Millennials Are Skipping Starter Homes for Their Dream Homes

Millennials Are Skipping Starter Homes for Their Dream Homes | Simplifying The Market

A new trend has begun to emerge. With home prices skyrocketing in the starter home category, many first-time homebuyers are skipping the traditional starter homes and moving right into their dream homes.

What’s a Starter Home?

According to the National Association of Realtors (NAR), simply put, a starter home is a one or two-bedroom home (sometimes even a small, three bedroom).Prices vary widely by market but starters on average cost $150,000 to $250,000 while trade-up and premium homes cost upwards of $300,000.”

Finding Their Forever Homes Now

A recent CNBC article revealed that there are many factors that delayed older millennials (ages 25-35) from buying a home earlier in their lives. The aftereffects of the Great Recession teaming up with larger education costs forced many to either remain living in their parent’s homes or to rent.

With the economy continuing to improve, many millennials have been able to break into better-paying jobs which has helped spur down payment savings. As the dream of homeownership comes closer to reality, many millennials are saving for their forever homes.

According to the latest statistics from NAR, 30% of millennials bought homes for $300,000 or more this year (up from 14% in 2013). Diane Swonk, Chief Economist at Grant Thornton weighed in saying, “They rented for longer. Now they’re going to where they want to stay.”

More and more millennials are settling down, getting married, and starting families, which is a huge factor driving them to look for larger homes.

Increased competition in the starter home market has also been a driving force in waiting to afford their dream homes. Inventory in the starter home market is down 14.2% from last year, according to research from Trulia. This has driven prices up and has led to bidding wars.

Many first-time buyers who were originally looking for starter homes are realizing that for just a little bit more of an investment, they could afford trade-up or premium homes instead.

Bottom Line

If you plan on purchasing your first home this year, let’s get together to determine how much house you can afford. You may be pleasantly surprised.

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5 Reasons Why to Sell This Summer!

5 Reasons Why to Sell This Summer! | Simplifying The Market

Here are five reasons listing your home for sale this summer makes sense.

1. Demand Is Strong

The latest Buyer Traffic Report from the National Association of Realtors (NAR) shows that buyer demand remains very strong throughout the vast majority of the country. These buyers are ready, willing and able to purchase…and are in the market right now! More often than not, multiple buyers are competing with each other to buy the same home.

Take advantage of the buyer activity currently in the market.

2. There Is Less Competition Now

Housing inventory has declined year-over-year for the last 35 months and is still under the 6-month supply needed for a normal housing market. This means that, in the majority of the country, there are not enough homes for sale to satisfy the number of buyers in the market. This is good news for homeowners who have gained equity as their home values have increased. However, additional inventory could be coming to the market soon.

Historically, the average number of years a homeowner stayed in his or her home was six, but that number has hovered between nine and ten years since 2011. There is a pent-up desire for many homeowners to move as they were unable to sell over the last few years because of a negative equity situation. As home values continue to appreciate, more and more homeowners will be given the freedom to move.

The choices buyers have will continue to increase. Don’t wait until this other inventory comes to market before you decide to sell.

3. The Process Will Be Quicker

Today’s competitive environment has forced buyers to do all they can to stand out from the crowd, including getting pre-approved for their mortgage financing. This makes the entire selling process much faster and much simpler as buyers know exactly what they can afford before home shopping. According to Ellie Mae’s latest Origination Insights Report, the average time it took to close a loan was 41 days.

4. There Will Never Be a Better Time to Move Up

If your next move will be into a premium or luxury home, now is the time to move up! The inventory of homes for sale at these higher price ranges has forced these markets into a buyer’s market. This means that if you are planning on selling a starter or trade-up home, your home will sell quickly, AND you’ll be able to find a premium home to call your own!

Prices are projected to appreciate by 5.2% over the next year, according to CoreLogic. If you are moving to a higher-priced home, it will wind up costing you more in raw dollars (both in down payment and mortgage payment) if you wait.

5. It’s Time to Move on With Your Life

Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?

Only you know the answers to the questions above. You have the power to take control of the situation by putting your home on the market. Perhaps the time has come for you and your family to move on and start living the life you desire.

That is what is truly important.

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What Risks Are There If I Sell My Home On My Own?

It can be tempting to try to sell your home by yourself, especially if you live in a market as lucrative as Charleston. People think it’s a cost efficient method and that the job is relatively easy. Perhaps you’ve heard a story about a friend of a friend who successfully sold their home in no time and saved tons of money? Frankly there are typically more to these stories than you are told. There are numerous downsides to attempting to sell your home without enlisting the help of professionals. Would you diagnose a major health condition without visiting the doctor? Hopefully not. The same goes for realty. Here are the top four reasons you should have a professional real estate agent help you to sell your beloved home.


Reason 1: It’s not easy to identify qualified buyers. As a homeowner, trying to sell without the help of a professional will leave you vulnerable. Investors may want to get a great deal by taking advantage of you and offering very low prices. Now you might think, I would never accept a low offer! That may be true, but can you also identify the  excited and qualified individuals who have fallen in love with your home and made offers versus those that simply cannot truly afford the end price and would not be fully approved for making such an offer? Probably not. You don’t want to make the mistake of wasting your precious time and energy on these individuals or even worse yet, accepting their offer. The only way to avoid this is by enlisting the help of professionals!


Reason 2: Getting the best price for your home is not easy without proper staging. Sellers who do not use professionals often have no idea of the importance of staging. Your home needs to be staged so it appears in tip top shape, with no random piles of laundry or dog toys hidden in the background of photos. This is also without mentioning that you need quality photographs in order to make your home look as appealing as possible to prospective buyers. With the help of a real estate agent, you’ll have the right lighting, the right staging, and most importantly you’ll get the right price.


Reason 3: Handling all the smaller details. Without the help of qualified professionals, individuals who chose to sell their home on their own often find themselves floundering at this stage of the process where things really begin. There is a lot of detailed tasks you must consider in order to handle financing correctly. This is not the time to cut corners!


Reason 4:  You’ll feel like you’re drowning in paperwork. When you’re selling your home the paperwork can seem never ending, let alone the fact that it is laden with legalities. A tiny mistake can not only cause you to start over, but it can cost you…big time. You could potentially find yourself losing out on thousands of dollars, simply because you are unfamiliar with the paperwork. This is the time when you need to seek the help of someone who does this professionally. Real estate agents often seek the help of lawyers in order to ensure this process goes as smoothly as possible because it is simply not worth the risk.


Why struggle just because it seems like you might save money? The negative side effects of selling your own home are plentiful and likely. Moving is stressful regardless, so why not minimize the stress by enlisting the help a professional and make it a smooth transition for your own peace of mind?


If you’re considering selling in Charleston, let’s talk today.


Selling Your House on Your Own Could Cost You

Selling Your House on Your Own Could Cost You | Simplifying The Market

In this extremely hot real estate market, some homeowners might consider selling their homes on their own which is known as a For Sale by Owner (FSBO). They rationalize that they don’t need a real estate agent and believe that they can save the fee for the services a real estate agent offers.

However, a study by Collateral Analytics reveals that FSBOs don’t actually save anything, and in some cases may be costing themselves more, by not listing with an agent.

In the study, they analyzed home sales in a variety of markets. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate.” (emphasis added)

Why would FSBOs net less money than if they had used an agent?

The study makes several suggestions:

  • “There could be systematic bias on the buyer side as well. FSBO sales might attract more strategic buyers than MLS sales, particularly buyers who rationalize lower-priced bids with the logic that the seller is “saving” a traditional commission. Such buyers might specifically search for and target sellers who are not getting representational assistance from agents.” In other words, ‘bargain lookers’ might shop FSBOs more often.
  • “Experienced agents are experts at ‘staging’ homes for sale” which could bring more money for the home.
  • “Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.” If more buyers see a home, the greater the chances are that there could be a bidding war for the property.

Conclusions from the study:

  1. FSBOs achieve prices significantly lower than those from similar properties sold by Realtors using the MLS.
  2. The data suggests the average price was near 6% lower for FSBO sales of similar properties.

Bottom Line

As Dave Ramsey, America’s trusted voice on money, explains:

“Research has shown that, between mistakes, lack of negotiating skills, pricing errors and general exposure on the market, you’ll cost yourself more than the real estate commission…You’ll come out slightly better and with a lot less hassle if you use a top-shelf agent.”

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Why Have Interest Rates Jumped to a 7-Year High?

Why Have Interest Rates Jumped to a 7-Year High? | Simplifying The Market

Interest rates for a 30-year fixed rate mortgage have climbed from 3.95% in the first week of January up to 4.61% last week, which marks a 7-year high according to Freddie Mac. The current pace of acceleration has been fueled by many factors.

Sam Khater, Freddie Mac’s Chief Economist, had this to say:

“Healthy consumer spending and higher commodity prices spooked bond markets and led to higher mortgage rates over the past week.

Not only are buyers facing higher borrowing costs, gas prices are currently at four-year highs just as we enter the important peak home sales season.”

But what do gas prices have to do with interest rates?

Investopedia explains the relationship like this:

“The price of oil and inflation are often seen as being connected in a cause-and-effect relationship. As oil prices move up or down, inflation follows in the same direction.”

You may have noticed that filling your gas tank has become substantially more expensive in recent months. The average national gas price has climbed nearly $0.50 from the beginning of the year, leading to the highest price for Memorial Day weekend since 2014.

As rates go up, your purchasing power goes down, but don’t worry; rates are still well below the averages we’ve seen over the last four decades.

“Freddie Mac said this year’s higher rates have not yet caused much of a ripple in the strong demand levels for buying a home seen in most markets, but inflationary pressures and the prospect of rates approaching 5 percent could begin to hit the psyche of some prospective buyers.”

Buying sooner rather than later will help lock in a lower rate than waiting, as the experts believe rates will continue to climb. Even a small increase in interest rates can have a big impact on your monthly housing cost.

Bottom Line

If you are planning on buying a home this year, keep an eye on gas prices the next time you’re at the pump. If you start to feel a big jump in price, know that rates are probably on their way up, too.

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How Current Interest Rates Can Have a High Impact on Your Purchasing Power

How Current Interest Rates Can Have a High Impact on Your Purchasing Power | Simplifying The Market

According to Freddie Mac’s latest Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at 4.61%, which is still near record lows in comparison to recent history!

The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

Purchasing power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford to buy will decrease if you plan to stay within a certain monthly housing budget.

The chart below shows the impact that rising interest rates would have if you planned to purchase a home within the national median price range while keeping your principal and interest payments between $1,850-$1,900 a month.

How Current Interest Rates Can Have a High Impact on Your Purchasing Power | Simplifying The Market

With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5% (in this example, $10,000). Experts predict that mortgage rates will be closer to 5% by this time next year.

Act now to get the most house for your hard-earned money.

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Don’t Wait to Sell Your House! Buyers Are Out Now

Don’t Wait to Sell Your House! Buyers Are Out Now | Simplifying The Market

Recently released data from the National Association of Realtors (NAR) suggests that now is a great time to sell your home. The concept of ‘supply & demand’ reveals that the best price for an item is realized when the supply of that item is low and the demand for that item is high.

Let’s see how this applies to the current residential real estate market.


It is no secret that the supply of homes for sale has been far below the number needed to sustain a normal market for over a year at this point. A normal market requires six months of housing inventory to meet the demand. The latest report from NAR revealed that there is currently only a 3.6-month supply of houses on the market.

Supply is currently very low!


A report that was just released tells us that demand is very strong. The most recent Foot Traffic Report (which sheds light on the number of buyers who are actually out looking at homes) disclosed that “foot traffic grew 10.5 points to 52.4 in March as the new season approaches.”

Demand is currently very high!

Bottom Line

Waiting to sell will only increase the competition between you and all of the other sellers putting their houses on the market later this summer. If you are debating whether or not to list your home, let’s get together to discuss the conditions in our market.

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Where Are The Best Places To Take My Guests In Charleston?

Options are many when it comes to showing your friends and family the sights and sounds of Charleston. Within a mere 15 minutes, you can go from beach to city to country. The Holy City is steeped in early American history, has an impressive arts, culture and nature scenes, and there’s no end of fun and fine places to eat!


Get Outdoors

Sullivan’s Island sits on the coast of Mount Pleasant and is an outstanding place to entertain your guests and show Charleston off to family and friends. Its small size belies all there is to do. Walking along the beach collecting shells, photography and kiteboarding are but a few of the activities you will find here. Your guests may also enjoy exploring Fort Moultrie, where early American soldiers gave the state it’s namesake by defending the shores amongst  a base fortified by palmetto trees (which was a soft wood that reflected cannonballs fired by the British, instead of absorbing them). One of the only air conditioned buildings made during WW2 exists here as well, for that special history buff amongst your group.


From Sullivan’s Island, you can roll across the Ravenel Bridge to explore King Street downtown, one of the oldest streets in the U.S. Here you’ll find unique shops and the restaurants that define southern food and hospitality. Coleslaw, fried chicken, burgers, deep fried fish, biscuits, grits; you will find it all nearby.


Head to Market Street on the weekends and you’ll see what local artisans produce, along with more great food from the soul and Lowcountry traditions. If you’re lucky, you may get to see Second Sunday! This is when King Street gets blocked off from Calhoun to Market Streets and pedestrians flood the streets to check out local shops or get great eats out on King Street!


If you want go ahead and make your way to Waterfront Park; one of Charleston’s most visited sites, especially in the summer. It boasts a pineapple-shaped fountain that children find irresistible, as well as there are dedicated gardens and sweeping views of the water and Charleston Harbor.


Beyond food, you can take your visitors on haunted house tours (a real kid pleaser, whether it’s the Old City Jail or the Provost Exchange), or make a visit to actual plantations like McLeod Plantation Historic Site or Boone Hall Plantation (which is still a working plantation). Middleton Place is an early rice plantation that also has one of the first private gardens in the country.


Charleston Navy Base and Naval Shipyard became the North Charleston Riverfront Park in 1996. This park is now open year-round as well. It has sheltered picnic areas, cooling fountains for children during the summer and sits on the Cooper River.


For Less Than Perfect Weather

You can explore the past even deeper by visiting the Gullah Geechee Corridor, which runs from Jacksonville, FL to Wilmington, NC. The National Park Service recognizes this corridor and the communities along it celebrate the gullah geechee in organized festivals throughout the year.


If you don’t want to stray far from home, check out Charleston’s Museum Mile. The mile includes four parks, six museums, five historic homes and the historic city hall and market. You’ll find a wide range of Charleston history at The Charleston Museum, including civilian and military.


Just because these are museums doesn’t mean that your children will be bored. Be sure to visit the Children’s Museum of the Low Country and let them play on a pirate ship, explore the medieval castle and spend time inside an art room!


The Spoleto Festival USA is an internationally known arts festival that starts around Memorial Day and runs for the first two weeks in June. Numerous opera, music, dance and theater performances are held at various venues throughout the area during this event.


If you still want to lounge around on a lazy day, considering gathering your group to go to the Cinebarre theater in Mount Pleasant. This theater distinguishes itself by offering casual eating, light alcoholic beverages and big-screen movie watching simultaneously. Furthermore, anyone under 18 must be accompanied by an adult; so you wont find yourself being bugged by pesky teenagers!


If you’re finding yourself in love with Charleston, let’s talk about whats available today!