Mortgage Rates and Housing Prices Expected to Rise in 2014

Mortgage Rates RiseEven though 30-year fixed rates dropped in the first half of January, many analysts expect fixed mortgage rates to go up somewhat in 2014, but to top out at around 5%. What this means for buyers is that while higher than 2013’s historic lows, the rates will remain favorable and predictable for homebuyers.

What is less predictable is the potential rise in home prices. In fact, a Fannie Mae survey shows that more than 90% of the nation’s consumers believe that home prices are likely to rise and that potential buyers should start looking sooner rather than later. Nationwide, home values rose as much as 10 to 20% last year and many consumers expect at least another 3 percent rise in the coming months. One factor driving home prices up is the lack of available inventory. Many homeowners have placed their homes on the market, but according to the Fannie Mae survey, at least 33 % are under the impression that this climate is great for placing their homes on the market. If inventory rises, prices may remain stable for awhile, giving buyers the opportunity to solidify their financial situation, set a budget, gather their down payment, double check their credit report and get preapproval for a loan.

Another potential driver of home prices is the cost of materials for new homes and remodels. The aftermath of disasters such as Superstorm Sandy and various wild fires has pushed the price of lumber up more than 5 percent overall last year. Labor cost increases due to changes in many state minimum wage laws and immigration rules, as well as rising insurance costs affect materials costs too. For sellers, this means placing your home on the market now has to potential to get it sold faster, and at a moderate price increase. As interest rates go up, however, prices will correspondingly come down to adjust to buyers’ debt-to-income ratio. To set the appropriate price on your home, work closely with your professional real estate agent.

Your neighborhood comparables and the “mood” of the housing market in your area, along with the input from your agent will help you determine the best price for your situation. Remember, the mood of the market includes more than the national reports tell you. Your market is made up of a combination of the local jobs report, home inventory, interest rates, local school popularity, which neighborhoods or home styles are trending, and the community’s perceived desirability of your address. Your professional agent stays abreast of this information and works with your to set the right price for your home.

Getting the consumer to act on your website!

Virtual Results is happy to present a new blog series of Tips and Techniques for your WordPress Real Estate Site. This post comes from one of our newer members Colleen Kulikowski, who is a successful Realtor and real estate blogger in Buffalo, NY. Colleen has years of experience blogging on her real estate sites and has been successful at getting many buyers and sellers from those efforts. For ongoing discussion and additional insights, Virtual Results members should access our private Real Estate Facebook group. Apply for group membership by emailing support@virtualresults.net with your facebook email address.

Improving your Conversion

On your website, there needs to be a variety of  Calls to Action to get home buyers, sellers and investors to call, click, or self-identify or just to look at properties.   There are several types of Calls to Action you can have on your site.  Big or small, they play a huge part of the conversion on your website from viewer to prospect to client.  However, as client interaction isn’t an exact science, you may need to experiment until you get it just right. Here are a few of the most popular types of Calls To Action

Text

The simplest way to call the reader to action is via the text you use.  These calls to action are simple.   They are a sentence in your text asking the reader to call you for more information.  For example:  Call “Your Name” for more information at (xxx) xxx-xxxx.

Links

Links can be considered Calls to Action, as they entice the reader to click to do something.   Much like we discussed in our how to make your posts sticky, these links direct consumers to read more.   Keeping them on your website longer and creating the raving fans you desire!

Buttons/Graphics

Your Virtual Results site has many buttons or graphics that call the reader to action.  Buttons have a higher conversion rate than text or links if they are done right (bright colors, attention grabbing phrases, etc).   They do not have to be sexy, they just have to provide a compelling reason for the consumer to click on them.

Besides the buttons on your website, you might like to try a call to action on a page directed at home sellers like this:

calltoactionIt is simple, direct and when I use it, site visitors click on it to get more information about selling their home.  I even get phone calls as a result.   One important thing to remember when creating Calls to Action: Expectation is Everything. Make sure your call to action links to a page that contains the content they expected to see based on the wording of the Call to Action.

Can there be too much on a page?

Like most things in life, there can be too much of a good thing.  Consumers can be overloaded with too many choices.  You will want to make sure you utilize your Calls to Action strategically.   A busy page will have a negative effect on the consumer.   Consumers are more comfortable making a decisions with limited choices. It doesn’t hurt if you experiment with a Call to Action on your website.   Like all things with your site,  you will discover what works through trial and error. You may need more try different styles, phrases and locations before you find the one that works for your site.

This post comes from one of our members Colleen Kulikowski, who is a successful Realtor and real estate blogger in Buffalo, NY. Colleen has years of experience blogging on her real estate sites and has been successful at getting many buyers and sellers from those efforts. For ongoing discussion and additional insights, Virtual Results members should access our private Real Estate Facebook group.   Apply for group membership by emailing support@virtualresults.net with your facebook email address.

 

 

Will a Bath Remodel Increase My Home’s Value?

Bathroom RemodelSpring is just around the corner and the lure of a new home has you thinking about putting yours on the market. Your neighbor added a new bathroom last year and you’re wondering if you should upgrade yours before you sell. Logically, a new bathroom should increase the value of your home, right?

From 2006 through 2012, the return on a bathroom remodel investment averaged around 62%, according to the cost vs. value report prepared by Remodeling magazine while a bathroom addition garnered only 51%. Beginning in 2013, however, those numbers began trending up, so a bathroom remodel in 2014 is hovering near 72% and an addition is at 60% ROI. Even so, you will be spending more money than you can expect in return. That being said, there are great reasons to go ahead with a remodel, and your professional real estate agent can help you decide if it is a good investment for you.

One reason is that if several similar homes are on the market in your neighborhood, an upgraded bath may help yours sell more quickly. After all, when comparing side by side, who doesn’t want a clean, fresh bath? Busy buyers looking to move in quickly won’t want to do the upgrade themselves. Another reason to consider updating your bath is to attract a different type of buyer. Flippers, investors and DIY-homeowners will want the bones of the house to be in great shape, but will probably offer a lower price because they plan to make upgrades and changes themselves. Qualified buyers that want move-in ready conditions will appreciate not having to worry about upgrading, remodeling or renovating.

If you and your professional real estate agent determine that a bath upgrade will improve your sale, be sure to do it right. Do not attempt a DIY project you’ve never done before just to save a few bucks. Poorly installed flooring may cost you a sale. Remember, some changes do have more appeal than others. For instance, if you only have one bath, consider putting in a double sink. Couples, families and even roommates appreciate multiple sinks when trying to get out the door in the morning. Even a small bath can accommodate a double sink with the right choice. A new eco-friendly toilet is a nice touch too. Simple changes and give your bath a fresh look without a lot of expense. Consider fresh paint, a new rain-style showerhead, new classy but neutral shower curtain, updated faucets, or a new toilet. Don’t skimp on lighting. According to Alicia Garceau at HGTV, a bathroom remodel should include task lighting for applying makeup or shaving, ambient lighting—that bounces off walls—to soften shadows, accent lighting to give depth and dimension, and decorative lighting to add luxury or play up an architectural feature.

Contact us and we’ll help you determine your home’s value and how to prepare it to sell.

Design Trends in New Homes

Pubsub New ConstructionWhen the housing market rebounded, so did home builders eager to show off their design skills. Buyers expect that newly constructed homes will be safer and more energy efficient, but they’re also looking for homes that meet the needs of the more modern buyer. Here’s a round-up of some of the most popular design trends seen in today’s newest homes.

Kitchen islands look more like continents.
Maybe it’s the Food Network’s influence or maybe builders have finally realized that people ALWAYS end up hanging out in the kitchen. Either way, kitchens are now being designed to accommodate the crowds they always seem to attract. Kitchen islands with plenty of seating allow people to sit and watch the home chef in action, and they let the host and hostess interact while feeding family and friends. With lots of incorporated storage and attention to design details, the extra-large kitchen island is becoming the focal point and showpiece of the modern kitchen.

Foyers that earn their keep.
Home buyers don’t want to walk in the front door and straight into a living room setting. So foyers that give a sense of entry are making a strong comeback in modern construction. But today’s foyers aren’t just a short hallway. Builders are adding built-in benches, alcoves, book nooks or high-end places to hang your things up as you enter.

Extended uses for extended families.
As the Baby Boomers age, the number of multi-generational households continues to rise. Buyers are requesting more homes with two master suites – often with one upstairs and one downstairs, which better suites elderly parents living in the home. Also, small “shadow” homes are being built alongside the main house to give aging parents a more independent living situation that’s still only steps away the family.

Productivity in pocket offices.
While the popularity of a large, formal home office may have faded over time, people still want hard-working spaces where they can do the work required to run a household. These small “pocket offices” are being located off of high-traffic areas like the kitchen and great room, where parents can still be in the middle of the action but have a separate, dedicated space for paying bills, signing papers and checking email.

Connection is key.
When people started saying “There’s an app for that,” it was only a matter of time before that app frenzy worked its way into new homes. With everything from smart thermostats to smart garage door openers, home buyers want more control over their environments by using the one thing we hardly ever leave home without – the smartphone. Soon there won’t be any more worries over whether or not you left the door unlocked or the garage door open because a touch of a button on your smartphone screen will assure you that all is well. Look for complete home automation systems to take a big step forward in newly constructed homes.

Sneaky storage spaces.
Square footage has to work harder in today’s home and every inch counts. Builders are sneaking those highly-coveted storage spaces into places that were once overlooked. Cabinets under staircases, drawers inside stair risers and storage space under window seats are all creative uses of space that would otherwise be wasted.

Look for design trends like these to meet the demands of today’s bigger, busier, more well-connected family.

Pinterest for Home Buyers and Sellers

Pinterest LogoPinterest for Home Buyers

Some people are great at articulating exactly what they want in their next home. But some of us know what we want yet find it tough to explain that vision to someone else. It usually comes out something like this: “I’ll know it when I see it.” But seeing tons of listings can be frustrating and can waste your time unnecessarily. Enter Pinterest – the social network that lets you collect all those dream house mental pictures that are often hard to put into words.

Pinterest has become a favorite online hang-out for home buyers and those who plan to build or remodel a home. After all, knowing what you want is half the battle in finding or creating it. With a few simple searches, Pinterest users are exposed to thousands of photos they can use as inspiration in their house hunt. High-end and creative home features are one of the most heavily populated areas of Pinterest so there’s no shortage of ideas to sift through. Some users have created virtual “pin boards” for each room of their dream house and yard, making it easier to organize ideas and find them later. Do a simple search for “bathroom” in the search bar and you’ll find everything from rustic cabin outhouses to over-the-top luxury master suites.

If you’re having a tough time explaining your vision to your agent, consider sharing your Pinterest photos with him or her. Seeing what you like best can guide your agent’s selections for which listings are most likely to interest you. Of course, no one can make every Pinterest dream come true in one house, but it’s a good way to get on the same page and narrow down the choices of which houses to see and which ones to skip. Pinterest photos can also guide your decisions when looking for a house with “good bones” that can be remodeled into your dream house.

Pinterest for Home Sellers

For sellers, Pinterest can be a great way to get insight on what potential buyers are hoping to find during their house hunt. If the same type of living room photo keeps cropping up on Pinterest, you can bet it’s representative of a style that’s trending right now. Consider using that photo as a guide for how you might update, rearrange or stage your own living room to reflect the current trend. Pay special attention to wall colors, room layout, window treatments and floor coverings. Appeal to visual thinkers by making your home’s online photos as “pin-worthy” as possible.

Cleaning and organization are also huge areas of interest for Pinterest users, and the tips found in these “pins” can help as you prepare to put your house on the market. Clutter and half-hearted cleaning attempts can thwart a deal with potential buyers. Use the tips collected on hundreds of Pinterest boards to find new ideas for eliminating cluttered areas. You’ll also find innovative ways for simple household fixes like repairing nail holes, cleaning baseboards and dusting window blinds – all things that discerning home buyers will notice.

Whether you’re buying, selling, building, remodeling or just plain “nesting,” Pinterest might become your favorite online tool for finding inspiration, advice and friends who share your vision.

Tips for Home Buyers

Tips for Home BuyersFinding a new home can be one of the most exciting times of your life. It’s a little like dating – the pursuit, the “getting to know you” period, the proposal (aka “offer”), and the marriage (aka “closing”). If you don’t want your relationship with a new house to crash and burn, you need to know a few things before you fall in love.

 1. Know thy numbers.

You’d be surprised at how many home buyers start their new home pursuit without really knowing what they can and can’t afford. Avoid being disappointed later by getting preapproved for a mortgage before you even get started. And be sure you know the difference between being “prequalified” and “preapproved.” You can be preapproved only after a lender has reviewed all your financial information and has told you how much the bank is willing to lend to you. Being pre-approved will let sellers know you’re a serious buyer, and it will also prevent you from falling in love with a home that is financially “out of your league.”

2. Love the neighborhood, not just the house.

It’s easy to get caught up in how perfect a house is and forget that the house is only part of a bigger picture. It won’t matter how awesome the master bathroom is if you discover that the neighborhood just isn’t a good fit for you. Spend as much time researching the neighborhood as you do checking into all the nooks and crannies of the house. Regardless of whether or not you have kids, ask questions about the neighborhood’s school district since that will impact the home’s resale value. And be sure to drive through the neighborhood at various times of day to make sure you’re not missing any “deal breaker” factors.

3. Beware the lure of the lowball offer.

Even though buying a home is a financial decision that involves legal contracts, that doesn’t mean it’s devoid of emotion. If you’re tempted to make a lowball offer on a home just to see what happens, be aware that some sellers will be so offended that they won’t entertain future offers from you. It may be a business deal, but this is still their home – and that’s personal. Make an offer based on the selling price of other homes in the same neighborhood and then determine what the average price per square foot is for that area. Also, make your offer number an odd number instead of a round one. For example, an offer of $352,500 sounds like you put some thought into it based on real calculations, whereas an offer of $350,000 sounds more like a shot in the dark.

4. Get a home inspector’s “blessing.”

Some churches require engaged couples to go through a few premarital counseling sessions before they can be married in the church. Similarly, you’d be wise to seek the counsel of a qualified home inspector before you make things official with a new home. If the house has hidden baggage, a good home inspector will find it, which gives you the opportunity to decide if it’s something you’re willing to deal with or not.

By following a few simple guidelines and leading with your head instead of your heart, your destiny with a new home is much more likely to end with “happily ever after.”