Keeping Current Matters

How to Simply Increase Your Family Wealth by Paying for Housing

How to Simply Increase Your Family Wealth by Paying for Housing | Keeping Current Matters

Everyone should realize that unless you are living somewhere rent-free, you are paying a mortgage – either yours or your landlord’s. Buying your own home provides you with a form of ‘forced savings’ that allows you to use your monthly housing costs to increase your family’s wealth.

Every month that you pay your mortgage, you are paying off a portion of the debt that you took on to purchase your home. Therefore, you own a little bit more of your home every month in the form of home equity. As your home’s value increases you also gain home equity.

Every quarter, Pulsenomics surveys a nationwide panel of over 100 economists, real estate experts, and investment and market strategists and asks them to project how residential home prices will appreciate over the next five years for their Home Price Expectation Survey (HPES).

The latest data from their Q4 2018 Survey revealed that home prices are expected to round out the year 5.8% higher than they were in January. For the next 5 years, home values will appreciate by an average of nearly 3% a year.

This is still great news for homeowners!

For example, let’s assume a young couple purchases and closes on a $250,000 home in January. Simply through their home appreciating in value, those homeowners can build their home equity by nearly $40,000 over the next five years.

How to Simply Increase Your Family Wealth by Paying for Housing | Keeping Current Matters

Let’s look at the potential equity gained over the same period of time at some higher price points:

How to Simply Increase Your Family Wealth by Paying for Housing | Keeping Current Matters

In many cases, home equity is a large portion of a family’s overall net worth.

Bottom Line

If your plan for 2019 includes entering the housing market to purchase a home, whether it’s your first or your fifth, meet with a local real estate professional who can help you understand where prices are headed in your area.


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Have You Set Up Personalized Posts Yet? | Keeping Current Matters

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What If I Wait A Year to Buy a Home?

What If I Wait A Year to Buy a Home? | Keeping Current Matters

National home prices have increased by 5.4% since this time last year. Over that same time period, interest rates have remained near historic lows which has allowed many buyers to enter the market and lock in low rates.

As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price but instead about the ‘long-term cost’ of the home.

The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Insights Reporthome prices will appreciate by 4.8% over the next 12 months.

What Does This Mean as a Buyer?

If home prices appreciate by 4.8% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:

What If I Wait Until 2019 To Buy A Home? | Keeping Current Matters

Bottom Line

If buying a home is in your plan for this year, doing it sooner rather than later could save you thousands of dollars over the terms of your loan.


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The post What If I Wait A Year to Buy a Home? appeared first on Keeping Current Matters.

The Tale of Two Markets [INFOGRAPHIC]

Some Highlights:

  • An emerging trend for some time now has been the difference between available inventory and demand in the premium and luxury markets and that in the starter and trade-up markets and what those differences are doing to prices!
  • Inventory continues to rise in the luxury and premium home markets which is causing prices to cool.
  • Demand continues to rise with lower-than-normal inventory levels in the starter and trade-up home markets, causing prices to rise on a year-over-year basis for 80 consecutive months.

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Thank you for visiting today. If this is your first visit, take your time and look around. I have plenty of information and resources available to you. If you are a return visitor, thank you. I would love to hear from you and tell you how I can serve all your real estate needs.

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Beach Town and The Medendorp Real Estate Group
318 Houston Avenue 3rd floor
Muskegon, MI 49441
Main Office: 231-777-7355
Fax: 231-332-5912

David Direct: 231-206-3367
Andy Direct: 616-403-4712

Email: INFO@sellmuskegon.com
david@SELLMUSKEGON.COM
AndyB@sellmuskegon.com

David Medendorp Ccim - GRI on Zillow        
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