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6 Things to Expect this Spring: Heads Up for Homeowners and Home Buyers

     
March 30, 2014  |  Real Estate

Spring is the start of the busy homebuying season. Although the U.S. economy started the year off on a slightly rocky note, these unsteady and unpredictable economic conditions might even benefit homebuyers with mortgage rates that went low as early as the first week of March. But just as the economy seems to be heading downhill, positive figures also sent mortgage rates higher. Regardless of this yo-yo effect interest-rate conditions are expected to remain favorable this spring season.

With the cold months behind us, it’s time the market gears for a fresh start! If you’re in the market for a home or a mortgage this spring, know these important trends and how you can maneuver them to work for your advantage. Here are six homebuyer-savvy facts:

 

mortgage rates

 

Mortgage rates will remain at a low

While mortgage rates are anticipated to go up the rest of 2014, they not only will remain at an all-time low by the time the year ends, but will be much lower compared to during the spring homebuying season. The idea here is quite simple: When the economy falters, mortgage rates ease off. When the economy improves say, more jobs and higher gross in domestic products – mortgage rates will firm. HSH.com Vice President Keith Gumbinger predicted that a 30-year fixed rate mortgage will have between 4.375 percent and 5.625 percent in 2014.

 

Inventory

Limited inventory

What is expected to be a challenge for homebuyers in the coming months is housing inventory, which has always plagued home seekers from getting the home they want. The over-all good home prices in 2013 and the potential of moderate prices this year will actually allow some homeowners to list their properties for grabs on the market. This will encourage more sellers to put their homes up for sale. However, many are predicting the gains to remain rather slim to match those of 2013.

With higher home prices, there comes home equity. As equity returns, then so does the fear of selling your home at a loss subsides. Negative equity is said to continue to decline in 2014.

Here are two sides to the coin: Foreclosures will continue to improve this year but the reduction in distressed sales will affect the housing inventory this year. Not to be troubled however! New-home-sales are making an appearance with the construction of new homes that will be a big component in inventories and could be the saving grace for many local markets. These properties could relieve the shortage of available homes in many localities.

 

online home shopping

 

The growth of online home shopping

The National Association of Realtors reported that 90 percent of homebuyers turned to the Internet at some point during their homebuying process in 2013. Online shopping is not at all that difficult, just that each website displays information differently from the next site, and this goes to ALL kinds of shopping done on the web, including purchasing a home. Not every website is the same and as an online home shopper, you need to know where and how to get the information you need – those that are most important to you.

Are you looking for property listings that have data on school district, community information, numerous photos of the home for sale, as well as of the neighborhood? Is pricing comparison something you consider in your search? Similarly, does the average price in your preferred rate or even as simple as the walk score a buying factor for you? Choose a website that meets your needs as a home buyer.

 

You can check out these sites for comprehensive property listings in metro Denver:

www.findalldenverhomelistings.com

www.lisablake.com

 

mortgage loans

 

Options for securing loans

Federal Housing Administration mortgages, which are insured by the federal government, are good options for borrowers who are shaky in meeting the strict down payment and credit-score requirements of other loans.

Adjustable-rate mortgages are also an alternative to the 30-year fixed rate. They represent only a small or minimal portion of the mortgage market. According to the Mortgage Bankers Association, ARMs have only 8 percent of total applications in the first few months of this year.

 

paperworks

 

Yes, tons of paperwork requirements

This year is expected to be like its predecessors — “the year of documentation.” If you have already applied for a mortgage and have done some work on it the past years, then documentation requirements wouldn’t be a surprise. But if 2014 is your welcome year into the mortgage experience, then the paperwork could come as a big culture-shock of paperwork attack!

The new rule, which took effect in early January states that mortgage lenders are no longer allowed to lend money when they might overlook long-term financial goals for quick profits. Hence, it makes the collection of asset documentation more imperative than ever as lenders now strive to meet the requirements by conscientiously collecting, checking, and analyzing your paperwork to make sure that you qualify and can indeed pay for your mortgage.

So there goes complacency and in comes assiduousness in paperwork (I hear groans everywhere!)

 

refinancing

 

The shrink of refinancing

Steven March, branch manager of Inlanta Mortgage in Wis. shared his advice for rate-sensitive refinance clients, “go ahead and begin the underwriting process and then ask your lender to set aside your loan application until a date when mortgage rates are down.”

The economy remains unpredictable and frankly, unbalanced for mortgage rates. Homeowners who are planning to refinance in 2014 will have to “refinance on the dips” the mortgage rates tend to take in an otherwise upward trend this year. Think of the investment strategy: “buying on the dips.”

 

 

Source: Real Estate MSN

 

About the author

The Blake Team is a full-service Real Estate team based in Aurora, Colorado specializing in working with Buyers & Sellers, foreclosures/HUD, short sales, and luxury properties. A team with years of experience and an impressive success rate that made it the No.18 real estate brokerage in the nation, as well as the No.1 Keller Williams agent in Colorado led by CEO & Founder Lisa Blake. The Blake Team is your No. 1 choice for getting your dream home!