen@bairdwarner.com
Cell:    224-523-2217

Sales Contracts Hit Highest Level in Months

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The National Association of Realtors (NAR) just announced that the February Pending Home Sales Index reached its highest reading since July 2015.

What is the Pending Home Sales Index (PHSI)?

NAR’s PHSI is “a forward-looking indicator based on contract signings”. The higher the Pending Home Sales Index number, the more contracts have been signed by buyers that will soon translate to sales. February’s Index rose 3.5% month-over-month to 109.1.

What does this mean for the market?

Lawrence Yun, NAR’s Chief Economist explained:

“After some volatility this winter, the latest data is encouraging in that a decent number of buyers signed contracts last month, lured by mortgage rates dipping to their lowest levels in nearly a year and a modest, seasonal uptick in inventory.”

“Looking ahead, the key for sustained momentum and more sales than last spring is a continuous stream of new listings quickly replacing what’s being scooped up by a growing pool of buyers. Without adequate supply, sales will likely plateau.”

So What Does This Mean For Buyers?

There is a lot of competition out there right now for your dream home. Prices are going to continue to climb, act now before you are priced out of your future home.

What Does This Mean For Sellers?

If you are on the fence about listing your home for sale and debating whether now is the time to move on with your plans of relocating… don’t wait!

There are more buyers that are ready, willing and able to buy their first, second, third, vacation, or investment property now than there has been in years! The supply of homes for sale is not keeping up with the demand of these buyers.

Listing your home for sale now will give you the most exposure to buyers and the best sales price.

Bottom Line

Whether you are planning on buying or selling a house this year, waiting to act no longer makes sense.

How can I help you achieve your real estate goals so that you can live YOUR life?

About Carol Juntunen:
My name is Carol Juntunen and I’m a Realtor® with the Baird & Warner in the Chicago northwest suburbs. My intention is to provide insights and information to empower you to make informed real estate choices and decisions, and guide you through the home buying, selling or renting process.

Contact Me:
Website: www.caroljuntunen.com
Email:   carol.juntunen@bairdwarner.com
Cell:    224-523-2217

 

91.5% of Homes in the US have Positive Equity

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CoreLogic’s latest Equity Report revealed that one million borrowers regained equity in their homes in 2015. The outlook for 2016 remains positive as well, as an additional 850,000 properties would regain equity if home prices rose another 5% this year. 

The study also revealed:

  • 95% of homes valued over $200,000 now have a positive equity position
  • 87% of homes valued under $200,000 have entered a positive position
  • The 11.5% growth in home equity in Q4 marked the 13th consecutive quarter of double digit gains

Below is a map showing the percentage of homes with a mortgage, in each state, that have positive equity. (The states in gray have insufficient data to report.)

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Significant Equity Is On The Rise

Anand Nallathambi, President & CEO of CoreLogic, believes this is great news for the“long-term health of the U.S. economy.” He went on to say:

“The number of homeowners with more than 20% equity is rising rapidly. Higher prices driven largely by tight supply are certainly a big reason for the rise, but continued population growth, household formation and ultralow interest rates are also factors.”

Of the 91.5% of homeowners with positive equity in the US, 72.6% have significant equity (defined as more than 20%). This means that nearly three out of four homeowners with a mortgage could use the equity in their current home to purchase a new home now.

The map below shows the percentage of homes with a mortgage, in each state, with significant equity.

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Bottom Line

If you are one of the many homeowners who is unsure of how much equity you have in your home and are curious about your ability to move, I’d love to meet with you and help evaluate your situation.

How can I help you achieve your real estate goals so that you can live YOUR life?

About Carol Juntunen:
My name is Carol Juntunen and I'm a Realtor® with Baird & Warner in the Chicago northwest suburbs. My intention is to provide insights and information to empower you to make informed real estate choices and decisions, and guide you through the home buying, selling or renting process.

I can help you buy, sell or rent real estate anywhere in the NW suburbs including: Schaumburg, Elgin, South Elgin, Bartlett, Streamwood, Hoffman Estates, Barrington, Dundee (East & West), Sleepy Hollow, Algonquin, Hanover Park, Crystal Lake, Geneva, St. Charles, Palatine, Roselle, Pingree Grove, etc. 

Contact me:
Website: www.caroljuntunen.com
Email:   carol.juntunen@bairdwarner.com
Cell:    224-523-2217

 

3 Charts That Scream ‘List Your Home Today’

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In school we all learned the Theory of Supply and Demand. When the demand for an item is greater than the supply of that item, the price will surely rise.

SUPPLY

The National Association of Realtors (NAR) recently reported that the inventory of homes for sale stands at a 4.4-month supply. This is considerably lower than the 6-month inventory necessary for a normal market.

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DEMAND

Every month NAR reports on the amount of buyers that are actually out in the market looking for homes, or foot traffic. As seen in the graph below, buyer demand in February significantly outpaced the last six months.

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Many buyers are being confronted with a very competitive market in which they must compete with other buyers for their dream home (if they even are able to find a home they wish to purchase).

Listing your house for sale now will allow you to capitalize on the shortage of homes for sale in the market, which will translate into a better pricing situation.

HOME EQUITY

Many homeowners underestimate the amount of equity they currently have in their home. According to a recent Fannie Mae study, 37% of homeowners believe that they have more than 20% equity in their home. In reality, CoreLogic’s latest Equity Reporttells us that 72.6% actually do!

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Many homeowners who are undervaluing their home equity may feel trapped in their current home, which may be contributing to the lack of inventory in the market.

Bottom Line

If you are debating selling your home this year, please let me help you evaluate the equity you have in your home, as well as the opportunities available in your market.
To find out what your home is worth, click the green button in side bar.
How can I help you achieve your real estate goals so that you can live your life?
About Carol Juntunen:
My name is Carol Juntunen and I’m a Realtor® with the Baird & Warner in the Chicago northwest suburbs. My intention is to provide insights and information to empower you to make informed real estate choice and decisions, and guide you through the home buying, selling or renting process.

Contact me:
Website:  www.caroljuntunen.com
Email:    carol.juntunen@bairdwarner.com
Cell:     224-523-2217

 

 

The Importance of Using an Agent to Sell Your House

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When a homeowner decides to sell their house, they obviously want the best possible price with the least amount of hassles. However, for the vast majority of sellers, the most important result is to actually get the home sold.

In order to accomplish all three goals, a seller should realize the importance of using a real estate professional. We realize that technology has changed the purchaser’s behavior during the home buying process. For the past three years, 92% of all buyers have used the internet in their home search according to the National Association of Realtors’ most recent Profile of Home Buyers & Sellers.

However, the report also revealed that 95% percent of buyers that used the internet when searching for a home purchased their home through either a real estate agent/broker or from a builder or builder’s agent. Only 2% purchased their home directly from a seller whom the buyer didn’t know.

Buyers search for a home online, but then depend on an agent to find the actual home they will buy (53%), or to negotiate the terms of the sale & price (48%), or to help understand the process (60%).

The plethora of information now available has resulted in an increase in the percentage of buyers that reach out to real estate professionals to “connect the dots”. This is obvious, as the percentage of overall buyers who used an agent to buy their home has steadily increased from 69% in 2001.

Bottom Line

If you are thinking of selling your home, don’t underestimate the role a real estate professional can play in the process.

How can I help you achieve your real estate goals?

About Carol Juntunen:
My name is Carol Juntunen and I’m a Realtor® with the Baird & Warner in the Chicago northwest suburbs. My intention is to proved insights and information to empower you to make informed real estate choices and decisions, and guide you through the home buying, selling, or renting process.

Contact Me:
Website: www.caroljuntunen.com
Email: carol.juntunen@bairdwarner.com
Cell: 224-523-2217

 

Lack of Inventory Challenging Many Housing Markets

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Going into the 2016 spring market, the biggest challenge the real estate industry has is the lack of available housing inventory for sale. Here are a few experts and their thoughts on the subject:

David Crowe, Chief Economist for the National Association of Home Builders:

“Many sellers may not have an absolute decision as to whether to buy an existing home or a new home. So the low inventory of existing homes is locking them in place.”

Ralph McLaughin, Chief Economist with Trulia:

“We are in a time of short supply, which is great news for sellers because they will likely be faced with multiple offers due to the little inventory out there…Buyers will be up against a lot of other people and against a short supply of existing homes.”

Lawrence Yun, Chief Economist with NAR:

“First-time buyers in high demand areas continue to encounter instances where their offer is trumped by cash buyers and investors. Without a much-needed boost in new and existing-homes for sale in their price range, their path to homeownership will remain an uphill climb.”

Fitch Ratings:

“One important issue that has restrained sales and starts is inventory. On an absolute basis, inventory has not expanded as much as in past recoveries, leading to less selection for buyers. This is especially true for existing home sales but is evident for new home construction as well. When it comes to U.S. housing inventory, more is better.” 

Jonathan Smoke, Chief Economist for Realtor.com:

“The increase in sales is resulting in continued tighter-than-tight supply—measured by NAR to be four months in January.  For you non-economists out there, that metric measures the number of months it would take to sell the current inventory of available homes, at the current pace. Got it? Six to seven months’ worth of homes on the market is considered normal; four months is cray-cray.”

If you’re thinking about selling, NOW is a great time to list your house. Let’s discuss your options!

How can I help you achieve your real estate goals?

About Carol Juntunen:
I’m a Realtor® with Baird & Warner in the Chicago NW suburbs. My intention is to provide insights and information to empower you to make informed real estate choices and decisions, and guide your through the home buying, selling or renting process.

Contact me:
Cell: 224-523-2217
Website: www.caroljuntunen.com
Email: carol.juntunen@bairdwarner.com

 

The Main Reason to Use a Real Estate Professional When Selling Your House

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Every homeowner hopes to accomplish five goals when selling their home:

1.  Sell it for the best price

2.  Sell it within a predetermined time

3.  Sell it with the least amount of hassles

4.  Close on the sale the same day they move into their new home

The fifth reason is the most obvious and the most important:

5. They want to make sure it sells.

In order to dramatically increase the chances that the house sells, a homeowner should list with a real estate professional in their market. Why? Because agents have access to the vast majority of the available buyers!!

According to the National Association of Realtors(NAR) recently released 2016 Home Buyer and Seller Generational Trends Report, 87% of all buyers purchased their home through a real estate agent or broker. And more that 8 out of 10 buyers in every age group used an agent (see chart below).

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Bottom Line

If you want your home sold, the best way is to go where the buyers are. The NAR study revealed that the vast majority of purchasers will use an agent when they buy.  Working with a local real estate professional gives you the best chance of selling.

How can I help you achieve your real estate goals.

About Carol Juntunen:
I’m a Realtor® with Baird & Warner in the Chicago NW suburbs.
My intention is to provide insights and information to empower you to make informed real estate choices and decisions, and guide you through the home buying, renting or selling process.

Contact me:
Cell: 224-523-2217
Website: www.caroljuntunen.com
Email: carol.juntunen@bairdwarner.com