There’s usually a long checklist of items to go through before selling a house. After all, you want to maximize your profit and make sure your home is attractive to buyers. That’s why, in addition to cleaning up clutter, planting some flowers, and touching up chipped paint, you may be considering a renovation project. But not all renovations have the same return on investment. That’s why the Appraisal Institute suggests hiring an appraiser to estimate your property’s value before and after a potential upgrade. “Real estate appraisers have the local market knowledge required to gauge how an improvement may affect a home’s value,” Jefferson L. Sherman, president of the Appraisal Institute, says. “While they can’t make guarantees, appraisers can use their expertise and experience to help homeowners make wise decisions about which improvement projects to take on.” For example, projects like a garage door replacement, a minor kitchen remodel, or replacing old windows and siding provide a bigger return on investment than some other projects. Getting a professional opinion before doing any work can help give you confidence that you’re making the smartest choice for your home and finances. (source)

Each month, Fannie Mae’s Home Purchase Sentiment Index surveys Americans to measure interest in home buying and selling. The index looks at how people view the housing market, home prices, mortgage rates, their jobs, income, and expectations for the future. In February, the HPSI was relatively flat from the month before but remained near all-time highs. In fact, the survey found 59 percent of Americans believe now is a good time to buy a house and 67 percent say it’s a good time to sell. Doug Duncan, Fannie Mae’s senior vice president and chief economist, says the housing market has started the year off strong. “The HPSI remained relatively steady in February, reflecting another month of robust consumer sentiment consistent with strong housing market data to start the year,” Duncan said. “In particular, household income sentiment picked back up as more workers saw their wages rise amid tight labor market conditions, helping bolster already strong housing demand.” However, though Americans are optimistic about the housing market and economy, Duncan warns that February’s results don’t yet account for the potential economic impact of the coronavirus, which could affect future survey results. (source)

A lot of what you look for in a home has to do with the particulars of your day-to-day life. For example, a home buyer who has young children would be more likely to prioritize living in a good school district than a buyer who doesn’t have kids. That makes sense, after all. So you’d probably think that the buying preferences of younger buyers are much different than those of older buyers. And yet, the latest Home Buyer and Seller Generational Trend report from the National Association of Realtors found some surprising results. In fact, it found that buyers between the ages of 22 and 29 had some of the same priorities as buyers between 74 and 94, including living close to loved ones. “The silent generation – older Americans who are typically grandparents and great-grandparents – for years have prioritized living near family and other loved ones,” Lawrence Yun, NAR’s chief economist, says. “But it was surprising to see younger millennials with home buying preferences and ideals similar to older segments of the population.” The survey found that 53 percent of buyers between the ages of 22 and 29 said that proximity to friends and family was a high priority when deciding where to live. (source)

Home design trends come and go. But whether today’s fad is mid-century inspired or favors a more contemporary look, home buyers can’t help but be swayed by the latest décor trends. After all, no one wants their house to look dated or like it hasn’t been touched since 1982. So which trends are dominating today’s market? Well, according to one recent analysis, the style that buyers will pay the highest premium for is modern farmhouse. Comfortable, casual, and a little rustic is popular with today’s buyers. In fact, listings that advertise a home’s farmhouse aesthetic sold at a 10.3 percent premium, which outpaced all others. That means, an extra $25,000 on the typical American home. Other design trends that were associated with a higher premium included waterfall countertops, Moroccan tile, exposed brick, and free-standing tubs. Ultimately, though, buyers should choose a home that fits their specific lifestyle and personal preferences, because today’s hottest style is likely to be out of fashion by the time you’re ready to put the house back on the market. (source)

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell to their lowest level in more than seven years last week. Rates were down across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. Michael Fratantoni, MBA’s senior vice president and chief economist, said the decline was due to concerns about the coronavirus. “The 30-year fixed-rate mortgage dropped to its lowest level in more than seven years last week, amidst increasing concerns regarding the economic impact from the spread of the coronavirus, as well as the tremendous financial market volatility,” Fratantoni said. “Refinance demand jumped as a result, with conventional refinance applications increasing more than 30 percent.” Refinance activity is now 224 percent higher than it was at the same time last year. Purchase activity is also up from last year, rising 10 percent above year-before levels. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

You don’t have to be an economist to understand supply and demand. When there are more buyers than there are sellers, prices rise. This is true for any market, including the housing market. When there are too few home buyers, homeowners have to price their homes low enough to attract the buyers that are active. When there are too many buyers, the opposite is true. This is why prices have been increasing now for several years. Many housing markets across the country are suffering from a lack of homes for sale. But why? Well, according to Freddie Mac, the issue has its roots in the financial crisis and housing crash. After the crash, many small home builders went out of business and have not returned. That’s led to fewer new homes being built and especially in the affordable price ranges that are most in demand. Freddie Mac estimates that the market is now 3.3 million homes short of where it should be. Fortunately, recent trends point to an uptick in new residential construction and, as the rate of new home building increases, it should help bring balance to the market and keep prices in check. (source)

The National Association of Realtors’ Pending Home Sales Index tracks the number of contracts to buy homes that are signed each month. The index is a good indicator of where home sales are headed because contract signings precede closings by a number of weeks. In January, the PHSI rose 5.2 percent from the month before and is now up 5.7 percent over last year at the same time. Lawrence Yun, NAR’s chief economist, says conditions are favorable for home buyers right now and it may lead to an increase in buying activity as we approach the spring sales season. “With housing starts hovering at 1.6 million in December and January, along with the favorable mortgage rates, among other factors, 2020 has so far presented a very positive sales climate,” Yun said. “Moreover, the latest stock market correction could provide exceptional, even lower mortgage rates for a few weeks, and that would help bring about a noticeable upturn in the coming months.” (source)