Should I Rent My House if I Can’t Sell It?

Rents are skyrocketing and homes are still at great prices. These two situations are also causing some sellers to consider renting their home instead of selling it. After all, a homeowner can get great rental income now and perhaps wait until house values increase even further before selling.This logic makes sense in some cases. There is a strong belief that residential real estate is a great investment right now. However, if you have no desire to actually become an educated investor in this sector, you may be headed for more trouble than you were looking for. You should answer the following questions to make sure this is the right course of action for you and your family. 10 Questions to ask BEFORE renting your home 1.   How will you respond if your tenant says they can’t afford to pay the rent this month because of more pressing obligations? 2.   Because of the economy, many homeowners cannot make their mortgage payment. What percentage of tenants do you think cannot afford to pay their rent? 3.   Have you interviewed experienced eviction attorneys in case a challenge does arise? 4.   Have you talked to your insurance company about a possible increase in premiums as liability is greater in a non-owner occupied home? 5.   Will you allow pets? Cats? Dogs? How big a dog? 6.   How will you actually collect the rent? By mail? In person? 7.   Repairs are part of being a landlord. Who will take tenant calls when necessary repairs come up? 8.   Do you have a list of craftspeople readily available to handle these repairs? 9.   How often will you do a physical inspection of the property? 10. Will you alert your current neighbors that you are renting the house? Bottom Line Again, renting out residential real estate is historically a great investment. However, it is not without its challenges. Make sure you have decided to rent the house because you want to be an investor, not because you are hoping to get a few extra dollars by postponing a sale. Who do you know looking to buy or sell a home? Call David. David Demangos Keller Williams Realty Cell: 858.232.8410 Realtor® BRE# 01905183 www.AwesomeSanDiegoRealEstate.com San Diego Real Estate Elite - Global Property Specialist - Green Specialist -ALC Committee - CIPS Our Team Goes to Extremes to Fulfill Your Real Estate Dreams! Download The #1 Real Estate Live Home Search App Below Awesome Home App

Millionaires Use Real Estate Agents

Do as I Say… not as I Do

This adage could be no truer today after it has been reported, in a recent Herald Tribune article. That when it came to selling his Florida mansion, Al Bennati, the longtime chief executive of BuyOwner.com, has chosen to list his home with a local real estate agent. BuyOwner.com is one of many websites out there now that encourage home owners that they do not need to enlist the help of a professional agent to be able to sell their home. They go as far as to tell homeowners: 

"BuyOwner.com allows you to reach the most potential buyers in the shortest amount of time, in the most effective (the Internet) and most cost effective manner (no commission!) possible."

Let’s break down that statement:

Myth #1 – The internet is the most effective way to sell your home

Many have said that, with the introduction of home search on the internet, hiring an agent is no longer a necessity. When the time came to list his own home, Bennati went against his own advice saying:

"To sell a home of this magnitude, it needs to be done by a person and a company that reaches buyers of this caliber."

Myth #2 – FSBO’ing is the most cost effective solution

Without proper exposure to the “right kind of buyers” your home will not sell. Many real estate professionals have elaborate strategies to get your listing in front of exactly who needs to see it.

The most recent Home Sellers’ and Buyers’ Profile Report from the National Association of Realtors revealed that, though 92% of buyers search for a home on the internet, 90% still use a real estate professional.

Bottom Line

Two separate people made fortunes convincing others to sell their home through their FSBO sites. Yet, when it came to selling their own home, they recognized the value of using a real estate professional. There is a reason the real estate industry has been around for centuries: it performs a valuable service.

Who do you know looking to buy or sell a home? Call David!

David Demangos
Keller Williams Realty
Cell: 858.232.8410
Realtor® BRE# 01905183
www.AwesomeSanDiegoRealEstate.com

San Diego Real Estate Area Expert / Green Specialist / ALC Committee
Our Team Goes to Extremes to Fulfill Your Real Estate Dreams!

Download The #1 Real Estate Live Home Search App Below

Awesome Home App

The Dream Lives On: The Future of Home Ownership in America

In his paper, Eric Belsky reveals five financial reasons people should consider buying a home.

Here are the five reasons, each followed by an excerpt from the study:

1.) Housing is typically the one leveraged investment available. 

“Few households are interested in borrowing money to buy stocks and bonds and few lenders are willing to lend them the money. As a result, homeownership allows households to amplify any appreciation on the value of their homes by a leverage factor. Even a hefty 20 percent down payment results in a leverage factor of five so that every percentage point rise in the value of the home is a 5 percent return on their equity. With many buyers putting 10 percent or less down, their leverage factor is 10 or more.”

2.) You're paying for housing whether you own or rent. 

“Homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord.”

3.) Owning is usually a form of “forced savings”.

“Since many people have trouble saving and have to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings to another day.”

4.) There are substantial tax benefits to owning. 

“Homeowners are able to deduct mortgage interest and property taxes from income...On top of all this, capital gains up to $250,000 are excluded from income for single filers and up to $500,000 for married couples if they sell their homes for a gain.”

5.) Owning is a hedge against inflation.

“Housing costs and rents have tended over most time periods to go up at or higher than the rate of inflation, making owning an attractive proposition.”

Realize that home ownership makes sense for many Americans for many social and family reasons. 

Who do you know looking to buy or sell a home? Call David!

David Demangos
Keller Williams Realty
Cell: 858.232.8410
Realtor® BRE# 01905183

www.AwesomeSanDiegoRealEstate.com
San Diego Real Estate Area Expert / Green Specialist / ALC Committee
Our Team Goes to Extremes to Fulfill Your Real Estate Dreams!

5 Reasons to Hire a Real Estate Professional

Whether you are buying or selling a home, you need an experienced Real Estate Professional to lead you toward your ultimate goal. In this world of instant gratification and Internet searches, many sellers think that they can For Sale by Owner or FSBO. The 5 Reasons You NEED a Real Estate Professional in your corner.

1. What do you do with all this paperwork?

Each state has different regulations regarding the contracts required for a successful sale, and these regulations are constantly changing. A true Real Estate Professional is an expert in their market and can guide you through the stacks of paperwork necessary to make your dream a reality. Remember, there are over 200 tasks/disclosures/advisory's the need to be understood and completed.

2. Ok, so you found your dream house, now what?

According to the Orlando Regional REALTOR Association, there are over 230 possible actions that need to take place during every successful real estate transaction. Don’t you want someone who has been there before, who knows what these actions are to make sure that you acquire your dream?

3. Are you a good negotiator?

So maybe you’re not convinced that you need an agent to sell your home. However, after looking at the list of parties that you need to be prepared to negotiate with, you’ll realize the value in selecting a Real Estate Professional. From the buyer (who wants the best deal possible), to the home inspection companies, to the appraiser, there are at least 11 different people that you will have to be knowledgeable with and answer to, during the process.

4. What is the home you’re buying/selling really worth?

Not only is it important for your home to be priced correctly from the start, to attract the right buyers and shorten the time that it’s on the market, but you also need someone who is not emotionally connected to your home, to give you the truth as to your home’s value.

According to the National Associates of Realtors, “the typical FSBO home sold for $184,000 compared to $230,000 among agent-assisted home sales.” Get the most out of your transaction by hiring a professional.

5. Do you know what’s really going on in the market?

There is so much information out there on the news and the Internet about home sales, prices, mortgage rates; how do you know what’s going on specifically in your area? Who do you turn to, to tell you how to competitively price your home correctly at the beginning of the selling process? How do you know what to offer on your dream home without paying too much, or offending the seller with a low-ball offer? “When getting help with money, whether it’s insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman.” – Dave Ramsey

Hiring an agent who has their finger on the pulse of the market will make your buying/selling experience an educated one. You need someone who is going to tell you the truth, not just what they think you want to hear.

Bottom Line:

You wouldn't hike up Kilimanjaro without a Sherpa, or replace the engine in your car without a trusted mechanic, why would you make one of your most important financial decisions of your life without hiring a Real Estate Professional?

Who do you know looking to buy or sell a home? Call me!

David Demangos
Keller Williams Realty
Cell: 858.232.8410
Realtor® BRE# 01905183

San Diego Real Estate Area Expert / Green Specialist / ALC Committee
Our Team Goes to Extremes to Fulfill Your Real Estate Dreams!

Gallup Poll: Real Estate is the Best Long Term Investment

The Gallup organization just released their report which asked Americans to choose the best option for long term investment. It was no surprise to us that real estate returned to the top position over other investment categories (gold, stocks/mutual funds, savings accounts/CDs and bonds). 

Back in 2011, gold was the most popular long-term investment among Americans. However, with the housing market improving across the U.S. and home prices rising, more Americans now consider real estate the best option for long-term investments.

Who do you know looking to buy a home, call David!

David Demangos
Keller Williams Realty
Cell: 858.232.8410
Realtor® BRE# 01905183

San Diego Real Estate Area Expert / Green Specialist / ALC Committee
Our Team Goes to Extremes to Fulfill Your Real Estate Dreams!

Download The #1 Real Estate Live Home Search App Below
Awesome Home Search App

Over 12,000 Homes Sold Yesterday!

If you read certain headlines, you might be led to believe that the housing recovery has slowed. Naysayers are claiming that rising mortgage rates and a lack of consumer confidence are keeping Americans on the fence when it comes to purchasing real estate. That is actually far from reality.

After all, 12,575 houses sold yesterday, 12,575 will sell today and 12,575 will sell tomorrow. 12,575! That is the average number of homes that sell each and every day in this country according to the National Association of Realtors’ (NAR) latest Existing Home Sales Report. According to the report, annualized sales now stand at 4.59 million. Divide that number by 365 (days in a year) and we can see that, on average, over 12,500 homes sell every day. If you are considering whether or not to put your house up for sale, don't let the headlines scare you. There are purchasers in the market and they are buying - to the tune of 12,575 homes a day.

Who do you know looking to buy a home, call David!

David Demangos
Keller Williams Realty
Cell: 858.232.8410
Realtor® BRE# 01905183

San Diego Real Estate Area Expert / Green Specialist / ALC Committee
Our Team Goes to Extremes to Fulfill Your Real Estate Dreams!

Download The #1 Real Estate Live Home Search App Below
Awesome Home Search App
 

We are NOT the Only Ones Saying You Should Buy

I have always believed in homeownership. That does not mean I think EVERYONE should run out and buy a house. However, if a person or family is ready, willing and able to purchase a home, I believe that owning is much better than renting. I am not the only one that thinks owning has massive benefits or that now is a sensational time to plunge into owning your own home. Here are a few others:

Benefits of Owning

Joint Center for Housing Studies, Harvard University

“Homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord…Having to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings.”

The Federal Reserve

“Renters have much lower median and mean net worth than homeowners in any survey year.”

Benefits of Buying Now

 Trulia

“Buying costs less than renting in all 100 large U.S. metros… Now, at a 30-year fixed rate of 4.5%, buying is 38% cheaper than renting nationally".

Freddie Mac

"One thing seems certain: we are not likely to see average 30-year fixed mortgage rates return to the historic lows experienced in 2012…Yes, rates are higher than they were a year ago – and certainly higher than two years ago. But if you look at the averages over the last four decades, today's rates remain historically low."

David Demangos
Keller Williams Realty
Cell: 858.232.8410
Realtor® BRE# 01905183

San Diego Real Estate Area Expert / Green Specialist / ALC Committee
Our Team Goes to Extremes to Fulfill Your Real Estate Dreams!

Download The #1 Real Estate Live Home Search App Below
Awesome Home Search App