Tag Archives: First Time Home Buyer

real estate faq

Common Mistakes Home Buyers Make

Common Mistakes Buyers Make When Purchasing A Home

To understand the home buying process and the current market you are currently shopping in is crucial to successfully purchase a home. You should be vigilant and avoid these common mistakes so you don’t miss out the home of your dreams!
Not knowing your numbers before you look at a house:
You should always get preapproved before beginning your home search. A good lender will provide you with an estimate to give you a better sense of what you can afford. A $600,000 home sounds excellent, but what does that mean for a monthly mortgage payment? Does it line up with your budget? Do you know how much your closing costs will be? By knowing this information ahead of time, you can figure out what works and then work it backward. Knowing what you can afford in the beginning will make for a better negotiation and experience. If you don’t have a lender, your real estate agent will be able to recommend someone they personally use and trust.

Writing an offer based on someone else’s:
What does a great deal mean to you? Many home buyers assume that they can get the same deal that another friend or a family member received. More times than not they only have half the story, they are in a different market or their financial situation is very different from yours. Work with your agent and write the deal that will get you into your perfect home.

Waiting too long to write an offer based on what others think:
Buying a home will be one of the biggest financial decision of your life and having people close to you to help with the decision making can be helpful or it can hurt. I’ve seen both. Be sure to sit down with your agent and discuss your specific needs and goals when it comes to a new home. Also, beware of bringing family and friends to showings. The homes you see should match the conversations that you have had with your agent. Everyone has an opinion and the very things you love in a home will probably not be the same for your friends and family. Do not let that discourage you from pursuing a home.
These are just to name a few mistakes home buyers can make when buying a home.
Want to see what a good buyers agent can do for you?  Check out this video!
Call us today and let us help you avoid some of the common mistakes buyers make when purchasing a home.
real estate faq

What if my home appraisal price comes in lower than my offer price?

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What if my home appraisal price comes in lower than my offer price?

In this video, Jordan Bennett talks about what happens when your home appraisal price is lower than the price you offered to pay for your home.

If you have a question about real estate, buying, selling or investing, please email me at info@jordanbennettonline.com and we will answer it in our next video.

real estate faq

Are online mortgage calculators misleading?

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Are online mortgage calculators misleading?

In this video, Jordan Bennett talks about if all those mortgage calculators that you see online are accurate or misleading and why.

If you have a question about real estate, buying, selling or investing, please email me at info@jordanbennettonline.com and we will answer it in our next video.

real estate faq

New Construction vs. Resale Homes – Real Estate FAQ

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New Construction vs. Resale Homes

In this video, Jordan Bennett talks about the pros and cons of purchasing new construction vs. a resale (previously built) home and vice versa.

If you have a question about real estate, buying, selling or investing, please email me at info@jordanbennettonline.com and we will answer it in our next video.

real estate faq

Should I get a home inspection? – Real Estate FAQ

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Should I get a home inspection when purchasing a new home?

In this video, Jordan Bennett talks if and why you should get a home inspection when purchasing a new home

If you have a question about real estate, buying, selling or investing, please email us at info@jordanbennettonline.com and we will answer it in our next video.

Orange County Housing Report June 7th, 2017

Orange County Housing Report: Time to Sharpen Your Pencil

To be successful during the Summer Market, it all boils down to price.

 

Achieving the Objective in Selling: Many sellers are pushing the envelope in terms of price and are risking not finding success and wasting valuable market time.

The transition from the Spring Market to the Summer Market is underway. Seemingly, everybody has become accustomed to multiple offers within days of placing the FOR SALE sign in the yard. With so many offers to purchase a home, a bidding war often arises. Reports of record prices swirl around neighborhoods. Many homeowners are tempted to join the fray.

Yet, the market has already started to shift. There aren’t as many multiple offers. Sellers who have stretched their asking prices above the most recent comparable pending and closed sales are sitting on the market without success.  Can the shift between the Spring and Summer Markets really be that significant? The answer is a resounding YES.
It is not like the market suddenly transitioned into a buyer’s market. It’s more about supply and demand and carefully pricing a home. Housing is drifting away from a hot seller’s market and moving towards a slight seller’s market. The supply of homes on the market has been on the rise throughout the Spring Market. It has increased by nearly 1,300 homes since the end of February, a 29% rise.

Orange County Housing Report

 

The inventory will continue to grow until it peaks around mid-August. More homes will come on the market at a similar pace to the spring, yet many unsuccessful homeowners will accumulate on the active listing inventory. The inventory swells due to this accumulation of unsuccessful sellers. This occurs in every price range, not just the luxury end. In fact, during the Summer Market of 2016, homes between $500,000 and $750,000 had the largest increase compared to any other price range, growing by 18%. The second largest, a 13% increase occurred for homes priced between $750,000 and $1 million.

Demand, the number of homes placed into escrow within the prior month, rocketed upward since the beginning of the year and continued to rise until it reached a peak for 2017 at the beginning of May. During the Spring Market, it increased from 2,651 at the end of February until the May peak of 3,012 pending sales, a rise of 361, or 14%. Since reaching the peak, demand has actually dropped by 4% and sits at 2,904 homes today.

Due to all of the distractions of summer, demand slowly drops. It’s still the second hottest season of the year behind spring, but the shift can be felt within the real estate trenches. The housing market is simply not as robust. It is no longer at a fever pitch that produces instantaneous throngs of potential buyers the moment a home comes on the market.

Orange County Housing Report

The bottom line: as the supply of homes increases throughout the summer months, it is met with slowly dissipating demand. As the supply increases and demand decreases, price becomes a lot more important in order for sellers to find success. Push the envelope on pricing and homes will sit. Buyers know that home values have been on the rise for years now, but that does not mean they want to stretch much above the most recent comparable closed sale.

Right now is the time of the year when sellers really need to have a reality check, or they risk not achieving their objective in selling their homes. Are they pushing the envelope by stretching the asking price too far above comparable sales? Or, are they priced realistically, close to their home’s Fair Market Value? In order to zero in on the Fair Market Value, it is imperative that a home is compared to the most recent pending and closed sales. Comparing prices is extremely important, but so is the condition, upgrades, location, lot size, and all of the other nuances that go into making a home more or less desirable.

For sellers who are overpriced, the longer they wait to correct their price, valuable market time will have transpired. Since demand slowly drops through the summer months, the deeper a seller gets into the Summer Market, the harder it will be to find success. The reason for the drop, buyers with families typically want to move by the end of summer prior to the kids going back to school at the end of August. In order to close a sale by then, the window of opportunity to place a home into escrow is now through the first few weeks of July.

The moral of the story: it is time for sellers to sharpen their pencils and properly price their homes in order to achieve their objective in selling.

Active Inventory: The active inventory increased by 2% in the past couple of weeks.

The active listing inventory added an additional 134 homes in the past two weeks, a 2% increase, and now sits at 5,757. We can expect the inventory to continue to rise throughout the Summer Market until it reaches a peak somewhere around mid-August. From there, the market will transition into the Autumn Market, from mid-August through Thanksgiving, with fewer homes coming on the market with both the spring and summer in the rear view mirror.

Within the last month, 8% fewer homes came on the market compared to last year. As a result, the active inventory has been off compared to last year. Last year at this time, there were 6,603 homes on the market, 15% more than today.

Demand:  The demand dropped by 10 pending sales in the past couple of weeks.

The number of homes placed into escrow within the prior month dropped by 10 pending sales in the past two weeks and now totals 2,904. Demand is off the most in the entry-level market, homes priced below $500,000. With 23% fewer homes that have been placed on the market so far this year below $500,000, demand is now off by 22%. This market has been underperforming all year due to a real lack of inventory.

We can expect demand to continue to drop slightly from now through the end of the Summer Market.

Last year at this time, there were 118 more pending sales totaling 3,022, or 4% more. The expected market time increased from 58 to 59 days in the past couple of weeks. Last year it was at 66 days.

Luxury EndLuxury demand dropped by 5% in the past couple of weeks while the inventory grew by 1%.

In the past two weeks, demand for homes above $1.25 million decreased from 369 to 351 pending sales, a 5% drop. Since the start of May, luxury demand has dropped by 15%. The luxury home inventory increased from 1,965 homes to 1,981, up 1%.  Similar to the rest of the market, demand is dropping for luxury homes while the luxury inventory continues to grow. There is already plenty of seller competition in the upper ranges.

For homes priced between $1.25 million and $1.5 million, the expected market time increased from 90 to 108 days. For homes priced between $1.5 million to $2 million, the expected market time decreased from 162 to 144 days. In addition, for homes priced above $2 million, the expected market time increased from 235 days to 256 days. At 256 days, a seller would be looking at placing their home into escrow around mid-February of next year.

Orange County Housing Report

 

Orange County Housing Market Summary:

  • The active listing inventory increased by 134 homes, or 2%, in the past couple of weeks, and now totals 5,757. Last year, there were 6,603 homes on the market, 846 more than today.
  • There are 35% fewer homes on the market below $500,000 today compared to last year at this time and demand is down by 22%. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is slowly disappearing.
  • Demand, the number of pending sales over the prior month, dropped by 10 pending sales in the past couple of weeks and now totals 2,904. The average pending price is $842,204.
  • The average list price for all of Orange County remained at $1.6 million. This number is high due to the mix of homes in the luxury ranges that sit on the market and do not move as quickly as the lower end.
  • The homes priced below $750,000, the market is HOT with an expected market time of just 38 days. This range represents 38% of the active inventory and 60% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 54 days, a hot seller’s market (less than 60 days). This range represents 18% of the active inventory and 21% of demand.
  • Homes priced between $1 million to $1.25 million, the expected market time is at 71 days, a seller’s market.
  • Luxury homes priced between $1.25 million and $1.5 million, the expected market time increased from 90 to 108 days. For homes priced between $1.5 million to $2 million, the expected market time decreased from 162 to 144 days. For luxury homes priced above $2 million, the expected market time increased from 235 to 256 days.
  • The luxury end, all homes above $1.25 million, accounts for 35% of the inventory and only 12% of demand.
  • The expected market time for all homes in Orange County increased from 58 days to 59 in the past couple of weeks, a solid seller’s market (less than 60 days), but about to transition into a normal seller’s market (60 to 90 days). From here, we can expect the market time to slowly rise throughout the Summer Market, moving from a seller’s market to a slight seller’s market.
  • Distressed homes, both short sales and foreclosures combined, make up only 1.3% of all listings and 1.9% of demand. There are only 32 foreclosures and 44 short sales available to purchase today in all of Orange County, that’s 76 total distressed homes on the active market, 8 more than two weeks ago. Last year there were 148 total distressed sales, 95% more than today.
  • There were 3,143 closed sales in May, an 18% increase over April 2017 and a 4% increase over May 2016. The sales to list price ratio was 97.8% for all of Orange County. Foreclosures accounted for just 1.1% of all closed sales and short sales accounted for 1.7%. That means that nearly 97.2% of all sales were good old fashioned equity sellers.

 

 

Orange County Housing Report

 

 

Orange County Housing Report

 

 

Orange County Housing Report

 

 

Orange County Housing Report

 

 

Orange County Housing Report

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This Month in Real Estate – April 2017

This Month in Real Estate – April 2017

Check out the National Numbers for April, 2017

 

This Month in Real Estate – March 2017

This Month in Real Estate – March 2017

Check out the National Number for March, 2017

 

Orange County Housing Report February 28th, 2017

Orange County Housing Report: OC Housing is Sizzling

With a very limited inventory, the Orange County housing market is extremely hot and values are on the rise.

Find out more in this Orange County Housing Report for February 28th, 2017.

Hot Housing Market: Everything on the market below $1 million is selling like hotcakes, and below $750,000 is nothing short of nuts.

The current Orange County housing market is scorching hot and has not been this good since July 2013. Once again, buyers are tripping over themselves to purchase. Homes that hit the market Orange County Housing Reportare fetching multiple offers within the first couple of days. Some buyers are writing offers on homes unseen. Others are waiving the appraisal contingency (still mandatory if they are getting a loan; so, if the appraisal comes in low, the buyer will have to bring in more money in order to close). When a home is priced at or close to its Fair Market Value, the purchase price is often higher than the asking price.

We are back to the bidding war days. When 10 offers to purchase are generated, there is only one victor. Nine buyers walk away and have to continue the pursuit of their dream home. This market can be extremely frustrating for a buyer. After a couple of failed attempts, many buyers sharpen their pencils and are willing to stretch in price even if it means paying more than the most recent comparable pending or closed sale. That is the nature of a housing market with very little inventory and very high demand.

The expected market time (the amount of time it would take for a newly listed home today to be placed into escrow) for all of Orange County is now at 50 days. When the expected market time drops below 60 days, the market is considered a solid seller’s market with steady price appreciation. Last year, Orange County was only below the 60-day threshold for about eight weeks, from mid-March through mid-May and never dropped below 55 days. It appears as if 2017 is going to be much hotter than the last few years.

When the expected market time dips below 30 days, the market shifts to a sizzling hot seller’s market with rapid price appreciation. In the past decade, the overall housing market has never reached this level, but many price ranges have. That is the case today as well. Not all of Orange County is considered “hot;” however, condominiums and detached homes priced below $500,000 are sizzling. This range represents 15% of the active listing inventory and 29% of demand.

Orange County Housing Report

 

Condominiums priced between $500,000 and $750,000, and detached homes priced between $500,000 and $1 million, are considered “solid” seller’s markets with expected market times between 30 and 60 days. They represent 24% of the current active inventory and 36% of demand. Both condominiums and detached homes priced between $500,000 and $750,000 are knocking on the door of a sizzling hot seller’s market with expected market times just above the 30-day threshold. That price range is starting to feel very hot and could easily drop below 30-days in the coming weeks.

Condominiums priced between $750,000 and $1 million and detached homes priced between $1 million and $1.5 million are currently experiencing a slight seller’s market, between 60 and 90 days. They represent 18% of the active listing inventory and 12% of demand. A slight seller’s market is characterized by slow, methodical price appreciation.

The market does not lean in the seller’s favor for detached homes priced above $1.5 million and condominiums priced above $1 million. The higher the price, the slower the market. They represent 30% of the inventory and only 9% of demand.

Buyers and sellers alike need to understand the market that they are working with in order to approach it with proper expectations. A buyer looking to purchase a $650,000 home is going to encounter a much different market than a buyer looking to purchase a $2 million home. Similarly, a condominium seller at $450,000 is going to experience a much different market than a condominium seller at $800,000.

A warning for buyers: do not expect the market dynamics to change much in the coming months. Even when more homes come on the market during the spring, there will be an increase in buyer activity as well.

A warning for sellers: do not stretch the asking price much at all. Overpriced, overzealous list prices result in wasted market time and do not generate offers. Pricing at or close to the Fair Market Value is the wisest formula for success.

Active Inventory: Within the past couple of weeks, the active inventory only increased by 12 homes.

Since January 1st, the active inventory has only grown by 389 homes. Within the past couple of weeks, it remained almost the same, growing by only 12 homes, a 0% increase, and now sits at 4,460. Once again, nearly everything that is coming on the market at or close to its Fair Market Value is being placed into escrow almost immediately.

Part of the issue is that, so far this year, 8% fewer homes have come on the market compared to last year at this time. The combination of a limited supply of homes coming on the market and ferocious demand has created the current sizzling hot Orange County housing market. More and more homeowners will come onto the market this spring through mid-August.

Last year at this time, there were 5,271 homes on the market, 15% more. Two years ago, there were 973 more homes on the market, or 18% more.

 

Orange County Housing Report

 

Demand:  Demand is HOT, increasing by 10% in the past two weeks.

The only thing holding back current demand is the lack of supply of homes. There are simply not enough new sellers coming on the market. Even with very few choices right now, buyers are pouncing on everything new that hits the market that is reasonably priced and in decent condition.

Demand, the number of homes placed into escrow within the prior month, increased by 248 pending sales in the past couple of weeks, or 10%, and now totals 2,651. With an increase in demand and an inventory that remained the same, the expected market time dropped from 56 days to 50 days, a solid seller’s market.

Last year at this time, there were 2,584 total sales, 67 fewer than today, or 3% less.

Luxury EndThe luxury market is starting to heat up a bit.

Demand is up for Orange County’s luxury home market with 73 additional pending sales compared to last year at this time, 19% higher. The luxury inventory is up by only 3 homes, nearly identical. The overall expected market time for all homes priced above $1 million is 122 days compared to 144 days last year.

In the past two weeks, demand for homes above $1 million increased from 412 to 465 pending sales, a 13% rise, its highest level since the end of August. The luxury home inventory increased from 1,834 homes to 1,891, its highest level since the start of December 2016.  The expected market time decreased in the past couple of weeks from 134 to 122 days.

For homes priced between $1 million to $1.5 million, the expected market time in the past couple of weeks decreased from 80 days to 76 days. For homes priced between $1.5 million to $2 million, the expected market time decreased from 153 to 129 days. For homes priced above $2 million, the expected market time dropped from 252 days to 227 days. At 227 days, a seller would be looking at placing their home in escrow around mid-October.

Orange County Housing Report

 

Orange County Housing Market Summary:

  • The active listing inventory increased by 12 homes in the past couple of weeks, a 0% rise, and now totals 4,460. There are 8% fewer homes that have come on the market this year compared to 2016. The inventory should start to rise in March and peak in mid-August.
  • There are 44% fewer homes on the market below $500,000 compared to last year at this time and demand is down by 7%. Fewer and fewer homes and condominiums can now be found priced below $500,000. This price range is slowly vanishing.
  • Demand, the number of pending sales over the prior month, increased by 10% in the past couple of weeks, adding an additional 248 and now totals 2,651. Today’s demand is 3% higher than last year when it totaled 2,584. The average pending price is $835,152.
  • The average list price for all of Orange County is $1.6 million, identical to two weeks ago. This number is high due to the mix of homes in the luxury ranges that sit on the market.
  • For homes priced below $750,000, the market is HOT with an expected market time of just 34 days. This range represents 39% of the active inventory and 65% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 54 days, a seller’s market (less than 60 days). This range represents 19% of the active inventory and 18% of demand.
  • For luxury homes priced between $1 million to $1.5 million, the expected market time is at 76 days, dropping by 4 in the past couple of weeks. For homes priced between $1.5 million to $2 million, the expected market time decreased from 153 to 129 days. For luxury homes priced above $2 million, the expected market time decreased from 252 to 227 days.
  • The luxury end, all homes above $1 million, accounts for 42% of the inventory and only 17% of demand.
  • The expected market time for all homes in Orange County dropped in the past couple of weeks from 56 to 50, a solid seller’s market (less than 60 days).
  • Distressed homes, both short sales and foreclosures combined, make up only 1.9% of all listings and 3.2% of demand. There are only 18 foreclosures and 67 short sales available to purchase today in all of Orange County, that’s 85 total distressed homes on the active market, 18 fewer than two weeks ago, a drop of 17% and its lowest level since the start of the Great Recession 10 years ago. Last year there were 152 total distressed sales, 79% more.
  • There were 1,905 closed sales in January, a 33% drop from December, but more than the 1,859 closed sales posted in January 2016. The sales to list price ratio was 97.3% for all of Orange County. Foreclosures accounted for just 0.9% of all closed sales and short sales accounted for 2.3%. That means that 96.8% of all sales were good ol’ fashioned equity sellers.

 

Orange County Housing Report

 

 

Orange County Housing Report

 

 

Orange County Housing Report

 

 

Orange County Housing Report

 

 

 

Orange County Housing Report