Provided to you Exclusively by Brian G. Smith
Office: 419-625-2600
Toll Free: 866-659-2600
Email: bsmith@unmco.com
For the month of January 2011
IN THIS ISSUE...
Happy New Year! The holidays are over and a brand new year is in front of us. Are you ready to start the year off right? The articles below can help by providing insight on what to expect in the coming months, what projects you should consider tackling around the house this year, and where home loan rates are headed in 2011. If you only read one newsletter this year, make sure it’s this one!
- Looking Ahead: Economy and Housing in 2011– What should you expect in the months ahead? Read the concise forecast below for 2011!
- Resolutions for Improving Your Home – Here’s a list of the Top 5 projects based on time, expense, and value. Plus read the article for a bonus tip!
- Q&A: Will Home Loan Rates Go Back Down?– Will the recent trend continue? Find out where rates are headed…and why!
This information is important to so many people who aren’t sure what to expect or do in 2011. So please help your friends, family members and coworkers by forwarding this newsletter to them. And if you – or any of your friends – have any questions or need any help, just call or email to start the new year out with planning, preparation, and unmatched industry insight.
Looking Ahead: The Economy and Housing Market in 2011
Overall, the economy looks to have stabilized from the crisis situation a couple of years ago. Although there are still some global economic concerns in Europe, the U.S. economy appears positioned for continued growth and strengthening – especially in terms of meeting the growing demand for goods in Asian and Latin American countries.
The stock market finally had a good year in 2010 and saw some strong earnings to help continue the climb out of the financial crisis a couple of years ago. With the strong finish to last year, the stage is set for another good year in stocks.
The positive economic news and corporate earnings in 2010 should also help the labor market strengthen in 2011. Of course, it won’t turnaround over night, but will instead start out slow and build up to more noticeable improvements in the latter part of the year. But don’t mistake those improvements for a complete rebound, since we probably won’t see significant improvement in the overall unemployment rate until after 2011. Still, any positive news for the labor market is good news for the economy – and for families across the country!
What Does All That Mean to Housing and Home Loan Rates?
The economy, stock market, and employment are all closely related. For example, an improving economy leads to better corporate earnings and increased manufacturing demand, which in turn leads to increased hiring as companies try to meet that demand.
In addition, all of the aspects discussed above influence the housing market and home loan rates. One of the biggest influences is employment, since people who are unemployed, under-employed, or afraid of losing their jobs are less likely to purchase a new home. So the improvements in the labor market will be good for the housing industry as well. And in terms of home prices, a more secure employment market can help home prices stabilize – since fewer people would be at risk of losing their homes to foreclosure.
That said, it’s important to remember that all real estate markets are local…and that means there can be enormous variations across the country. Areas where employment is struggling, the housing market will continue to struggle as well. However, in many parts of the country where the bottom has been tested and employment is improving, we’ll see the housing market on the mend in 2011.
But what about the big question: Where will home loan rates go in 2011? To find out, read the Q&A section below!
Top 5 New Year's Resolutions for Improving Your Home
This time last year, you were probably filled with inspiration. Excitement was in the air because you were finally going to take on all of those household projects that you've been wanting and needing to do.
But, if you were like a lot of homeowners, 2010 came and went rather uneventfully in terms of house projects. Maybe you ended up being busier than you thought you would be or maybe with the economy bottoming out, those projects just didn’t seem feasible. Now it's 365 days later, and your home looks exactly the same as it did last year. In other words, the "resolution" you made about improving your home fell apart. Aside from basic maintenance, nothing got done.
The good news is things are looking up and it’s a brand new year! To help get you moving in the right direction, here’s a list of the Top 5 New Year's resolutions for improving your home, which take into account everything from the time and cost involved to the overall "bang for your buck" these improvements will provide.
- Two Words: “Paint” and “Paint.” Nothing improves the overall look of a home quite like a fresh coat of paint. This is true for both the outside and the inside of your home. For the outside, consider hiring professionals. This is the best way to ensure that the job is done quickly and correctly. When it comes to the inside of your home, there's nothing wrong with doing it yourself. Once again, tackle one room at a time, and don't move on until you're happy. Remember, you can always paint over a color that looked better in the store than it does on your walls. For homeowners who are thinking of selling, stick to neutral colors when painting to help broaden the house’s appeal and make it easier to sell.
- Curb Appeal. Step outside your home and walk to the middle of the street, being mindful of any traffic. Take a good look at your home. Be as objective as you can, and ask yourself how does it look? Is the lawn in need of a manicure? Could the yard use a little more foliage? Are the front door and the garage door beaten up or in need of paint? You see where we're going with this. Assess which elements need a facelift, and then make it happen. You'll have a smile on your face every time you pull up the driveway, and your neighbors will also love you for it.
- Time to Update? Frequently homes that were built in the ’70s and ’80s seem more like they're from the 1770s or 1880s. The reason is that newer-built homes come with niceties like dimmer switches for the lighting, crown molding, digital display thermostats, smoke detectors in every room, and the list goes on. Look around your home and determine where it may be reflecting its age. And, if you’re feeling a little ambitious and you have acoustic ceilings (also known as "cottage cheese" ceilings), consider getting rid of them. It's a messy project, but it will improve the look and feel of your home.
- Get Floored. Are your floors in need of a new look? There are more flooring options available now than ever before. Whether you're partial to carpet, hardwood, or tile, there are choices that will fit any budget. The best part is that a new floor, regardless of type, will not only improve the look of your home, it will also increase the value. It may even be a good idea to talk to a real estate agent in your area to see what options are adding the most value to homes in your area. If your floors are relatively new but look a little drab, you may want to have them professionally cleaned. Either way, this is a great project to complete during warmer months.
- Go with the Flow. Plumbing is very important to both homeowners and homebuyers. Is the hot water hot enough? Do the showers have the perfect pressure? Does the toilet run longer than it should? Some of these issues can be solved with a trip to the hardware store, while others will require a plumber. The important thing is that you start paying attention to these "minor" issues and work to get them resolved.
Plus…here’s a bonus tip you can do in just a few minutes and without any supplies!
Bonus Tip: Clear the Clutter. Clutter may seem harmless, but it can have a bigger impact than you might think. For starters, it's a distraction that frequently keeps us from focusing on bigger projects. It also makes a home look messy and reduces valuable space. And for anyone who's thinking about putting their home on the market, it's a known fact that homes with less clutter will sell faster.
So here’s what you do, anytime you find that you have a little bit of free time, pick a small part of your house – or even your garage or shed – to focus on. Maybe it’s an entire room or maybe it’s just the entertainment center that’s cluttered with CDs and DVDs.
Remember, you don’t just want to straighten the clutter, you want to clear it out – and that means getting rid of all those things that you no longer use. You can even earn some money for your efforts by holding a garage sale or donating the items to charity. Just be sure to get a receipt so that you can include your donation on your tax return.
Regardless of which projects are on your to-do list for 2011, make a plan of attack and then tackle them one at a time. And don’t forget to take some before and after photos for your scrapbook or to possibly show a real estate agent in the future if you decide to put your house on the market.
Q&A: Will Home Loan Rates Go Back Down?
QUESTION: Although rates are still near historic lows, they have been heading up. So are those unbelievably low home loan rates behind us for good?
ANSWER: There are only a couple things that would bring back the lows that we saw just a couple months ago:
- If the Fed’s recent round of Quantitative Easing falls on its face and doesn't meet its mission of creating inflation, boosting Stock prices, lowering unemployment and creating consumer demand, then Bond prices could make some gains as the threat of deflation reemerges. But this is a long shot. As the saying goes: “Don’t fight the Fed” – which means that if the Fed wants to raise inflation, it most likely will.
- If the financial problems in Europe that we saw in 2010 worsen significantly in 2011, then this could drive investors into the safe haven of the U.S. Bond market, which would help Bond prices but probably only modestly.
Realistically, the chances of these events happening are unlikely. And when you consider the stimulative action of extending the tax rates and adding further cuts, it’s tough to see Bonds or home loan rates improving much. So the bottom line is that rates may see a brief and fleeting improvement here or there, but many experts believe that the overall trend will continue – meaning home loan rates will creep up as we progress through 2011.
The good news is that home loan rates are still extremely attractive and are still near historic lows for now. That may not be the case in the coming weeks and months. If you or someone you know has been thinking about purchasing or refinancing a home, NOW is the time to call or email to get started.
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The material contained in this newsletter has been prepared by an independent third-party provider. The material provided is for informational and educational purposes only and should not be construed as investment, financial, real estate and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is not without errors.
As your Trusted Advisor, I always want to make sure you are clear on all details of the home financing process. If you or someone you know are interested in purchasing or refinancing a home, give me a call today!
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