Still Cheaper to Buy Than Rent

03/24/2014 at 4:14 pm  •  Posted in Buying a Home, Dream Blue, Real Estate Advice, Real Estate News, Real Estate Trends, Tips by Blog Team  •  0 Comments

By Dick Greenwood, Director, Builder Marketing
Jed Kolko, chief Economist of Trulia released a research study the last week of February, 2014 which showed that in most of America it is cheaper to buy than rent. The study showed that in Chicago, it is 47% cheaper to buy than rent. The St. Louis market is 54% cheaper to buy than rent. And in Milwaukee, it is 51% cheaper to buy. Trulia research compared the costs of owning and renting, assuming buyers got a 4.5% mortgage rate on a 30-year fixed rate loan with 20% down, itemize their federal tax deductions and are in the 25% tax bracket and will stay in their home for seven years.
Under these assumptions, buying is 38% cheaper than renting nationwide, taking into account all the costs and proceeds from buying or renting over an entire seven year period. Buying a home remains cheaper than renting in all of the 100 largest metro areas. One might ask how is this possible with mortgage rates increasing? Two points: the mort-gage rates are still historically low and secondly, rents in most markets have risen sharply.
The rent vs. buy math differs across the United States since local markets have their own normal levels of prices and rent. Two very significant local variables are property taxes and home price appreciation. Considering all the variables, buying ranges from just 5% cheaper than renting in Honolulu to 66% cheaper than renting in Detroit. Buying is a tougher call in the most expensive markets in California and New York. However in most markets, buying beats renting until mortgage rates hit 10.6%, then renting becomes cheaper than buying.
I know some are thinking what if I don’t live in the home for at least seven years and I don’t itemize my tax deductions. In these cases, the gap between buy vs. rent gets small-er and smaller until it starts to tip toward renting. Most experts dismiss this by saying you should never look at the house as a short term investment (less than 5 years), housing is a long term investment.
One thing I like about the Trulia study is that they used a very conservative annual home price assumption that ranges between 1.7% and 3.1% depending on the metro. They did not take the 12% increase we saw in 2013. Jed Kolko said it best when he said “If the last bubble taught us anything, its that excessive optimism about future home prices can lead to foolish decisions and heartbreak.”

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Blog Team

Contributions to this blog come from our dedicated Coldwell Banker Residential Brokerage real estate professionals and our regional service center staff. We welcome your comments and questions!

Creative Ways to Get the Winning House Bid

08/05/2014 at 11:05 am  •  Posted in Buying a Home, Dream Blue, How To, Real Estate Advice, Tips by Blog Team  •  0 Comments

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In today’s real estate market, home buyers can expect to face multiple offer situations. Knowing a few tricks of the trade can make the difference between walking away disappointed and purchasing the home of your dreams at a fair price. Consider these tips that will grab a seller’s attention:

Show them the money.

Offer the highest price you can and make a large down payment. Up the amount of earnest money you’re willing to deposit. Better yet, a cash offer will stand out.

Get preapproved, not just prequalified.

Attach a copy of the preapproval letter to your offer. Make as large a down payment as you can and provide documentation showing the source of your down payment.

Be Flexible.

If you are aware of any stipulations that are of significant importance to the seller, try to accommodate them as much as possible, especially the closing date. They may need more time, or want to move quickly.

Write a love letter.

Sellers often like to feel good about the people who will eventually live in their home. Attach a letter along with your offer, and maybe even a photo of your family, explaining why you want to live there.

Cover seller costs.

Sellers often cover transfer taxes associated with the sale. Consider asking the seller to pay only a portion or none of the closing costs.

Make an offer they can’t refuse.

Still do a home inspection, and have a contingency that allows you to walk away.  But, if there are minor repairs needed, the sellers will know they won’t have additional costs to fix up the home before closing.

Be likeable.

Don’t turn off the seller by being demanding or critical of their home. Some sellers may eliminate your offer even if it is for more money. Always be cordial and as agreeable as the situation

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Blog Team

Contributions to this blog come from our dedicated Coldwell Banker Residential Brokerage real estate professionals and our regional service center staff. We welcome your comments and questions!

Coldwell Banker 2015 Real Estate Market Updates on YouTube

Check out 2015 current Coldwell Banker Real Estate Market Updates on Various Southeastern Wisconsin and Surrounding Areas by Clicking HERE

ColdwellBankerOnline.com Increases Online Traffic Over a Year

03/30/2012 at 9:20 am  •  Posted in Buying a Home, Dream Blue, Real Estate Advice, Real Estate Agent, Real Estate News, Technology, Tips, Uncategorized by Blog Team  •  0 Comments

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Last year, we made major updates to our local site, ColdwellBankerOnline.com.
We still make changes and upgrades on a regular basis, and the numbers continue to show that. Below are some highlights from February.

• Compared to February of last year, our visitors to ColdwellBankerOnline.com have increased dramatically.
• The driving factor behind this is that our organic (search engine optimized) traffic from Google has grown by over 100% year over year!
• Our mobile traffic continues to show huge growths year over year, and February was our largest month for mobile traffic yet (making up over 19% of our total traffic).

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Blog Team

Contributions to this blog come from our dedicated Coldwell Banker Residential Brokerage real estate professionals and our regional service center staff. We welcome your comments and questions!

 

Don't forget to visit my personal Coldwell Banker webpage by visiting www.jenniferhupke.com

Positive Signs in the Houseing Market

05/12/2014 at 11:10 am  •  Posted in Dream Blue, Listing Marketing, Luxury Homes, Real Estate Advice, Real Estate Agent, Real Estate News, Real Estate Trends, Uncategorized by Dick Greenwood  •  0 Comments

A headline saying “Housing Down for the Last 3 Months” conveys a negative thought and does not convey a true picture of the housing market. If the paper printed all the facts, the public would have a totally different perspective on the market. Here are a few facts that should be presented.
First, prices are still increasing, not at the same rate as 2013, but at a rate that almost all economists say is a healthier 4.3%. Volume may be down, but values are up.
Secondly, according to Realtor.com, the number of homes for sale and the amount of time they have typically been on the market have both increased. These are “welcome signs” for the spring buyers. The larger amount of inventory and slower selling times could make homes more affordable in some markets and reduce the frequency of bidding wars.
Third, the spring buying season in the Midwest and Northeast has been pushed back by the weather. Chicago for example had the third snowiest winter in history with many storms coming on the weekends. I know what you are thinking; weather would not deter a home buyer. I can positively say that it does. After 30 years in the new home market where we tracked daily traffic coming into the models, along with the weather, we know that even a little rain keeps people away.
Fourth, we now have job growth and household formations, both of which were on the back burner during the recession. Whenever we have job growth, population growth and growing household formations we have housing demand. Currently, the strongest housing markets are the same ones that have job growth. Chicagoland created 55,000 jobs last year—housing will follow this year.
Fifth, Doug Duncan, SVP and Chief Economist at Fannie Mae reported “compared to last year, consumers are less pessimistic about their personal finances, and more optimistic about the current selling environment and their ability to get a mortgage.” This positive consumer mindset will continue to drive the market.
Sixth, over the last six years, a common thought was that homeownership had lost some of its allure as a financial investment. The Federal Reserve did a study to see if this is true. Here is what they found. A homeowner’s net worth is over thirty times greater than that of a renter. The average homeowner has a net worth of $174,500 while the average net worth of a renter is $5,100.

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Dick Greenwood

Director, Builder Marketing at Coldwell Banker Residential Brokerage

Time for Some Fun in the Sun! July 2015 Summer Festivals in Wisconsin

Let the Festivities Begin!  Summer in Wisconsin is filled with festivals of all kinds, especially in July.  There is something for everyone!  Here is a list of local festivals for July 2015.  Have fun, be safe, and enjoy!

June 24-28/ June 30-July 5 Summerfest

200 N. Harbor Dr., Milwaukee

July 3 Downtown Milwaukee Fireworks

Milwaukee Lakefront

July 4 Wauwatosa’s 4^th of July Parade and Celebration

July 9-12 Bastille Days

Cathedral Square Park

July 10-11 Gathering on the Green

Rotary Park, Mequon

July 10-14 St. Mary Festival Hales Corners

9520 W. Forest Home Ave., Hales Corners

July 10-12 South Shore Frolics

2900 South Shore Dr., Bay View

July 11-12 Milwaukee IndyFest

Milwaukee Mile at State Fair Park

July 11 Mukwonago Croatian Day Picnic

Hwy 83 & Hwy NN, Mukwonago

July 11 City Lounge City Limits Fest

3455 E. Layton Ave., Cudahy

July 17-18 Waterford Hot Air Balloon Fest

4001 S. Whitnall Ave., Milwaukee

July 17-18 Festa Italiana

200 North Harbor Drive, Milwaukee

July 17-19 St. Rita Festival West Allis

60^th & Lincoln Ave., Mest Allis

July 18 Mamies Chicken Fry in July

3300 W. National Ave., Milwaukee

July 18 Port Fish Day

Lakefront Park, Port Washington

July 23-26 Falls Fest

Village Park, Menomonee Falls

July 24-26 South Milwaukee Lionsfest

Rawson & 16^th Ave., South Milwaukee

July 24-26 St. Elizabeth Ann Seton Funfest

12700 W. Howard Ave., New Berlin

July 24-26 St. John the Evangelist Festival

8500 W. Coldspring Rd., Greenfield

July 24-26 German Fest

200 North Harbor Drive, Milwaukee

July 24-25 Gallery Night and Day

Downtown Milwaukee

July 25 Brady Street Fesival

Farwell to Van Buren Streets

July 25-26 Milwaukee Air and Water Show

Bradford-McKinley Beach, Milwaukee

July 31- August 2 Sweet Apple-Wood Festival

3000 E. Ramsey Ave., Cudahy

Support Our Veterans Through the Honor Flight Network

On May 17, 2015 I was humbled and honored to be a part of the Stars and Strips Honor Flight welcoming at Mitchell International Airport in Milwaukee, Wisconsin.  My family and a close group of my friends created posters and decorations to help celebrate the arrival of our veterans on the Honor Flight.  Stars and Stripes Honor Flight Network is an organization that I highly respect and cherish because of how wonderful of an opportunity it gives to our veterans.

Being able to participate in providing a warm and loving welcome to our veterans when they step off of that plane is heart-warming.  It was enthusiastic and proud to see my son and nephew get creative and excited to to make posters and signs to hold up for the veterans.

 It's important for our children to learn about, respect, and support what our veterans have done for our country.  It was a fun-filled day with my friends and family and we were honored to support and  be able to help put a smile on the faces of our veterans.  There isn't a more rewarding or better way to spend a weekend night than that.


To learn more about and support the Stars and Stripes Honor Flight Network or to find an Honor Flight near you, visit: Stars and Stripes Website HERE