The crazy things real estate agents say

queen anne house
Queen Anne

Real estate agetns are really selling the idea of buying a house right now. They say all sorts of crazy things.   One of my least favorites concerning interest rates is: “Date the rate but marry the house” The idea is that interest rates come and go and sometimes people can refinance.

I don’t think it is wise to take on a large mortgage and count on refinancing. For one thing, the interest on a mortgage is front-loaded which means the borrower pays the highest amount of interest in that first payment. The interest portion of the payment goes down slightly every month.

Each time the buyer refinances the buyer starts all over again which is why it is best to wait until the interest rate drops a couple of percentage points before refinancing.

Real estate agents are reminding us that mortgage interest rates have been higher. That is true but home prices are also higher as they have risen much faster than wages during the last 50 years or so.

There really isn’t an upside to the housing market right now at least not for buyers.

Some agents are suggesting that now is a great time to buy because there is less competition. There is less competition but there is still enough competition to create multiple offer situations.

Housing prices are at an all-time high right now and interest rates are at a 20-year high. There are people who have been priced out of the market. It is simple math. There isn’t any other way to look at it.

There are still some great reasons to buy. Some home buyers will pay less for housing if they buy rather than rent. Maybe not in the first year but in the long run. People who own houses are building equity.

Elections 2022 – Have you voted yet?

I vote

Most of us are pretty sick of the campaign ads. We won’t be seeing them for long.  Minnesotans can vote today with an absentee ballot. Go to the election office in your county. They are waiting for you. My husband and I voted last week.

This will be your last reminder from me to vote on or by November 8th, 2022. I am passionate about voting. The upcoming election will be my 5th in a row as a precinct election judge. We simply can’t have a democracy without voting.

You may have heard the term “mid-term elections”. They are coming on November 8th. Voter turnout is generally low. Like 40% ish, which is even worse than the 60% or so of eligible voters who turn out for the national elections. These elections are so important. We won’t be electing a president but we will be electing a governor and an Attorney General, a Secretary of State, a State auditor, judges, and school board members too.

There are also US house of representatives on the ballot. Please choose wisely. There is no electoral college each person gets one vote and they all count.

Now is the time to educate yourself and get a sample ballot and do your homework so you know who to vote for.

Research the candidates and learn about them, don’t just take the world of their opponents in campaign ads. Find out what each candidate stands for. Some of them have actual plans that go beyond being against their opponent’s ideas. Some incumbents are running unopposed.

In Minnesota, you can register at the polls. See the list of what to bring and how to register.  

Find your polling place. It may have changed due to redistricting.

There is also early voting, find out how and where.

Did you know that you can check online to see if you are a registered voter?

What’s on the Election Day ballot in 2022?

All voters will have these races on their general election ballot:

  • U.S. Representative
  • Governor & Lt. Governor
  • Secretary of State
  • State Auditor
  • Attorney General
  • State Senator
  • State Representative
  • Judicial seats

Voters may have one or more of these races on their ballot:

  • County Officials
  • City Officers
  • School Board Members
  • Township Officers
  • Local ballot questions

 

There is plenty of bad news these days

The downside to record-low interest rates is that they tend to go back up and when rates go up that is very bad news.  The downside to a record-breaking year in home sales like 2021 is that if the next year isn’t even better the real estate news is all doom and gloom.

Much of the news about home sales and the housing market is grim yet homes sell for more today than they did in the fall of 2020, or in the fall of 2019. There have been times in my career when on average it took months or even a year to sell a house. Right now a house in St Paul will sell in less than 30 days even in October.

If you need to move don’t worry about selling your house. If you are buying a house you may be able to negotiate and get the pre-pandemic price. You may also be able to get the seller to make some repairs or pay some closing costs or points.

If you bought a house during the peak in 2021 don’t worry. It is going to be alright because of that loan you got with the super low-interest rate. Looking ahead I think 2023 will be more like 2019 than like 2021.

Haunted ?

Minnesota unemployment rate the national low

help wanted
Help wanted

The latest unemployment rate for Minnesota is 2% which is a national low. It is also up slightly from what was the new record low of 1.8%.  No other state has seen a low of 1.8%.

With that said I can say there are jobs in Minnesota. There are also people who can not find jobs that are a good fit. I know a teacher and a college professor who can not find work in their fields.

In the coming months, we may also see more people in the real estate, title, and mortgage industries looking for jobs. There have been layoffs in the mortgage industry as applications are down. Real estate agents are usually independent contractors who don’t have to worry about being let go but some will move on if they can’t make enough money to pay their bills.

There are plenty of job openings in retail, restaurants, and customer service. There are also a lot of openings for nurses and other health care professionals.

Some local businesses have shortened their hours of operation due to a lack of help.

It seems to me that there are some mismatches between job openings and people who are seeking jobs. It could have to do with an aging workforce, or pay and working conditions.

The national unemployment rate is 3.5%. Illinois had an unemployment rate of 4.5% and the highest unemployment rate in the country right now is the district of Columbia with a 4.7% unemployment rate. [Source: US Department of Labor data is for September 2022]

The unemployment rate affects the housing market and a lack of housing or lack of affordable housing can affect the employment rate.

Get ready for election day November 8, 2022

I vote

You may have heard the term “mid-term elections”. They are coming this November. Voter turnout is generally low. Like 40% ish, which is even worse than the 60% or so of eligible voters who turn out for the national elections. These elections are so important. We won’t be electing a president but we will be electing a governor and an Attorney General, a Secretary of State, a State auditor, judges, and school board members too.

There are also US house of representatives on the ballot. Please choose wisely.

Now is the time to educate yourself and get a sample ballot and do your homework so you know who to vote for.

Research the candidates and learn about them, don’t just take the world of their opponents in campaign ads. Find out what each candidate stands for. Some of them have actual plans that go beyond being against their opponent’s ideas. Some incumbents are running unopposed.

In Minnesota, you can register at the polls. See the list of what to bring and how to register.  

Find your polling place. It may have changed due to redistricting.

There is also early voting, find out how and where.

What’s on the Election Day ballot in 2022?

All voters will have these races on their general election ballot:

  • U.S. Representative
  • Governor & Lt. Governor
  • Secretary of State
  • State Auditor
  • Attorney General
  • State Senator
  • State Representative
  • Judicial seats

Voters may have one or more of these races on their ballot:

  • County Officials
  • City Officers
  • School Board Members
  • Township Officers
  • Local ballot questions

The concept of decreasing property values

During the great recession and housing market crash we did see actual decreases in property values. People bought houses and ended up owing more on them than they could sell them for.

The value of my own home declined during the crash but we could have sold it for twice as much as we paid for it. Did we lose money? The house is now worth twice as much as it was worth in 2009.

It is kind of like looking at the statement for my retirement account. The dollar value today is less than what it was a year ago, but it is worth many times more than what I put into it. Another account is growing at about the same rate as it would if I had buried the money in the backyard. Yet I know for sure the money wouldn’t grow at all if I buried it in the backyard.

Today in some parts of the country the median home sale price is lower than it was in August. Most of the people who bought houses in August will not need to sell and if they did chances are they could get the same amount for their house as they paid for it last month, or maybe more.

Home values fluctuate but over the long run, prices go up. There are a few things that could cause home values to decline. When the number of available houses is higher than the demand for houses then the prices will decrease.

The idea of decreasing home values can be misleading. The idea of a “real estate recession” is confusing. The housing market isn’t like it was before the pandemic. Nothing is quite the same.

If you would like to know how much your house will sell for right now contact me.

If you are currently renting be skeptical of claims that renting is somehow better than owning. Paying rent isn’t throwing money away but a rental is never really home and it isn’t an investment.

white picket fence