More Retirees Carry Mortgage Debt

More Retirees Carry Mortgage Debt

Retiring baby boomers are less likely to be mortgage-free compared to people their age in previous generations, according to Fannie Mae. That could hurt boomers’ financial security and exacerbate the housing affordability crisis.

Slightly less than 50 percent of the oldest baby boomer homeowners in 2015 were mortgage-free, 10 percentage points lower than the number of Silent Generation homeowners who were in the same age group in 2000 and mortgage-free, according to Fannie Mae. “The increasing prevalence of housing debt among older homeowners could compromise financial security in retirement by expanding housing affordability problems, crimping essential non-housing spending, increasing vulnerability to home loss through foreclosure, or limiting the accumulation of housing wealth,” Fannie Mae researcher Patrick Simmons writes on the GSE’s Housing Perspectives blog.

Between 2010 and 2015, when the housing market was recovering from the crash, baby boomers were paying off their mortgages at an accelerated pace. But even if that trend continues, researchers predict, the rate of boomers who own their homes free and clear in retirement is unlikely to keep pace with previous generations.

“The greater propensity of boomer homeowners to carry housing debt might signal the need to expand consumer outreach and education that helps older mortgagors manage their monthly housing expenses, including ensuring that they have fully exploited opportunities to reduce monthly mortgage payments through refinancing,” Simmons notes. “Educating younger boomers about options for shorter-duration mortgages that accelerate principal pay-down might also increase the likelihood that they enter retirement with little or no housing debt. For older boomer mortgagors who wish to eliminate housing debt, an option worth considering is trading down to less expensive homes.”

Source: “Baby Boomers Accelerate Their Advance into Free-and-Clear Homeownership,” Fannie Mae’s Housing Insights (Oct. 5, 2017)

How to Appear More Confident to Clients

How to Appear More Confident to Clients

Whether you’re making a listing presentation to potential clients or speaking in front of a group of agents, there are subtle ways to appear more confident, likable, and approachable while speaking with authority. Business strategist Marc Gordon offers these five tips that will help you “fake it ’til you make it.”

1. Dress the part. When choosing an outfit, consider two factors: whom you’re speaking to and where you’ll be speaking. The audience and the setting will have a large influence on what you choose to wear. How you dress when presenting at a trade show will likely differ from meeting a client at a construction site.

2. Stand up straight. “Proper posture will make you look poised and give the impression of authority,” Gordon says. “When seated, be relaxed and comfortable, but don’t slouch.” Tips for sitting at a table: Leaning in with your arms resting on the top will make you appear interested, while leaning back will make you appear approachable and relaxed, Gordon says.

3. Stay cool and calm. Sometimes emotions can get the best of people, especially when a deal doesn’t work out in their favor. If a meeting with a client gets heated, acknowledge the situation, but don’t allow your emotions to run hot, too. “Stay calm and objective, and never get personal,” Gordon says. If needed, take a short break.

4. Listen. Make sure your nonverbal cues reflect that you’re hearing your clients. Eye contact shows you’re listening, as does a head nod or smile. Even when speaking to a group, it’s good to make random eye contact with people, Gordon says.

5. Remember what makes you great. You’ve built your skills and have become an expert; now it’s time for you to accept it. “While a group of investors or potential customers can seem intimidating, remember that they experience the same challenges as you. They also get nervous, experience stress, have a fear of failure, and want to be liked,” Gordon says. It’s also important to recognize that if someone in your meeting comes off as aggressive or arrogant, it’s not confidence but an overcompensation for fear. “If you can be the one to demonstrate that everyone is welcome, all ideas are valued, and no one will be judged, then you will emerge as the natural leader you were meant to be,” Gordon says.

Source: “Five ways to appear more confident (even if you’re not),” Oct. 1, 2017.  marcgordon.ca

Home Lot Sizes Shrink to New Low

Home Lot Sizes Shrink to New Low

Lot sizes on new single-family homes have reached a new record low. New homes sold in 2016 had a median lot size of 8,562 square feet, or slightly under one-fifth of an acre.

The median lot size fell to under 8,600 square feet in 2015, according to the Census Bureau’s Survey of Construction data. Lot sizes have continued to shrink since then.

Location plays a big role. For example, the median lot size in the New England region is nearly twice as large as the national median, exceeding a third of an acre.

“New England is known for its strict local zoning regulations that often require very low densities,” the National Association of Home Builders notes on its Eye on Housing blog. “Therefore, it is not surprising that more than half of single-family spec homes started in New England are built on some of the largest lots in the nation, with more than half of the lots exceeding a third of an acre.”

On the other hand, the Pacific region—where densities are often high and developed land is more scarce—has the smallest lots. Half of the lots in the region are under 0.15 acres.

Source: “Lot Size Is at a Record Low,” National Association of Home Builders’ Eye on Housing blog (Oct. 3, 2017)

Factors Most Influential on Home Values

Factors Most Influential on Home Values

Buyers have become wiser, researching important facts not only about the houses they’re interested in but also about the communities where the homes are located. Desare Kohn-Laski, broker-owner of Skye Louis Realty in Coconut Creek, Fla., says it’s essential that real estate professionals show their value by keenly understanding the factors influencing home values in order to help and influence those research-savvy clients.

Study these four factors in your market:

1. Location. This is nothing new; everyone knows location is extremely influential on home values. But it might be underutilized in the marketing listings. A great location is something sellers can capitalize on today more than ever, whether it’s a city, neighborhood, proximity to amenities, or the view, Kohn-Laski says.
2. Community statistics. School district performance, crime rates, walkability, and the number of establishments such as convenience stores and restaurants are factors that can influence home values, Kohn-Laski says, also influencing home buyers.
3. Home updates. Improvements and renovations can have a dramatic effect on a home’s value. Take a look at comparable properties in the area to understand which updates will give your clients the most bang for their buck. Changes in flooring, wall paints, doors, and even added rooms will add to the home value and appeal to buyers.
4. The neighborhood. “Home values are volatile,” Kohn-Laski says. “Always do your dose of monitoring neighboring home prices. This way you can properly put a tag price on your own not only for profitable margins but also to be competitive with other homes for sale.”

Source: Skye Louis Realty

Scope of Equifax Breach Widens Further

Scope of Equifax Breach Widens Further

Some 2.5 million more people than originally reported were affected by the recent Equifax data breach, the credit bureau said Monday. The estimate of the number of Americans whose personal information was potentially exposed is now 145.5 million—the largest hack on record. Cybersecurity firm Mandiant, which was hired by Equifax to investigate the hack, found the additional compromised accounts in a forensic review.

The information hackers were able to extract includes consumers’ names, Social Security numbers, birth dates, addresses, and driver’s license numbers. “I am deeply sorry that this occurred,” former Equifax CEO Richard F. Smith, who stepped down last week, said in a statement Monday. “Equifax was entrusted with Americans’ private data, and we let them down.”

The real estate industry is warning that the Equifax breach could put home sales at risk. For consumers whose information was stolen, it could become harder to get approval for a mortgage, or their info could be used for unlawful real estate transactions. Rob Douglas, an identity theft expert, predicts there will be an increase in fraudulent mortgage and refinance applications due to the Equifax breach. Some loan officers who have put additional vetting procedures in place could slow the loan approval process and burden borrowers with extra costs.

Source: “2.5 Million More People Potentially Exposed in Equifax Breach,” The New York Times (Oct. 2, 2017)

The ‘Bonus Room’ Makes a Comeback

The ‘Bonus Room’ Makes a Comeback

Home builders and designers say demand is increasing for more flexible living spaces, giving rise once again to “bonus” or “multipurpose” rooms, The Wall Street Journal reports. Such rooms offer extra square footage for owners to create a space that fits their lifestyle. Baby boomers, for example, are showing interest in bonus rooms that could potentially serve as a first-floor master bedroom or suite.

Out of the 20 top-selling floor plans on Houseplans.com, 13 include bonus rooms, according to the site. However, only 14 percent of all plans the site offers contain such rooms. They are usually located off the entry hallway near the main living space and a bathroom. The location makes it easy to transform the space into an extra bedroom, if needed. Bonus rooms also may be located above the garage. Homeowners use these extra spaces for anything from an in-law suite to a home theater.

Some designers say real estate professionals shouldn’t label bonus rooms with a specific purpose when showing a home to their clients. Let buyers imagine for themselves how they’d use the room; this can also make the listing more appealing to them. “When you name it ‘dining room,’ they will always see it as a dining room; they will never get it out of their mind,” says Mark Mathis, co-owner of Hattiesburg, Miss.-based design firm House Plan Gallery. “We have found that labeling this type of area as ‘flex space’ on our floor plans best allows home buyers to decide how a particular space can be used to fit their specific family’s needs.”

Source: “Forward-Looking Homeowners Want Rooms That Do Double Duty,” The Wall Street Journal (Sept. 28, 2017) [Log-in required.]