The ‘Great News’ About Rising Prices

​Recently there has been a lot of talk about home prices and if they are accelerating too quickly. In some areas of the country, seller supply (homes for sale) cannot keep up with the number of buyers out looking for a home, which has caused prices to rise.
The great news about rising prices, however, is that according to CoreLogic’s latest US Economic Outlook, the average American household gained over $11,000 in equity over the course of the last year, largely due to home value increases.
The map below was created from CoreLogic’s report and shows the average equity gain per mortgaged home from June 2015 to June 2016 (the latest data available).

For those that are worried that we are doomed to repeat 2006 all over again, it is important to note that homeowners are investing their new found equity in their homes and themselves, not in depreciating assets.

The added equity is helping families put their children through college, and even invest in starting small businesses, allowing them to pay of their mortgage sooner or move up to the home that will better suit their needs

Bottom Line

CoreLogic predicts that home prices will appreciate by another 5% by this time next year. If you are a homeowner looking to take advantage of your home equity by moving up to your dream home, let’s get together to discuss your options!

Keeping Current Matters 2016

How Historically Low Interest Rates Increase Your Purchasing Power

According to Freddie Mac’s latest Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at 3.47%. Rates have remained at or below 3.5% each of the last 16 weeks, marking a historic low.

The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

Purchasing power, simply put, is the amount of home you can afford buy for the budget you have available to spend. As rates increase, the price of the house you can afford will decrease if you plan to stay within a certain monthly housing budget.

The chart below shows what impact rising interest rates would have if you planned to purchase a home within the national median price range, and planned to keep your principal and interest payments at or about $1,100 a month.

With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5%, (in this example, $6,250). Experts predict that mortgage rates will be closer to 4% by this time next year.

Act now to get the most house for your hard earned money.

Keeping Current Matters, Inc. © 2016

Help, My Contractor Disappeared—Now What?

​We’ve all heard horror stories about those poor souls who take a low bid from a contractor to redo their kitchen, but then are left hanging with unfinished cabinets, bare cement floors, and a massive, gaping hole in their bank account. Bummer! So what’s a homeowner to do when a contractor pulls a disappearing act before the work is finished?

The quick answer: Don’t take offense, take action.

Here are some steps to take to persuade that contractor to come back and finish what he started.

Review your contract

“Before you lash out, scrutinize your contract,” advises Albert Tumpson, a Los Angeles attorney. He notes that when you’re cooking on a hot plate and living out of a minifridge, it may seem like the builders are taking too long with their renovations, but they might actually be within the time frame you originally agreed upon.

What? You don’t have a contract? What were you thinking?

They’re not called contractors for nothing. In fact, a major red flag would be a contractor who is willing to kick off a job without a written contract—even if he’s your brother-in-law. Job specifics, length of time, and quality and cost of materials should all be specified before the first hammer swings. But fear not. All is not lost if you failed to sign on the dotted line. Tumpson says a verbal agreement may be legally binding if you have a third-party witness.

Get the job done

Once you’ve determined that your contractors are nearing the agreed-upon time limit and you haven’t seen their smiling faces in a long while, the first step is to send a friendly but firm message—by phone, text, email, or all three—asking them to please come back and finish the work they’ve agreed to do. If you get no response, it’s time to start legally covering your bases.

“Send them a registered letter that requires a signature, giving them ‘notice to perform to the terms of the contract,’” advises Mark Marshall, a licensed contractor in California’s Inland Empire who has stepped in numerous times to right what other contractors have wronged. “A registered letter usually shows them that you need to be taken seriously, and 90% of the time they’ll come back.”

Another tactic homeowner Marcy Sprague of Phoenix found useful to persuade a contractor to come back to finish her deck was to mention the possibility of posting an unflattering review on Angie’s List, where she’d found the contractor in the first place.

“I’d hate to have to write a negative review about you,” she told him calmly, “because I know how important that client source is to you.”

You can also mention you’d be inclined to post negative reviews on your local Better Business Bureau website and Craigslist, in addition to anywhere else the contractor might advertise.


If these tactics fail to get you the desired results, it’s time to step it up.

Send a second registered letter: Inform the contractors that if they don’t finish their work within a given amount of time, say, 10 days, their contract will be terminated and you will contact their bond company. This is the third party typically required by contractor licensing agencies that, in the event that a contractor flakes, will offer you full compensation. It’s easy to find the bond company by looking up your contractor on your state licensing board’s website. “Contractors hate it when you mess with their bonds,” says Marshall. In states such as California, a contractor can’t be licensed without being bonded, so you could be threatening their very livelihood.

Fire them outright: This will not get your work done in a timely fashion, but at least it will clear the way for someone else to step in and finish the job. Be advised, however, that you must be able to show that the contractor is in clear breach of the contract, and have well-documented instances of those breaches, or the contractor could take you to court and put a lien on your property, claiming that you’re the party in breach of contract.

Get your money back

These options are fine and dandy if you just want your project finished. But if you’ve paid the contractor ahead of time and you want the money back for materials that weren’t delivered and services that weren’t rendered, that’s a whole ‘nother kettle of fish.

Try these steps from Oliver Marks, a carpenter who specializes in home improvement:

• Request a hearing: If your construction contract contains a binding arbitration clause, this is a relatively low-cost process in which a neutral party or arbitrator makes a final decision about who owes whom what.

• Go to small-claims court: This is fine if your claim is a small one. Most states limit small claims to a range of $3,000 to $7,500.

• Make a claim with the contractor’s bond company: The mere mentioning of this approach could clear up the problem.

• Hire an attorney: This will probably be your last resort, because, hello? Most lawyers are expensive! You would have to be suffering major financial loss to make it worth paying up to $400 per hour for a real estate attorney’s services. If it’s a good lawyer, though, and you have a real case, this is one of the surest way to get compensation.

Lisa Johnson Mandell,

The Most Common Questions Asked by Home Sellers—Answered!

​Selling a home you’ve lived in and loved over the years isn’t exactly like unloading your collection of old Slayer LPs on Craigslist (or is it…?). It’s hard. It’s emotional. And above all else, it’s complicated. A slew of questions will likely pop into your head throughout the process—and possibly keep you up at night.

Last week, we revealed the most common questions asked by home buyers. Since people on the other end of this deal have a lot on their minds, too, today we’ll tackle the most common questions that real estate agents hear from sellers—along with some answers, of course.

Q: How much needs to be done to my house before putting it on the market?

“Many sellers have extreme anxiety over the thought of having to clear out and fix up their home, so much so that it can prevent them from putting the place on the market in the first place,” says Alyssa Blevins with Pierce Murdock Group. But in most cases, there’s no need to panic here—or to overshoot your goals. “Very often, there’s far less to do than homeowners think.” So before spending months and millions (figuratively) upgrading your place—or just throwing up your hands and giving up before you begin—show your home to a Realtor®. You might be pleasantly surprised by your current sales prospects.

Q: How much is my house worth?

While the median house price in 2016 is $228,000, the exact price of your own home will depend on its size, neighborhood, and lots of other factors. Further complicating matters is your own skewed perspective: We tend to mentally inflate our home’s positives and airbrush out the flaws that are all too apparent to the cold, calculating eyes of buyers. “People always seem to compare their house to the most expensive sale in the neighborhood,” says Mary Ann Grabel, an agent at Douglas Elliman in Greenwich, CT. Instead, look at the prices of similarly sized homes that have recently sold in your area—data that agents call comparative market analysis, or “comps.” Then, price your place strategically. “If you price too high, the home is likely to linger on the market,” says Grabel. Meanwhile, pricing low can have major upsides, resulting in multiple bids that could ultimately jack up your price. So, do your homework. Then, discuss a number with your Realtor that feels right—and is realistic.

Q: How long will it take to sell my home?

Right now, nationally, houses spend around 100 days on the market before they sell, although the time varies wildly based on area and price. So, price competitively and make sure that you and your Realtor are getting the place in front of as many eyeballs as possible. “The higher the exposure, the faster the offers,” says Felise Eber, a real estate associate affiliated with Coldwell Banker Residential Real Estate and part of the Miami Beach luxury real estate sales team The Jills. Spread the word through your own social networks——real ones and virtual ones. You never know whose passing it along to that special someone will lead to a sale.

Q: Is staging really important?

On average, a staged home sells 88% faster—and for 20% more money—than a home that’s left as is. The reason it works, of course, is it gives buyers a “stage” onto which they can play out their home-owning fantasies and envision themselves living in your home. “Choose neutral paint colors and remove any family photos,” says Johnson. Give would-be homeowners a blank canvass that they can mentally fill with their loved ones and themselves.

Q: Should I be present when buyers view my house?

“NO!” says Johnson. (Hey, no need to shout. We’re right here!) “There is not any situation in which this is appropriate. Having the owner in the house makes the buyers uncomfortable. They feel as though they can’t make comments or ask questions that could be offensive. The owner—who has a history and attachment to the house—has the tendency to argue if a potential buyer makes a comment that could be a little negative. This can turn off buyers and lose you offers.” Got it.

Q: What is the agent’s commission?

While the commission can vary, it is typically 6% of a home’s sale price—and that’s usually shared with the buyer’s agent. But what’s implied by this question is “What are Realtors doing to earn that check?” Here are some facts to keep in mind: Unlike lawyers who get paid by the hour, or doctors who are paid by the appointment, listing agents don’t get paid unless they make a sale. For every hour an agent spends with a client, he or she will typically spend nine hours on average working on that client’s behalf doing everything from networking to finding potential buyers to filling out paperwork. And no, not all agents are created equal. Since most contracts last for a year, Realtor Susan Ratliff recommends that sellers “interview three agents prior to selecting one to represent them. It’s no different from choosing an attorney, accountant, or the doctor who will deliver your baby. You want to be sure that you trust that person and are comfortable with them.”

Margaret Heidenry,

Surefire Tactics to Getting More Money for Your Home

All home sellers hope their place will fetch a big, fat price. And while you can’t control everything that determines a house’s market rate—like, say, the state of the stock market or the quality of your local school district—there are plenty of things within your power that can nudge that number higher. A lot higher, in fact.

Granted, manipulating your home’s selling price will take some work, and usually some money. But time and again, these proven strategies make a big difference in final sales prices. Try a few, then prepare to do a victory dance on the big day you get your offer(s)

Tactic 1: Bite the bullet and make smart upgrades

Yes, overall renovations to your home will nudge up the price, although not always as much as you might hope: According to Remodeling magazine’s 2016 Cost vs. Value Report, you’ll get back an average of 64% on whatever upgrades you paid for. But that ROI varies widely based on what type of improvement you do. The most profitable upgrade is—drum roll—insulating your attic. It may not be all that sexy, but you’ll recoup 116.9% of your costs. It’s the only home reno in the report that redeems more money than you spend!

Tactic 2: Boost your curb appeal

You Realtor® has probably already told you: One surefire way to jack up your sale price is to knock ’em dead before they even reach your front door. So spend some time and do it for real. Improving your home’s curb appeal can increase your sale price by up to 17%, a Texas Tech University study found. Basic landscaping such as trimming hedges, pulling weeds, and pruning trees is a must.

You can add pops of color by planting flowers in the front yard and placing potted plants on each side of the front door, says Kimberly Sands, a broker at Coldwell Banker Advantage in Apex, NC. Consider installing white panel lighting along railings, fences, or doorsteps to make your home’s exterior visually appealing for evening showings. Other low-cost projects to improve your home’s appearance include putting a fresh coat of paint on the front door, updating the house numbers, and adding porch furniture.

Tactic 3: Create the illusion of more space

It goes without saying that a higher square footage fetches a higher sum, but you can’t do anything about that, right? Not so fast: Your home’s actual specs don’t matter as much as how spacious rooms look when you’re standing in them. So be sure to create an open, inviting space. That entails removing large pieces of furniture such as the oversize coffee table (it might look nice, but it could be blocking foot traffic).

Not enough room in the garage to stow everything? Look into renting a storage unit, says Jennifer Baxter, associate broker at Coldwell Banker RMR in Suwanee, GA. If your home has beautiful hardwood floors, show them off by removing large rugs, and clear off your kitchen’s counter space by putting away blenders, coffee makers, toaster ovens, and other small appliances, she advises.

Buyers are particularly attuned to closet space, so move off-season clothes into storage. “You want to give the illusion that your closet is so large that you can’t fill it,” she says.

Tactic 4: Hire a professional home stager

Have “eclectic” design tastes? Your personal aesthetic might put off some buyers, so move all your knickknacks into storage and hire a home stager. It’s true that these professionals—who tweak your space to make it more appealing to buyers—aren’t cheap, but they can be well worth it.

On average, staged homes sell for a whopping 20% more money than nonstaged ones. Staging may be particularly important if you’re in the process of moving, and some rooms are vacant. Make sure your living room and kitchen are fully furnished, since they’re the most important rooms to buyers, according to the National Association of Realtors®’ 2015 Profile of Home Staging survey.

Tactic 5: Pick a neutral color palette

Maybe you painted your daughter’s room pink, or thought lime green was perfect for the master bedroom. (We all make mistakes!) However, boldly colored walls can turn off buyers, says Katie Wethman, a Washington, DC–based Realtor and founder of the Wethman Group. So consider hiring a professional to repaint the house throughout in a neutral color such as off-white or beige. Or if you have the time, you can cut costs by painting it yourself.

Daniel Bortz, REALTOR.COM

Ouch! Three Times You Can Kiss Your Earnest Money Goodbye

​The earnest money deposit—the cash you offer to essentially call dibs on a house—is one of the most important and misunderstood parts of the home-buying process.

Depending on where you live, you can expect to put down anywhere from 1% to even 10% of the home’s purchase price as earnest money. (In some highly competitive markets, buyers are making even larger deposits in an effort to stand out.) An earnest money deposit tells a seller you are serious about closing. Without earnest money, you could theoretically make offers on multiple homes, essentially taking them off the market until you decide which one you like best.

Don’t worry—the seller isn’t going to run off to Aruba with your cash. It remains in an escrow account or with the title company until the sale closes. And, if everything goes off without a hitch, that earnest money is put toward your down payment and closing costs. So there’s nothing to lose, right?

Probably not, except these three scenarios where your earnest money could end up financing the seller’s trip to Aruba.

1. You waived your contingencies

In highly competitive markets, it’s becoming more common for buyers to waive contract contingencies regarding financing or an inspection. You might be tempted to do the same—it will make you a more attractive buyer. But it also comes with serious risks. You guessed it: You might lose your earnest money deposit.

The financing contingency guarantees that you’ll get your money back if for some reason your mortgage doesn’t go through and you’re unable to purchase the house. The inspection contingency allows you to renegotiate the price or demand repairs if serious defects are found during the inspection.

If your contract doesn’t have such buyer protections and you run into trouble with the inspection, you won’t be able to get your money back if you abandon the deal. Most experts recommend that you not waive the inspection contingency, unless you’re planning on tearing the property down.

As for the mortgage-financing contingency, waiving it may be the only way to compete with all-cash buyers. But you’ve got to be absolutely sure that you’ll be able to get approval from your bank.

“I strongly encourage my clients to obtain a conditional approval before signing a noncontingent contract,” says Ivona Perecman, a New York City real estate broker and lawyer. “Otherwise, it may turn out that the bank that pre-approved you will not give you financing or offer a lot less worse terms and, consequently, you may lose the deposit.”

2. You ignored the timeline outlined in the contract

Your contract usually sets out a specific time frame in which you’ll need to secure financing, get the home inspected, and be available for the closing. Generally speaking, as long as you’ve made a good-faith effort to adhere to the timeline, sellers will grant a reasonable extension if a lender drags his feet or there are other extenuating circumstances that delay things.

However, in some cases sellers may include a “time is of the essence” clause in the contract. Watch out for this phrase in your paperwork—it means the closing date for the sale is binding. If you can’t make it to close for any reason, you’ve breached the contract and could lose your deposit.

3. You get cold feet

If you have a change of heart about the home you’re buying—but there’s no problem with the property or the financing—you likely will not get your money back.

“If a buyer changes her mind and was able to request the down payment be returned without consequence then the whole idea of a contract would no longer be worth much,” says Marc Kaufman, a real estate attorney with Wexler Lehrer & Kaufman in New York City. “One party cannot simply walk away and default on a whim.”

The earnest money deposit serves a protection for the sellers when they take their home off the market. If late in the game you decide that you no longer want to make the purchase, they get to keep it as compensation for the time and money they have to spend on listing their home again and looking for another buyer.

When it comes to real estate, a case of buyer’s remorse could be even more painful than a lost deposit. To avoid both, really make sure the home you’re bidding on is “the one.”

Beth Braverman,

6 Reasons You Should Never Buy or Sell a Home Without an Agent

​It’s a slow Sunday morning. You’ve just brewed your Nespresso and popped open your laptop to check out the latest home listings before you hit the road for a day of open houses.

You’re DIYing this real estate thing, and you think you’re doing pretty well—after all, any info you might need is at your fingertips online, right? That and your own sterling judgment.

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Oh, dear home buyer (or seller!)—we know you can do it on your own. But you really, really shouldn’t. This is likely the biggest financial decision of your entire life, and you need a Realtor® if you want to do it right. Here’s why.

1. They have loads of expertise

Want to check the MLS for a 4B/2B with an EIK and a W/D? Real estate has its own language, full of acronyms and semi-arcane jargon, and your Realtor is trained to speak that language fluently.

Plus, buying or selling a home usually requires dozens of forms, reports, disclosures, and other technical documents. Realtors have the expertise to help you prepare a killer deal—while avoiding delays or costly mistakes that can seriously mess you up.

2. They have turbocharged searching power

The Internet is awesome. You can find almost anything—anything! And with online real estate listing sites such as yours truly, you can find up-to-date home listings on your own, any time you want. But guess what? Realtors have access to even more listings. Sometimes properties are available but not actively advertised. A Realtor can help you find those hidden gems.

3. They have bullish negotiating chops

Any time you buy or sell a home, you’re going to encounter negotiations—and as today’s housing market heats up, those negotiations are more likely than ever to get a little heated.

You can expect lots of competition, cutthroat tactics, all-cash offers, and bidding wars. Don’t you want a savvy and professional negotiator on your side to seal the best deal for you?

And it’s not just about how much money you end up spending or netting. A Realtor will help draw up a purchase agreement that allows enough time for inspections, contingencies, and anything else that’s crucial to your particular needs.

4. They’re connected to everyone

Realtors might not know everything, but they make it their mission to know just about everyone who can possibly help in the process of buying or selling a home. Mortgage brokers, real estate attorneys, home inspectors, home stagers, interior designers—the list goes on—and they’re all in your Realtor’s network. Use them.

5. They adhere to a strict code of ethics

Not every real estate agent is a Realtor, who is a licensed real estate salesperson who belongs to the National Association of Realtors®, the largest trade group in the country.

What difference does it make? Realtors are held to a higher ethical standard than licensed agents and must adhere to a Code of Ethics.

6. They’re your sage parent/data analyst/therapist—all rolled into one

The thing about Realtors: They wear a lot of different hats. Sure, they’re salespeople, but they actually do a whole heck of a lot to earn their commission. They’re constantly driving around, checking out listings for you. They spend their own money on marketing your home (if you’re selling). They’re researching comps to make sure you’re getting the best deal.

And, of course, they’re working for you at nearly all hours of the day and night—whether you need more info on a home or just someone to talk to in order to feel at ease with the offer you just put in. This is the biggest financial (and possibly emotional) decision of your life, and guiding you through it isn’t a responsibility Realtors take lightly.

Rachel Stults,