Buying Power is High

Many buyers look at their monthly budget when considering to purchase a home. Though it would be great if we could all afford to pay cash for our home, most people have to consider borrowing money to make their purchase. Since this is the case, interest rates play a significant role in determining purchase power.

Buying powerThis is significant because as interest rates change, buyer’s ability to purchase changes. The higher the interest rate, for example, the lower the purchase price has to be to keep the same monthly principal and interest (P + I) payment. Conversely, the lower the interest rate, the more home a purchaser can afford or the lower the monthly payment is.

Though interest rates have come up and are now above the historic lows we experienced a year or so ago, they are still below average making this a great time to buy!

For more information regarding home affordability, give me a call today at 832-309-0450 or send me an email at ByronU@cbunited.com.

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Houston Apartment Occupancy Reaches New Highes

With employment and population in Houston growing, demand on apartments is increasing. The current supply of apartments is not enough to keep pace with the higher demand. Because of this increased demand and the slower increase in supply of apartments in the Houston area, apartment occupancy rates are extremely high.

 

 

 

 

 

The building classifications are as follow and may vary from market to market.

Class A

  • Generally, garden product built within the last 10 years
  • High-rise product in select Central Business District may be over 20 years old
  • Commands rents within the range of Class “A” rents in the submarket
  • Well merchandised with landscaping, attractive rental office and/or club buildings
  • High-end exterior and interior amenities as dictated by other Class “A” products in the market
  • High quality construction with highest quality materials

Class B

  • Generally, product built within the last 20 years
  • Exterior and interior amenity package is dated and less than what is offered by properties in the high end of the market
  • Good quality construction with little deferred maintenance
  • Commands rents within the range of Class “B” rents in the submarket

Class C

  • Generally, product built within the last 30 years
  • Limited, dated exterior and interior amenity package
  • Improvements show some age and deferred maintenance
  • Commands rents below Class “B” rents in submarket
  • Majority of appliances are “original”

Class D

  • Generally, product over 30 years old, worn properties, operationally more transient, situated in fringe or mediocre locations
  • Shorter remaining economic lives for the system components
  • No amenity package offered
  • Marginal construction quality and condition
  • Lower side of the market unit rent range, coupled with intensive use of the property (turnover and density of use) combine to constrain budget for operations

Occupancy rates over 90% are in the landlord’s favor with renters leaving being quickly replaced by new renters. The Houston market, however, is not showing great investment into the rental market with owners willing to allow the growth of demand of rental units to outpace the growth of supply. Nobody wants to be caught holding too many units in a downturn. The result is continued low supply in a demand driven market.

This information is supported by Houston Association of Realtors (HAR) statistics showing the price of rentals increasing in Houston since 2007. The median rental price inn Houston in 2007 was just over $1400 with the median rental price at the end of the third quarter of 2013 at $1650.

This is a great time to consider investing in rental property. Missouri City has many homes and townhouses that ideal for investment purposes. If you or someone you know is considering investing in real estate, give me a call at 832-309-0450 or email me at byronu@cbunited.com

Texas Tops Employment Growth in 2013

The Texas economy is teaming along evidenced by its healthy job growth. Though California had more new jobs by numbers, Texas had the largest percentage growth in jobs in the country in 2013. The top five states are:

  1. Texas                  +312,870
  2. California           +229,660
  3. Florida                +144,530
  4. New York            +89,750
  5. Georgia                +71,540

*MetroStudy 2013

Looking at more detail in the state of Texas shows that the majority of new jobs are in Houston and Dallas/Fort Worth Metroplex with Houston leading the way in percentage of increase.

newjobsThis trend is good not only for the Texas economy but also for home owners. The more jobs created, the greater the pressure on the supply of homes. As demand to purchase and rent housing increases the supply of homes to rent or purchase goes down. Lower supply and higher demand means higher home prices for sellers.

Do you know what your home is worth? Call Byron Underwood at 832-309-0450 today to schedule your free market analysis.

Houston Prepares for a Freeze

Tonight looks like a chilly night with temperatures forcasted to be below freezing. The concern according to Click2Houston, there is a significant chance of temperatures below freezing for several hours.  Freezes can be deadly for animals and expensive in lost landscaping and broken water pipes. So, be mindful of outdoors pets! Also take care to prepare your plants for the freeze and perhaps exposed pipes. Stay warm!

Real Estate in Texas ROCKS!

Monthly reports continue to show increases in prices and sales volume on month to month comparisons. Inventory is lower than it has been. Employment is strong and projected to continue to be strong. It’s a great time to be in Texas. This Texa-Plex video that keeps floating around shows why.

Title Companies – Who Picks and Why Is It Important?

“Who gets to pick the title company?”.  If you guessed the Buyer, you are correct.  The HUD RESPA (Real Estate Settlement Procedures Act)  guidelines are very specific.

Choice of title company

Who gets to pick the title company that will issue the owner policy of title insurance? (updated July 27, 2010) Logical arguments can be made that support either a seller or buyer picking the title company. A seller may feel he should be the one to pick the title company where the applicable provision of the TREC contract shows the cost of the owner policy to be a seller’s expense. A buyer may feel that he should pick the title company because he will actually be the insured party in the owner policy.

The only law governing this issue is under the Real Estate Settlement and Procedures Act (RESPA). The HUD Web site states, “Section 9 of RESPA prohibits a seller from requiring the home buyer to use a particular title insurance company, either directly or indirectly, as a condition of sale.

Buyers may sue a seller who violates this provision for an amount equal to three times all charges made for the title insurance.”

How do yo choose a title company?

  • Price – Price is Important, Value is more Important! You should search for a closing agent or title company that offers you a savings on title insurance, closing costs, title search & exam, and courier fees, etc. You may be entitled to a discounted rate on your title insurance policy. If you are refinancing and have a previously written Owners or current Lender’s Title Policy, ask if you qualify for a “reissue rate” or “substitution rate”. Title companies may not offer the discounted rate unless you ask for it. The savings could be 30 percent or more of the original title policy.
  • Service – Title Companies and Closing agents are not all alike. Title insurance rates and closing fees vary from company to company, but you may not be aware of the differences in service you will receive from one company to the next. Many borrowers also are not aware that they have the right to choose title insurance agents. Under the Federal Real Estate Settlement Procedures Act (“RESPA”), the seller cannot require you to buy title insurance from a particular title company. The lender may request that you use a title company it finds acceptable, and it likely will recommend some companies, but in most cases you have the choice. In the end, the lender usually agrees with your pick. This power of choice is a tool you can use to be sure your closing goes as smoothly and quickly as possible. Closing is about preparation, service and anticipating your needs before and long after the closing. Making the right choice on service is a major component of Value and can save you thousands of dollars in the long run.
  • Reputation – When choosing a Title Company, Closing Agent or Escrow Officer an important component is their reputation in the community. Ask the number of years the company has been in business. Ask your friends and acquaintances who have had recent experience with real estate transactions to recommend a company or an individual they have been pleased with, one who met all their expectations. Inquire among friends as to the reputation of the individual officer or Title Company in your local community. Ask your friends if the escrow agent they recommend returns phone calls promptly, explains details in everyday understandable language, inspires confidence, is knowledgeable and acts in a professional, courteous manner.
  • Technology – Does the Title Company use a “transaction-management system” or other means of receiving/delivering documents? Can Realtors, Lenders, home buyers and sellers log into this system to monitor the status of the closing? Are they set up to receive lenders “digitally delivered documents” from Lenders quickly and efficiently. It’s critical to be able to receive last-minute changes, corrections and additions to your loan documents. How good is their bank’s wire room? Do they get instantaneous notifications of arrival of funds? Things sometimes move fast at closings. Access to funds and documentation can mean the difference between closing and not closing. It can cost your money! Again, it’s all about Value!
  • Experience – The Title Company should able to comply with the terms and conditions of your contract, strive to be as confidential as possible, answer your questions, and clear up any title problems which may arise. Management experience and Professionalism, as well as knowledge, friendliness and efficiency are critical. Ask lots of questions about their previous experience. Do they have a good working relationship with lenders and understand loan documents? Do they have experience in handling possible title problems? Choosing the company to handle your sale can mean the difference between a smooth rapid closing or a complicated, delayed closing, fraught with anguish and extra cost. Again, this is part of Value.
  • Underwriters – A great indication of the quality of your Title Company is the identity of their Underwriters. The five major national title insurance companies are LandAmerica Financial Group (Commonwealth Land Title & Lawyers Title), Old Republic Title Company, Fidelity National Financial Inc., First American Corporation, and Stewart Title Guaranty Company. These underwriters comprise the vast majority of all transactions in the United States. The top Title Companies and Agents have the top underwriters, simple as that.
  • The Final Decision – Your choice of escrow or closing agent may be one of the most important decisions you make to arrive at your final goal of a timely real estate sale or purchase. Although price is a major factor in choosing a title company, good service, reputation, access to technology and the ability to pay claims should also be considered. You will want to try to select the most reputable and professional escrow or closing agent you can find, combined with the one who also charges the most reasonable fees. In the end, It’s about Value.

Quail Valley Water District Encourages Water Conservation

The Quail Valley Municipal Utility District encourages its customers to voluntarily conserve water due to the current drought situation. Residents are being asked to limit water usage, including watering lawns, to the following days:

Odd street number address: Use water on Monday & Thursday

Even street number address: Use water on Tuesday & Friday

If you have questions, call the Quail Valley Utility District at 281-499-5539.

Helpful Home Buying Tips from a Realtor®

Buying a home should be fun, not stressful. As you look for your dream home, keep in mind these tips for making the process as easy going as possible.

1. Find a real estate agent you can connect with. Home buying is not only a big financial commitment, but also an emotional one. It’s critical that the REALTOR® you chose is both highly skilled and a good fit with your personality. With the Susan Greer Team in Sugar Land, TX, you have a team you can count on.

2. Remember, there’s no “right” time to buy, just as there’s no perfect time to sell. If you find a home now, don’t try to second-guess interest rates or the housing market by waiting longer — you risk losing out on the home of your dreams. The housing market usually doesn’t change fast enough to make that much difference in price, and a good home won’t stay on the market long.

3. Don’t ask for too many opinions. It’s natural to want reassurance for such a big decision, but too many ideas from too many people will make it much harder to make a decision. Focus on the wants and needs of your immediate family — the people who will be living in the home.

4. Accept that no house is ever perfect. If it’s in the right location, the yard may be a bit smaller than you had hoped. The kitchen may be perfect, but the roof needs repair. Make a list of your top priorities and focus in on things that are most important to you. Let the minor ones go.

5. Don’t try to be a killer negotiator. Negotiation is definitely a part of the real estate process, but trying to “win” by getting an extra-low price or by refusing to budge on your offer may cost you the home you love. Negotiation is give and take.

6. Don’t sweat the small stuff. Don’t get so caught up in the physical aspects of the house itself — room size, kitchen, etc. — that you forget about important issues as noise level, location to amenities, and other aspects that also have a big impact on your quality of life.

7. Plan ahead. Don’t wait until you’ve found a home and made an offer to get approved for a mortgage, investigate home insurance, and consider a schedule for moving. Presenting an offer contingent on a lot of unresolved issues will make your bid much less attractive to sellers.

8. Factor in maintenance and repair costs in your post-home buying budget. Even if you buy a new home, there will be costs. Don’t leave yourself short and let your home deteriorate.

9. Choose a home first because you love it; then think about appreciation. While U.S. homes have appreciated an average of 5.4 percent annually over from 1998 to 2002, a home’s most important role is to serve as a comfortable, safe place to live.

Houston Real Estate Market Update March 2011

Home prices continue to rise in the Houston market place according to the statistics from Houston Association of Realtors’ Chairman, Carlos Bujosa. Single family homes sales volume, however, fell 4.4% when compared to March 2010. Bujosa attributes this decline to the First Time Buyer Tax Credit of 2009 and 2010. Bujosa continues by saying that it is the trend in our marketplaces that show the true picture. Volume and price are on the rise.

Home Foreclosures in Houston See Dip In Postings

Perhaps we are seeing a light at the end of the tunnel or maybe it’s just a dip in postings but the number of new foreclosures in Houston’s Harris County has dipped in April. The Houston Chronicle reported in the Business Section on April 24th in an article written by Nancy Sarnoff that lenders posted 28% fewer foreclosures in April than last month. Foreclosure Information & Listing Service, according to the article reported 2,942 foreclosure postings for next month’s auction.

Amanda Cureux of the foreclosure firm believes that Harris County’s foreclosure market peaked in 2010 with 47652 foreclosure posting, the largest since 1987.  Cureaux supported her market prediction by stating three facts. First, the subprime lender foreclosures had mostly filtered through the system. Second, the local economy has improved. Third, underwriting guidelines are more strict than in subprime loan days.

The Houston Association of Realtors showed the number of sales in all of the Houston area to be increasing in February and March of 2011 compared to those two months last year. With an increasing demand and the beginnings of a decreasing supply, as Cumeaux suggests, Houston should begin to see an increase in price. This is great news for sellers. In the meantime, however, the present continues to be a great time to buy. The real estate market is looking up!