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Why Home Prices Are Increasing

by Amy McLeod Group

There are many unsubstantiated theories as to why home values are continuing to increase. From those who are worried that lending standards are again becoming too lenient (data shows this is untrue), to those who are concerned that prices are again approaching boom peaks because of “irrational exuberance” (this is also untrue as prices are not at peak levels when they are adjusted for inflation), there seems to be no shortage of opinion.

However, the increase in prices is easily explained by the theory of supply & demand. Whenever there is a limited supply of an item that is in high demand, prices increase.

It is that simple. In real estate, it takes a six-month supply of existing salable inventory to maintain pricing stability. In most housing markets, anything less than six months will cause home values to appreciate and anything more than seven months will cause prices to depreciate (see chart below).

According to the Existing Home Sales Report from the National Association of Realtors (NAR), the monthly inventory of homes for sale has been below six months for the last five years (see chart below).

Bottom Line

If buyer demand continues to outpace the current supply of existing homes for sale, prices will continue to appreciate. Nothing nefarious is taking place. It is simply the theory of supply & demand working as it should.

If you are thinking about listing your home for sale or starting the search for your new home, give The McLeod Group Network a call today! 971.208.5093

By: KCM Crew

Exploring Salem Oregon: 31st Oregon Ag Fest

by Amy McLeod Group

Saturday, April 28, 2018 - 8:30 AM to 5:00 PM
Sunday, April 29, 2018 - 10:00 AM to 5:00 PM

Family-fun event that helps people understand where their food and fiber comes from. Watch chicks hatch, dig for potatoes, ride ponies and more!

Oregon State Fairgrounds 
2330 17th St. NE 
Salem, OR 97301


503-508-2868

www.oragfest.com

Courtesy of Amy McLeod, The McLeod Group Network

Photo Credit: travelsalem.com​

14 Factors That Can Stall the Mortgage Closing Process

by Amy McLeod Group

Once you find your dream house and your purchase offer is accepted, you need to get through one more step before you move in: mortgage closing. The time it takes to close on a home will vary from one person to the next. When everything goes right, loan closings can be completed in as little as 21 to 28 days, says Atlanta-based real estate agent Bruce Ailion. Currently, Ellie Mae reports that the average closing time for home loans is 44 days.

“Factors like the type of home loan or last-minute changes and requests will affect the amount of time it takes before a house becomes yours. But typically, a lender can close on a mortgage in about a month,” states Andrina Valdes, the division president at Cornerstone Home Lending, Inc. in San Antonio, TX.

However, not everything always goes according to plan. Issues can arise that can keep you from settling into your new place for weeks and sometimes months longer than you expected. Here are some of the most common snafus that can delay the mortgage closing process.

1. Expensive purchases for your new home

A word of advice: Don't make any pricey purchases with your credit card before closing on your house. "This could actually put buyers out of qualifying for their new home,” says Texas real estate agent Jeff Peterson.

After an offer on a house is accepted, some people may be tempted to buy a new sofa, dining set, or another expensive piece of furniture. But real estate experts warn that this could be disastrous. Right before closing, the mortgage lender will pull the buyer’s credit to make sure nothing has changed. A big purchase will show up, which could become an issue, because it means that the buyer is taking on more debt.

2. Death of the original homeowner

If there has been a death associated with the desired property, the home may need to go through probate court first to authenticate the former owner's last will and testament. “If that's the case, your closing will be delayed, and there's not much you can do about it,” says Jim Lorio, a Florida real estate investor. In some states, probate can take anywhere from a few months to a few years.

3. Homeowners association issues

If the previous homeowner has outstanding homeowner association (HOA) fees or fines, this could cause delays. In some cases, you may be able to negotiate those fees with the seller; otherwise, you will be responsible for paying them.

4. Verification issues

In some instances, the borrower’s landlord, mortgage company, employer, or source of down payment may not be willing to provide verification in a timely manner. Their failure to move quickly can slow you down.

5. Down payment issues

There are times when the lender may require the home buyer to put more money down; this may take time, especially if the buyer lacks the extra funding.

6. Lender may need additional information

In some cases, additional info may be requested late in the process. Other times, the lender may lose a document that will need to be obtained again.

7. Scheduling problems

One party—whether the closing agent, attorney, title company representative, lender, buyer, or seller—may not be available to meet on the closing day, which can push timelines back.

8. Buyer delays

If a buyer is self-employed, sometimes additional documents are required. If the buyer has multiple sources of income, this may need to be documented and verified as well. If the buyer is getting a down payment from an unconventional source or a gift, this could also slow down the process.

9. Flood insurance requirement

If your new home is in a flood zone, you may need to get flood insurance, which may require a benchmark survey. In some markets, this might take three weeks. Then, it must be reviewed by the mortgage underwriter—aka the person who approves your loan. Flood insurance, and even homeowner's insurance, can also sometimes be tough to get, depending on your past history with claims, credit, and location.

10. Appraisal disparities

Before a mortgage is ever approved, the bank must first appraise the home. If the appraisal comes in low, it may take some time to renegotiate the asking price of the home.

11. Title issues

In some cases, there may be a tax lien against the property that needs to be resolved first, in order to move forward with the closing process. Other times, the title may have the incorrect signature or attestation.

12. Property damage

If there is any type of damage to the property, the lender may require repairs prior to closing.

13. Contract disagreements

Sometimes the seller may not agree to the buyer’s contract requests (like agreeing to include the entire contents of the home in the deal). This can kill the transaction or require further negotiation between the agents and other parties involved.

14. Foreclosure

If a homeowner is in foreclosure, it can take up to 10 days to get a payoff from the mortgage company, which often includes legal fees.

Contact your local experts at The McLeod Group Network to start the search for your new home! 971.208.5093 or mcleodgroupoffice@gmail.com.​​

By: Realtor.com, Nikki Gaskins Campbell

Exploring Salem Oregon: Vintage Weekend

by Amy McLeod Group

Friday, April 20, 2018 through Sunday, April 22, 2018

The Independence Downtown Association is hosting its first Vintage Weekend. There will be a Vintage Trailer Rally in the park, an Antique Market on C Street, a private Ghost Walk, and more.

Downtown Independence
278 South Main St.
Independence, OR 97351

503-917-1902

Courtesy of Amy McLeod, The McLeod Group Network

Photo Credit: travelsalem.com

6 Downsizing Mistakes Even Smart People Make

by Amy McLeod Group

This past year, my mother downsized from our six-bedroom family home into a two-bedroom condo in a senior development. Although she was nervous to cast aside her old life, now that the deed is done, she feels elated and free—and wishes she'd done it years earlier.

Now, my mom no longer worries about keeping her lawn mowed and driveway clear of snow, because maintenance staff does it for her. Rather than rattling around a huge house that took hours to clean, she has a manageable space she can easily tidy up herself. And, not incidentally, she has more money for whatever comes down the road.

Nonetheless, downsizing can still fill people with dread; experts say this is largely because they've heard horror stories from people who went about it all wrong. Here are the top six mistakes people make when downsizing, plus some ways to make the process easier and less intimidating.

1. Waiting too long to downsize

Are your kids gone? Is the mortgage paid off? Are you in reasonably good health? Think of it this way: It's better to move now—while you have the strength and energy—than later, when it will be harder.

“The biggest mistake we make on downsizing is that we wait too long,” says Jacquie Denny, co-founder and chief development officer of estate sale marketplace, Everything But the House.

Typically people wait until an illness, or even when one spouse dies. That means we’re downsizing while we’re grieving or struggling through poor health, which are far from ideal circumstances.

Instead, Denny says, “we should actually plan ahead to downsize so that it is a lifestyle choice"—e.g., exchanging onerous yardwork for fun activities such as golf games or long hikes. Don't mistake this, however, for rushing the process; Denny suggests giving yourself a full six months to prepare for your move.

2. Giving your kids too long a leash

Odds are, your kids can help you downsize by grabbing some furniture you won't have room for, or a few mementos that are meaningful to them.

“Have your children over and ask them which pieces, if any, they would like to incorporate in their home,” says Denny.

The one caveat: Give them a time limit. None of this “I may want that dresser, but give me a couple of months to figure out where I’d put it.” This is a time for tough love. State a date by which they need to remove anything they want to keep.

3. Tackling your whole home all at once

Downsizing your whole home at once will likely be overwhelming—so instead, focus on thinning out yard tools and kitchens first, since “people are usually going to a leaner lifestyle in these areas," says Denny.

If you’re moving to a home where outdoor spaces are maintained by the condo association, you can just get rid of all your yard gear. (OK, maybe keep a spade and gardening gloves if you have houseplants.)

Downsizing the kitchen will take more work. Start with what you want to keep and set that aside. Make sure it’s really going to fit in a smaller space, that it’s all worth the bother of moving, and that you’ll actually use the stuff regularly in your new home.

4. Tossing all your possessions in the trash

Feeling guilty about hauling everything to a dumpster? There are other options.

My mom, for instance, didn’t want to deal with the hassle of a yard sale, so she put out the word to friends and neighbors that she had a house full of furniture for the taking. She also scheduled a pickup from Habitat for Humanity’s ReStore, which accepts donated furniture and more, with the proceeds of any sales going toward building houses for those in need.

5. Assuming your furniture will fit in your new digs

So how much furniture should you keep? First, measure each room in your new home. Then measure the pieces you’d like to take with you and make sure they’ll actually fit. You may want to try a virtual room online tool to figure out how you’ll configure your furniture in your new home. Planner 5dRoomstyler 3D Planner, and HomeByMe are all free.

6. Focusing on how you're losing all your 'stuff'

So many memories to leave behind. How do you do it? Take photos of what’s hardest to leave. I like what Suzanne Stavert, author of The Empty Nesters blog, says: “It is so refreshing to realize ‘what we really need’ is our family and friends. The ‘stuff’ is so secondary.”

Contact your local experts at The McLeod Group Network for all your Real Estate needs! 971.208.5093 or mcleodgroupoffice@gmail.com.​

By: Realtor.com, Adriana Velez

Exploring Salem Oregon: Banff Mountain Film Festival World Tour

by Amy McLeod Group

Tuesday, April 17, 2018 - 7:00 PM to 10:00 PM

Features the best mountain films from the Banff Mountain Film Festival this year, showcasing amazing filmmaking talent that spans the globe. $20 admission.

Elsinore Theatre
170 High St. SE
Salem, OR 97301

503-375-3574

Courtesy of Amy McLeod, The McLeod Group Network

Photo Credit: travelsalem.com

What Is Private Mortgage Insurance (PMI)?

by Amy McLeod Group

When it comes to buying a home, whether it is your first time or your fifth, it is always important to know all the facts. With the large number of mortgage programs available that allow buyers to purchase homes with down payments below 20%, you can never have too much information about Private Mortgage Insurance (PMI).

What is PMI?

Freddie Mac defines PMI as:

“An insurance policy that protects the lender if you are unable to pay your mortgage. It’s a monthly fee, rolled into your mortgage payment, that is required for all conforming, conventional loans that have down payments less than 20%.

Once you’ve built equity of 20% in your home, you can cancel your PMI and remove that expense from your mortgage payment.”

As the borrower, you pay the monthly premiums for the insurance policy, and the lender is the beneficiary. Freddie Mac goes on to explain that:

“The cost of PMI varies based on your loan-to-value ratio – the amount you owe on your mortgage compared to its value – and credit score, but you can expect to pay between $30 and $70 per month for every $100,000 borrowed.” 

According to the National Association of Realtors, the average down payment for all buyers last year was 10%. For first-time buyers, that number dropped to 5%, while repeat buyers put down 14% (no doubt aided by the sale of their homes). This just goes to show that for a large number of buyers last year, PMI did not stop them from buying their dream homes.

Here’s an example of the cost of a mortgage on a $200,000 home with a 5% down payment & PMI, compared to a 20% down payment without PMI:

The larger the down payment you can make, the lower your monthly housing cost will be, but Freddie Mac urges you to remember:

“It’s no doubt an added cost, but it’s enabling you to buy now and begin building equity versus waiting 5 to 10 years to build enough savings for a 20% down payment.”

Bottom Line

If you have questions about whether you should buy now or wait until you’ve saved a larger down payment, let’s get together to discuss our market’s conditions and help you make the best decision for you and your family. 971.208.5093 or mcleodgroupoffice@gmail.com.

By: KCM Crew

Salem Keizer OR Real Estate For Sale
1091 Ivy Way NE, Keizer, OR  97303

Come enjoy this classic colonial in the lovely Greenwood neighborhood! Well maintained, 1091 Ivy Way NE offers 3 bedrooms, 2.5 baths, stunning hardwood floors, built ins, exposed beams, large windows, a covered front porch, plus a private backyard oasis all perfectly situated on a quiet street conveniently close to restaurants, shopping and services. The beautiful wood burning fireplace with mantle and built in bookcases are the highlight of this spacious living room. The eat-in kitchen offers you an abundance of cabinetry and counter space, updated appliances and a breakfast bar into the dining area with access to the rear patio. A large first floor den with built in bookcases could also be a fourth bedroom if that better suits your needs. Upstairs the oversized master will be your retreat with a walk-in closet and en suite. Two generously sized secondary bedrooms provide ample closet space and a shared full hall bath. The large laundry room with cabinetry helps with all your storage needs and organization. All this and more is ready for a new family to enjoy!

The McLeod Group Network has distinguished themselves as a leader in the Salem Oregon real estate market. As a full service, real estate team - focused on working with our Seller and Buyer clients to help achieve their real estate goals!

We bring a keen eye for the details of buying or selling a Salem Oregon home and seemingly boundless determination and energy, which is why our clients benefit from our unique brand of real estate service. Rooted in Tradition, focused on the Future –The McLeod Group Network will help make the most of your Salem Oregon real estate experience. With over 40 years of combined experience, you can rest assured that your real estate transaction will be handled and cared for with the utmost respect and attention to detail. Give us a call today 503-798-4001 and discover the difference we can make during your family's move.

Exploring Salem Oregon: Gardenpalooza 2018

by Amy McLeod Group

Saturday, April 7 - 8:00 AM to 4:00 PM

More than 40 Vendors will attend Gardenpalooza where you can shop at the country store, eat delicious foods and see hundreds of plants and tools on display.

Fir Point Farms
14601 Arndt Rd.
Aurora, OR 97002

503-793-6804

Get Directions Here

Event Website

Courtesy of Amy McLeod, The McLeod Group Network

Photo Credit: gardengalleryironworks.net

NOT Owning Your Home Can Cost You a Lot of Money!

by Amy McLeod Group

Owning a home has great financial benefits, yet many continue to rent! Today, let’s look at the financial reasons why owning a home of your own has been a part of the American Dream for as long as America has existed.

Realtor.com recently reported that:

Buying remains the more attractive option in the long term – that remains the American dream, and it’s true in many markets where renting has become really the shortsighted option… as people get more savings in their pockets, buying becomes the better option.”

What proof exists that owning is financially better than renting?

1. In a previous blog we highlighted the top 5 financial benefits of homeownership:

  • Homeownership is a form of forced savings.
  • Homeownership provides tax savings.
  • Homeownership allows you to lock in your monthly housing cost.
  • Buying a home is cheaper than renting.
  • No other investment lets you live inside of it.

2. Studies have shown that a homeowner’s net worth is 44x greater than that of a renter.

3. Just a few months ago, we explained that a family that purchased an average-priced home at the beginning of 2018 could build more than $44,000 in family wealth over the next five years.

4. Some argue that renting eliminates the cost of taxes and home repairs, but every potential renter must realize that all the expenses the landlord incurs are already baked into the rent payment– along with a profit margin!!

Bottom Line

Owning a home has always been, and will always be, better from a financial standpoint than renting.

Let’s make your dreams of homeownership a reality! 971.208.5093 or mcleodgroupoffice@gmail.com.

By: KCM Crew

Displaying blog entries 1-10 of 10

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Contact Information

Photo of The McLeod Group Network Real Estate
The McLeod Group Network
Keller Williams Capital City
1900 Hines St SE #220
Salem OR 97302
971-208-5093
Fax: 971-599-5229

**Disclaimer: Amy McLeod, and her team, do not initiate, process, or service mortgages.  And provide this information only as a service.  You should confirm information here with your Licensed Mortgage Lender.