Buyer Tips • August 8, 2023

Mortgage Types in Rhode Island

by Christine Farley

Exploring Mortgage Options for Home Buyers in Rhode Island

**Introduction:**
When it comes to purchasing a home, Rhode Island offers a variety of mortgage options to cater to the diverse needs of prospective home buyers. From traditional fixed-rate mortgages to specialized programs, understanding these options can empower buyers to make informed decisions that align with their financial goals. In this blog post, we’ll dive into the different mortgage options available in Rhode Island, helping you navigate the path to homeownership with confidence.

**1. Fixed-Rate Mortgages:**
Fixed-rate mortgages are a popular choice among home buyers for their predictability. With this option, the interest rate remains constant throughout the life of the loan, ensuring stable monthly payments. Rhode Island residents can opt for terms ranging from 15 to 30 years, allowing them to select a timeframe that suits their budget and long-term plans.

**2. Adjustable-Rate Mortgages (ARMs):**
For those who seek flexibility in their mortgage payments, an adjustable-rate mortgage might be the right fit. ARMs start with a fixed interest rate for a specified period, often 5, 7, or 10 years, after which the rate adjusts periodically based on market conditions. While initial rates are typically lower than those of fixed-rate mortgages, potential fluctuations should be carefully considered, especially if market interest rates rise.

**3. Federal Housing Administration (FHA) Loans:**
FHA loans are government-backed mortgages designed to make homeownership more accessible, particularly for first-time buyers. With lower down payment requirements and more lenient credit criteria, these loans are an attractive option for those with limited funds for a down payment. Rhode Island residents can leverage FHA loans to enter the housing market with as little as 3.5% down.

**4. Veterans Affairs (VA) Loans:**
VA loans are exclusively available to eligible veterans, active-duty service members, and certain members of the National Guard and Reserves. These loans are backed by the Department of Veterans Affairs and often require no down payment, making homeownership more attainable for those who have served their country. Rhode Island veterans can explore this option to benefit from competitive interest rates and flexible terms.

**5. United States Department of Agriculture (USDA) Loans:**
USDA loans are another government-backed option that aims to promote homeownership in rural areas. While Rhode Island might not immediately come to mind as rural, there are USDA-eligible areas within the state. These loans offer low to no down payment requirements and competitive interest rates, making them a viable choice for buyers looking to settle in qualifying regions.

**6. Rhode Island Housing Programs:**
The Rhode Island Housing agency offers a range of programs to help residents achieve their homeownership dreams. From down payment assistance to low-interest loans, these programs cater to various income levels and can be particularly helpful for first-time buyers. Exploring these options can lead to valuable financial support throughout the home buying process.

**Conclusion:**
As you embark on your journey to homeownership in Rhode Island, it’s essential to consider the array of mortgage options available. From fixed-rate stability to government-backed loans and specialized programs, each option serves different financial circumstances and goals. Take the time to research, compare, and consult with mortgage professionals to determine the best fit for your unique situation. By making an informed decision, you’ll be well on your way to securing a mortgage that aligns with your long-term vision of owning a home in the beautiful state of Rhode Island.

Home Ownership • Uncategorized • August 1, 2023

August Homeowner’s Checklist: Keeping Your Property in Tip-Top Shape

by Christine Farley

August Homeowner’s Checklist: Keeping Your Property in Tip-Top Shape

As the dog days of summer roll in, August provides homeowners with a golden opportunity to perform essential maintenance tasks that will safeguard their property and prepare it for the upcoming seasons. Whether you’re a seasoned homeowner or new to the responsibilities of maintaining a house, this blog post will serve as your go-to guide for tackling crucial tasks this August. By taking proactive steps, you can ensure your home remains in excellent condition and save yourself from potential headaches down the road.

1. Inspect and Clean Gutters:
Clogged gutters can cause water damage, so it’s crucial to inspect and clean them during August. Remove leaves, debris, and any blockages that may have accumulated during the summer. Properly functioning gutters will redirect rainwater away from your home, protecting its foundation and preventing potential water-related issues.

2. Check and Seal Windows and Doors:
Inspect the caulking and weather stripping around windows and doors for any cracks or gaps. Proper sealing will improve energy efficiency by keeping cool air in and hot air out. Additionally, sealing gaps helps prevent pests from finding their way into your home as they seek shelter from the changing weather.

3. Test and Maintain Air Conditioning Systems:
August heat can put a strain on your air conditioning system. Before the hottest days arrive, test your AC unit to ensure it’s functioning correctly. Replace air filters regularly to maintain optimal performance and improve indoor air quality. If you encounter any issues, it’s better to address them now than to suffer through a breakdown during a heatwave.

4. Spruce Up Your Landscaping:
Take advantage of the warm weather and give your yard some TLC. Water your lawn regularly, trim overgrown bushes, and remove any weeds. Consider planting fall flowers to keep your garden vibrant as the seasons change. Proper landscaping not only enhances your home’s curb appeal but also adds value to your property.

5. Conduct a Roof Inspection:
Check your roof for any damaged or missing shingles. A well-maintained roof is essential for safeguarding your home against water leaks and structural damage. Addressing roofing issues promptly can prevent costly repairs in the future.

6. Clean and Organize the Garage:
With the summer activities winding down, now is an excellent time to clean and organize your garage. Dispose of any unused items, tidy up shelves, and create designated storage areas for seasonal items. A well-organized garage allows for easier access to tools and equipment when needed.

7. Review Home Security Measures:
As the days get shorter, it’s wise to reassess your home security. Check the batteries in your smoke detectors and carbon monoxide alarms. Ensure all outdoor lighting is functioning correctly to deter potential intruders. If you haven’t already, consider installing a home security system to protect your property and loved ones.

8. Schedule HVAC Maintenance:
To maintain a comfortable living environment, schedule professional maintenance for your heating and ventilation systems before the colder months arrive. Regular servicing will optimize their efficiency and extend their lifespan.

9. Prepare for Back-to-School:
If you have school-age children, August is the ideal time to prepare for the upcoming academic year. Organize study spaces, stock up on school supplies, and adjust family routines to accommodate new schedules.

As August arrives, don’t let the summer lull lead to neglecting your home. By following this homeowner’s checklist, you can ensure your property remains in excellent condition, ready to face the changing seasons. Taking proactive steps now can save you time, money, and stress in the long run, allowing you to enjoy the rest of your summer worry-free. Happy August and happy home maintaining!

Buyer Tips • July 25, 2023

How to Make Your Home Offer Irresistible to Sellers When You Can’t Offer the Asking Price

by Christine Farley

How to Make Your Home Offer Irresistible to Sellers When You Can’t Offer the Asking Price

In a competitive real estate market, offering the asking price might not always be feasible for home buyers. But fear not! There are several strategies you can employ to make your offer more desirable to sellers, even if you can’t meet their asking price. In this blog post, we’ll explore some creative ways to make your offer stand out and increase your chances of securing your dream home.

**1. Get Pre-Approved for a Mortgage**

One of the most effective ways to make your offer more attractive is to get pre-approved for a mortgage. This shows sellers that you are a serious buyer with the financial capability to close the deal. A pre-approval letter from a reputable lender can instill confidence in the seller that the transaction is less likely to fall through due to financing issues.

**2. Offer a Larger Earnest Money Deposit**

An earnest money deposit is a sum of money you put down to demonstrate your commitment to purchasing the property. Offering a larger earnest money deposit than the typical amount can show the seller that you are fully invested in buying their home. It also indicates that you have the financial resources to back up your offer, making it more enticing for the seller to consider.

**3. Be Flexible with the Closing Timeline**

Flexibility in the closing timeline can be a significant advantage when negotiating with a seller. If the seller needs to move out quickly, offering to close the deal sooner or giving them extra time to find a new home can make your offer more attractive. Be prepared to accommodate their needs while ensuring it aligns with your own plans.

**4. Include an Escalation Clause**

An escalation clause is a powerful tool that allows your offer to increase automatically if competing offers come in. It specifies the amount by which you are willing to increase your offer above other bids, up to a certain limit. This clause shows the seller that you’re serious about the property and ready to outbid others to secure it.

**5. Write a Personal Letter**

Sometimes, a heartfelt personal touch can make all the difference. Consider writing a sincere letter to the seller, expressing your love for their home and why it’s the perfect fit for you and your family. Share your plans and aspirations for the property, making a personal connection that goes beyond mere numbers. Emotional connections can influence sellers to choose your offer over others, especially in competitive markets.

**6. Waive Unnecessary Contingencies**

While some contingencies are essential for your protection as a buyer, consider waiving non-essential ones to make your offer more enticing. For example, if you have a strong inspection report, you may choose to waive the inspection contingency. However, be cautious and only waive contingencies if you are confident in your decision and fully understand the risks involved.

**7. Use an Experienced Real Estate Agent**

Working with an experienced real estate agent can be invaluable when trying to make your offer more desirable. They can offer insights into the local market, help you craft a competitive offer, and negotiate on your behalf. Their expertise can be the edge you need to stand out and successfully secure the home you want.

Offering less than the asking price doesn’t necessarily mean losing out on your dream home. By employing these strategies and creatively making your offer more desirable, you can increase your chances of success in a competitive real estate market. Remember to stay flexible, communicate effectively, and work with a trusted real estate agent to navigate the home-buying process with confidence. Happy house hunting!

Holidays • Uncategorized • July 4, 2023

Happy 4th of July

by Christine Farley

Celebrating Independence: The Spirit of the 4th of July

The 4th of July, commonly known as Independence Day, is a significant date in American history. It marks the anniversary of the United States’ declaration of independence from Great Britain in 1776. This day holds great importance as it symbolizes freedom, patriotism, and the spirit of unity among the American people. As we prepare to celebrate this cherished holiday, let us delve into the history, traditions, and significance of the 4th of July.

1. The Historical Significance:

On July 4, 1776, the Continental Congress adopted the Declaration of Independence, a revolutionary document that asserted the colonies’ autonomy and announced their separation from British rule. This act paved the way for the birth of a new nation, founded on the principles of liberty, equality, and the pursuit of happiness. The 4th of July serves as a reminder of the courage and determination of the founding fathers who fought for the rights and freedoms we enjoy today.

2. Time-Honored Traditions:

The 4th of July is celebrated with various traditions and festivities that have become deeply ingrained in American culture. Fireworks, barbecues, parades, and family gatherings are common sights across the nation. Fireworks displays illuminate the night sky, filling the air with vibrant colors and awe-inspiring explosions, symbolizing the triumph of freedom. Backyard barbecues bring friends and families together, where the tantalizing aroma of grilled food and the joy of shared laughter create cherished memories.

3. Spirit of Patriotism:

The 4th of July ignites a strong sense of patriotism in the hearts of Americans. It is a time to reflect on the nation’s achievements, honor those who have served in the military, and pay tribute to the ideals that the United States was built upon. From displaying the American flag proudly to attending local ceremonies and events, Americans demonstrate their love and commitment to their country on this special day.

4. Embracing Diversity:

The 4th of July transcends cultural, ethnic, and religious boundaries, uniting people from all walks of life in the spirit of freedom and unity. It is a day when differences are set aside, and Americans come together to celebrate their shared values and common goals. This celebration of diversity highlights the strength and resilience of a nation that welcomes individuals from all backgrounds.

5. Reflection and Gratitude:

Amidst the festivities, it is essential to take a moment to reflect on the sacrifices made by those who came before us and express gratitude for the freedoms we enjoy. The 4th of July reminds us of the ongoing pursuit of liberty and justice for all. It serves as a call to action, encouraging us to strive for a better future and ensure that the principles upon which this nation was founded are upheld.

As the 4th of July approaches, let us celebrate this day with joy, appreciation, and a renewed commitment to the values that make the United States a beacon of hope and freedom. Let us remember the history, honor the traditions, and embrace the diversity that defines our great nation. May the spirit of the 4th of July continue to inspire unity, progress, and the pursuit of a brighter future for all Americans. Happy Independence Day!

Home Ownership • June 27, 2023

Guest Room Essentials

by Christine Farley

The Essentials for a Guest Room: Creating a Welcoming Retreat

Introduction:

Creating a comfortable and inviting guest room is essential for providing a warm and memorable experience for your visitors. Whether you frequently host friends and family or occasionally accommodate overnight guests, a well-equipped guest room can make a world of difference. In this blog post, we will explore the essential elements that will transform an ordinary space into a welcoming retreat for your visitors.

A Comfortable Bed:

The cornerstone of any guest room is a comfortable bed. Invest in a high-quality mattress that offers proper support and consider opting for a queen or king size if space allows. Dress the bed with clean, soft linens, including a cozy duvet or comforter, plush pillows, and extra blankets to cater to individual preferences.

Adequate Storage:

Provide ample storage options to help your guests feel organized during their stay. A dresser or a chest of drawers can be used to store clothing, while a luggage rack or bench allows guests to conveniently access their suitcases. Consider providing hangers in the closet and a small bedside table for personal belongings.

Privacy:

Ensure that your guest room offers privacy and the means to control it. Install blinds, curtains, or shades that can be easily adjusted to allow guests to personalize the level of natural light entering the room. If possible, dedicate a separate bathroom or, at the very least, clearly communicate bathroom arrangements to avoid any awkwardness.

Thoughtful Amenities:

Consider adding thoughtful amenities to enhance your guests’ comfort. Provide a bedside clock or alarm, a reading lamp, and access to electrical outlets for charging electronic devices. A full-length mirror, a waste bin, and a laundry hamper are also practical additions that can make a guest’s stay more convenient.

5. Adequate Lighting

Ensure that your guest room has sufficient lighting options to accommodate various needs and moods. Install a ceiling light with a dimmer switch for overall illumination. Include bedside lamps or sconces for reading and ambient lighting. A small desk or table with a task lamp can be beneficial for guests who may need to work or use their laptops.

Thoughtful Decor:

Create a welcoming atmosphere by incorporating tasteful decor that reflects your personal style. Opt for soothing paint colors, artwork, or photographs that evoke a sense of tranquility. Adding plants or fresh flowers can breathe life into the space, making it feel more vibrant and inviting.

Wi-Fi Access:

In today’s digital age, providing Wi-Fi access is crucial. Share the network name and password with your guests, and ensure that the signal is strong and reliable within the guest room. Consider providing a small information card with these details for easy reference.

Guest Information:

To make your guests’ stay as seamless as possible, provide essential information within the guest room. Include details such as your contact information, emergency numbers, nearby attractions, and public transportation options. A small welcome note or guidebook with recommendations for local restaurants, shops, or entertainment can also be a nice touch.

Creating a guest room that offers comfort, privacy, and thoughtful amenities is key to ensuring your visitors have a pleasant stay. By considering the essentials discussed in this blog post, you can transform a simple room into a welcoming retreat that leaves a lasting impression. Remember, a well-prepared guest room not only reflects your hospitality but also shows your guests how much you value their presence in your home.

Buyer Tips • Home Ownership • June 16, 2023

Understanding the Legal Requirements for Designating a Room as a Bedroom

by Christine Farley

Understanding the Legal Requirements for Designating a Room as a Bedroom

When it comes to designating a room as a bedroom, there are certain legal requirements that must be met to ensure the safety, comfort, and habitability of the space. These requirements vary from jurisdiction to jurisdiction, but there are some common criteria that are often considered in determining whether a room can be legally called a bedroom. In this blog post, we will explore these criteria and provide you with a comprehensive understanding of what is legally required to call a bedroom a bedroom.

1. Minimum Room Size:

One of the primary considerations for designating a room as a bedroom is its size. Generally, there is a minimum square footage requirement that must be met. The exact size requirement may vary depending on the local building codes and regulations, but a typical guideline is around 70 square feet. This minimum size ensures that the room is spacious enough to accommodate essential bedroom furniture and allow for comfortable movement.

2. Ceiling Height:

Another crucial factor is the ceiling height. The room must have a minimum ceiling height as specified by local building codes. Commonly, the requirement is around 7 feet, although it can vary. This criterion ensures that the room provides sufficient headspace and promotes a sense of openness.

3. Emergency Exits:

To ensure safety in case of an emergency, a bedroom should have at least two exits. Typically, one exit is the door leading to the main living area or hallway, while the second exit can be a window. The window must meet specific size requirements to allow for easy escape and rescue, and it should have no obstructions hindering its accessibility.

4. Ventilation and Natural Light:

Proper ventilation and access to natural light are crucial for maintaining a healthy living environment. Local building codes often require bedrooms to have a certain minimum window size to allow for adequate airflow and natural light. These requirements aim to prevent the room from becoming stuffy and to enhance the overall comfort of the occupants.

5. Heating and Cooling:

A bedroom should have a reliable heating system to ensure a comfortable temperature during colder months. Similarly, an appropriate cooling mechanism, such as air conditioning or fans, may be required to maintain comfortable conditions in warmer climates. Local regulations may specify the type of heating and cooling systems permitted and their efficiency standards.

6. Closet Space:

The presence of a closet is often considered in determining whether a room can be classified as a bedroom. However, the requirement for a closet may vary depending on the jurisdiction. Some areas have specific regulations mandating the presence of a closet, while in others, it may be a more flexible requirement.

Conclusion:

To legally designate a room as a bedroom, it must meet certain criteria established by local building codes and regulations. These requirements typically encompass factors such as minimum room size, ceiling height, emergency exits, ventilation, natural light, heating and cooling systems, and sometimes the presence of a closet. Adhering to these guidelines ensures that a bedroom provides a safe, comfortable, and habitable space for its occupants.

Before designating a room as a bedroom, it is crucial to consult the specific regulations and requirements applicable in your local area. Building codes and regulations can vary significantly, so it is essential to comply with the rules set forth by the appropriate authorities to ensure both legal compliance and the well-being of those utilizing the space as a bedroom.

Sellers • June 6, 2023

Boosting Curb Appeal: Essential Steps for Sellers Before Listing Their House

by Christine Farley

Boosting Curb Appeal: Essential Steps for Sellers Before Listing Their House

When it comes to selling a house, first impressions matter. Potential buyers form their initial opinions based on the property’s curb appeal—the way it looks from the outside. Enhancing curb appeal is a vital step in attracting buyers and increasing the chances of a quick and profitable sale. In this blog post, we’ll explore actionable tips and ideas for sellers to create irresistible curb appeal and make their house stand out in a competitive real estate market.

1. Spruce up the Exterior:
a. Start with a thorough cleaning: Pressure wash the exterior walls, walkways, and driveway to remove dirt, grime, and mildew.
b. Repaint where necessary: A fresh coat of paint on the front door, shutters, and trim can instantly revitalize the house’s appearance.
c. Repair and replace: Fix any cracked or damaged siding, roof shingles, windows, or gutters. Replace broken or outdated fixtures, such as house numbers, outdoor lighting, and mailbox.

2. Landscaping:
a. Tidy up the yard: Trim overgrown bushes, trees, and hedges. Remove weeds, fallen leaves, and debris from the lawn.
b. Add color and vibrancy: Plant seasonal flowers and arrange potted plants near the entrance for a welcoming touch.
c. Define walkways: Install edging or add stepping stones to create a clear path leading to the front door. This helps guide visitors and enhances visual appeal.

3. Enhance the Entryway:
a. Upgrade the front door: Consider replacing an old or worn-out front door with a stylish, energy-efficient one. Alternatively, a fresh coat of paint and new hardware can do wonders.
b. Add inviting elements: Place a welcoming doormat, add a couple of potted plants on either side of the entrance, and hang a beautiful wreath on the door.
c. Good lighting: Install outdoor lighting fixtures that illuminate the walkway and highlight architectural features, providing a warm and secure atmosphere.

4. Window Appeal:
a. Clean windows thoroughly: Sparkling clean windows not only enhance the overall appearance but also allow more natural light into the house.
b. Dress them up: Consider adding window boxes with flowers or installing shutters to create visual interest and charm.

5. Maintain the Driveway:
a. Repair cracks and potholes: A well-maintained driveway makes a positive impression. Patch any visible damage and seal the surface to improve its appearance.
b. Organize parking space: Clear the driveway of any vehicles or clutter. Buyers want to envision their own cars in the space.

6. Pay Attention to Details:
a. Outdoor staging: Consider arranging outdoor furniture or a cozy seating area on the porch or patio to showcase the potential of the outdoor living space.
b. Clean and declutter: Remove any unnecessary items such as toys, garden tools, or excessive decorations from the yard.
c. Symmetry and balance: Ensure a balanced and harmonious look by placing decorative elements symmetrically.

Creating curb appeal is a critical step in preparing a house for sale. By investing time and effort into improving the exterior appearance, sellers can significantly increase the chances of attracting potential buyers and achieving a faster, more successful sale. Remember, a well-maintained and visually appealing exterior sets the stage for a positive impression and creates a lasting impact on potential buyers.

Sellers • May 23, 2023

The Ultimate Guide: Getting Your Home Ready to Sell

by Christine Farley

The Ultimate Guide: Getting Your Home Ready to Sell

Selling a home can be an exciting and potentially lucrative venture. However, before putting your house on the market, it’s essential to invest time and effort into preparing it for sale. By following a few key steps, you can significantly increase your chances of attracting potential buyers and securing a favorable deal. In this blog post, we will guide you through the essential tasks that every seller should undertake to get their home ready to sell.

1. Boost Curb Appeal:
First impressions matter, and the exterior of your home sets the tone for prospective buyers. Enhance your home’s curb appeal by ensuring the front yard is well-maintained, the lawn is neatly trimmed, and the landscaping is in order. Consider repainting the front door, cleaning or replacing the house numbers, and adding potted plants or flowers to create an inviting entrance.

2. Declutter and Depersonalize:
One of the most critical steps in preparing your home for sale is decluttering. Clear out excessive furniture, personal items, and any clutter that can make spaces feel cramped. Potential buyers should be able to envision themselves living in the house, so it’s crucial to create a neutral and welcoming environment. Remove personal photographs, excessive decorations, and items that may distract buyers from seeing the potential of the space.

3. Deep Cleaning:
A sparkling clean home is far more appealing to buyers. Devote time to thoroughly clean every room, including floors, windows, carpets, and appliances. Pay special attention to kitchens and bathrooms, ensuring they are spotless and free of any unpleasant odors. Consider hiring professional cleaners for a deep cleaning if necessary.

4. Make Necessary Repairs:
Take a walk around your home and identify any noticeable repairs that need attention. Repair leaky faucets, squeaky doors, broken tiles, or any other issues that could deter potential buyers. Minor repairs can make a significant difference in the perceived value of your home and reassure buyers that it has been well-maintained.

5. Freshen Up with Paint:
A fresh coat of paint can work wonders in revitalizing your home’s appearance. Neutral, light-colored walls are generally the most appealing to buyers as they create a sense of spaciousness. Repaint any rooms with outdated or overly bold colors, focusing on high-traffic areas such as the living room and kitchen. Additionally, consider painting the front door to create an attractive focal point.

6. Stage the Space:
Staging your home can help potential buyers visualize its potential and maximize its appeal. Rearrange furniture to create an open and inviting layout, and use strategic decor to highlight the best features of each room. Consider consulting with a professional home stager who can provide expert advice on showcasing your home’s best attributes.

7. Enhance Lighting and Ambiance:
Ample lighting can make a home feel warm, inviting, and spacious. Maximize natural light by opening curtains and blinds, and ensure all light fixtures are in working order. Consider replacing outdated or dim bulbs with brighter, energy-efficient options. Additionally, strategically place mirrors to reflect light and create an illusion of space.

8. Pay Attention to Odors:
Unpleasant odors can be an instant turnoff for potential buyers. Ensure your home smells fresh and clean by eliminating any sources of odor, such as pet smells, cigarette smoke, or cooking odors. Open windows to let in fresh air, use air fresheners sparingly, and consider baking cookies or brewing coffee before showings to create a welcoming aroma.

Getting your home ready to sell requires some time, effort, and attention to detail. By following these essential steps, you can significantly enhance your home’s appeal, attract more potential buyers, and increase your chances of securing a successful sale. Remember, creating

Sellers • May 16, 2023

Why It’s a Great Time to List Your House

by Christine Farley

Why It’s a Great Time to List Your House

Selling a home can be a complex and emotional process, requiring careful planning and consideration of market conditions. While the real estate market may fluctuate over time, there are occasions when favorable conditions align to create an advantageous environment for sellers. In the current landscape, several factors have converged, making it an excellent time to list your house for sale. In this blog post, we will explore these factors and shed light on why now is a great opportunity for homeowners looking to sell.

1. High Demand for Homes

One of the most compelling reasons to list your house right now is the high demand for homes. Over the past few years, the real estate market has been characterized by a shortage of available homes for sale, leading to fierce competition among buyers and driving up prices. As a result, many potential buyers are eager to find their dream home and are actively searching the market. By listing your house now, you can tap into this high demand and attract motivated buyers who are willing to pay a premium for the right property.

2. Low Housing Inventory

Another advantage for sellers in today’s market is the low housing inventory. In many areas, the number of available homes for sale has fallen, leading to a shortage of supply. This imbalance between supply and demand has created a seller’s market, giving homeowners a significant advantage in negotiations. By listing your house now, you can take advantage of this shortage of supply and potentially receive multiple offers, driving up the final sale price.

3. Historically Low Mortgage Interest Rates

Low mortgage interest rates are not only advantageous for buyers but also for sellers. The low rates have incentivized more buyers to enter the market, increasing the demand for homes. Additionally, the low rates make homeownership more affordable, potentially enabling buyers to stretch their budget and purchase a higher-priced home. This increased affordability can lead to a larger pool of potential buyers and a quicker sale for sellers.

In conclusion, the current real estate market presents an excellent opportunity for homeowners looking to sell their house. The combination of high demand, low inventory, and low mortgage interest rates creates a favorable environment for sellers, potentially leading to a quicker sale and a higher sale price. If you are considering selling your home, now is a great time to list your house and take advantage of these favorable market conditions.

Buyer Tips • May 9, 2023

Fed’s Latest Hike Pushes Mortgage Rates Down

by Christine Farley

Fed’s latest hike pushes mortgage rates down

By Movement Staff

MARKET UPDATE

MAY 5, 2023

A 10th straight hike brought us to a 16-year high of the federal funds rate this past week as the Federal Open Market Committee approved a 25-basis point rate increase. Now, the overnight lending rate stands at 5.25%. The move was highly anticipated, and expected, but the FOMC members made a notable omission in their language announcing the hike—they took out the wording that indicated future rate hikes are likely.

The announcement was a boon for the mortgage industry on the day of the announcement as the 10-year Treasury note continued on a strong downward trend. The 10-year yield started the week at a high of 3.57% when markets opened on May 1 and ended Thursday trading at 3.35%—a 20-basis point dip that spurred a flurry of rate-lock activity.

Yields dropped because, quite simply, investors are spooked that the Fed’s move will negatively affect more banks and plunge the economy into a recession. When investors get fearful, they move their money into the relative stability of government-backed bonds, like the 10-year Treasury note, which drives price up and drives yields down.

A day before the Fed’s announcement, yet another major bank was taken over by the FDIC and then sold to J.P Morgan Chase. The bank, First Republic, reported it lost $100 billion in deposits over the last year as the Fed raised interest rates and bank customers moved their money into higher performing assets. Consequently, the Fed raising rates again in an already weak bank-earnings environment prompted investors to flee to the safer bet fearing more bank collapses.

This contributed to the plague of uncertainty that continues to hover over the global economy as many central banks make an effort to stay out of a recession. The Fed’s latest hike is an effort to do just that although chairman Jerome Powell made note in his press conference that the labor market remains tight and acknowledged the higher borrowing costs “are likely to weigh on economic activity, hiring and inflation.”

The April jobs report from the Labor Department was released just two days after Powell’s speech and reflected the language he used. The report showed 253,000 jobs were added in April, well ahead of the expectation for 180,000 jobs—indicating the labor market is still extremely strong despite a clearly slowing U.S. economy. The unemployment rate was 3.4% which went against estimates of 3.6%. Wage growth also beat expectations, increasing 4.4% year-over-year against the 4.2% forecast.

Earlier in the week, ADP released its private payrolls report showing a much higher than expected reading. Private payrolls added 296,000 jobs in April, according to the data, well ahead of the estimated number of 133,000. This was the highest monthly increase for private payrolls since July of last year.

MORTGAGE WORLD REMAINS EXTREMELY SENSITIVE

One thing every mortgage originator is craving right now is stability in pricing. Borrowers are always wanting to wait for the best rate, but that timing has become extremely hard to predict over the last year causing a lot of frustration in the housing world.

The 30-year fixed-rate mortgage average moved to 6.39% this last week, according to Freddie Mac. The group’s analysts wrote in their report that, “This week, mortgage rates inched down slightly amid recent volatility in the banking sector and commentary from the Federal Reserve on its policy outlook. Spring is typically the busiest season for the residential housing market and, despite rates hovering in the mid-six percent range, this year is no different. Interested homebuyers are acclimating to the current rate environment, but the lack of inventory remains a primary obstacle to affordability.”

It is important to keep in mind that while you might be conditioned to look for the lowest rate, that may not always be your best option. Also, many times the eye-popping low rates that are advertised require you to buy down the rate with points. One discount point generally costs about 1% of your loan amount and, while it varies by lender, will often result in a .25% reduction in interest rate. This money is applied to your closing costs and could add up very quickly and may not be worth it in the long run.

It’s best to walk through every scenario with a local Movement Mortgage loan officer who can give you a long-term financial picture of home financing versus just getting the lowest rate right now.