There are several myths that have long circulated when it comes to buying and selling Columbia SC houses. We decided to try and bust those myths in this article.
What Everyone Misses When Buying and Selling Columbia SC Houses
The most important rule in real estate is location, location, location. Not true! The most important rule in real estate should be future location, future location, future location. Home buyers eager to maximize their returns need to look 10 or 20 years down the road to assess what will happen to the neighborhood, not what it is today.
Buy the worst house in the best neighborhood. Wrong! The house will always be the worst house in the neighborhood, and buyers in a great neighborhood are likely to look past your ugly duckling when you go to sell. Price gains on these "worst houses" actually under-perform their surrounding neighborhood rather than being carried along with them. Instead, a shopper should buy the worst house in the hottest neighborhood — and to do so within the first five years of the neighborhood getting hot.
When it comes to buying and selling Columbia SC houses, remodeling the kitchen, with a lot of fancy upgrades, is one of the smartest moves you can make to boost your home's value. WRONG! Kitchen renovations, at any level, offer among the lowest return on investment of the home improvements you can make. Instead, a modest bathroom makeover might have the biggest impact on your home's value.
When selling Columbia SC houses, list early in the year to catch the spring home-buying rush. Wrong again. With more home buyers starting their search online, it's better to list in late March, generally speaking, so your listing is near the top of search results. The "New rule of Thumb" for maximum results: Don't list your house for sale before March Madness or after the Masters.
The mortgage interest deduction is essential to the health of the nation's real estate market. Not so fast. Some are calling the mortgage interest deduction ill-conceived public policy. The federal government is essentially spending $100 billion in the form of lost tax revenue annually to help Americans living in homes that cost about $865,000. It's especially ironic that the (mortgage interest deduction) is consistently sold to the American people as a populist policy to help the little guy. In reality, it's the exact opposite.
Home ownership is the foundation of the American Dream. Not any more, or so it seems. An analysis of data indicates public policy designed to boost homeownership among low-income buyers has the opposite effect of lifting people out of poverty. That's in large part because of less affluent neighborhoods, where many of these new home owners can afford to buy, experience lower appreciation and higher price volatility than more affluent neighborhoods.
Find more articles pertaining to buying and selling Columbia SC houses under our Columbia SC Home Buying Tips and Columbia SC Home Selling Tips to your right under Columbia SC Real Estate Categories. We also post tips on Facebook and Twitter. Follow us there for more tips on buying and selling Columbia SC houses as well.
There are signs that confidence in the Columbia SC housing market is waning a bit with the latest new home construction data. Many analysts are still trying to figure out why housing starts nose-dived in February.
Privately owned housing starts in February plummeted 17%, down to an annualized 897,000 from the revised January estimate of 1,081,000.
Single-family housing starts in February were at a rate of 593,000; this is 14.9% below the revised January figure of 697,000.
Is Weather to Blame for the Columbia SC Housing Downturn?
Some looked at the weather as the primary culprit despite the big drop in the West region, but now thoughts are turning to other factors like whether there's a skilled labor shortage, or whether younger buyers are still staying on the sidelines.
Here is more in this Fox Business News interview with real estate broker Kendra Todd and Avison Young VP Jason Meister…
In our last video report, we took a look at how Wall Street experts and people on Main Street fared in 2014 when it came to predicting what was going to happen to the stock market, oil prices, and housing prices. In this report, let's see what the experts and a few people on the street think will happen to Columbia SC housing, oil and the stock market, in 2015…
Last year, we got predictions from Wall Street experts and people on Main Street about what was going to happen to the stock market, oil prices, and housing prices.
So who was smarter, the experts, or people on the street. Let's see who was right…
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In our Columbia SC Real Estate News for January 2015:
Columbia SC Housing – What to Expect in 2015
As we turn the calendar to 2015, it seems only fitting that we explore Columbia SC housing and some of the things to watch for in the new year.
Columbia SC Housing – Prices, Inventory and Sales
Let's start our look at Columbia SC housing with Prices, and what's expected to happen in 2015.
When all the figures are in, it appears Columbia SC housing prices – as measured by the national repeat sales index (Case-Shiller, CoreLogic) – will be up about 5% or so in 2014 (after increasing about 12% in 2013).
Some of the key factors in 2012 and 2013 were limited inventory, fewer foreclosures, investor buying in certain areas, and a change in psychology as buyers and sellers started believing house prices had bottomed. In some areas, there appeared to be a bounce off the bottom – but that bounce appears to have ended in 2014. The investor buying has slowed – as have distressed sales.
The consensus of housing analysts appears to be for price increases of around 3.5% to 4.0% in 2015.
Inventory – It appears housing inventory bottomed in early 2013. The question is, will inventory increase further in 2015, and, if so, by how much?
Inventory is not seasonally adjusted, and usually inventory decreases from the seasonal high in mid-summer to the seasonal lows in December and January as sellers take their homes off the market for the holidays.
The Columbia SC housing market is slowly moving back to normal, and real estate is very local, as we all know. But our best guess at this point is, available inventory will increase further in 2015. If this holds true, it will keep home price increases from going to high too fast, which is never a good thing for the Columbia SC housing market.
Sales – CoreLogic released its 2015 Housing Outlook that shows home sales will increase by 9 percent. The most important economic trend is that employment growth for millennials began to improve in 2014, with the 25- to 29-year-old segment experiencing a 3 percent improvement in employment growth — one percentage point higher than the overall employment growth rate. That's important because this age group is the key first-time homebuyer segment.
When it comes to the Columbia SC housing market, 2015 may be the year first-time home buyers make a comeback. With rents rising faster than incomes, many Millennials are expected to start looking to buy homes of their own.
Here are two more Columbia SC housing market trends economists and other industry experts expect to see in the year ahead, in additon to the price expectations and inventory projects we just covered.
Looser Lending Standards – In early December, Fannie Mae and Freddie Mac put new lending guidelines in place and started offering 3% down payment mortgages that will make it easier for more first-time buyers to qualify for a mortgage.
Add to that a strengthening job market, and prospects look much brighter for young home buyers.
First time home buyers are important to the overall Columbia SC housing market because a spike in the number of first time home buyers should spark a chain reaction by enabling existing homeowners to sell their homes and buy more expensive ones.
Mortgage Rates – If there's any single market trend that real estate industry pros have gotten consistently wrong lately, it's the direction of mortgage rates. But most do expect rates to rise at some point in 2015.
In December, the Federal Reserve signaled that it would not raise the Federal Funds rate until the summer of 2015 or perhaps even later.
With the mortgage rate guessing game continuing as we start the new year, many experts believe rates will peak in 2015 at 4.75% for a 30-year fixed rate mortgage, and even if they hit 5.00%, that's still a very favorable rate, historically.
An increase to 4.5% from the current 4% adds about $60 a month to mortgage payments on a loan with a principal balance of $200,000. Not enough to keep buyers away, when rental rates are increasing much faster, comparitively speaking.
As the economy improves and salaries rise, Millennials are expected to become a bigger force in the Columbia SC housing market in the new year. Households headed by Millennials are expected to see significant growth in 2015, particularly as the economy continues to make gains.
Millennials are expected to drive two-thirds of household formations over the next five years, according to a report from the National Association of Realtors. The forecasted addition of 2.5 million jobs next year, as well as an increase in household formation, are the two factors that realtor.com® points to in driving more first time home buyers to the Columbia SC housing market.
As always, we'll continue to track all of these Columbia SC housing trends for you throughout the new year and keep you updated right here.