29
Apr 16

Investment Home Sales Rebound in 2015 [INFOGRAPHIC]

Investment Home Sales Rebound in 2015 | Simplifying The Market

Some Highlights:

  • 2015 marks the first year-over-year increase in investment home sales since 2011.
  • 62% of all investment homes purchased were single family homes.
  • The South saw the highest percentage of investment home sales (39%) with the West coming in second (28%).

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28
Apr 16

Investors: More Sales and Higher Prices

Investors: More Sales and Higher Prices | Simplifying The Market

The National Association of Realtors recently released their 2016 Investment and Vacation Home Buyers Survey. The survey revealed many characteristics of both vacation home purchasers and investors. Two weeks ago, we posted on the vacation home market. Today, we want to concentrate on the investor real estate market.

The survey revealed that investment-home sales in 2015 jumped 7.0 percent to an estimated 1.09 million from 1.02 million in 2014.

Investors: More Sales and Higher Prices | Simplifying The Market

Lawrence Yun, NAR’s chief economist discussed the increase in the number of sales:

“Despite a smaller share of distressed properties coming onto the market, investment purchases reversed course in 2015 after declining for four straight years. Steadily increasing home prices and strong rental demand appear to be giving more individual investors assurance that purchasing real estate will diversify their portfolios and generate additional income if they decide to rent out the home.”  

Prices Are Also Up

The price paid by investors also increased in 2015 by 15.3%.

Investors: More Sales and Higher Prices | Simplifying The Market

Tomorrow, we will be providing an infographic that will highlight the other findings about investors from the survey.

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26
Apr 16

One More Time… You Do Not Need 20% Down To Buy NOW

One More Time… You Do Not Need 20% Down To Buy NOW | Simplifying The Market

A survey by Ipsos found that the American public is still somewhat confused about what is actually necessary to qualify for a home mortgage loan in today’s housing market. The study pointed out two major misconceptions that we want to address today. 

1. Down Payment

The survey revealed that consumers overestimate the down payment funds needed to qualify for a home loan. According to the report, 36% think a 20% down payment is always required. In actuality, there are many loans written with a down payment of 3% or less.

Many renters may actually be able to enter the housing market sooner than they ever imagined with new programs that have emerged allowing less cash out of pocket.

2. FICO Scores

The survey also reported that two-thirds of the respondents believe they need a very good credit score to buy a home, with 45 percent thinking a “good credit score” is over 780. In actuality, the average FICO scores of approved conventional and FHA mortgages are much lower.

The average conventional loan closed in March had a credit score of 753, while FHA mortgages closed with a 685 score. The average across all loans closed in March was 722. The graph below shows how the average FICO Score required has come down over the last 12 months and has stayed around 722 for the last six months.

FICO Score Distribution | Simplifying The Market

Bottom Line

If you are a prospective buyer who is ‘ready’ and ‘willing’ to act now, but are not sure if you are ‘able’ to, sit down with a professional who can help you understand your true options.

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