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Monday, August 22, 2016

4 Myths of Buying vs. Renting

According to a recent report by Harvard University’s Joint Center for Housing Studies, the past 15 years have seen a drastic shift in how Americans approach renting and owning. More people are renting, while fewer are buying houses. In fact, the average annual growth number for renters is now approaching the peak number for homebuying reached in 2006, just before the housing market crash.

The reasons for such explosive rental growth are numerous: lingering effects from the economic collapse in 2008, the revitalization of many urban cores, Baby Boomers aging out of their houses, and high rates of student loan debt among Millennials. Many millennial renters are postponing “next-steps” like marriage or starting a family, and still see home ownership as out of reach.

But should they? Maybe not. We at ABODO know a little something about renting, and have broken down four of the most common myths about buying a house versus renting an apartment.

MYTH #1: Ownership Is More Expensive
Not always — at least month by month. As demand for rental properties has grown, so have rents. In fact, in 2015 rents nationwide rose 4.6%, the largest increase in almost 10 years. According to a recent study, it’s cheaper to buy a house than rent it in 42 states. The overall price tag might give you sticker shock, but more often than not, a monthly mortgage payment will be comparable (or less) than rent, and at least you’ll be gaining equity. Plus, mortgage interest payments are tax-deductible. This handy calculator from the  New York Times can tell you if homeownership might actually be a good financial move.

MYTH #2: Your Savings Will Be Depleted, Forever
You might think that after a downpayment, and mortgage payments, and furnishing, and repairs, and maintenance, and property taxes… saving money is a lost cause. But think of it this way: Every mortgage payment that pays down principal and interest is a kind of “forced savings account.” You have to pay it, so you do. But unlike a rent payment, that money isn’t vanishing into the ether (or, as it’s more commonly known, your landlord’s pocket). Assuming you don’t default on your loan and go into foreclosure, you’ll see that money again, in a different form. By establishing equity in your house, you’ll be seeing long-term value in the form of an investment. You’ll also be eligible for new lines of credit. It might take 30 years, but it won’t be 30 years of checks down the drain.

MYTH #3: You Can’t Get a Loan
Yes, the days of subprime lending are over — and thank goodness, given how that turned out. Given the events of 2007-2009, banks are understandably cautious about handing out large loans for new homeowners. But that doesn’t mean it’s impossible. In 2014, Fannie Mae and Freddie Mac announced a new initiative, aimed at encouraging first-time homeowners, that backs mortgages with extremely low down payments — as low as 3%. There are conditions, of course: Potential homebuyers must buy private mortgage insurance and have a high credit score (at least 620). But such a low down payment (the standard is 20%!) is a major help for younger homebuyers who might still be paying off student loans.

MYTH #4: You’re Too Young to Own
According to the National Association of Realtors, over 35% of new homebuyers in 2015 were Millennials, making them the largest group of recent buyers for two years running. And the median age for Millennial homebuyers was 30. So it’s not just Gen X or Boomers buying houses. (In fact, Boomers are moving into apartments in droves.)

Convinced? We hope not. It takes more than just an internet article to know whether you’re ready for homeownership. In addition to this list, take an honest and hard look at your finances, your life goals, and your tolerance for home-repair before you commit. But if you decide to go ahead on the rewarding path of homeownership, get in touch with Josh Lavik & Associates 608-620-4234 to set up a consultation. And happy house-hunting!

Friday, August 19, 2016

This Month in Real Estate: July 2016

According to the South Central Wisconsin MLS active inventories have fallen in all 6 markets. Single family home sales have also fallen in five of the six markets compared to last year. Year-to-date sales however are ahead in one-half of the SCWMLS, but slightly down in Dane County.

There is a strong competition among buyers in the price range under $300,000. The impact of this competition can be easily seen with the year-to-date increases in median prices for both single family homes and condos. 

The good news for buyers is that it is a strong economy with historically low interest rates. This helps with affordability even with rising prices. The good news for sellers is that there are buyers waiting for your home. Now is the time to contact Josh Lavik & Associates 608-620-4234 to help you navigate your way through this tricky market. We've helped many buyers and sellers find their dream home!

Thursday, August 11, 2016

How Can You Make Your Home Happier?

Your home should be a sanctuary from the stresses of everyday life where you can relax and spend time with friends and family. Here are some tips to help you put a smile on your face whenever you walk in your front door.
  1. Surround yourself with mood-boosting colors. Red, orange and yellow are often associated with generating a positive mood. If these colors aren't your favorite, surround yourself with ones that are uplifting and give you inspiration. 
  2. Fill the air with blissful scents. Many scents like jasmine, lavender, citrus or even fresh baked cookies are linked to happiness. Sent is also linked to memory so filling your home with happy memories will lift your spirits. 
  3. Create a dedicated space for your hobbies. Spending time on activities that bring you joy is important to your overall happiness. If you passion is reading, painting or woodworking, having a space devoted to your favorite hobby will motivate you to spend more time on what you love.
  4. Bring the outdoors in. There is a significant link between spending time enjoying nature and your mood. Fill your home with plants and fresh flowers, even just opening the curtains can make an impact.
Simple tips like these can create a happier, healthier and more valuable home!

Friday, August 5, 2016

August Home Care Tips

The return to school and work is looming over us now that August is here and we're getting in those last vacations before summer is over. Here are a few things you can do around the house with fall right around the corner.
  1.  Edit and organize clothes closets. Before you do any shopping for fall, sort through your closets and drawers. Donate any items you no longer want. Begin pulling out fall clothes from storage to asses what you still need.
  2. Clean the bathroom fan. Through the summer months the bathroom fan has to work even harder to clean the air. Leave it on for a full 30 minutes after each shower to prevent bathroom mildew from forming. Use a vacuum attachment to clear out the dust and grime.
  3. Prep for quick and easy weeknight dinners and school lunches. Get a jump start on kitchen tasks by cleaning out cupboards and prepping some big batch meals you can freeze. Wash and chop fruits and veggies to keep as healthy snacks.
  4. Give the mudroom a makeover. Create a functional and attractive mudroom with a set of wall hooks and some organizational baskets. Maximize closet space with a shoe rack and a high shelf for less frequently used items.
  5. Do some emergency prep. In case of an emergency you should always have some emergency kits up to date with food, water, clothes, flashlights and first aid supplies. Especially if you are living in an area where flooding, hurricanes, tornadoes or earthquakes occur. 
  6. Check and put away summer equipment. Clean summer gear and toss broken items before storing them for next year. Take advantage of end of season sales to find a new one at the best price. 

Monday, July 25, 2016

Having a Good Agent on Your Side

In this competitive real estate market it's important to have a good agent on your side and with our team you get the best! In our latest Real Estate News video Josh breaks down the dynamic of our team and how we provide you a better real estate experience.

Ready to take the next steps? If you're wanting to sell or looking to buy, we're ready to help you with all your real estate needs. Contact us by giving us a call at 608-620-4234 or visit our website.