Southern Indiana Real Estate BlogRecently posted or modified blog posts by tag - Salem, INhttps://www.wardrealtyservices.com/blog/Copyright WardRealtyServices.com2022-10-26T08:07:05-07:00tag:wardrealtyservices.com,2012-09-20:20199Pre-Approval Is a Critical First Step on Your Homebuying JourneyIf you’re planning to buy a home in Southern Indiana or Louisville this year, one of the first steps on your <a href="https://www.simplifyingthemarket.com/2022/10/07/the-journey-to-buy-a-home-infographic/?a=449944-4cf5617461979320c601b621502c88f9">journey</a> is getting pre-approved. Especially in today’s market when <a href="https://www.simplifyingthemarket.com/2022/10/04/the-cost-of-waiting-for-mortgage-rates-to-go-down/?a=449944-4cf5617461979320c601b621502c88f9">mortgage rates</a> are higher than they were just a few months ago, getting a <a href="https://www.simplifyingthemarket.com/2022/09/16/a-crucial-first-step-mortgage-pre-approval-infographic/?a=449944-4cf5617461979320c601b621502c88f9">mortgage pre-approval</a> can be a game changer. Here’s why.
Southern Indiana Homebuyers: What Is Pre-Approval?
To better understand why pre-approval is key, it’s important to know what pre-approval is. The Mortgage Reports <a href="https://themortgagereports.com/62952/how-to-get-mortgage-preapproval-in-3-steps" target="_blank">explains</a> it like this:
“When you’re ready to take the leap into homeownership, your first step is mortgage preapproval. . . . A mortgage preapproval is when a lender determines you’re qualified for a home loan. Your preapproval letter shows the maximum loan amount you’re approved for (your home buying budget), as well as the specific interest rate and loan term you can expect.”
As part of the pre-approval process, a lender will look at your finances to determine what they’d be willing to loan you. From there, your lender will give you a pre-approval letter to help you understand your true price range and how much money you can borrow. That can make it easier when you set out to search for Southern Indiana homes because you’ll know your overall numbers. And with <a href="https://www.simplifyingthemarket.com/2022/10/12/four-things-that-help-determine-your-mortgage-rate/?a=449944-4cf5617461979320c601b621502c88f9">mortgage rates</a> rising and impacting affordability, a solid understanding of your numbers is even more important.
Pre-Approval Can Signal You’re a Serious Buyer
Another added benefit is that pre-approval lets the seller know you’re qualified to buy their house. A recent article from realtor.com <a href="https://www.realtor.com/advice/finance/do-i-need-a-pre-approval-letter-to-make-an-offer/" target="_blank">notes</a>:
“. . . getting pre-approved can actually improve your chances of falling into the sellers’ good graces, and you’ll want to get it done as early as you possibly can in the home-buying process.”
Even though <a href="https://www.simplifyingthemarket.com/2022/08/31/buyers-you-may-face-less-competition-as-bidding-wars-ease/?a=449944-4cf5617461979320c601b621502c88f9">bidding wars</a> are easing this year as the market shifts, preapproval is still an important part of making a strong offer. It can help a seller feel more confident because it shows you’re serious about their home and that you’re a qualified buyer.
Bottom Line for Southern Indiana Homebuyers
Getting pre-approved for a mortgage is critical. It helps you better understand what you can borrow and shows sellers you’re serious about purchasing their home. Connect with a local real estate professional and a trusted lender so you have the tools you need to succeed as a homebuyer in today’s market.2022-10-24T07:59:53-07:002022-10-26T08:07:05-07:00Ward Realty Servicestag:wardrealtyservices.com,2012-09-20:20112The True Strength of Homeowners TodayThe real estate market is on just about everyone’s mind these days. That’s because the unsustainable market of the past two years is behind us, and the difference is being felt. The question now is, just how financially strong are homeowners throughout the country? And how financially strong are homeowners in <a href="http://www.wardrealtyservices.com" title="WRS">Southern Indiana or Louisville</a>? Mortgage debt grew beyond 10 trillion dollars over the past year, and many called that a troubling sign when it happened for the first time in history.
Recently Odeta Kushi, Deputy Chief Economist at First American, answered that question when she <a href="https://twitter.com/odetakushi/status/1569338892830265344" target="_blank">said</a>:
“U.S. households own $41 trillion in owner-occupied real estate, just over $12 trillion in debt, and the remaining ~$29 trillion in equity. The national “LTV” in Q2 2022 was 29.5%, the lowest since 1983.”
She continued on to <a href="https://twitter.com/odetakushi/status/1569338906604359685" target="_blank">say</a>:
“Homeowners had an average of $320,000 in inflation-adjusted equity in their homes in Q2 2022, an all-time high.”
What Is LTV?
The term LTV refers to loan to value ratio. For more context, here’s how the Mortgage Reports <a href="https://themortgagereports.com/13598/loan-to-value-for-mortgages-explained-in-plain-english" target="_blank">defines</a> it:
“Your ‘loan to value ratio’ (LTV) compares the size of your mortgage loan to the value of the home. For example: If your home is worth $200,000, and you have a mortgage for $180,000, your LTV ratio is 90% — because the loan makes up 90% of the total price.
You can also think about LTV in terms of your down payment. If you put 20% down, that means you’re borrowing 80% of the home’s value. So your LTV ratio is 80%.”
Why Is This Important to Southern Indiana and Louisville Homeowners?
This is yet another reason we won’t see the housing market crash. <a href="https://www.wardrealtyservices.com/blog/owning-a-home-builds-up-your-net-worth/">Home equity</a> allows homeowners to be in control. For example, if someone did need to sell their home, they likely have the equity they need to be able to sell it and still put money in their pocket. This was not the case back in 2008, when many owed more on their homes than they were worth.
Bottom Line
Homeowners today have more financial strength than they have had since 1983. This is a combination of how homeowners have handled equity since the crash and rising home prices of the last two years.
And this is yet another <a href="https://www.wardrealtyservices.com/blog/is-the-shifting-market-a-challenge-or-an-opportunity-for-homebuyers/">reason homeownership in any market makes </a>sense.<br /><br />Looking for a home? Check out the<a href="https://www.wardrealtyservices.com/property-search/results/?searchid=8796592"> latest listings here</a>. 2022-09-26T08:54:00-07:002022-09-26T12:02:45-07:00Ward Realty Servicestag:wardrealtyservices.com,2012-09-20:19887A Window of Opportunity for Homebuyers in Southern IndianaMortgage rates are much higher today than they were at the beginning of the year, and that’s had a clear impact on the <a href="https://www.simplifyingthemarket.com/2022/07/12/expert-housing-market-forecasts-for-the-second-half-of-the-year/?a=449944-4cf5617461979320c601b621502c88f9">housing market</a>. As a result, the Southern Indiana market is seeing a shift back toward the range of pre-pandemic levels for buyer demand and home sales.
But the transition back toward pre-pandemic levels isn’t a bad thing. In fact, the years leading up to the pandemic were some of the best the housing market has seen. That’s why, as the market undergoes this shift, it’s important to compare today not to the abnormal pandemic years, but to the most recent normal years to show how the current <a href="https://www.simplifyingthemarket.com/2022/07/14/housing-experts-say-this-isnt-a-bubble/?a=449944-4cf5617461979320c601b621502c88f9">housing market</a> is still strong.
Higher Mortgage Rates Are Moderating the Housing Market
The <a href="https://www.showingtime.com/showingtime-showing-index/" target="_blank">ShowingTime Showing Index</a> tracks the traffic of home showings according to agents and brokers. It’s also a good indication of buyer demand over time. Here’s a look at their <a href="https://www.showingtime.com/blog/may-2022-showing-index-results/" target="_blank">data</a> going back to 2017 (see graph below):
<a href="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/22141552/20220726-MEM-Eng-1.png?a=449944-4cf5617461979320c601b621502c88f9"><img loading="lazy" class="aligncenter wp-image-46886" src="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/22141552/20220726-MEM-Eng-1.png" alt="A Window of Opportunity for Homebuyers | Simplifying The Market" width="650" height="488" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/22141552/20220726-MEM-Eng-1.png 1000w, https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/22141552/20220726-MEM-Eng-1-400x300.png 400w" sizes="(max-width: 650px) 100vw, 650px" /></a>
Here’s a breakdown of the story this data tells:
The 2017 through early 2020 numbers (shown in gray) give a good baseline of pre-pandemic demand. The steady up and down trends seen in each of these years show typical seasonality in the market.
The blue on the graph represents the pandemic years. The height of those blue bars indicates home showings skyrocketed during the pandemic.
The most recent data (shown in green), indicates buyer demand is moderating back toward more pre-pandemic levels.
This shows that buyer demand is coming down from levels seen over the past two years, and the frenzy in real estate for Louisville and the Indiana market is easing because of higher mortgage rates. For you, that means buying your next home should be <a href="https://www.simplifyingthemarket.com/2022/06/28/a-key-opportunity-for-homebuyers/?a=449944-4cf5617461979320c601b621502c88f9">less challenging</a> than it would’ve been during the pandemic because there is more inventory available.
Higher Mortgage Rates Slow the Once Frenzied Pace of Home Sales in the Local Market and Elsewhere
As mortgage rates started to rise this year, other shifts began to occur too. One additional example is the slowing pace of home sales. Using <a href="https://www.nar.realtor/newsroom/existing-home-sales-slid-5-4-in-june" target="_blank">data</a> from the National Association of Realtors (NAR), here’s a look at <a href="https://www.nar.realtor/research-and-statistics/housing-statistics/existing-home-sales" target="_blank">existing home sales</a> going all the way back to 2017. Much like the previous graph, a similar trend emerges (see graph below):
<a href="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/22141555/20220726-MEM-Eng-2.png?a=449944-4cf5617461979320c601b621502c88f9"><img loading="lazy" class="aligncenter wp-image-46888" src="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/22141555/20220726-MEM-Eng-2.png" alt="A Window of Opportunity for Homebuyers | Simplifying The Market" width="650" height="488" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/22141555/20220726-MEM-Eng-2.png 1000w, https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/22141555/20220726-MEM-Eng-2-400x300.png 400w" sizes="(max-width: 650px) 100vw, 650px" /></a>
Again, the data paints a picture of the shift:
The pre-pandemic years (shown in gray) establish a baseline of the number of existing home sales in more typical years.
The pandemic years (shown in blue) exceeded the level of sales seen in previous years. That’s largely because low mortgage rates during that time spurred buyer demand and home sales to new heights.
This year (shown in green), the market is feeling the impact of higher mortgage rates and that’s moderating buyer demand (and by extension home sales). That’s why the expectation for home sales this year is closer to what the market saw in 2018-2019.
Why Is All of This Good News for Southern Indiana Homebuyers?
Both of those factors have opened up a window of opportunity for homeowners <a href="https://www.simplifyingthemarket.com/2022/07/18/wondering-where-youll-move-if-you-sell-your-house-today/?a=449944-4cf5617461979320c601b621502c88f9">looking to move</a> and for <a href="https://www.simplifyingthemarket.com/2022/07/13/should-i-buy-a-home-right-now/?a=449944-4cf5617461979320c601b621502c88f9">buyers</a> looking to purchase a home. As demand moderates and the pace of home sales slows, housing inventory is able to grow – and that gives you <a href="https://www.simplifyingthemarket.com/2022/06/17/more-listings-are-coming-onto-the-market-infographic/?a=449944-4cf5617461979320c601b621502c88f9">more options</a> for your home search.
So don’t let the headlines about the market cooling or moderating scare you. The housing market is still strong; it’s just easing off from the unsustainable frenzy it saw during the height of the pandemic – and that’s a good thing. It opens up new opportunities for you to find a home that meets your needs.
Bottom Line
The housing market is undergoing a shift because of higher mortgage rates, but the market is still strong. If you’ve been looking to buy a home over the last couple of years and it felt impossible to do, now may be your opportunity. Buying a home right now isn’t easy, but there is more opportunity for those who are looking.2022-07-27T06:36:00-07:002022-07-27T10:42:56-07:00Marketing Ward Realty Servicestag:wardrealtyservices.com,2012-09-20:19838How Your Equity Can Grow over TimeIt’s true that record levels of <a href="https://www.simplifyingthemarket.com/2022/06/16/home-price-deceleration-doesnt-mean-home-price-depreciation/?a=449944-4cf5617461979320c601b621502c88f9">home price appreciation</a> have spurred significant <a href="https://www.simplifyingthemarket.com/2022/06/21/the-average-homeowner-gained-64k-in-equity-over-the-past-year/?a=449944-4cf5617461979320c601b621502c88f9">equity gains</a> for homeowners over the past few years. As Diana Olick, Real Estate Correspondent at CNBC, <a href="https://www.cnbc.com/2022/02/03/housing-wealth-is-setting-new-records-for-both-owners-and-sellers.html#:~:text=The%20stunning%20jump%20in%20home,in%202020%2C%20according%20to%20CoreLogic">says</a>:
“The stunning jump in home values over the course of the Covid-19 pandemic has given U.S. homeowners record amounts of housing wealth.”
That’s great for your Southern Indiana home’s value over the last couple of years, but what if you’ve lived in your home for longer than that? You may be wondering how much equity you truly have.
The National Association of Realtors (NAR) has done <a href="https://www.nar.realtor/blogs/economists-outlook/metro-wealth-reports-as-of-2022-q1" target="_blank">a study</a> to calculate the typical equity gains over longer spans of time. The data they compiled could be enough to motivate you to move. Just remember, to find out how much equity you have in your specific home, you’ll want to get a professional equity assessment from a trusted real estate advisor at Ward Realty Services.
How Your Equity Grows
Let’s start by establishing how you build equity in your Southern Indiana home. While price appreciation is clearly a factor that can help boost your equity, you also build equity over time as you pay down your <a href="https://www.simplifyingthemarket.com/2022/06/22/things-to-avoid-after-applying-for-a-home-loan/?a=449944-4cf5617461979320c601b621502c88f9">home loan</a>. NAR <a href="https://www.nar.realtor/research-and-statistics/research-reports/metro-area-housing-wealth-gains" target="_blank">explains</a>:
“Home equity gains are built up through price appreciation and by paying off the mortgage through principal payments.”
Average Equity Growth over Time
The study from NAR breaks down the <a href="https://cdn.nar.realtor/sites/default/files/documents/2022-q1-metro-area-housing-wealth-gains-05-24-2022.pdf" target="_blank">typical equity gain</a> over time (see graph below). It calculates the equity a homeowner potentially gained if they purchased the median-priced home 5, 10, or 30 years ago and still own it today.
<a href="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/05165547/20220706-MEM-Eng-1.png?a=449944-4cf5617461979320c601b621502c88f9"><img loading="lazy" class="aligncenter wp-image-46774" src="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/05165547/20220706-MEM-Eng-1.png" alt="How Your Equity Can Grow over Time | Simplifying The Market" width="650" height="488" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/05165547/20220706-MEM-Eng-1.png 1000w, https://files.simplifyingthemarket.com/wp-content/uploads/2022/07/05165547/20220706-MEM-Eng-1-400x300.png 400w" sizes="(max-width: 650px) 100vw, 650px" /></a>
These six-figure numbers are impressive and certainly enough to help you fuel a move into your next home, but they’re not a promised amount. Remember, your own equity gain will be different. It depends on how long you’ve been in the house, your home’s condition, any upgrades you’ve made, your area, and much more.
If you want to find out how much equity you have, partner with a trusted real estate professional at Ward Realty Services for an equity assessment on your home. We can provide an expert opinion on what your house is worth today and how the equity you’ve gained over time can help you when you purchase your next home in the Southern Indiana market. It may be some (if not all) of what you need for your next down payment.
Bottom Line
If you’re thinking about <a href="https://www.simplifyingthemarket.com/2022/06/15/a-majority-of-consumers-say-its-a-good-time-to-sell-your-house/?a=449944-4cf5617461979320c601b621502c88f9">selling your house</a> and making a move, home equity can be a real game-changer, especially if you’ve been in your current home for a while. If you’re ready to find out how much equity you have, let’s connect.
2022-07-06T10:48:00-07:002022-07-06T10:54:25-07:00Ward Realty Servicestag:wardrealtyservices.com,2012-09-20:19770A Majority of Consumers Say It’s a Good Time To Sell Your HouseIf you’re a homeowner thinking about selling your house, you’re probably looking for the best time to make your move. That means you’re likely balancing a number of factors, like your <a href="https://www.simplifyingthemarket.com/2022/05/27/bright-days-are-ahead-when-you-move-up-this-summer-infographic/?a=449944-4cf5617461979320c601b621502c88f9">changing needs</a>, where you’ll go when you sell, and today’s <a href="https://www.simplifyingthemarket.com/2022/05/31/what-does-the-rest-of-the-year-hold-for-the-housing-market/?a=449944-4cf5617461979320c601b621502c88f9">mortgage rates</a> in order to time it just right.
According to recent data, that sweet spot could already be here. The latest Home Purchase Sentiment Index (HPSI) by Fannie Mae finds that 76% of consumers believe now is a <a href="https://www.fanniemae.com/research-and-insights/surveys/national-housing-survey" target="_blank">good time to sell</a>.
The graph below shows the percentage of survey respondents who say it’s a good time to sell a house. The big dip in March and April of 2020 reflects how consumer sentiment dropped at the beginning of the pandemic as uncertainty about the health crisis grew. Since then, the percentage has grown consistently as more people feel confident it’s a good time to sell.
In fact, survey respondents think it’s an even better time to sell a house today than they did in 2019, which was a strong year for the housing market. The latest survey results indicate one of the strongest peaks in seller sentiment in nearly three years (see graph below):
<a href="https://files.simplifyingthemarket.com/wp-content/uploads/2022/06/14132102/20220615-MEM-Eng-1.png?a=449944-4cf5617461979320c601b621502c88f9"><img loading="lazy" class="aligncenter wp-image-46660" src="https://files.simplifyingthemarket.com/wp-content/uploads/2022/06/14132102/20220615-MEM-Eng-1.png" alt="A Majority of Consumers Say It’s a Good Time To Sell Your House | Simplifying The Market" width="650" height="488" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2022/06/14132102/20220615-MEM-Eng-1.png 1000w, https://files.simplifyingthemarket.com/wp-content/uploads/2022/06/14132102/20220615-MEM-Eng-1-400x300.png 400w" sizes="(max-width: 650px) 100vw, 650px" /></a>
What Makes Today a Good Time To Sell in Southern Indiana?
One reason so many people think it’s a good time to sell is because there are still more buyers in today’s market than there are homes for sale. That’s driving <a href="https://www.simplifyingthemarket.com/2022/05/24/sellers-have-an-opportunity-with-todays-home-prices/?a=449944-4cf5617461979320c601b621502c88f9">home prices</a> up, making it a good time to sell your house.
And if you’re on the fence about whether or not to sell because you don’t know where you’ll go once you do, know that you might have more options today than in previous months. That’s because the <a href="https://www.simplifyingthemarket.com/2022/06/07/why-the-growing-number-of-homes-for-sale-is-good-for-your-move-up/?a=449944-4cf5617461979320c601b621502c88f9">number of homes</a> coming onto the market has grown each month since the start of the year. When more homes come onto the market, it gives you more opportunities to find one that meets your changing needs.
Bottom Line
While the number of homes available for sale is growing and giving you more options for your move, inventory is still low overall. That could mean it’s a great time for you to sell. If you’re ready to address your changing needs and take advantage of today’s favorable conditions, let’s connect.2022-06-15T08:31:00-07:002022-06-15T09:14:22-07:00Ward Realty Servicestag:wardrealtyservices.com,2012-09-20:13859Beautiful Custom Log Home on Over 3 Acres!Have you always wanted to live in total privacy among nature and dark summer sky above? This little piece of heaven might be for you. This beautiful custom log home located at <a href="http://www.wardrealtyservices.com/property-search/detail/4/201809727/3438-s-eastern-school-road-salem-in-47167/">3438 S. Eastern School Rd.</a> in <a href="http://www.wardrealtyservices.com/salem/">Salem</a>, sits on over 3 ac. of secluded paradise is perfect for getting away from that busy hustle and bustle of the city. The lot has mature trees scattered around and the home sits on a hilltop. It has a large loft that looks down on the great room and the open floor plan is very inviting. Both the front and rear of the home have large covered porches that are perfect for early morning coffee or evenings with the family. The basement is a walk-out with an add'l bedroom and bath for entertaining convenience. The basement ceilings are also high and spacious with room to add on even more if so desired. With 3 1/2 baths, 3 bedrooms, 3 floors, 2 covered decks and a partially finished walk-out basement, the home has so many great places for hanging out. The bedrooms are all larger than what you find in standard homes and the extra space makes for a very comfortable home. The outbuilding is a great multi use shed that will accommodate about any kind of use. There is also a kid's custom tree house that is precision built and a chicken house for plenty of fresh eggs and a chain-link fenced in area that is great for pets of any kind.
Call <a href="http://www.wardrealtyservices.com/agents/1945/dave-davis/">Dave Davis</a> today at 502-594-6260 to set up a showing time!
2018-06-18T11:43:00-07:002018-06-18T11:52:02-07:00Amanda Hobbs