by rtdosen | Oct 2, 2015 | Ryan Dosen Real Estate Articles
State of the Market: Fall Edition By Ryan Dosen Fall is here. Welcome are the cooler temperatures and beautiful colors, as well as the typical flurry of real estate activity. People have returned from summer vacation, kids are back in school, and many will try to close transactions before year-end and the holidays. In general, the market seems to be following a similar path this year, at a noticeably faster pace. Pending Home Sales Remain Up Year-Over-Year The National Association of Realtors (NAR) reports that “pending home sales retreated in August but remained at a healthy level of activity and have now risen year-over-year for 12 consecutive months.” NAR’s Pending Home Sales Index is also up 6.1% year-over-year. Pending sales are an important indicator for the real estate market, as they represent the number of transactions that are under contract, but not yet closed. A measure of closed transactions would show us where the market is today. However, most are more concerned with where the market is headed. Pending transactions represent closings that will, for the most part, occur in the next couple of months—providing a decent indicator of the real estate market’s health in the near future. Lawrence Yun, Chief Economist for NAR, says that “pending sales have leveled off since mid-summer, with buyers being bounded by rising prices and few available and affordable properties within their budget…. Even with existing-housing supply barely budging all summer and no relief coming from new construction, contract activity is still higher than earlier this year and a year ago.” In Chester County, housing supply has dipped about 7 percent since...
by rtdosen | Oct 2, 2015 | Ryan Dosen Real Estate Articles
TRID Clears the Air on Home Loan & Settlement Terms By Ryan Dosen New forms, new procedures, and new requirements are coming for real estate loans and settlements by way of the TILA-RESPA Integrated Disclosure (TRID) rule. For loan applications taken on or after October 3, 2015, Good Faith Estimates go the way of the dinosaur and lenders will have heightened requirements for getting you to the closing table. For consumers, the changes should largely be positive, unless you find yourself working with a lender or agent that is not prepared for the changes. Changes to Loan Paperwork Currently, lenders are required to provide their clients with Good Faith Estimates (GFEs) and Truth-in-Lending Act disclosures (TILAs). The GFE provides the consumer with lender, sales price, loan amount, interest rate, and type of loan information. The TILA provides the consumer with the loan’s interest rate, along with information about fees, such as loan origination fees, underwriting and processing fees, and other costs associated with the loan. Starting on October 3, the GFE and TILA are replaced with a 3-page Loan Estimate form. The new form provides the consumer with much of the same information, but in a format that is supposed to be more easily digestible. Changes to HUD-1 Currently, the HUD-1 Settlement Statement is the form that is signed at closing, summarizing all payments being made pursuant to a real estate transaction. The HUD-1 and final TILA forms are being replaced with a new 5-page Closing Disclosure form. In addition to providing a breakdown of financials, this form is used to disclose many of the terms and...
by rtdosen | Sep 28, 2015 | Ryan Dosen Real Estate Articles
Home Buying Process Starts with a Major Decision By Ryan Dosen The first step in your home buying process isn’t driving around your ideal neighborhood looking for “For Sale” signs. It isn’t going online to run a search on the latest properties to hit the market. It isn’t sitting down with your Realtor to discuss the best homes in the area. It isn’t getting pre-approved for a mortgage. It may actually be choosing your college major. Of course, not everyone will go to college. Nor do they need to in order to buy a home. And of course, different people will take different paths with the same college degree, some more lucrative than others. But the bottom line is that, on average, your choice of degree puts you on a path to generally make a certain amount of money. Your choices and work ethic can certainly alter your path and future income, but the fact remains that your choice of college degree significantly impacts your future income and the home(s) you will eventually purchase. It is in this way that your choice of college degree could be said to be the first step in your home buying process. This is all very logical and unsurprising; however, most 18-year olds are probably not thinking specifically about buying a home when they are choosing a major. College Majors and Home Affordability More than 300 college degrees were analyzed by PayScale and Realtor.com, and engineering majors dominate the top of the list of incomes and mid-career (10+ years) maximum affordable home prices. Petroleum engineers sit at the top of the mountain with...
by rtdosen | Sep 25, 2015 | Ryan Dosen Real Estate Articles
Yearly Do-It-Yourself Home Inspections Pay Big Dividends By Ryan Dosen Home inspections aren’t just for home buyers. Failure to perform yearly inspections on your own home is a mistake that can cost you big time down the road, especially when it comes time to sell. Like most problems in life, issues with your home are best dealt with early on and while they’re still small. Performing a brief yearly inspection of some of your home’s most common and easily examined problem areas will put you way ahead of the curve and in prime position to minimize the impact and cost of the inevitable toll that nature and life will take on your home. Easy Do-It-Yourself Home Inspections You’re probably not a home inspector. You may not know how to test your home’s electrical system. You likely don’t have the knowledge or tools necessary for performing a hydraulic load test on your home’s septic system. There are many items in your home that you’re probably not going to be able to assess on your own. But that’s no reason to avoid inspecting your home altogether. Especially when it comes to water intrusion, there are many simple inspections that you can perform on your own that will help you protect your most valuable asset. Exterior Inspections Timothy Dahl of Lifehacker.com recommends a yearly visual inspection of your home’s exterior and the usual suspect problem areas, perhaps with the aid of a pair of binoculars. Dahl recommends checking your downspouts and gutters for cracks, clogs, and damaged elbows, as runoff can get into your foundation and cause water damage. Dahl further...
by rtdosen | Sep 4, 2015 | Ryan Dosen Real Estate Articles
The Mortgage Industry’s Race Problem By Ryan Dosen Racial discrimination in mortgage lending is apparently still a problem. Strides have been made and much attention has been paid to the issue, especially since the release of the Boston Fed’s well-known study back in 1992. However, according to a recent study, black borrowers still pay higher rates on their mortgages than comparable white borrowers. The Study Ping Cheng, Ph.D., professor of finance at Florida Atlantic University, led this recent study on potential racial discrimination in mortgage lending. Cheng’s report, “Racial Discrepancy in Mortgage Interest Rates,” reveals that “black borrowers on average pay about 29 basis points more than comparable white borrowers.” This means that black borrowers’ interest rates are, on average, 0.29 percent higher than the rates paid by comparable white borrowers. Cheng’s study also found that “rate disparity mainly occurs to young borrowers with low education as well as those borrowers whose income and credit disqualify them from prime lending rates.” Subprime borrowers with lower credit qualifications certainly have to pay higher rates than buyers with excellent credit, but Cheng’s numbers show that lenders are being even harder on black subprime borrowers. The study concludes by stating that, “while the racial disparity in mortgage rates is widespread between black and white borrowers, it is the more financially vulnerable black women who suffer the most.” Black women, according to the study, are charged an average of 57.36 basis points more than comparable white borrowers. Based upon today’s current rates, this means that, on average, black women may be paying an $80 premium on monthly payments for a $250,000 mortgage. ...
by rtdosen | Aug 21, 2015 | Ryan Dosen Real Estate Articles
Confident Builders Constructing More, Smaller Homes By Ryan Dosen Homebuilders are feeling confident and they’re ready to ride the wave of first-time homebuyers that is starting to be unleashed onto the real estate market. Frozen out of the home buying game in the wake of the Great Recession, many would-be first-time home buyers had been forced to delay their plans while their jobs, credit, and finances were put back in order. As these overdue first-timers enter the market, builders are responding with more homes and smaller homes. Confident Builders The National Association of Home Builders (NAHB) reports that home builder confidence has reached its highest level in almost 10 years. The NAHB/Wells Fargo Housing Market Index measures builder perceptions about single-family home sales, sales expectations for the next 6 months, and buyer traffic. The index now sits at 61. Any reading above 50 means that more builders view conditions as “good” rather than “poor.” NAHB chief economist David Crowe said that this recent report is consistent with NAHB’s forecast “for a gradual strengthening of the single-family housing sector in 2015” and that “job and economic gains should keep the market moving forward at a modest pace throughout the rest of the year.” NAHB Chairman Tom Woods concurred with Crowe’s sentiments, while also taking note that builders are still facing difficulties accessing land and labor. New Home Starts Hit 8-Year High The Commerce Department reported earlier this week that these confident homebuilders broke ground on new homes at the fastest pace since 2007. The significant 12.8 percent month-over-month jump in housing starts in July put housing production at...
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