Over the next five years, home prices are expected to appreciate, on average, by 3.6% per year and to grow by 18.2% cumulatively, according to Pulsenomics’ most recent Home Price Expectation Survey.

So, what does this mean for homeowners and their equity position?
As an example, let’s assume a young couple purchased and closed on a $250,000 home this January. If we only look at the projected increase in the price of that home, how much equity will they earn over the next 5 years?

Since the experts predict that home prices will increase by 5.0% in 2018, the young homeowners will have gained $12,500 in equity in just one year.

Over a five-year period, their equity will increase by over $48,000! This figure does not even take into account their monthly principal mortgage payments. In many cases, home equity is one of the largest portions of a family’s overall net worth.

Bottom Line

Not only is homeownership something to be proud of, but it also offers you and your family the ability to build equity you can borrow against in the future. If you are ready and willing to buy, find out if you are able to today!

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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In many markets across the country, the number of buyers searching for their dream homes greatly outnumbers the number of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search.

Even if you are in a market that is not as competitive, understanding your budget will give you the confidence of knowing if your dream home is within your reach.

Freddie Mac lays out the advantages of pre-approval in the ‘My Home’ section of their website:

“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you with this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment and residential history.”

Freddie Mac describes the ‘4 Cs’ that help determine the amount you will be qualified to borrow

Capacity: Your current and future ability to make your payments
Capital or cash reserves: The money, savings, and investments you have that can be sold quickly for cash
Collateral: The home, or type of home, that you would like to purchase
Credit: Your history of paying bills and other debts on time
Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and it often helps speed up the process once your offer has been accepted.

Bottom Line

Many potential home buyers overestimate the down payment and credit scores needed to qualify for a mortgage today. If you are ready and willing to buy, you may be pleasantly surprised at your ability to do so.

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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The Northern Virginia Association of Realtors® reports on March 2018 home sales activity for Fairfax and Arlington counties, the cities of Alexandria, Fairfax and Falls Church and the towns of Vienna, Herndon and Clifton.

According to the Northern Virginia Association of Realtors, March 2018 continued the trend of tight supply of homes for sale, and stiff competition for the available homes. Buyers in the starter home market are particular impacted, because bidding wars often shut out buyers that have more modest means.

Year over year totals of home sold were off less than 1%. March 2018 saw a total of 1,768 homes sold, compared to 1,779 homes sold in March 2017.

Market uncertainty and rising interest rates may be causing some sellers to stay on the sidelines. Active listings decreased in March 2018 when compared with March 2017 — down about 21 percent below last year, with 2,891 active listings in March, compared with 3,667 homes available in March 2017.

Demonstrated continued strong demand, despite lack of available homes, the average days on market (DOM) for was 42 days in March 2018, compared to the 52 DOM for homes in March 2017. This is a a decrease of about 19 percent.

The average home sale price remains comparatively flat year over year.  March 2018 reflects average prices at $568,576, up by barely 1 percent compared to a year prior, with an average price of $565,964.

The median sold price was $514,500 for homes sold in March 2018, which is an increase of 3.31 percent compared to the median price of $498,000 in March 2017.

As expected when fewer homes are available on the market, pending home sales in Northern Virginia in March 2018 were 7.25 percent below March of last year. Total pending sales were off by 10.72 percent compared with the pending contracts in March 2017.

While the markets pose some challenges, for those who have been saving and preparing for a new home purchase can still find opportunities. As interest rates and prices are expected to continue to rise, waiting could cost you money in the long run.

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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It’s almost spring, and time to start thinking about your outdoor spaces. Many of you may be undertaking projects to extend your living space outdoors, and one popular option is the outdoor kitchen! The possibilities are endless and limited only by your budget.

There is much more to designing an outdoor kitchen than picking appliances and seating options. Depending on how elaborate your design, you may need to think about utilities (gas and electric), plumbing, fire safety, and lighting, as well as hardscapes such as brick or stonework, pergolas, and concrete work. The intrepid do-it-yourself-er may feel up to tackling all the various projects, but many homeowners will need to engage a contractor that specializes in outdoor kitchens.

Given the unpredictable weather in the Northern Virginia area, you may also want to consider ways to extend your seasons. With the expense of outdoor kitchens you want to be able to use them more than 4-5 months out of the year! Think about ways to heat the area in the fall, and provide shade and cooling in the summer.

Another consideration is your home’s resale value. Any major project such as this should enhance the value of your home, but not overprice it for your neighborhood.  We can help you determine what makes sense for your home and your Northern Virginia  or Greater DC neighborhood.

Houzz offers a ton of ideas to get your creativity flowing!

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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The Northern Virginia Association of Realtors® reports on February 2018 home sales activity for Fairfax and Arlington counties, the cities of Alexandria, Fairfax and Falls Church and the towns of Vienna, Herndon and Clifton.

According to the Northern Virginia Association of Realtors, February 2018 continued the trend of tight supply of homes for sale, and stiff competition for the available homes. As a matter of fact 1 in 8 home buyers are making cash offers, which can make it difficult for those using traditional financing to make a deal.

A total of 1,143 homes sold in February 2018, which represents a 4.11 percent decrease from February 2017 home sales of 1,192.

According to Ryan T. Conrad, NVAR CEO, “Northern Virginia continues to be a stable market for real estate. Although year-over-year numbers for February show a slowing of home sale activity in our local footprint, the numbers overall are positive when compared with a five-year February average.

Active listings decreased in February when compared with 2017. The number of new listings were down about 19% from last year, based on 2,396 active listings in February. By comparison, in February 2017, there were 2,973 homes available. The average days on market (DOM) continues to decrease, showing February 2018 at an average of 61 days, compared to the average 67 DOM in February 2017, which is a 9% reduction.

The average home sale price rose slightly compared with last February, to $556,791. This is up less than 1 percent compared to February 2017, when the average price was $552,942.

As can be expected, short supply and buyer competition results in rising home prices. The median sold price for homes in February 2018 was $500,000, up 7.37 percent compared to the February 2017 median price of $465,700.

New pending home sales, reported in February 2018 at 1,768 in Northern Virginia was 3.49 percent below the previous year 1,832 pending contracts. Total pending sales were down by 7.55 percent last month, compared with 2018.

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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Each year, the National Cherry Blossom Festival brings hundreds of thousands of visitors to the DC area. The festival is typically timed to coincide with peek bloom, although weather can sometimes wreak havoc on the plans. This year’s event is slated for March 20-April 15, so you should have plenty of opportunity to take in the beauty of the spring foliage.

Due to current weather conditions, the latest intel suggests peak bloom will be approximately March 27-31.

Major Events

March 31 – Blossom Kite Festival. Free at Washington Monument.  Bring your own kite, compete in various events, or kids can make their own kites. Find more about it here.

April 7 – PetalPalooza. Free admission. Wharf area (formerly known as the Southwest Waterfront). Entertainment, dining, and nighttime fireworks. More information here.

April 14 – National Cherry Blossom Festival Parade. Free general admission; tickets required for bleacher seating. The parade route runs down Constitution Avenue between the National Archives building and the Washington Monument.  Find parade info here or buy tickets here.

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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Here are four great reasons to consider buying a home today instead of waiting.

Prices Will Continue to Rise

CoreLogic’s latest Home Price Index reports that home prices have appreciated by 6.6% over the last 12 months. The same report predicts that prices will continue to increase at a rate of 4.3% over the next year.

The bottom in home prices has come and gone. Home values will continue to appreciate for years. Waiting no longer makes sense.

Mortgage Interest Rates Are Projected to Increase

Freddie Mac’s Primary Mortgage Market Survey shows that interest rates for a 30-year mortgage hovered close to 4.0% in 2017. Most experts predict that rates will rise over the next 12 months. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison, projecting that rates will increase by nearly a full percentage point by this time next year.

An increase in rates will impact YOUR monthly mortgage payment. A year from now, your housing expense will increase if a mortgage is necessary to buy your next home.

Either Way, You Are Paying a Mortgage

There are some renters who have not yet purchased a home because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s.

As an owner, your mortgage payment is a form of ‘forced savings’ that allows you to have equity in your home that you can tap into later in life. As a renter, you guarantee your landlord is the person with that equity.

Are you ready to put your housing cost to work for you?

It’s Time to Move on with Your Life

The ‘cost’ of a home is determined by two major components: the price of the home and the current mortgage rate. It appears that both are on the rise.

But what if they weren’t? Would you wait?

Look at the actual reason you are buying and decide if it is worth waiting. Whether you want to have a great place for your children to grow up, you want your family to be safer, or you just want to have control over renovations, maybe now is the time to buy.

If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings.

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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Saving for a down payment is often the biggest hurdle for a first-time homebuyer. Depending on where you live, median income, median rents, and home prices all vary. So, we set out to find out how long it would take to save for a down payment in each state.

Using data from the United States Census Bureau and Zillow, we determined how long it would take, nationwide, for a first-time buyer to save enough money for a down payment on their dream home. There is a long-standing ‘rule’ that a household should not pay more than 28% of their income on their monthly housing expense.

By determining the percentage of income spent renting in each state, and the amount needed for a 10% down payment, we were able to establish how long (in years) it would take for an average resident to save enough money to buy a home of their own.

According to the data, residents in Ohio can save for a down payment the quickest in just under 3 years (2.44). Below is a map that was created using the data for each state:

What if you only needed to save 3%?

What if you were able to take advantage of one of Freddie Mac’s or Fannie Mae’s 3%-down programs? Suddenly, saving for a down payment no longer takes 5 or 10 years, but becomes possible in a year or two in many states as shown on the map below.

Bottom Line

Whether you have just started to save for a down payment, or have been saving for years, you may be closer to your dream home than you think! Let’s meet up so I can help you evaluate your ability to buy today.

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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Some Highlights:

• Don’t forget to set your clocks forward this Sunday, March 11^th at 2:00 AM EST in observance of Daylight Saving Time.
• Unless of course, you are a resident of Arizona or Hawaii!
• Every hour in the United States: 614 homes are sold, 81 homes regain equity (meaning they are no longer underwater on their mortgage), and the median home price rises $1.51!

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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Let’s face it. For the last eight or so years, we’ve been pretty spoiled with stock market gains that recovered the losses of 2007/08 and continued to move into ever higher territory. Sure, there were little blips and dips along the way, but we have mostly been spared from major equity market losses for nearly a decade.

As for all good things, bull markets eventually come to an end.

Now, I don’t have a crystal ball, so I don’t know if these recent market losses will be short lived or part of an extended downward trend. But experts are suggesting that volatility in the market (those gut-wrenching swings that take you from euphoria to fear in a matter of minutes) could be the norm for the foreseeable future.

If you are invested in the market, then you are probably already wondering what the future may hold for your retirement portfolio and your kids’ education funds. But, increasingly, home owners and potential home buyers are wondering what this market could mean for their home values or their ability to buy a home in the future.

Interest Rates

Probably the biggest potential impact to homeowners and potential home buyers is the specter of increasing interest rates. The reason the market has reacted so violently in the past week or so was actually because of positive economic news. But that news raised fears that interest rates may go up more the Federal Reserve had previously indicated, in an effort to stave off inflation. This could be bad news for businesses wanting to borrow, but it also potentially impacts mortgage borrowers.

Those seeking new mortgages in the future may find themselves paying higher interest rates, which could in turn reduce the maximum banks will allow them to borrow. Borrowers will pay thousands more in interest over the life of the loan than during more favorable interest rate climates.

Rising interest rates, of course, will also impact people who hold variable rate mortgages, or those who may need to take out a home equity line to make home improvements or complete repairs.

We don’t know yet how much rates may go up. This is key. We still have a couple percentage points to go before we are back to the 6-7% rates that were common in the 90’s. So rates are still low, and now is still a good time to take advantage of lower rates.

Home Prices

If rates should get above 5 or more percent, then we may see buyers start to sit on the sidelines, which could put some pressure on sellers to be more competitive in pricing their homes or make more buyer concessions than they have been accustomed to in the current sellers’ market.

This isn’t necessarily bad for home buyers, though. Here in Northern Virginia and the DC Metro area, we have been in an extended seller’s market, with ever increasing prices. Buyers could enjoy some respite from the need to compete with multiple offers and may even experience some price stabilization. Any price breaks will likely be offset by the higher interest rates, though.

Investment Portfolios

For most people, investing in the stock market is a long-game. Speak to your investment advisor if you have concerns about your overall portfolio balance and the volatility of your individual investments. As your portfolio relates to real estate, if you have your down payment funds for your next home currently invested in in the market, you may want to speak to your advisor about protecting some of those funds against the market volatility or consider interest-bearing vehicles to park your down payment funds until you are ready to use them. This could give you peace of mind to ensure you don’t end up with less funds than you thought you had at closing.

The Nitty Gritty

I have to caveat this entire discussion with the usual disclaimers. We don’t know what future economic data may come out that totally changes the landscape again. This analysis is based on what we know right now, and what we can conjecture based on the facts at hand. Other variables could be rising wages and the as-yet-unknowns of the tax changes that won’t be realized until tax season 2019 and beyond, as well as other economic factors.

The bottom line is that real estate is a solid investment that typically results in growth of principle over time. If you are thinking of buying a home, you may want to consider taking the plunge before interest rates rise again. If you are thinking about selling, you may want to consider how waiting could impact your ability to attract buyers and your selling price.

Herbert Riggs and Associates can help you with all your real estate needs. Whether buying, selling, or investing, If you have any questions, give me a call at 703-966-2647 or send me an email at Herbert.Riggs@gmail.com.

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