I know… it’s not January 1st, but this is urgent. So I broke out my crystal ball…
Here are the things you absolutely must tell them. Feel free to copy/paste into your own blog or email newsletter and quote me. So if I’m wrong, it’s not your fault:
Prediction #1 – Each homeowner has a LAST IN A LIFETIME CHANCE to get locked in on a 30-year fixed new mortgage for well UNDER a 3% interest rate. The 15-year rate (same article) is 2.37% average today. My prediction is this is a ONCE IN A LIFETIME chance for homeowners… current or new ones… to lock in rates this low. On a $250K loan that 30-year P&I payment is $1034/month at today’s 2.87%. A $500K loan is $2068 P&I. This will not repeat in our lifetimes. Take advantage of it while you can.
Prediction #2 – The run up on prices will END when the rates go up, which they eventually will. My bet is sooner rather than later. When that happens, no matter WHERE you live, you very well may be STUCK there. That’s you. That’s every homeowner you know. As I’ve been saying for several years, and Mike and I arranged for ourselves: “Go get stuck where you want to be stuck… not where you don’t want to be stuck.” Do you need a home office space? or TWO OF THEM?? Three? Some homes need this now and may need forever. If where you live now is NOT where you want to be for the next 7-10 years, MOVE NOW.
Prediction #3 – Single level properties, or primarily single level (at least 2 bedrooms and 2 baths on main level) are scarce. And the demand for them is going to go up DRAMATICALLY for the rest of our lifetimes. It’s just math. The last count on Americans over 65 was 49.2 MILLION. By 2050 it’s projected they will account for 83.7 million. Again… it’s just the math and needs of older Americans. My prediction is that single level $/sq. ft cost will be DOUBLE what a multilevel home is in the future. Why? Builders don’t want to build them because it takes a larger lot footprint. They will only do it if it’s more income for them. So..looking at #1 and #2 above, is it time to get into a single level NOW?
Prediction #4 – The Aging of American Homes is going to become a bigger and bigger problem. We Coach agents all over the US and Canada. Those in areas with older homes continue to have more problems with inspections and failed transactions due to home repair and maintenance issues. Let’s face it – homes built before 2000 were not meant to last 40+ years. When you are choosing a new abode from #1, 2 or 3 above… consider the newest thing you can find to avoid roofs, electrical, plumbing and appliance replacements for the entire next cycle. You will thank me.
Prediction #5 – Buy investment real estate. It’s called “real” estate because it’s something real. Something tangible. Something of value. When you invest in paper or companies, they can go away. Completely away. Invisible away. Real Estate, if fee simple (which most of the US is fee simple) has value. DON’T overextend. See #2 above. DO get something it’s a NO-BRAINER will rent for LOTS more than the payment and then SAVE that overage in case of vacancy or repairs. Want less repairs? Then go with prediction #4 and buy a new home to invest in. We have investments around $280K that rent for $1800 or more right now. Some over $2K/month. Put down 10% and get an investor loan around 4% for a P&I payment of around $1200/month. Yes, there are taxes, insurance and property management fees, but you are PRETTY safe at a profit each month, not to mention your money is in a TANGIBLE “real” asset until the next cycle. Don’t buy things that can go down to $0. I speak from experience. Consider a self-directed IRA. You have the money. Put it somewhere safe. Talk to your wealth manager for details.
These are important conversations. Have them with those you care about.
— Donna Stott, Broker, NWATLP