There are a lot of factors that determine the selling potential of a home, but the most impactful ones are overall interest rates, economic conditions, and the economy in association with the real estate market. Whether you are a potential home buyer or a current home owner planning to sell your home, you must be well aware of what factors have the biggest impact on the entire process. This short article will give a brief explanation of the top four factors that affect the overall process of selling a home.
1. Fluctuating mortgage interest rates
Majority of home buyers who are interested in purchasing a home in this day and age opt for the fixed-rate type of mortgage that lasts for 30 years. For most home owners, one of the biggest investments in their lives is their house. That being said, as a home owner, you have to understand what impact the decrease or increase of interest rates has on your monthly expenses. Moreover, mortgage rates also have a direct correlation with interest rates making it all the more important on your part to have a better understanding of these fluctuating mortgage interest rates.
Generally, the rule of thumb for mortgage interest rates is that for every 1% increase in your mortgage interest rate, you get an increase of $60 per month per $100,000 of your loan in terms of costs. Basically, if your mortgage has a value of $500,000, if its interest rates will go up by 1%, your monthly payment will increase by $300 more or less.
Despite the fact that in the past five years, mortgage interest rates have gone down and up until are still relatively low, they still increase at nearly 1%. For instance, if interest rates will go up from 3.5% to 4.5%, the above example can be expected. However, if the federal reserve decides to raise the interest rates and from 3.5% the rates will go up by 5.5%, this would be a very impactful increase on the part of most home owners.
2. Mortgage eligibility
For most lenders, they determine the eligibility of a person for a particular mortgage by looking into the relationship between the person’s monthly income and his or her monthly expenditures. Thus, if mortgage rates increase, some of the potential home buyers may not be eligible for buying a home that they once were qualified.
3. Housing market strength
If you look at the current real estate market, you will see that most of the houses being sold have increased selling prices. This is a simple scenario of the supply and demand chain as well as the existence of the sellers market making the current industry have more potential home buyers versus more available houses for sale. When mortgage interest rates will affect negatively the number of potential home buyers, the end result will be decreased demand for house and perhaps leading to home prices going down.
4. New construction/buildings
Once again, when interest rates increase, costs associated in making construction loans increase. This could result in one of two things, that is, home building becoming more expensive and challenging or reduced home building plans. This might imply builders to take more risks, accept lower profit margins, or not accept any new projects for the time being.
As the name implies, a commercial property manager provides expert assistance to property owners in managing their commercial properties. Commercial property managers carry out a number of different tasks to provide the best services to commercial property owners, but generally, they take care of the following things:
• The maintenance and repair of elements of the buildings constructed on the commercial property such as mowing of lawns and prompt repairs
• The screening of possible new tenants who are interested in renting one of the commercial stores or buildings
• Overseeing of the leasing of property sections like the retail spaces inside a mall
• The collection of rent payments from tenants on the commercial property owner’s behalf
Basically, a commercial property manager deals with different kinds of commercial properties from retail spaces to office buildings with multiple stories. Most of the time, commercial property owners will hire companies that offer these services to take care of the daily operations that take place in their commercial properties. This allows them to have more time in dealing with other parts of their business. For any company or commercial property manager that will be hired to manage commercial properties, they will usually be given some authority that will allow them to make crucial decisions that would have some influence on how much income the commercial property owner will receive. There are a lot of benefits to hiring the right company. To start, the property owner will be able to have lower turnover rates for their tenants and will be able to secure the best rental rates.
As mentioned above, one of the responsibilities of a commercial property manager is to be the one to do the screening of possible tenants in the property. They accept their applications as well as be the ones to do some background checks. If they find it reasonable to accept the application of the tenant for a rent of space, they will be preparing the lease. For the entire duration of the lease, the manager will see to it that the tenant will be receiving benefits and responsibilities stated in their lease agreement from their rental amount to their rental due and many more.
Furthermore, the commercial property manager will act as the middleman between the commercial property owner and the tenants. If, for instance, the tenants have any needs or problems that need catering to such as repairs of their rented space, they will immediately go see the manager. The manger will then be the one to institute the necessary measures to resolve the issue at hand. It is the role of the manager to resolve this whatever problems tenants have to benefit not just the tenants themselves but the owners as well. On the other hand, when the tenant is not able to pay the rent as stipulated in the leasing agreement or is doing something that is not stated in keeping with their agreement, then it would be the job of the manager to send an eviction notice. For every state or jurisdiction, there will be differences in their eviction regulations. If the manger will serve this notice, he or she must be sure to follow all the steps being outlined by the state about this process. By doing so, the entire process will be done legally avoiding the possibility of receiving some complaints from the tenants that they have been evicted illegally.
What majority of potential home owners enjoy a lot while going on a house hunt will be seeing what each neighborhood and each housing option offers. The houses you see from one neighborhood are clearly not the same as the houses you see from another neighborhood. Yet no matter how enjoyable this process might be, you will be investing a lot of your time and effort in it.
Nevertheless, getting the best financing option seems to be one of the most important aspects in buying a home. A wise home buyer is someone who first gets a home loan pre-approval before buying a house or better before even starting looking for the perfect one.
While going on a house hunt in your target neighborhoods, you finally found a property that is well priced. Keeping this in mind, you know that the competition will be tough to have your offer accepted by the home seller over the other bidders. It will be to your advantage then to acquire a home loan pre-approval so that when your real estate broker will offer a deal, they will tell the home seller that you are pre-approved already. If the home seller wants to sell their home fast that they cannot afford anymore to wait a couple of weeks or months to get check out the highest bidder, they will most likely take your lower offer knowing that you can surely pay them.
Getting a home loan pre-approval does not necessarily imply that you will be approved of getting a mortgage more so getting a more favorable set of terms or a particular rate. The process of being pre-approved is really all about getting yourself started in buying a house while still preparing for minimal documentation. It helps in knowing what price range of houses you can afford based on your income. Also, it can serve as a credit check that would help determine what alarming issues you might be facing.
But what is really beneficial with getting a pre-approval is the fact that you can start accomplishing your documentation requirements as recently, these requirements have become stricter. You have to provide your tax returns the past years as well as be ready to answer any question that pertains to your sources of income.
Gone are the days where not having any documentation will have you accepted to get a house loan. This is actually something very beneficial among home buyers who would want to keep their homes with them, enjoy it, and increase its assets and value in the following years. You must be able to prepare the following documentation when getting a pre-approval for your home loan: verification of employment, proof of assets, and proof of income.
Usually, lenders make sure to give the best interest rate offers to people who have obtained a credit score above 740. However, this does not automatically imply that those who have a credit score below such number cannot get a loan. They can actually still be granted, but they can always expect to be getting terms that are less favorable instead.
One of the challenges of owning a real estate property found in urban areas is that it can be challenging to fully develop it if you are on a tight budget. However, if you live in an urban area and you have an extra lot, there are some ways for you to make use of your property without having to invest a lot of your money. Here are some unique concepts that you can try on your property that will contribute to the overall improvement of your community.
• Urban gardening
Among urban properties, gardening is gaining some popularity. And what is great about it is the fact that in just a single lot, you can grow a lot of vegetables. By just preparing a few raised beds, you cannot just grow some greens such as arugula and lettuce you can also grow bigger vegetables and some tomatoes on the side. Just a single lot can be more than enough to provide a good vegetable supply among family and friends. If not, you can turn this lot of yours into a spot where community gardening can be carried out. Allow having your neighbors plant and maintain their own plots. This will no doubt result to improving the overall diet of your entire neighborhood.
• Construction of tiny houses
In the current real estate market, smaller living spaces are becoming popular. One tiny house can easily be constructed on a trailer structure and can be used as a living space for one or two adults. For majority of cities, zoning laws are too complicated where there are some areas that do not allow people to live in small mobile houses. If you have no interest in becoming a legal residence in this tiny house, you can still utilize this space to create between two and three tiny houses and then put them up on display for sale. Your home buyers can easily transfer them to a trailer park or any suburb that have less strict zoning laws. Construction of tiny homes is not the same as that for the more traditional homes because the former will not be needing as many different permits and certifications as the latter.
• Petting zoo
For most children, there is no better feeling in the world than visiting a zoo and having a chance to pet the animals; hence, the existence of petting zoos. Aside from the children benefitting from them, the grownups also benefit from them by allowing them to do whatever it is they want. If you were growing up as a kid loving petting zoos, turning your urban lot into one can actually be a good idea. Though growing goats within city limits can help you produce some meat and milk, most cities have tight regulations against raising livestock. Collecting pets, however, is not the same as raising livestock because it is not intended for producing food. Having a petting zoo within the city can benefit a lot of children from the neighborhood by teaching them about certain kinds of animals that they can never normally see while living the modern city life.
Your choice of property management company can either make or break your investment plans in the real estate market. There are basically a number of property managers that are present in all areas of the real estate market. Taking advantage of their services can only be made possible if you choose the right company to help you out.
• Their branding and messaging efforts
What outbound branding and messaging efforts the property management company utilizes determine how good they are in doing their job. In order for you to better understand what goes on in their daily operations, you have to be assertive and ask them the most appropriate questions.
• Their dealing with documentation
While looking for potential property management companies that you can hire, you have to first assess if they are recognized by relevant bodies and are currently licensed. As the potential client, you have the right to find out what types of properties they have managed and are currently managing. You then proceed in getting references from them. Never hire a company that cannot or will not give you the necessary documents that you need. If you are given the necessary pieces of documentation papers in person, then you can rest assured that they are operating legitimately.
• Make sure that you find out the following specific things about the property management company you plan on hiring:
– Their method of collecting and setting rent payments
– Their dealing with repair and maintenance concerns
– If they do property inspections
– Their methods of marketing and keeping tenants
– The ways in which they deal with owner and tenant funds
– The process of doing tenant screening
Other concerns that you have to speak with your potential project management company includes their management contract and their management fees.
If possible, you determine the abovementioned things from your project management company options (at least three) before you go into contract with them. Always take the necessary precautions when hiring these companies. Never settle for a company that looks promising when you still have not really talked to them in person and have brought to them the abovementioned concerns. There is nothing wrong with being able to see and talk to the company before you consider hiring them. It even pays to talk to other potential companies that you can hire rather than just talking to one. Who knows, you might find the third or the second option more promising and more capable of dealing with your project management concerns.
Denying yourself the time to talk to other companies will not let you have to do any comparisons from one company to another. You need to get some idea how each company differs in terms of their business operations so that you can really ascertain that you are hiring the right people for the job.
There are a number of websites and databases that you can benefit from when you go looking for some project management companies within your vicinity. Always make decisions after doing all the necessary research, interview, and brainstorming for each potential company that you can hire. There are a lot of qualities that make one company better than the others and you can start your search by looking into the above factors mentioned above.