By Carlos Iglesias
Record low mortgage rates spell good news for anyone in the position to purchase a home in the current real estate market.
According to a recent weekly Freddie Mac mortgage market survey, mortgage rates have hit record lows for the second straight week, ending Sept. 15.
Here’s a closer look at rates for the week ending Sept. 15:
30-year fixed-rate mortgages: averaged 4.09 percent this week, down from last week’s previous record of 4.12 percent. Last year at this time, 30-year rates averaged 4.37 percent. 15-year fixed-rate mortgages: averaged 3.30 percent, dropping from last week’s record low of 3.33 percent. Last year at this time, 15-year rates averaged 3.82 percent.
5-year adjustable-rate mortgages: averaged 2.99 percent this week, up slightly from last week’s 2.96 percent average. A year ago at this time, the 5-year ARM averaged 3.55 percent.
1-year ARMs: averaged 2.81 percent, down from last week’s 2.84 percent average. A year ago, the 1-year ARM averaged 3.40 percent.
Houston Real Estate Market
The real estate market in Houston has been holding up better than in other states because of the oil and medical industries, two very strong pillars in the economy here in Houston.
We have a lot of migration of individuals from other states where the real estate market is faring much worse. Locally, in Houston, it is one of the best times to consider refinancing an existing mortgage or buying the dream home you have been waiting for.
Fannie Mae and Freddie Mac are loosening up tight lending standards to help improve the ability of prospective homeowners to qualify for home mortgages and providing current incentives for homeowners to purchase a home in the current market.
If you are in the market to purchase a home, you will need the following:
• Last two years of tax returns
• Last two months of bank statements
• A full month of paycheck stubs
That is basically all you will need for your first interview with a mortgage professional, who will pull your credit report and have you complete a mortgage application as a part of the process.
Considerations for Sellers
As a real estate professional for the past seven years, my experience has been that homeowners typically think their home is valued more than it actually is.
I encourage a potential seller to consult with a professional to determine the actual value of their home in the market. Overvaluing a home results in the home staying on the market longer than it would if priced more accurately at the onset.
According to information from a recent Daily News Report, 75 percent of home owners say their homes are worth more than the recommended listing price, according to real estate professionals recently surveyed by HomeGain.
On the other hand, 68 percent of home buyers say homes are overpriced.
Weighing Value of Home Improvements
One thing that sellers tend to do is invest $40-$50,000 to put a pool in the backyard thinking that they will get that money back when they sell the home. Wrong. That is the worst investment that a seller can make, because a pool will get only 15 to 20 percent of the value of what they are going to spend when the home is sold.
If you are going to invest in making home improvements, do so wisely. One of the things that increases the value of your home is granite countertops in the kitchen. That is a definite selling point that enhances your home’s value for potential buyers. People get excited when they see granite countertops in a home.
A seller should also consider investing in upgrades in the home’s bathroom. Depending on the condition of the bathroom, improvements could range from changing out the bathtub to changing the mirror to changing out faucet fixtures. If you put an attractively designed mirror in the bathroom it may cost you no more than perhaps $100 dollars to make a big impact on the bathroom’s appearance.
As far as making exterior improvements to your home, sellers should look at investing in a basic flower bed. You can spend $1 to $2 for each plant, which is very inexpensive. And with the current dry weather conditions, it is important to remember to water it. A lot of people spend $200 to $300 dollars on a flower bed and forget to maintain and water it.
Sellers also may want to change or freshen up the paint on the home. I recommend the use of neutral colors and staying away from accent paints. Not everybody is attracted to accent paints, but everybody is generally attracted to neutral colors.
Keeping your lawn cut and manicured also improves the homes curb appeal and can factor in your ability to sell your home.
Carlos Iglesias is a guest columnist for Empower Magazine’s “Real Estate Today” column sharing his insights in the real estate and Houston home buying market. A professional realtor since 2004, he is an agent for RE/MAX Elite.
For more information, call 281-980-000 or visit his office at 11319 Fountain Lake Drive in Stafford, Texas.