The Latest Info on Mortgage Rates
Mortgage rates have been on a general upward trend for over a year, and in the last few months, they've taken an even bigger jump higher.
As the economy recovered from the pandemic, low interest rates fueled increased spending. At the same time, supply chain issues created shortages for items like microchips, building supplies and certain food items. These factors combined to drive inflation higher as supplies failed to meet demand. According to the latest Consumer Price Index (CPI), 12-month inflation hit 8.5% in March, the highest it's been since 1981.
Adding to the inflationary pressures is Russia's invasion of Ukraine, which has disrupted some financial markets. This war could also add to global food shortages as agriculture, fuel and fertilizer shipments from these countries are limited or disrupted.
Sitting on the sidelines of all this is the COVID-19 pandemic, while case counts were declining to start 2022 that could change. If we see a resurgence of COVID it could add uncertainty to the global economy.
Is It A Good Time to Buy a House?
Even though mortgage rates are higher now than the previous year, on a historical level, rates still aren't as high as they used to be. For example, in 2002, the average rate on a 30-year fixed mortgage was about 7%. In addition, the rate on a 5-year adjustable-rate mortgage (ARM) is lower by 1.3 percentage points than a 30-year fixed mortgage rate. However, the historical average spread between these two rates is about 0.8 percentage points, making the 5-year ARM currently more attractive to borrowers.
Although the most popular form of home financing is the 30-year fixed-rate mortgage, adjustable-rate mortgages (ARMs) are also common. Thus, we may see a change in U.S. household mortgage trends. According to the Federal Reserve of New York, the ARM share has fluctuated substantially over time, reaching highs of 60 to 70 percent in 1994 but falling significantly in recent years. Nevertheless, buyers should be aware that the rate and consequently the monthly mortgage payment will change after the first 5 years, depending on economic conditions.
Experts caution against trying to time the market to secure the lowest mortgage rate, even though mortgage rates are important and a point or two can mean a lot over the life of the loan. Start the home-buying process when it's the next best step for your life circumstances and you have the finances to maintain homeownership. Shop around for a mortgage lender to get the best deal you can at that time–lenders' rates can vary significantly.
Schedule a Consultation with JJ Elek
If you'd like to get a better grasp on mortgage rates, the experts at JJ Elek Realty can help. Schedule a consultation with one of our experts today.
What's Hot and What's Not in Home Design
From dark hardwood flooring to home offices hidden away in closets, we're taking a look at what's hot and what's hot in-home design trends in 2022.
Not hot: The Cloffice
Early on in the pandemic, people started turning their closets into a home office. Coined the "cloffice," these makeshift offices served their purpose at a time when we all needed a quiet place to work. Homeowners are no longer looking for temporary workspaces, and if they are still working remotely, they're now looking for a more permanent, clearly defined home office (with windows!).
Hot: Light-colored flooring
After years of preferring dark hardwood flooring, we're seeing a resurgence in lighter wood plank flooring. One of the hottest trends is a color known as greige, a blend of gray and beige. It can offer a fresh look to bedrooms, living rooms and entryways. Darker colors can overpower a room at times. Lighter tones can make a room look brighter and larger, plus they camouflage dirt and dust much better than hardwood.
Wallpaper has been rising in popularity in recent years, but it's made a full comeback for 2022—just not in ways you might expect. You can use wallpaper to create a statement wall, provide a colorful backing for cabinets or line your shelving. Another outside-the-box idea is to use wallpaper on a ceiling to add dimension and excitement to your room.
Hot: Murphy beds
Creative furniture solutions, such as Murphy beds are coming back in a big way. These items are functional, allow us to do more in a small area, and have greater flexibility when designing a space.
Not hot: Minimalism
An uncluttered, sparsely decorated home can feel sad with a lack of personality. As we spend more time at home, they're seeking more meaningful interiors and placing more personal accents on display.
If you've always wanted to turn your home into a plant paradise, now's the time to do it. Rather than going the faux plants route, which may have been convenient in the past, this year you should go for the real deal. After all, plants add a little joy to your surroundings.
When it comes down to it, trust your own personal style. The design elements that make you happy are the best ones to choose!
JJ Elek Realty -Trusted for over 50 years! Call Today 732-634-9100.
Are you a real estate agent looking for a secret weapon to compete with sites like Zillow? Hyperlocal marketing is your solution. Let's see what this strategy is and how you can implement it into your real estate marketing.
Any marketing strategy that's laser focused on a specific area, region, zone, or demographic is hyperlocal. You can start incorporating any of the following into your hyperlocal marketing strategy:
Let's say you consider yourself an expert in a specific area like Middlesex County. So, you focus your marketing efforts there and cast your net wide to try to reach everyone in that market. The problem? That strategy is not targeted enough to gain new leads. While you might have some success, Middlesex County can be broken down into many smaller sub-areas, with different types of neighborhoods, school systems, points of interest, and more.
Why wouldn't you develop a more specific, hyperlocal marketing campaign for several smaller zones within the Middlesex County region?
Benefits of a Hyperlocal Marketing Plan
Hyperlocal marketing offers many advantages over a traditional marketing strategy, including:
Working in smaller areas means connect with fewer people and spending less money on each area. The savings lets you test out different strategies and increase your budget and effort with the ones that work best.
If want to maximize your marketing budget and take your business to the next level, hyperlocal real estate marketing is for you. Leave traditional messaging behind, set up this effective new framework, and reel in more leads than ever before. JJ Elek Realty will help you with tips such as this and more! Contact us today to join our team.
Don't Waive These Contingencies When Buying a Home
While it's tempting to waive contingencies to make your offer more compelling, it can leave you unprotected from unexpected fees, health threats, and at worst, a bad investment.
Here are 5 of contingencies you should never remove:
The home inspection is the foundation on which all other contingencies are built. During the assessment a neutral expert assesses the home for issues with:
Everything may look good to your eyes, but you won't really know until the inspections are completed.
Appraisals commit the buyer to pay the agreed-upon price regardless of how big a mortgage the lender agrees to bring. If you waive this and the home is appraised for a lower cost than the sales price, you'll be on the hook for the difference.
If the official home inspection reveals a potential mold issue, a mold specialist needs to be brought in to analyze the issue. Serious mold issues can cause mild to major health problems and can be surprisingly expensive to fix.
This often gets overlooked or waived, but most experts warn against it when buying a home that has a septic system. This is water that you'll be drinking and bathing in, and like mold, issues with the system can be very expensive to fix and have health ramifications.
Contact JJ Elek Realty today at 732-634-9100 to help you through your home buying experience.
First-Time Homebuyer Guide
Buying a home can be challenging for a first timer. There are so many steps, tasks, and requirements to consider that can make you feel anxious. To make it a little easier, we've compiled a list of things to consider throughout the process.
Your down payment plays an important role when you're buying a home. A down payment is a percentage of your home's purchase price that you pay up front when you close your home loan. But how much do you actually need? Ideally, 20 percent is best, but it can be as low as 10, 5 or 0 percent for certain type of mortgages, like VA loans.
In addition to having a down payment, a first-time homebuyer will need a decent credit score. This three-digit summary is a numerical of your credit score detailing how well you've paid off past debts, like credit cards and college loans. In turn, the lender will use this information to decide whether to lend you money and at what interest rate.
This is the fun part! Go out and pick your favorite houses and set up appointments to see them in person. Make a list of must-haves, whether it's a new home or a fixer-upper, and then narrow down your options.
The seller will think it's a great offer if you pay cash, you've preapproved for a mortgage, and you're not selling a house first to fund the purchase.
A top-to-bottom home inspection will find things like termites, mold, and foundation issues—all of which are typically fixable.
Bringing together the buyer, seller, mortgage representative, title officer and others officially gets you the keys to your new home (once you've paid the down payment and closing costs, which are typically 2-7 percent of the home price).
Once all of the preceding steps have taken place…welcome home!
How the Delta Variant Could Affect the Housing Market
When the COVID-19 pandemic first struck the world, housing experts predicted that stay-at-home orders, closed businesses, and general uneasiness would result in a drop in home prices. Instead, we saw an unexpected hike in prices due to a significant lack of homes for sale. Buyers became more competitive as sellers became more hesitant to sell.
When vaccines became available and a semblance of normalcy returned, we started to see home prices level out. But then the Delta variant hit. Experts have been debating how the new variant will impact the housing market, so what can we expect?
Declining Mortgage Rates
The housing market may get an even bigger blow caused by a drop in mortgage rates. Since the Delta variant emerged, investors have begun shifting their overseas money into mortgage bonds, which has dropped mortgage rates to as low as 2.37% in some areas. If the pandemic worsens, these rates will drop even lower.
While this may inspire would-be buyers to begin shopping again in larger numbers, the increased transmission of COVID, plus any newly introduced stay-at-home mandates, could decrease the amount of people willing to sell, which would result in a boost to home prices.
No Reason to Panic
It goes without saying that buyers would love for more homes to become available, and for those homes to not be priced over market value, but the Delta variant doesn't appear to be cooperating with that goal. This doesn't mean you should expect things to get worse. In fact, the market may end up showing little to no change.
Vaccinated individuals may feel comfortable enough to continue home shopping as they have been, even with the rise of the new variant. And since no new stay-at-home orders have been issued, home prices will likely stay where they're at.
Looking to the Future
As it stands, the housing market hasn't changed drastically since the introduction of the Delta variant, but experts agree that more time is needed to determine its overall impact. Until then, it's important to stay informed and to contact a JJ Elk agent if you have any questions about buying or selling a home in the coming months.
The Eviction Moratorium and What It Means
The COVID-19 pandemic has been an unprecedented time for everyone across the world, including landlords and their tenants. Financial hardship, businesses shuttering, and loss of work have contributed to many Americans being unable to pay their rent.
The federal government, as well various states, have begun taking action to limit the impact COVID has had on tenants, including a moratorium on evictions, a halt of late rent fees, and prevention of utility shutdowns due to non-payment.
What is the Current Status of the Moratorium?
On August 3rd, 2021, the Center for Disease Control and Prevention (CDC) issued an Agency Order on the current eviction moratorium in place until October 3rd, 2021. Titled Temporary Halt in Residential Evictions in Communities with Substantial or High Levels of Community Transmission of COVID-19 to Prevent the Further Spread of COVID-19, the order protects people from eviction if they're unable to pay their rent and meet the criteria below.
This order also requires that tenants who meet any of these criteria complete a declaration form. Since US states can put their own moratoriums in place, a tenant may still be protected by their state orders if they fail to meet the federal criteria listed by the CDC.
Contact JJ Elek Realty for More Information
Find out if your state has any tenant protections in place by visiting your state or governor's website. If you live in New Jersey, feel free to reach out to a JJ Elek Realty agent for more information.
Tips for Buyers in a Seller's Market
If you're trying to buy a house right now, you know the market isn't for the faint of heart. You can see a property you love one minute, and the next it's under contract. In this blog, we'll give you 5 tips for successfully navigating a seller's market in New Jersey.
A seller's market means that there's more demand for homes than there is supply. This is generally what we see in real estate markets today. It means buyers have a lot of competition when it comes to finding a home, and sellers have more leverage than the buyers.
In a seller's market, it's not uncommon for a house to go for more than the list price. In fact, properties are sometimes picked up by all-cash buyers. This is because they can close on the home faster than someone who needs to finance the purchase.
If you're looking to buy in a popular neighborhood, the listings are likely to be few and far between. When they do hit the market, then they're unlikely to be on the market for long. If you know where you want to be, make sure you're house hunting as soon as possible and ready to act quickly whenever you see something you love.
In today's market, there are likely to be multiple offers on a house. Be ready to throw your hat in the ring and have supplemental paperwork on hand like your mortgage pre-approval and proof of funds for the down payment. This will make the process swift and help you edge out any competitors.
Removing contingencies from your offer (inspections, mortgage commitments, etc.) can help make your offer more competitive. Sellers tend to see these contingencies as opportunities for a deal to fall through. If you make your offer clean, you'll make yourself a more attractive buyer.
As noted above, houses are likely to go for more than the list price in a seller's market. With this in mind, start out with a strong sale price. Sellers are likely to be enticed with a big payout. If you're able, a cash offer is also a great way to give yourself the advantage.
House hunting can feel incredibly overwhelming and discouraging right now, but don't give up! Just take the proper steps to prepare yourself, and you'll be in your dream home before you know it. JJ Elek Realty can help you today!