The Accunet Mortgage Show (9/29/19 Episode)

This week, Brian Wickert and Jerry Serketich discuss recent trends in the SE Wisconsin and national housing markets, and how they impact you.

The Accunet Mortgage and Realty Show, February 10th, 2019

This week on the Accunet Radio Show:

Brian Wickert and Jerry Serketich discuss millennial homebuyers, why now is a great time to buy or refinance your home, and the implications of the most recent rate cuts.

This week’s highlights

  • Instead of paying off your entire balance at once (if you have the means), consider taking a 15-year fixed-rate loan. This allows you to pay off your mortgage aggressively while investing the extra cash.
  • Freddie Mac is predicting a 3.4% rate for the coming year.
  • There’s record equity in people’s homes, but we’re not tapping it (yet) the way we did in the last boom. Remodeling your home is a great idea in anticipation.

Recent rate cuts, and what they mean for you

The recent rate cuts by the Federal Reserve have been a hot topic of discussion recently. But do these cuts mean that all interest rates have gone down? Well, not exactly.
The Fed can only cut two rates:
Rate #1: The interest rate the Fed charges banks for borrowing directly from the Fed
Rate #2: The interest rate charged for keeping money overnight
These rates impact others as a kind of waterfall effect, so it’s no surprise that the cuts were widely-reported. Most notably, the prime rate changed. This rate does impact consumer loans, and is the one most closely associated with the housing market.

What are millennial homebuyers looking for? 

We hear a lot about how millennials aren’t buying homes, but it’s a total misconception. Millennials are buying homes in droves; they account for 40% of all new home loans!
Recently, there was an article called “7 home upgrades that will attract first-time home buyers.” It touches on a few things to spruce up a pre-sale home specifically to attract millenials. Let’s take a look:

  1. Smart home technology: This includes thermostats, alarm systems, even light fixtures. The smarter, the better.
  2. Spaces for gathering and entertainment: As millennials grow up, we’ve also heard spaces devoted to gaming are increasing in popularity.
  3. USB chargers: So simple and inexpensive, but meaningful. A lot of USB plugs are now included in outlets, which could be a signal of a modern or updated home.
  4. Home offices: A lot of millennials work remotely, so having a home office can be a huge attractor. So, if you have a 3 or 4-bedroom home, converting or decorating one as a home office could potentially increase the likelihood of a millennial buyer.
  5. Energy-saving appliances: You can get just about any appliance in an energy-efficient model, including refrigerators, ovens, and even clothes dryers (one of the biggest energy eaters).
  6. Neutral colors: This is tried and true. Practically everyone prefers a home with neutral colors, at least when they’re buying.
  7. Garage technology: This extends beyond just opening your garage with your phone — it might even include a space to charge an electric car.

Update: SE Wisconsin housing market

Following recent trends, SE Wisconsin is definitely not a buyer’s market. In fact, Paul Langlois (a top real estate agent in Shorewood) recently reported 6 competing offers for a home priced in the $400,000 range. Competition in higher-priced homes is a sign of a rough market for buyers, which we’re definitely seeing the effects of.

Condo market update

Right now, condo sales are down 6.9%, with listings being down 4.5%. Condo sales are always tricky, especially when working with a Fannie Mae loan, which has pretty strict stipulations for condos they’ll lend on. In their eyes, condos need to be vetted just as much as the borrower does. Their verification process takes multiple factors into consideration, including:

  • The condo’s project type (as defined by their Fannie Mae condo project requirements)
  • How far along the condo is in the development process
  • How many other units have been purchased
  • The condo’s location

For more details on buying a condo, and specifically buying a condo with a Fannie Mae loan, reach out to one of our licensed loan consultants. Navigating Fannie Mae’s regulations can get tricky — Accunet makes it easy.[elementor-template id=”10109″]

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