Check out the real estate and mortgage market update below along with current rates update and a list of other resources that could be of help during this unprecedented time. We remain committed to keeping you informed about today’s market but please know, we are here for you however we can be.
Click on the video above for Michael Gordon’s most important tip this week!
- Forbearance is a main topic during the Covid-19 pandemic as many see it as a way to skip payments. **Please keep in mind that people who follow through with the forbearance plan will owe the amount of months they skipped at the end of the forbearance period. This could cause a huge influx of foreclosures when people can’t make that balloon payment in a few months time.** We urge you to pay your mortgage if you have the means to do so. With stimulus checks being distributed, use that towards your payment if possible!
- The IRS is now allowing you to track your stimulus check. With Wednesday being the first day of direct deposits hitting American’s accounts, most people are eagerly awaiting theirs to arrive. The system to check your status isn’t perfect and many have experienced glitches or the system reporting “unknown payment status”, however, it is likely an over-impacted tool that many Americans are trying to access at once. For the IRS website, click HERE
- Interest rates have recently reached record lows thought to be induced by the coronavirus. Many homeowners are taking advantage by refinancing their home. According to the Mortgage Bankers Association’s weekly index, applications rose 7.3% last week and refinancing accounted for 76.2% of all mortgage activity. Read more HERE
- There has been much speculation from people with the assumption that the pandemic will create a potential dive in home prices. So far, that doesn’t seem to be the case. According to the National Association of Realtors Flash Survey, 73% of agents reported their sellers have not lowered prices to attract buyers during the health crisis. This seems to be outside of buyers expectations. 63% of agents said their buyers are expecting a price reduction of at least 5%. This tells us that seller’s confidence levels remain high that their home will still sell. See the full report HERE.
- Today, homeowners have a tremendous amount of equity in their homes with a majority having over 50%. This tells us that homeowners today are much less likely to walk away from their homes at lower than what it’s worth.
- Many people fear that this health crisis could turn into a housing crisis and are asking “is this another 2008?” Remember that the 2008 Great Recession started with home appreciation reaching higher highs than we had ever seen and mortgage loans were easier to obtain. Appreciation is the increase in your home’s value over time and as you can see, it doesn’t seem to be running up at exceptional levels like it did leading into the crash in 2008. The last 6 years leading into our now 2020 health crisis, appreciation seems to be at relatively balanced levels.
- Whether you’re a buyer or a seller, this time is crucial to get prepared. After the pandemic, we could see a huge increase in housing supply due to sellers waiting to put their homes on the market. Consequently, we can see a huge increase in the amount of buyers that have been waiting for more homes to come available. That’s why buyers should be taking this time to get prepared by talking to a mortgage professional to get pre-approved. With the threat of more buyers coming into the market, you will want to be able to stand out and preparation will get you there. For sellers, preparing your home for the market is key. Talk to a Realtor and discuss improvements that can be made to your home and how to portray it in the best light to outshine the competition.
- The financial impact we’re all feeling as a result of COVID-19 is real! The government has rolled out a variety of resources to help during this difficult time. Grants, loans, unemployment, relaxed retirement withdrawal rules, etc., are all avenues to access relief. We encourage you to read through the information contained in the links below along with anything else you may find that could potentially help.
- (PPPL) – Paycheck Protection Program Information Sheet – This is another program that one could apply for. Application can be found here: Paycheck Protection Program – (PPPL
- Unemployment in California – Expansions to Unemployment and Independent Contractors are eligible!
- Retirement Account Withdrawals: You can use your retirement accounts to help if you’ve been negatively affected by COVID-19. 401(k)’s, IRA’s and similar retirement accounts will allow early withdrawals of up to $100,000 until December 31st, 2020 without being charged the traditional 10% early withdrawal fee. The law also doubles the amount 401(k) participants can take in loans from an account for the next six months to the lower of $100,000 or 100% of the account balance. IRAs don’t permit loans. Please consult with a tax professional to review options and to gain a clear understanding of potential tax consequences. We’re not CPA’s!!! 🙂
The safety and health of our clients, team and their families is always at the forefront of what we do. In our best efforts to keep everyone in our community safe, we are standing by the shelter in place initiative during this time and will not be holding open any of our listings. With that said, whether buying or selling, we are ready to guide you and help get your prepared for the next step in your journey.