Whew 2020 is over and we are onto making the most of 2021! You may have heard but the current housing market is a crazy one. Our team has gotten a lot of questions lately about what buyers and sellers can expect going into the New Year. So, we are just going to jump right into it and go over some of these answers. Interest rates are always of top concern so we cover that first.
- FHA and VA rates are sitting shockingly low, right around 2.5%
- Idaho Housing, First Time Home Buyer rates are 2.37% - 2.5%
- Conventional products are around 2.6% - 2.75%
- So, now is the time to buy as far as interest rates.
First Time Home Buyers
- Don't go shopping without your wallet! Get preapproved by a lender before you dive deep.
- Now it's about the offer. With the current Boise Real Estate market, we have to look at how to make the most desirable offer especially if going up in price is not an option. We then look at other options like Inspection Contingencies or a possible rent-back to the sellers.
- Following the offer, we walk you through the financing process, the appraisal process and the inspection process.
- Now, knowing 1st time home buyers will likely only remember about 10% of that, we are prepared to repeat and rewind as much as necessary :) but the first step is to get you preapproved.
How long does it take to buy a home?
- This goes back to that strong offer as most homes will have multiple offers within hours of hitting the market.
- If your offer is accepted right away: from the time of acceptance to the time of closing is typically about 30 days.
- If we count the time to find the house, we are typically seeing 60 to 90 days.
How urgent do we need to be once we find a home we like?
- If you can shift your schedule to look at a home that may work for you, do it.
- Sellers will likely review offers that same night as it was listed.
- Expect your agent to be pushing you to get in these homes as there is no time to play right now!
- Bottom line: The sooner the better, period.
What creates a seller's market vs a buyer's market?
- NAR or National Association of Realtors says, if you have more than 6 months inventory of homes on the market then you are in a buyer's market.
- Meaning if no one else listed their house today and buyers continued to buy at the current rate, we would have enough homes for 6 months.
- Now if we were to run out of houses in under 6 months or have under 6 months of inventory, we would be in a seller's market.
- The national average for inventory right now is roughly 1 to 2 months. Here in the Boise area, our inventory is less than 2 WEEKS! - Yes, this includes new construction!
What is a stratified market?
- Here we are talking about price point for the current real estate market.
- We have more buyers looking under a half million-dollar price point and fewer homes than let's say a 2-million-dollar price point where there are not typically too many buyers.
How much do I pay an agent when I buy a house?
- Not always, as there are exceptions, however, typically the seller pays agents on both sides.
Where should my credit score be for buying a home?
- Typically, 620 is a good credit score allowing you in the door to get an FHA loan among others.
- Keep in mind that a higher credit score usually means lower interest rates.
- Regardless of credit score, we must make certain there are no judgements on you or collections that must be paid off.
How much does a typical person need for a down payment on a home?
- VA loans are 0 down but may not always be the best way to go.
- There are Idaho Housing Loans that can get you in for .5% down.
- Conventional Programs are down as low as 3%
Should I sell my current home before buying another one?
- We have lots of variables here but to keep it simple, you may need to use that money from your current house to put money towards the new one.
- If that is not the case, keep in mind we are currently at less than 1% vacancy rate for our rentals in the Boise area!
What is earnest money?
- This is money, typically a check, that let's sellers know you are serious about this and if you just get cold feet and walk away, they will likely keep the earnest money.
- It will be held with the brokerage or title company depending on the contract.
- 1% is typical for the Treasure Valley.
- However, a stronger offer has more earnest money.
- Now, this is your money, and it will go back to your closing costs.
We hope this has been insightful and that if you have real estate questions in the future, you know you can always ask us. Keep in mind, real estate advice is always free, and we are here to help!