Wealthy Pick Real Estate Over the Stock Market

by The KCM Crew on September 2013 -  in For Buyers

We are taught from birth that the quickest way to achieve a goal is to seek out those who have already accomplished the goal and do what they do. Interested in creating wealth? It seems the wealthy trust real estate as an investment before even the stock market.

A recent survey revealed that 75 percent of luxury homebuyers believe homeownership is a more sound investment than the stock market. The study also reported 57 percent of employed luxury homeowners believe homeownership is a bigger indicator of success than their job or title.

Want to join the wealthy? Invest in real estate.

Noemi Cardoso
William Raveis Real Estate
Local Office. Local Agents. Local Knowledge.
www.DistinctiveHoems-NE.com

Harvard: Homeownership Still the American Dream

by The KCM Crew on September 6, 2013 

in For Buyers, For Sellers

A big question facing the real estate industry over the last few years is how the housing crisis would impact the public’s belief in homeownership as a major component of the American Dream. Many felt the tragedy experienced by so many families would force them to reconsider their desire to ever be a homeowner again.

A recent study by the Joint Center for Housing Studies at Harvard University addressed this question. Their paper, Reexamining the Social Benefits of Homeownership after the Housing Crisis, revealed some interesting findings:

Homeownership Still Preferred Over Renting

“Even after the dramatic loss of equity and the high foreclosure rates, the early evidence suggests that people seem to believe that, over the long run, owning is still preferable to renting…The long term cultural preference for owning seems to have weathered the recent housing crisis.”

Americans Still Expect to be Homeowners

“The research on home-buying expectations supports the conclusion that very large percentages of Americans still expect to buy a home at some time in the future.”

Younger Americans More Desirous of Homeownership

“Moreover, the finding that younger renters and owners are more likely than their older counterparts to expect to own bodes well for the future of the housing market.”

Even after one of the most difficult decades in this country’s real estate history, the belief that homeownership is a part of the American Dream still lives on.

Noemi Cardoso
Licensed in MA & RI
William Raveis Real Estate
Noemi@DistinctiveHomes-NE.com
 

Will Millennials Drive House Sales in 2013?

by The KCM Crew on May 7, 2013

The cover story of last month’s Barron’s Magazine discussed the Millennial generation and the impact they will have on the economy including the housing sector. There have been many contrasting views about this age group and their feelings on whether or not homeownership is a part of their personal American Dream.

Here are few questions about this generation that have been debated over the last several years… along with some current findings.

Is the Number of Millennials Large Enough to Make an Impact?

The Barron’s article quantifies their potential impact:

“Millennials sometimes called Generation Y, and defined by many demographers as ranging from ages 18 to 37 — make up the largest population cohort the U.S. has ever seen. Eighty-six million strong, it is 7% larger than the baby-boom generation, which came of age in the 1970s and ’80s. And the Millennial population could keep growing to 88.5 million people by 2020, owing to immigration, says demographer Peter Francese, an analyst at the MetLife Mature Market Institute.”

Do Millennials Even Believe in Homeownership?

There have been many recent studies showing this generation’s belief in homeownership is as strong as previous generations. Just last month, Gallup released a poll, American Dream of Owning Home Lives On, Even for Young, which revealed that 91% of young adults between 18 and 29 years old either own a home or plan to buy one. The report says:

“Nearly 7 in 10 Americans aged 18 to 29 currently do not own a home, but plan on buying one… Coupling this with the 21% of younger Americans who say they already are homeowners leaves few adults under 30 who say they don’t own a home and have no plans on buying one.”

What about Student Debt?

Barron’s explains the challenge may not be as crippling as some think.

“There is almost $1 trillion of student debt outstanding in the U.S. today, which could limit the purchasing power of Millennials…But, total figures are misleading. The average student loan among Gen Y-ers is $25,000, and the median loan is nearly $14,000, according to the Federal Reserve Bank of Kansas City. Less than 1% of student loans are larger than $100,000.”

Are They Ready to Leave Mom & Dad’s?

The economy forced many young adults to return home after college to live with their parents. Barron’s explains that, as the economy improves, this anomaly will correct itself:

“As the millennials’ employment situation improves, more young adults living at home will pack their bags and move out. That could spur an increase in U.S. household formation, which turned negative in 2007-08. Since then, the number of newly created households has recovered to about a million a year, still well below an annual average of 1.5 million since the 1970s, according to Census Bureau data.”

According to the latest CoreLogic Market Pulse Report, this correction is already occurring. They explain:

“The recession curtailed household formations, causing doubling-up in living arrangements and driving young potential buyers back to their parents. More recent data shows a shift with household formations returning in force.”

Also, Freddie Mac recently projected new household formations to again return to the 1.5 million levels in 2013.

Will They Prefer Owning over Renting?

The Barron’s story gives a good reason why they might:

“Greater financial security could mean an increase in the birth rate, which typically slumps during economic downturns. Francese sees the average birth rate for U.S. women rising to 2.1-2.2 in coming years from a depressed 1.9 recently. ‘A lot of Millennials put off having babies, and now they will get to work,’ he says. That suggests they will also start buying homes.”

CoreLogic believes that the first time homebuyer is poised to return to the market this year. They explain:

“As new renter-households are formed, rental prices are bid up, making the prospect of owning more attractive to existing renters. Sustained low interest rates add to the appeal for current renters to convert to homeownership. The expectation this spring is that more renters will take advantage of historically low interest rates and low home prices to become homeowners.”

We agree.

Noemi Cardoso
William Raveis Real Estate
911 Main Rd - Westport MA 02790
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
Noemi@DistinctiveHomes-NE.com
Licensed in MA & RI

Different Generations See the Value in Homeownership

by Steve Harney on April 18, 2013 

Our founder, Steve Harney, occasionally asks to do a personal post on what he sees as important to our industry. Today is one of those days. – The KCM Crew

During an online chat with other real estate professionals last week, the question of the true value of homeownership was raised. My son, Bill, and I each chimed in unaware of the other’s response. It was interesting how the different generations valued homeownership for slightly different reasons. Below, are both responses.

Bill’s Response:

 

I want to weigh in as a 20-something who recently purchased a home for the first time.

While the financial reasons (wealth-building, not wanting to throw away rent payments every month, that owning is actually cheaper than renting in many markets right now) certainly had an impact on our decision, I think there are too many that are quick to dismiss the non-financial reasons that my peers and I discuss more often than people think.

There’s a very good reason why my wife and I host more parties than my friends who live in apartments (space). There’s a reason why we get more compliments about our house than our renting friends (freedom to choose our own stuff). We have the greatest dog in the world, while I hear “I can’t wait to get a house because I’ve always wanted my own puppy but I can’t right now”.

As a “young” buyer, do I want to make a smart decision? Of course. Do I want to understand the numbers and feel confident with the purchase? Sure. But that’s not what I woke up dreaming about 2 years ago. I woke up dreaming about the house that my wife and I can raise a family in; the house where we’re going to have barbecues with all our neighbors.

We woke up talking about the house that finally allowed my wife to get the dog she’s wanted since she was a kid (and that I fell in love with). We started picking out bedroom colors for our future babies.

You want advice for helping more young buyers? Ask them what their dreams are. What are their goals? What do they wake up talking to their partner about? Help them realize this and you only have to show them that the financials make sense (we’re not looking to make a quick buck on the house we’re living in).

Isn’t this what real estate is about anyway? Helping people realize their dreams? That’s what it was always about in my house growing up (thanks Steve). That’s what my wife grew up thinking. That’s what my friends (all in the first time home buyer range) think. Why not talk to them about this?
Sorry for the rant everyone. Figured I had a spot for the voice of the young buyer to be heard by the industry’s elite and I couldn’t pass that up. Thanks for reading.

My Response:

 

Do I think that homeownership is right for everyone? No, I don’t.

Do I think people who can’t afford a house should buy one anyway? No, I don’t.

However, I do believe for the majority of families that homeownership is important. Instead of giving you the links to the numerous studies I have that delineate the benefits of homeownership, I’ll give you one anecdotal story – my own.


Guess where I got the seed money to start my real estate company? My home.

Guess where I got the money for Bill’s college education? My home.

Guess where my younger son, Steven, moved to when he couldn’t find gainful employment after college? My home.

Guess where my older son, Bill, and his wife (and cat & dog) moved to when Sandy ravaged their house? My home.

Guess where I got the down payment for a winter getaway in South Beach for my wife and me? My home.

The home I struggled to buy over 20 years ago has financed my business, put two sons through college and enabled me to buy a winter escape in Florida. And during that whole time, it also allowed me to provide my family shelter during their times of need.

Do I firmly believe in the value of homeownership? Yes, I do!!

Ready to start your own Real Estate adventure? If so let's chat and get you on the right path.

Noemi Cardoso
William Raveis Real Estate
911 Main Rd - Westport MA 02790
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
Noemi.Cardoso@raveis.com
Serving Ma & RI
Fluent in Portuguese and English


 

Homeownership: The Reports of Its Death…

by The KCM Crew on March 13, 2013

Mark Twain and homeownership are both iconic pieces of the American experience. And like what happened to Twain in 1897, recent reports of homeownership’s death have been greatly exaggerated. Ever since the housing bubble burst, many so-called experts have predicted the end of homeownership as part of the American Dream. Today, we want to expose some of these myths.

MYTH #1:

After the housing crash, Americans would no longer believe in homeownership.

FACT:

While homeownership has fallen from a high of 69.2% in 2004 to 65.4% at the end of 2012, the desire to own a home is still strong.

• 73% of Americans say it is a good time to buy a home. (Fannie Mae)
• 70% of Americans see homeownership as part of the American Dream. (Trulia)
• In every age group from 25 to 65 years old, over 80% plan to buy a home in the future. Even 76% of those over 65 years old plan to buy a home in the future. (Joint Center for Housing Studies at Harvard University)

MYTH #2:

Those families that were forced from their homes during the housing crash would never look at homeownership in a positive light again.

FACT:

• Many of the sellers who lost their home to a short sale or foreclosure over the last six years are re-entering the housing market as purchasers. It is projected that over 700,000 people in this category could be in the market for a home in 2013 and that the number will more than double to over 1.5 million in 2014. (Moody’s Analytics)
• Nearly 80% of those homeowners who decided to strategically default (walking away from the house and mortgage) over the last few years have expressed a desire to buy a home again within the next 12 months. (YouWalkAway.com)

MYTH #3:

Young adults, after seeing their parents suffer major loses of equity, will not embrace homeownership especially as a financial investment.

FACT:

Not one study has substantiated this myth. Recent studies have actually proven the exact opposite:

• 72% of young adults between 18-35 years old see homeownership as part of their personal American Dream. (Trulia)
• 75% of young adults between 18-35 years old see homeownership as an indicator of success. (Realogy)
• 94% of young adults under 25 and 96% between the ages of 25-34 plan to buy a home. (Joint Center for Housing Studies at Harvard University)
• 79% of young adults under 25 years old and 86% of young adults 25-34 believe that owning is a better financial decision than renting. (Joint Center for Housing Studies at Harvard University)

Obviously, the reports of the death of homeownership in America were GREATLY exaggerated.

If you are thinking of buying a home in Westport or surrounding areas please visit www.DistinctiveHomes-NE.com for a free list of homes for sale in Westport and Bristol County MA and RI.

 If you are thinking of selling your home contact me for a FREE Current Market Analysis and to learn about our Market Plan to get your home SOLD!

We work with one going in mind, YOURS!
Noemi Cardoso
Local Office. Local Agents. Local Knowledge.William Raveis Real Estate
911 Main Rd - Westport MA 02790
Cell: 508-558-1945www.DistinctiveHomes-NE.com
noemi@DistinctiveHomes-NE.com

Are Young Adults Buying Homes Again?

Posted: 05 Mar 2013 - KCM Group

Sales of residential properties are back to the highs experienced at the expiration of the Home Buyers Tax Credit in April 2010. One of the reasons for this surge in purchasing is that young adults may again be entering the market.

Over the last few years, many young adults stayed on the sidelines (some in their parents’ homes) while waiting for the overall economy and the housing market to stabilize. This group represents a pent-up purchasing demand which is now coming to market.

Last summer, the Joint Center for Housing Studies at Harvard University released a study which addressed this demographic:

“Surveys consistently find that the overwhelming majority of young adults plan to own a home in the future, but many would-be buyers have stayed on the sidelines waiting for the job outlook to improve and house prices to stop falling. But as markets tighten, these fence-sitters may begin to take advantage of today’s lower home prices and unusually low mortgage rates.”

This may be taking place already

It seems this is beginning to take place. The Census Bureau recently reported that annual household formations are almost back to boom time numbers:

• Boom Years: 1,250,000 annual formations
• 2008-2011: 650,000 annual formations
• 2012: 1,150,000 annual formations

Freddie Mac is projecting 1,250,000 new household formations in 2013.
These new households will be divided between purchases and rentals. However, we must realize this group believes strongly in homeownership. Here are three examples:

1. 43% of young adults between the ages of 18-34 years old already own a home.
2. 72% of young adults between the ages of 18-34 years old see homeownership as part of their personal American Dream.
3. 93% of young adults between the ages of 18-34 years old, who currently rent, plan to buy a home.

It will be interesting to follow this trend as prices rise and interest rates inch upward.

If you are thinking of buying a home in Westport or surrounding areas please visit www.DistinctiveHomes-NE.com for a free list of homes for sale in Westport and Bristol County MA and RI.

If you are thinking of selling your home contact me for a FREE Current Market Analysis and to learn about our Market Plan to get your home SOLD!

We work with one going in mind, YOURS!

Noemi Cardoso
Local Office. Local Agents. Local Knowledge.
William Raveis Real Estate
911 Main Rd - Westport MA 02790
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
noemi@DistinctiveHomes-NE.com

Homeownership: The American Dream.

As a real estate professional, it’s important to understand, and remind yourself, that homeownership really is the American Dream and your job is to be the guardian and guide to make that dream a reality. This is especially important in a market where some people may be misinformed about the benefits and possibilities of buying a home.

The good news is 96% of homeowners see homeownership as a positive experience and 88% of renters aspire to own a home. This is true in the United States more than any other country. Owning a part of our country has always been the American Dream and as an agent you are instrumental in this dream. It’s your job to help guide people to their ultimate goal of homeownership.

The first thing you must realize is that homeownership is NOT about the money. In fact, if we look at Fannie Mae’s quarterly National Home Survey, as far back as we can go, the top four reasons for buying a home are the same. The top four reasons people buy a home are:

1. It means having a good place to raise children and provide them with a good education
2. To have a physical structure where their family feels safe
3. It allows for more space for their family
4. It gives them control over what they do with their living space including renovations and updates.

Homeownership means something more to people and their families than just financial considerations. It’s up to you to be ready to communicate ALL the advantages to homeownership, not just the financial ones.

In tomorrow’s post, we will address more advantages of homeownership. (By KCM Crew )

If you are seriously thinking of buying or selling, or just plain curious to see what’s happening in your area of interest, start your search at the best real estate website www.DistinctiveHomes-NE.com


Noemi Cardoso
RE/MAX Welcome Home
Serving Westport, Dartmouth, Fall River, MA
Little Compton, Tiverton, RI and surrounding towns.
www.DistinctiveHomes-NE.com