Billings MT Real Estate | Buy a House, Homes for Sale, Real Estate Market, Home Appraisals, Home Listings, First Time Home Buyers » Homes in Billings MT

Billings Real Estate: Should I Take My Home Off the Market During the Holidays?

Laure & Steve — Wed, 02 Dec 2009 16:51:48 +0000

When you look at your calendar you may find the months already overloaded with seasonal obligations — shopping, entertaining, children’s pageants, charity work, decorating the house, and so much more. If you are also trying to sell your home, you are under extra pressure to keep your home in “showing” condition. And that could be the last thing you need before the holiday spirit is broken.

It is understandable why you would be tempted to take your home off the market during the holidays. And the list of justifications is long. If you are too busy, buyers may be also, and you may find your efforts unrewarded with not enough showings. And what if you do get an offer? You may be faced with the possibility of packing and moving during the busiest time of the year. Besides, you can give your house a rest, and it will have better momentum after the holidays. Better to just pack it in and start fresh in January, right?

But wait! Most top Realtors agree that taking your home off the market during the Christmas season is a mistake. The house surely isn’t going to sell off the market! What is the advantage of that? So you’re busy. Let your Realtor do the work. You can leave in the morning, go to work, go shopping, and let your Realtor take care of things.

The holidays are a wonderful selling period. Why? Because most people take off work sometime during the season. The husband and wife are both off and want to see houses. Most agents like the holidays because the buyers have more time, and they can look at homes together.

Before you take your home off the market, consider the following points:

Although buyer activity may appear to slow down, the buyers who are actively looking during the holidays are that much more serious. Agents believe the home market is no more affected at Christmas than during other “busy” periods. If that were so, the market would shut down throughout the year as families concentrate on spring weddings, June graduations, summer vacations, and autumn back-to-school activities.

Many buyers deliberately choose to shop for a home after the busy spring and summer rush. They know that it will be easier to look, and that negotiations will be less stressful. They may not have children, or they may have grown children, so moving to accommodate the school year isn’t a consideration. Finding the right home at the right price, however, is.

Relocating families often don’t have a choice when they can leave for their new destination. Although 68% of transferring families have children, many families have to transfer during the middle of the school year. These families are that much more motivated to get their families settled in before either the January semester begins, or to arrange for the move during spring break in March. If you sign a contract by New Year’s Eve, the timing couldn’t be more perfect.

At Christmas time, our culture focuses on family and the home. Preparing for the indoor activities of winter is one of the most enjoyable periods of family life. Allowing buyers to view your home during this most hospitable of seasons lets them better picture their own family life in the attractive environment you have created.

When is your home ever more beautiful and inviting? You have cleaned and decorated, and your home looks like a picture postcard. If the results are good enough for family and friends, they will surely be good enough to impress your buyers. Get the family team on board to do a five-minute blitz pick-up every morning to keep holiday messes to a minimum.

With many motivated buyers in the marketplace, you may find you have more showings than you would if you sold your home during a busier time of the year.

If you do get a contract, you can arrange the terms to suit your needs. If moving during the holidays isn’t an option, you can put in the closing date of your choice. Most people can close 30 to 60 days after a contract is written, so there is plenty of time. Possession and closings are very negotiable.

http://www.relocation.com/library/family_moving/moving_during_holidays.html

http://www.ibabuzz.com/propertylines/2007/12/24/selling-a-house-during-christmas-bah-humbug/

Renting vs Buying a Home in Billings MT

Laure & Steve — Thu, 05 Nov 2009 22:53:39 +0000

Americans believe in the dream of homeownership. With all the foreclosures and bankruptcies taking place, however, is it cheaper for people to rent rather than buy?

When it comes to the decision of renting vs. buying, most people make the decision based upon a comparison of monthly payments. If their rent payment is less than the payment on a home, many decide that it’s cheaper to rent than to buy. This approach, however, fails to take into account a number of other factors that influence the total costs of homeownership, rather than just the monthly payments.

The first step for any person who is considering buying (or selling) a home is to talk to a tax professional. Each person’s tax situation is different. When you purchase a primary residence you can normally reduce your withholding taxes. That is because the interest on your mortgage is tax deductible.

One of the most compelling reasons to buy rather than to rent is to lock in a permanent monthly payment at today’s rates for the next 30 years. If possible, obtain a fixed-rate mortgage for 30 years. This means that your mortgage 20 years from now will be at the same rate as it is today. In contrast, rent payments tend to keep pace with inflation.

The current 10-year average inflation rate is 2.82 percent per year. (The average since 1913 is actually 3.41 percent a year). Assuming the inflation rate continues to average 2.82 percent per year, in 2019 your $1,000 mortgage payment would be the equivalent of $718 in today’s dollars. If your property value keeps pace with inflation, it would have increased in value by approximately 28 percent as well, making it worth $128,000. Furthermore, you would have paid down your loan for 10 years.

Assuming a 6 percent interest rate on a 30-year fully amortized fixed-rate loan, your balance on your original $100,000 loan would be $83,686. Consequently, your equity position after 10 years would be $16,314 ($100,000 minus $83,686) plus $28,000 in appreciation due to inflation, for a total of $44,314. (This calculation does not take into consideration any amount that you would have placed on the property as a downpayment.)

Of course, there are other costs of homeownership to consider, too, such as homeowners association dues, property taxes and utility bills.

Compare the above example to the costs of renting. If your rent payments kept pace with inflation of 2.82 percent per year, your rental costs over the same period would increase 28.2 percent ($1,282 per month vs. $1,000 today.)

Assuming a 2.82 percent inflation rate over the next 20 years, this example becomes even more compelling. Your monthly loan payment of $1,000 would be the same as $436 in today’s dollars. If your property value kept pace with inflation, it would now be worth approximately $156,000.

After 20 years, the balance on your $100,000 fixed-rate loan would be $54,359. Thus, your equity position would be $56,000 due to the inflation-related appreciation increase plus $45,641 in principal reduction, for a total equity position of $101,641.

In terms of rent 20 years from now, if it kept place with inflation you would be paying $1,564 per month. That’s an extra $6,768 per year more than your mortgage payments if you had locked in your 30-year fixed-rate loan at time of purchase.

The wild card in this entire discussion is inflation. Many experts are predicting that the only way our government can pay our debts is to print more money. The result will be increased inflation. Using the 10-year example from above, paying off a $1 billion loan after 10 years of inflation at 2.82 percent means that the real payoff amount is $718 million in today’s dollars.

For an individual, this may be the best reason to purchase real estate. If you hold your property for the long term, it will normally keep pace with inflation, creating additional wealth. When you rent, you pay off your landlord’s mortgage and make him or her wealthy. These are among the reasons that homeowneship remains an American ideal and the norm.