Should I Rent or Buy a Home in 2024?
Understanding Rent vs. Own in Today's Market
Deciding whether to rent or buy a home in 2024 is a significant decision that impacts your financial freedom and lifestyle. With the ever-evolving real estate market, it's crucial to weigh the pros and cons based on current trends and personal circumstances.
Renting vs. Buying: A 2024 Perspective
- Flexibility: Ideal for those anticipating moves within two to three years, renting avoids the long-term commitment of homeownership.
- Low Maintenance: Repairs and upkeep are the landlord's responsibility, freeing you from the cost and hassle.
- Quick Move-In & Lower Initial Costs: Renting often allows for faster relocation with minimal upfront expenses compared to the down payment and closing costs of buying.
- Equity and Ownership: Every mortgage payment increases your home's equity, turning your monthly expense into an investment.
- Tax Benefits: Homeowners can still enjoy significant tax deductions on mortgage interest and property taxes in 2024.
- Inflation Hedge: Fixed-rate mortgages lock in your principal and interest payments, protecting you from rental inflation.
- Personalization: Owning a home means the freedom to customize your living space without restrictions.
When to Buy a House in 2024
The best time to buy is when you're financially and emotionally ready. Consider these factors:
- Financial Stability: Ensure you can afford the...
Your Dream Home Awaits: Discovering Real Estate Gems Near You
My Best Advice For First-Time Home Buyers
Joy. Joy is the first word I think of when I hear the term first-time home buyer. It’s what my wife and I felt moving into our first house. It’s what I always hope my clients feel at closing because buyer remorse has never been on anyone’s bucket list.
The process of buying a house has a lot of moving parts and involves many people. It can be stressful and intimidating even when it’s going well. When the pieces do not fall into place as you expect, it will be frustrating and even overwhelming on occasion.
Over the years, I have shared all those emotions with my clients on their journey to home-ownership. No two experiences are ever the same. However, it becomes glaringly evident that buyers who have the best outcomes are those that are most prepared. Knowledge is power. Here is some of my primo advice if you are buying your first home or even your last.
Make an Appointment with a Mortgage Broker
Before you get serious at looking for a home, you need to know if you qualify for a mortgage and how much the bank will lend you. You will also discuss what type of mortgage will best suit your financial circumstances and how you can receive the best interest rate. Shopping lenders is wise. Some offer better deals and options. A half-point or even a quarter-point less on your rate can generate significant savings over the life of your loan.
Decide How Much You Can Afford
The amount your mortgage lender is willing to finance may be more than you can comfortably afford. Make sure your mortgage payment and other monthly expenses...
Moving to Minnesota
It’s a sure bet that we can all agree that moving is a stressful life event. However, a process will make a move emotionally and physically easier. You can transform moving day from a potentially stressful experience into a fun event with the correct attitude. Yes, it is true. I know these things because I have moved 22 different times in my life and five times over the last eleven years. Sounds exhausting, right? Not really. I like to move most of the time, and I was excited and optimistic. It was an adventure, and I was up for the challenge. Stressful? Some stress is expected, but it can be rewarding if you focus on the positive change ahead, be it a new job, a new city, a new neighborhood, or a newly purchased home.
Advice from a Top Team of Relocation Realtors in MN
In addition to having a positive attitude, there are other steps you can take to make a move go smoothly. Here are my best tips for moving without losing your mind in the process.
Good organization is critical to the success of the entire movie. Make a plan with a timeline for all the essential steps involved in the process, such as hiring a mover, packing, turning on the electricity, and setting up your WIFI. Everything will fall into place when you develop a great plan and stick to it.
Professional Mover or Friends?
I’ve made several professional moves and used family and friends who worked for pizza and beer. If you do not have much furniture, moving with friends can transform your moving day into a party. Just keep two things in mind: it will take longer than you expect, and don’t crack open the beer until the very end.
If it’s not your first rodeo, you have most likely acquired furnishings and many possessions. I suggest hiring professionals to move you. It will be money well spent, and saving yourself a mountain of stress is priceless....
How to Write a Winning Offer in a Seller's Market
Forget the spin. Take off the rose-colored glasses too. Let's be honest. Most buyers are hoping to score a home at the current real estate market's lower pricing tiers and face fierce competition, creating a process fraught with disappointment.
That's the bad news. But I am by nature a confident guy, a problem solver, and a believer in the philosophy that winners never quit. So here is the good news. A buyer with a savvy agent can write an offer that a seller will find hard to refuse.
Be Ready to Act Fast
Desirable properties often have multiple offers a couple of days after hitting the market. There is no margin of error for indecisiveness or being unprepared to offer a hot property as quickly as possible. That means you should not even consider offering a home if you do not have a preapproval letter from an accredited lender.
Don't Be Coy
In this market, you can feel reasonably confident that if you have fallen in love with a home, so have other buyers. The occasion calls for an assertive approach, not a timid one. Open with your best offer, which should equal the asking price or higher. Your real estate professional will provide insights based on competitive properties also for sale in the neighborhood and homes that have already sold.
Go Above and Beyond
Let the sellers know your degree of commitment by upping the earnest money to 3% of the sale price. Doing so will instill seller confidence that you will not be likely to walk away from the deal since you have more money at risk. Another enticement is to make the earnest money offer non-refundable should you as the buyer cause the value to fall apart for any reason.
However, let me insert a caveat here. Consider the option carefully and talk it over with your agent and lender. You would need to prepare to forgo other contingencies to make this work.
It Isn't Only About Money.
7 Steps To Buy A Home
Seven steps to buying a home in the Twin Cities. Buying a home in Minnesota is an adventure; however, you need a plan before you dive into the housing market. Buying real estate is a journey, and the road to homeownership is rarely a straight line from point A to point B. Often the route is a winding mountain road with hills and valleys, twists and turns but worth the effort to reach the top. Having your path mapped out from start to finish will help you avoid obstacles and delays. Completing each portion of the journey before proceeding to the next will build confidence in the process. Here are my 7 Steps for a successful home buying experience.
Shop For a Mortgage
Now it’s time to find a lender. Of course, your first instinct is to secure a mortgage at the lowest possible rate. Don’t get me wrong that is extremely important. But customer service also matters. The variety of programs offered will make finding a loan that meets your particular financial situation easier.
Obtain a Pre-Approval
A mortgage banker will review your financial documents and run your credit. Then she can tell you how much you can borrow, the rate, terms, and estimate of closing costs. You are going to gather two years of tax returns, 1-2 months of pay stubs, 1-3 months of bank statements, other asset documentation, debt statements, a copy of your driver’s license, proof of residence of the last two years for your appointment. Hopefully, you will walk out with a preapproval so you can start shopping for a home.
Choose the Best Real Estate, Professional
There is no good reason for a buyer not to work with a professional when buying a home. Find one with experience, ...
All About The Home Warranty
A home warranty acts as a safety net for homeowners, covering the costs of repairing or replacing major home appliances and systems. It's a service contract that ensures you're not left footing the bill when something goes wrong. This guide delves into the intricacies of home warranties, offering peace of mind to homeowners, especially in the unpredictable moments of homeownership.
Home Warranties Provide Peace of Mind
There's nothing quite like the security of knowing that a sudden appliance breakdown won't drain your savings. For first-time homebuyers or those on a tight budget, this can be particularly reassuring. The home warranty stands as a buffer against the unpredictable, ensuring that a malfunction doesn’t disrupt your financial stability.
Home Warranties vs. Homeowners Insurance
While homeowners insurance covers damage from external events like fire and storms, it doesn't help when your air conditioner quits on the hottest day of the year. This is where home warranties shine, offering coverage for wear and tear on your home's most critical systems and appliances.
How Home Warranties Work
When a covered item breaks down, a simple call to your home warranty provider can set the wheels in motion for a repair or replacement. You'll pay a predetermined service fee, and the warranty company covers the rest. It's a streamlined process that saves time and reduces hassle.
Understanding Home Warranty Costs
Costs can vary, but most home warranty plans start around $400 annually, with service fees ranging from $75 to $125 per visit. It's a small price to pay for the convenience and protection these plans offer.
The Pros of Home Warranties
Home warranties bring numerous advantages to the table, from financial protection against unexpected repairs to the convenience of having a go-to resource...
Buying a Home in MN Takes a Team
If you have decided to transition from renter to homeowner, you are probably feeling excited and nervous at the same time. That is perfectly normal because it’s a big decision. Some think it is the litmus test for adulthood. While I’m not sure that is true, I will admit that it means taking on a whole new set of responsibilities. Heck, by the time I bought my first house, I was already working in real estate but still had the jitters.
While you may find the home buying journey intimidating, thankfully, it’s not a solo adventure. You will have lots of real estate professionals helping you along the way. Some of them you’ll interact with regularly and others you will never meet. Yet, they will all be doing their part to get you across the finish line. Let me introduce them to you.
The Real Estate Agent
Your agent will scout out homes for you, pointing out the positives and negatives of each one. Once you have found the property you want to buy, he will do a comparative market analysis to decide on your offer. He will prepare the purchase agreement and help with the negotiations between you and the seller.
In a nutshell, your licensed real estate professional will answer your questions, provide guidance, make recommendations, advocate in your best interests, provide emotional support, and help keep the whole process of buying your first MN home on the track. Your Realtor is a valuable resource in assembling the other professionals you need to complete your home buying journey. Since you will be communicating regularly with your Realtor, work with one you trust and who makes you feel comfortable. Also, be aware that a buyer’s agent represents the buyer's interests exclusively while other agents own their fiduciary to the seller. As a buyer, it’s to your advantage to have a buyer’s agent...
Buying a Home in Today's Market is a Challenge
You are rooted in the trenches in your quest for homeownership. The last property you toured had the kitchen of your dreams, but it is too close to the highway. The retirement condo you saw on the internet has everything on your wish list, but the building doesn't have an elevator.
A warning to buyers, especially first-timers, in this market, finding everything you want is rare when there are not many homes to choose from, and properties rarely last a week without an accepted offer. Although you agree that compromise is a given, it's wise to remember that some factors cannot be changed if you discover the deal you made is not working. You don't get an opportunity to test drive a home.
In a recent survey by Trulia, 51 percent of homeowners have regrets about some aspect of their home. It is a given with the lack of inventory and the stiff competition for homes. Circumstances may call for more compromise than you may want from your sacred wish list. There is nothing wrong with being adaptable. However, there are certain things you should never concede if you're going to be among the 49% without buyer's remorse.
The place is one characteristic of a home you can't change or adapt to. You should make sure that the area meets your family's needs now and for the amount of time, you expect to own your home. There are a few factors about the location you should consider. So when you evaluate a street address, ask yourself these questions.
- How is the school system rated?
- What is the crime level?
- Is this a high-traffic street?...
Home Buying Advice MSP
One thing I know for sure is the passage of time always brings a change in its wake. Fashion, food, hairstyles, home décor, and lifestyles have become extremely sensitive to trends. Some embrace change, and others fight it. Whichever the case, a constant we can depend on is that trends will come and go regardless.
Sifting Through Home Buyers Advice
Along with style changes, there is an incredible amount of advice about what we should hold on to and what goes off. Real estate is no different, and we must weed through all the bits and pieces of information and discover what is still meaningful and what no longer serves us when we decide to put a roof over our heads.
Purchasing a house is the most expensive buy of a lifetime for most of us. It is predominately a joyful experience, but a certain amount of stress is inherent in the process, especially for first-time homebuyers. We want to make the right choices, so we seek advice from family, friends, and the internet. But with so many tips out there, how do we know which keepers we should ignore? Here are several pieces of home buying advice that have not met the test of time.
You Will Always Be Better Off Owning Than Renting
Bad Advice. There are occasions when renting is a far better option than buying. If you plan to move in less than five years, you may not recoup what it will cost you to buy and sell your home. Renting may be a better fit for someone who would resent doing home chores like mowing the lawn and seasonal maintenance. Perhaps you travel a great deal for business, and renting a small apartment makes more sense personally and financially.
Good advice: One size does not fit all when it comes to the question of should you rent or buy. Evaluate your situation, personal preferences, and work-life balance, and make a decision based on what will work for you now.
Never Buy a House in Winter
Sorry but this one is...
Top Mpls MN Realtor on Buying a Home in the Fall
With summer in the rearview mirror, the fall home buying season is in full swing. As we move into the last quarter of the year, many disappointed summer home shoppers wonder if they should suspend their search to renew efforts in the spring.
As you ponder the question, you should take into consideration that the fall home buying season has some distinct advantages. Instead of taking a break, you may want to stay with the program and intensify your search for a home. Here are some of the perks and rewards you can expect if you decide to stay engaged in the hunt for a home.
Fall Home Buying Means Less Competition
Like most markets, real estate has seasonal adjustments. Fall home buying season is generally less busy than the spring and summer markets. The “must buy a home before school starts” mentality is one reason. Another is that some people do not want to move in the winter months.
Those who have no school-age kiddos or are more flexible about their moving timetable can take advantage of that market slowdown. They will find less competition for homes and less chance of getting into a multiple offer minefield. Let’s face it, “I want to be in a...
First Time Home Buyer Options in the Twin Cities
It’s an indisputable fact that buying a home today is a complicated process. It can be especially intimidating for a first-time buyer. Also, there is a severe shortage of inventory in the category of entry-level homes making the transition into homeowner a challenge. The home buying process in the Twin Cities Metro is not as simple as searching for a house, finding one that suits you, making an offer and going to closing. Although these are indeed the basics, it is not the complete picture. There are a lot of pesky details that are not understood and become fertile ground for the seeds of mistaken beliefs. The topic that seems to represent the most confusion is obtaining a mortgage. Let’s take a closer look at some of the most common myths about mortgage eligibility.
First Time Home Buyer Mortgages and Myths
Many people still believe you need a 20% down payment to buy a home in MN. No, you don't. Although a buyer needs to put 20 percent down on a home to avoid paying Private Mortgage Insurance, most can buy a house with much less money. When you look at real estate market statistics for home buyers in MN, the medium down payment is actually 10 percent. In addition, the statistics for first time home buyers in the Twin Cities is closer to 5 percent.
Zero Down Mortgage Options in Minnesota
In the Twin Cities Metro, home buyers can find lenders who will approve mortgages as low as 3 percent for well-qualified applicants. Another option is a loan from the Federal Housing Administration if your credit score...
How the Best Bloomington Realtors Market Real Estate
Located in an established neighborhood in desirable west Bloomington, this property would make an exceptional family residence for a first-time buyer or move up situation. It would also be an excellent option for the empty nester. This home is meticulous, and we think the fussiest buyer will agree. When you see the tasteful updates, expect to be impressed. The fresh décor is right on point. Let’s take a closer look.
At the rear of the home are my absolute favorite areas, the kitchen and dining space. The kitchen is bright, open and extremely well designed to make the best use of space. There are ample cabinets and countertops. Two windows let in plenty of light and make the kitchen bright and cheerful. The classic cherry cabinets add just the perfect touch of warmth. And did I mention the stainless steel appliances? Now I did!
So You Want To Buy a Home
Taking the step from renting to homeownership is a life-altering event. Many people consider it the litmus test for adulthood. It is both thrilling and scary at the same time. It should be because not only is owning a home in itself a significant responsibility but it is the most significant purchase the majority of people will make in their lifetime. Owning a home is also a source of pride, of achievement, and for millions, still an essential component of the American Dream.
If owning a home is on your bucket list, perhaps you are waiting for the right time. The question is, how will you know when that is? There is no stock answer. There are many factors to consider, both pro and con on the subject of buying a home. For many first time home buyers, money is an obstacle. But that isn’t always the case. Nor should the considerations of when to purchase a house be strictly limited to the financial ability to do so.
There are outstanding advantages that come along with owning a home and there are detriments as well. Let’s take a look at how the pros and the cons balance each other. When we evaluate both and can get to the intersection where rewards offset risks, we will have a clearer picture of how we can proceed.
Rewards vs. Risks of Buying a Home
Reward: When you walk away from the closing table with the keys to your new home, you get to make the decisions. The world is open to all the ways you can think of to customize your living space to suit your taste and needs. No more landlord is setting the rules of engagement. Grab the paint...
Do Your New Year’s Resolutions Need a Reboot?
Are you among those people who started the New Year with some well-intentioned resolutions only to find that your resolve has dwindled? Perhaps those goals that have slipped below the horizon of your consciousness during the day come back to haunt you at night like an insect buzzing around your head as you try to fall asleep.
According to statistics, by February 42% of us who made resolutions have not maintained them. We share your pain. We know the feeling when our willpower is on life-support and the loudest voice we hear is shouting self-criticism and blame.
It’s not easy to feel like you set yourself up for failure back on January 1. Statistics also tell us that 42% of Americans fail to achieve their established goals on a regular basis with only 9% feeling they had a successful outcome. However, and here is the good news to hang your hope on, people who start out the year with defined resolutions are ten times more likely to achieve their goals than those who do not make any.
Tips to Help You Restart Successfully
Take heart the game is still afoot! Every time the sun pops up out of the horizon and begins a new day offers us another opportunity to start over and to achieve our goals. Let’s begin with some general tips to help strengthen your resolve.
- Forgive yourself. Change is not easy but it is attainable. Remember that successful people are the ones that have...
Advice on Buying a Home in MN
When you make the transition from renter to owner, you become the recipient of many benefits, both practical ones, and emotional ones as well. For many people, homeownership is an important rite of passage on the highway into adulthood, probably second only to becoming a parent. Why? Because owning a home enables you to assume more control of two very important aspects of your life; your net worth and your personal environment. Most people would find that pretty exciting stuff! Many of us, when we become adults especially, want to have as much control over our lives as possible, or at least feel that we do!
So if 2018 is your year to purchase that downtown Minneapolis loft, starter home in the burbs, or downsize to the townhome you have always dreamed of, we have some great tips we are dying to share with you.
Prepare Your Finances
If you haven’t already done so, contact a mortgage broker or banker and get pre-approved. This is the only way to know for certain how much house you can afford to buy and what amount of cash you will require for a down payment and closing costs. Online calculators are fine for giving you a ballpark idea but there are too many other factors to consider. If you start looking at properties that are out of your reach, the reality of what you can afford may seem less appealing and sabotage your home buying experience or at the very least, waste your valuable time.
If you are still saving, or paying off...
Should I Buy a Home This Winter or Wait for Spring?
If you are a Twin Cities’ buyer that missed out on snaring a deal this past spring or summer, you might be asking yourself, your family, your friends and your realtor whether or not you should keep your search ongoing or simply hunker down for the winter months and venture forth again when the forsythia bloom. Maybe you just started the process and are thinking of putting it on hold until the new year arrives or wondering if there is an advantage to staying the course. As a realtor, I can tell you that I am being asked that question from many of my clients, especially the first time buyers.Because everyone has a story and no personal situation is exactly the same, there is no right or wrong answer. But generally speaking, I tell my buyers that nobody is too cool for thermal underwear in Minnesota. Let’s get some and keep looking for that home. Patience is a virtue and tenacity pays off in the end. To those just getting started in the process, if you have your pre-approval letter in hand start your search and if not get that preliminary work completed and then press go! Now before you get out your list of 7 reasons why you shouldn’t go out in the cold, here are my 7 reasons why house hunting this winter is an excellent idea.
Winter Sellers Are Serious Sellers
Generally speaking, homeowners that choose to put their house up for sale in the winter months have a compelling reason to do so. It may be they are facing a job-related move, a divorce, financial challenges, or...
The Twin Cities Are Filled With Real Estate Stories
Real estate is the story of buying and selling a home. Since I’ve been a Realtor for 14 years I have stories. Most end happily even though there may have been challenges along the way. But, every once in a while something goes wrong. Mistakes that could and should have been avoided happen. The only upside to mistakes is learning from them. Even better is learning from someone else’s mistake. Free advice that another paid for is like earning bonus miles.
I’m going to share three stories from three buyers who were on the home stretch to close on their dream home and then did something they shouldn’t. They had a signed contract, they had a loan, they had their closing date and all systems were go. And then they did something unthinkable that blew that deal.
Don’t Buy a Car
Alex was ready to stop renting. He was tired of the cost of his tiny apartment going up every year and knew the tight rental market was not going to loosen up anytime soon. Because he had student loans, it took him 2 years to scrimp and save and pay down his debt to a point where he would qualify for a mortgage on a modest condo.
It was a happy day for Alex when he had a signed contract on the perfect one bedroom in a Minneapolis neighborhood he loved. With the inspection and appraisal completed he had a closing date in a couple of weeks. He wanted to celebrate in some significant way and decided it was also time to start thinking about replacing his old and tired clunker of a car so off he went to the Subaru dealership....