Category Archives: Residential Real Estate

Is There A “Bust” Coming After This “Boom”?

For the past several months I have been hearing from my colleagues, consumers, and “talking heads” on the business channels on cable, that there is a coming “correction”, “downturn”, and even the dreaded “R” word; Recession.  Bollocks! I say.  Has there been a relenting of the continued pressure to increase prices? Yes, there has.  However, that does not mean that prices are in decline, or will be any time soon.

Recall the basic laws of economics; Supply and Demand.  We still have a tight supply and demand is very strong.  In many parts of the country, and especially in most of New England, there is much less than six months of supply.  (Six months of supply is considered to be “Balanced.”)

The reason that the pressure to push prices higher has relented a bit is that inventory has increased slightly.  So if the level of inventory went from 3.5 months to 4.4 months, there are more houses for buyers.  However, we are still far from a “Balanced Market”.

Balance scales

How do we know that this Demand will continue if the Fed raises interest rates? The reason that higher interest rates will not be detrimental to the real estate market is that Success: red graph over coinsREAL wages are increasing and new job creation is outpacing forecasts.

There were 230,000 new jobs created in September versus a Wall Street forecast of 180,000.  Additionally, demographics support continued strength in the housing market.  The number of millennials in the “Purchasing Pocket” ( most people buy their first home between 30-34 years of age) has been and will continue to increase.

This sustained demand and the continued increase in wages bodes well for the housing market. If the housing market is healthy that will create a thriving economy at-large because many more people will see increases in their income.  Every time a new house is sold $60,000-$75,000 of income is injected into the local economy.  That will help legions of small businesses.

Coming real estate “Bust”?…I think not.  The data doesn’t support that claim.

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RI Living shares tips for moving

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Source: https://w3.cdn.anvato.net/player/prod/v3/anvload.html?key=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%3D%3D“>RI Living shares tips for moving

Tips to get ready to move

The Fall home selling season will soon be upon us. If you’ve been thinking about moving – perhaps you want to move to a larger home, downsize, or even sell a vacation home – now is a great time to start getting ready. Joe Luca, President of the Rhode Island Association of Realtors, will provide some tips to help you get your home, and yourself, ready to move this fall.

-Enhance curb appeal
Do some end of season clean-up of your yard
Make sure entry ways are clean, uncluttered and appealing.
Fresh paint goes a long way, (inside or out) so if your front door is peeling or faded, etc., give it a coat of paint
-Staging
Declutter
Clean out closets
Find a secure or hidden place to put valuables and prescriptions
Clear off counters of all but a few things.
Get rid of pet smells – wash slipcovers, washable floor coverings, etc. (and never leave your pet home during showings.)
-Prepare for the buyer home inspection – It’s a good idea to get your own home inspection prior to selling to determine what issues could cause problems. The more you can take care of ahead of the game, the better of you will be.
On the buying side – The supply of homes for sale is beginning to grow so you will have more options to choose from.
-Double check your credit history. Make sure there are no issues that need to be addressed.
-Narrow down the area you’re interested in and register on RILiving.com. You can input what you’re looking for and get emails when a new home comes on the market or the status of an existing listing changes.

John Dolbec will get you Pre-approved for a mortgage.  401-266-4413

Gentry Moving will move your belongings. 401-785-1600

Source: RI Living shares tips for moving

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What Do Sellers Need To Do Before Listing Their House?

So you think you want to sell your house; “NOW is the Time To Sell” the headlines claim.  Where do you start? What do you do first?  The FIRST thing ALL prospective sellers should do is to find an experienced, credible, Full Time, REALTOR®.  Why Full Time? The sale/purchase of a house is usually the largest financial transaction of a person’s life.  There is a significant amount of money involved, and even more potential liability if something is over-looked, forgotten, or omitted during the transaction.  This is true for EVERY transaction.  If the REALTOR® is “part time”, working only on weekends, or summers, is the amount of potential liability reduced?  Does the part-timer only need to know some of the regulations, only use some of the most current forms, and only comply with some of the laws? No, No, and No.  None of these factors are static, and in fact, changes occur on a regular basis as our culture, the economy, methodologies, and technologies evolve and advance.  Will the part-timer take time away from the “real-job” to keep up on the aforementioned items? Hmm   As a Full Time REALTOR®, it is a big commitment for me to keep up on everything while still providing my Clients with top notch service.

Additionally, Market Knowledge is important.  Market Knowledge is not just what houses are selling for in a given geographic area, but it is also what buyers are looking for, what they want in a home. This is not something that can be researched on MLS.  If I am not aware of what the market is doing, what buyers want in a home, I may have to invest more time before my client can consummate a transaction. Which may have the unintended consequence of a missed opportunity.  The Seller may not find the best buyer, the Buyer may miss “the perfect house.”

The first reason it is important to consult a Full Time, experienced REALTOR® as soon as you are thinking about selling your house is that he/she will advise you what you need to do to prepare your house for sale.  Whether it is de-cluttering, or updating the interior, minor yard work, or major landscaping on the exterior.

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If a MAJOR de-cluttering is necessary you may want to put some of your belongings in storage and Gentry Moving & Storage is highly recommended.  Accept the guidance of the Full Timer.

The second reason is that appropriate pricing is also necessary.  Houses that are priced to the market sell the quickest and sometimes sell for over asking price.  Would you feel more comfortable accepting the suggested listing price from someone who supports themselves and their family by selling houses, or from someone who does it in their “spare time”?  Does this mean that Part-Timers shouldn’t be in the business? NO.  However, if they are, they should probably have a mentor, or team-leader, who could review, or provide guidance for the benefit of the Consumer. Rely on the market knowledge of the Full Timer.

The third reason is marketing your home.  There are many ways to market houses and houses at different price points, in different neighborhoods, with different demographics, may need to be marketed a little differently.  Dos it make sense to use aerial photography so show a property from 200′ above if there is a cemetery nearby? No. It may if it has a large nicely landscaped yard,  that would add value to the house because it highlights something that adds value

The fourth reason is an experienced REALTOR® will be able to explain how the transaction will proceed. What the Seller should expect from Listing, to Offer negotiation, to Inspection, to Walk-through, and finally Closing.  At which time it is highly recommended that the Seller use the services of an experienced real estate lawyer like Resnick and Caffrey.

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Millennials First Generation Worse Off Than Parents? What Gives?

Many things have been said about the millennial generation (Born 1981-1996) over the years.  The negative generalizations that are frequently applied to this generation in the media are “entitled,” “narcissistic” and “lazy.” (Incidentally, they are tired of being blamed for just about everything.)  However, there are some facts worth considering

 

In 1992                                                            In 2018

Average Home Cost:

$80,626                                                            >$265,000

Average Student Debt:

$5,200                                                               >$35,000

Average Family Income (after taxes)

$59,000                                                              $86,419

Fixed Mortgage Rate:

9.71%                                                                  4.65%

 

Today the average home costs 300% more, student debt averages almost 700% more but family income is only 46% greater than in 1992.  The good news is that the average fixed rate mortgage is about half what it was in 1992.  Unfortunately, the average millennial, due to high student debt, has a credit score of 625  (per NerdWallet) so they may not qualify for the lowest mortgage rates available. A Millennial today is worth 21% less than his 1983 counterpart while the net worth of a 60 year old is twice what it was in 1983.  So young folks are getting poorer while older folks are getting richer.  Is it any wonder that New Home Creation by this generation after graduating from post-secondary educational institutions has been delayed 2-3 years? The Quick Answer is “No”.   These are the contributing factors that support the statistics that show millennials are worse off than their parents.

GOOD NEWS: This generation is not willing to engage in profligate spending like some preceding generations.  They are more likely to move back home to save money to pay down student debt.  Contrary to messages on late-night comedy shows, they do not want  to move back home into their parents’ basement to play video games.  In fact, my personal experience with Millennials is that they are not likely to purchase a home for a price as high as their mortgage pre-approval will allow.  Other generations frequently spend every dollar that their pre-approval will permit.  It is not uncommon for millennial buyers to have a mortgage pre-approval for an amount that is 10-20% greater than what they actually want to spend.  Why? these buyers witnessed first hand when friends, neighbors, or family members were unemployed, and/or under-employed, and had to Short Sale their homes, or worse, experience a foreclosure.  That experience is still very fresh in their memory, so they are willing to take the steps necessary to lessen the chance that they will have such a traumatic experience.

Can anything be done to mitigate this situation? Possibly.  The National Association of REALTORS®  has a Federal Policy Position that would provide tax relief to student debt holders and employers who assist their employees’ student loan debt burdens.  In addition, the National Association of REALTORS® supports policies that provide tax relief to those borrowers with forgiven student debt.  We need to convey to our political representatives in Washington DC that there are things that can be done to address the student debt issue…if we work together.

Not all is “gloom and doom”.  This is the most educated generation, and the most tech-savy generation, in history.  As the economy rebounds real wages will increase, and due to their fiscal discipline, these consumers will be well-positioned to save money at a rate that has not been seen “in generations” 😉

The millennial generation is fantastic for the housing industry because their shear  numbers indicate that demand for homes will not abate for years.  So all of my REALTOR® colleagues across the country can rest assured that the demographics favor a sustained positive environment for home sales.  For everyone else this is also good news because when the housing market is strong the economy is not likely to falter.

SPRING HAS SPRUNG!! Time To List Your Home For Sale

Finally, the northeastern part of the country is experiencing seasonal weather. For two consecutive days the sun has shone and it’s great to feel the warm rays on my skin.  This warm weather also harkens the season for home-selling; the busiest time of year for REALTORS.  Lawns become greener, tree buds appear, and hopefully all those yard projects were completed if you were thinking about putting your home on the market.  

It definitely is a seller’s market, so NOW is the time to call a REALTOR to take the final steps to put your house on the market. In the event that you haven’t done anything, don’t despair, there are some simple things you can do to “put your best foot forward.” 

  1. CURB APPEAL should be at the top of your list because the first thing that people will see when they look at an online listing is typically a picture of the front of your house.  Make your house “Pop” with a nice green lawn (you can always fertilize it yourself) straight edges along walkways, the driveway, and curbs. Trim shrubs so they are not overgrown. Scrape peeling paint and touch it up with a matching color. 
  2. AIR QUALITY is something that may seem trivial but if it is not fresh it will leave a lasting, negative, impression.  If there are smokers in your house, lingering pet odors (especially urine), mold/mildew odors, dampness odors, or other smells, get rid of them! You don’t want your house to be remembered for a bad smell; and don’t try to “cover them up” with fragrances or scented candles because buyers and their REALTORS can “smell right through” those tricks. 
  3. PAINT- chipping and peeling paint is noticeable and easily rectified. You can attempt it yourself or hire a pro.  It shouldn’t take long and won’t cost much.
  4. CLEANLINESS is also super important. Dirty windows, dusty sills, dust-bunnies on the floor, are things by which you don’t want to be remembered. If you don’t have time, hire someone to do it for you because it will be worth it.

If you have any questions about preparing your home for sale email me at JosephLuca@remax.net

50 Years Of Fair Housing

April 11 marks the 50th anniversary of the signing of the federal Fair Housing Act. Why is the commemoration a top priority for the National Association of REALTORS®?
The right to own property, and to own a home, is the foundation of our business.

NAR has taken an active role in promoting, and educating REALTORS® about, equal housing opportunity for 50 years.


The Fair Housing Act prohibits discrimination based on race, color, national origin, religion, sex, familial status, or disability.
NAR incorporates all of those requirements, as well as equal opportunity on the basis of sexual orientation and gender identity, into our REALTORS® Code of Ethics, because it makes our association, our industry, and our country stronger.

FAIR Housing Commemoration

 

NAR’s commemoration of the Fair Housing Act is vital because it highlights how far we’ve come in promoting equal housing opportunity—both as a society and as an association—and, more importantly, that our work is on-going.
When Title VIII of the Civil Rights Act was passed in 1968, many in organized real estate had a far different view of fair housing. The new era of openness and equality in the sale or rental of housing clashed with hardwired beliefs at that time; and many believed that fair housing law posed a threat to individual property rights.

President Lyndon Johnson, as he signed the Fair Housing Act on April 11, 1968, famously declared that the right to fair housing “is now a part of the American way of life.”
That right also became every REALTOR®’s responsibility. For all the progress made to raise awareness and end discriminatory practices, as specified in the law and the REALTORS® Code of Ethics, the challenges for the industry and society persist. Fifty years later, REALTORS® commitment to upholding the principles of fair housing remains a top priority.

Despite all of the strides that have been made in Fair Housing, we must learn from the past. Housing is not a special interest; it is a human right. NAR and the RI Association of REALTORS® is committed to safeguarding this right.

Our vigilance must continue so that future generations may also enjoy the benefits of Fair Housing.

Some areas of concern include:

1. How to avoid Steering claims in the age of big data;
2. How emotional support animals like therapy dogs are finding their way into fair housing law;
3. Illegal discrimination based on familial status.
While we may not be able to predict the adversity of our society, or the challenges of the market place, in the future, we must always work together as a nation, and as REALTOR® professionals, to protect the right of Fair Housing for ALL who live here in the greatest country on earth.

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