Exactly 10 years ago this week, I started writing this weekly real estate column. Here was the inaugural column.
By way of introduction, I'm Dick Selzer and I've been in Real Estate in the Ukiah Valley since the 1970s. After more than 35 years in the industry, I thought I'd share a few facts and opinions about buying, selling, renting, and leasing property. I hope you find the information useful.
The question most often asked of Real Estate agents anytime they're out and about is, "How's the market?" So that's the question I'll be answering in all kinds of ways.
Right now, the market is in transition. Housing prices have pretty much bottomed out and are just starting to go up, but rates remain incredibly low and there's not much for sale. So, while this is a great time to buy, two obstacles are in the way: finding a property that meets your needs and getting qualified for a loan.
So, how can you overcome those obstacles? I'd recommend finding a Real Estate agent you trust and can relate to. Here's why: it's in their best interest to help you meet your goals, and they know a lot about Real Estate.
If you commit to one agent, and it doesn't have to be one of mine, that agent will commit to you. (If they won't, find a new one.) Once you've got a good agent, here's what you can expect.
They'll carefully listen to your needs and actively look for properties that meet those needs, so you won't waste your time looking at houses, land, or commercial properties that don't work for you.
They'll arrange to get you pre-qualified for a loan so you're ready when the right property becomes available.
They'll stay up-to-date on the latest market information (like inventory and mortgage rates), so they can make recommendations to save you money or share opportunities that you might not have been aware of.
They'll work in a manner that's consistent with your lifestyle. Let your agent know how and when you like to communicate (phone call, text, email, mornings, evenings, etc.), and they'll work with you so you get information the way you want it.
So now you've got an agent and the first thing they recommend is getting pre-qualified. Huh?
There are basically two levels of loan qualification – "pre-qualified" and "pre-approved." Pre-qualified consists of sitting down with an agent and doing some simple calculations to figure out how much house you can afford. To become "pre-approved" for a loan means working with your agent to find a loan broker who will review all your assets, liabilities, tax returns, W-2s, credit history, and any other relevant financial information to begin the process of applying for a loan.
Today, the market is different. In 2013, interest rates were incredibly low and prices had bottomed out. Now, rates are returning to historical norms. As much as we'd all like 2.5 percent rates on 30-year loans, I don't see those coming back any time soon. As for housing prices, it's hard to say if we're in a lull or whether prices really are back on the rise. Once we see a trend that holds for a few months, we'll have a better idea.
Regardless of how the market ebbs and flows, as Realtors we say, "Marry the house. Date the rate." That means, commit to the house you love – go all in on what you can afford. As for the rate, you're only committed to the loan if and when rates drop; then you can refinance.
While I would never advise a loan situation that makes you uncomfortable, I would say that for most people, buying a house has turned out to be a sound investment, even when they stretched their budget a little to get into the house they really wanted. If you find your dream home, now is a great time to buy. If rates happen to fall, you can always refinance.
Thanks for reading this column. I continue to enjoy it when people stop me in the grocery story to tell me they liked the last column or they have an idea for the next one.
If you have questions about property management or real estate, please contact me at rselzer@selzerrealty.com or call (707) 462-4000. If you have an idea for a future column, share it with me and if I use it, I'll send you a $25 gift certificate to Schat's Bakery. To see previous articles, visit http://www.selzerrealty.com and click on "How's the Market."
Dick Selzer is a real estate broker who has been in the business for more than 45 years.
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