The purpose of Veterans Affairs (VA) home loans is to provide a pathway to homeownership for those who have sacrificed so much by serving our nation. As the Veterans Administration says of the program:
“The objective of the VA Home Loan Guaranty program is to help eligible Veterans in Maryland, active-duty personnel, surviving spouses, and members of the Reserves and National Guard purchase, retain, and adapt homes in recognition of their service. . . .”
For over 75 years, VA home loans have provided millions of veterans and their families the opportunity to purchase their own homes.
2020 Data on VA Home Loans
“VA loans offer an extraordinary opportunity for veterans because of lower interest rates, lower monthly payments, no or low-down payments, and no private mortgage insurance.”
Those who qualify for a VA home loan in Maryland are eligible for the following:
One of the hottest topics of conversation in today’s real estate market is the shortage of available homes. Simply put, there are many more potential buyers than there are homes for sale. As a seller, you’ve likely heard that low supply is good news for you. It means your house will get more attention, and likely, more offers. But as life begins to return to normal, you may be wondering if that’s something that will change.
While it may be tempting to blame the pandemic for the current inventory shortage, the pandemic can’t take all the credit. While it did make some sellers hold off on listing their houses over the past year, the truth is the low supply of homes was years in the making. Let’s take a look at the root cause and what the future holds to uncover why now is still a great time to sell.
Where Did the Shortage Come From? It’s not just today’s high buyer demand. Our low supply goes hand-in-hand with the number of new homes built over the past decades. According to Sam Khater, VP and Chief Economist at Freddie Mac:
“The main driver of the housing shortfall has been the long-term decline in the construction of single-family homes.”
Data in a recent report from the National Association of Realtors (NAR) tells the same story. New home construction has been lagging behind the norm for quite some time. Historically, builders completed an average of 1.5 million new housing units per year. However, since the housing bubble in 2008, the level of new home construction has fallen off (see graph below):
The same NAR report elaborates on the impact of this below-average pace of construction:
“. . . the underbuilding gap in the U.S. totaled more than 5.5 million housing units in the last 20 years.”
“Looking ahead, in order to fill an underbuilding gap of approximately 5.5 million housing units during the next 10 years, while accounting for historical growth, new construction would need to accelerate to a pace that is well above the current trend, to more than 2 million housing units per year. . . .”
That means if we build even more new houses than the norm every year, it’ll still take a decade to close the underbuilding gap contributing to today’s supply-and-demand mix. Does that mean today’s ultimate sellers’ market is here to stay?
We’re already starting to see an increase in new home construction, which is great news. But newly built homes can’t bridge the supply gap we’re facing right now on their own. In the State of the Nation’s Housing 2021 Report, the Joint Center for Housing Studies of Harvard University (JCHS) says:
“…Although part of the answer to the nation’s housing shortage, new construction can only do so much to ease short-term supply constraints. To meet today’s strong demand, more existing single-family homes must come on the market.”
Early Indicators Show More Existing-Home Inventory Is on Its WayWhen we look at existing homes, the latest reports signal that housing supply is growing gradually month-over-month. This uptick in existing homes for sale shows things are beginning to shift. Based on recent data, Odeta Kushi, Deputy Chief Economist at First American, has this to say:
“It looks like existing inventory is starting to inch up, which is good news for a housing market parched for more supply.”
Lawrence Yun, Chief Economist at NAR, echoes that sentiment:
“As the inventory is beginning to pick up ever so modestly, we are still facing a housing shortage, but we may have turned a corner.”
So, what does all of this mean for you? Just because life is starting to return to normal, it doesn’t mean you missed out on the best time to sell. It’s not too late to take advantage of today’s sellers’ market and use rising equity and low interest rates to make your next move.
Bottom LineIt’s still a great time to sell. Even though housing supply is starting to trend up, it’s still hovering near historic lows. Let’s connect to discuss how you can list your house now and use the inventory shortage to get the best possible terms for you.
According to the latest CoreLogic Home Price Insights Report, nationwide home values increased by 8.2% over the last twelve months. The dramatic rise was brought about as the inventory of homes for sale reached historic lows at the same time buyer demand was buoyed by record-low mortgage rates. As CoreLogic explained:
“Home price growth remained consistently elevated throughout 2020. Home sales for the year are expected to register above 2019 levels. Meanwhile, the availability of for-sale homes has dwindled as demand increased and coronavirus (COVID-19) outbreaks continued across the country, which delayed some sellers from putting their homes on the market.
While the pandemic left many in positions of financial insecurity, those who maintained employment and income stability are also incentivized to buy given the record-low mortgage rates available; this is increasing buyer demand while for-sale inventory is in short supply.”
Where will Maryland home values go in 2021? Home price appreciation in 2021 will continue to be determined by this imbalance of supply and demand. If supply remains low and demand is high, prices will continue to increase.
Housing Supply According to the National Association of Realtors (NAR), the current number of single-family homes for sale is 1,080,000. At the same time last year, that number stood at 1,450,000. We are entering 2021 with approximately 370,000 fewer homes for sale than there were one year ago.
However, there is some speculation that the inventory crush will ease somewhat as we move through the new year for two reasons:
1. As the health crisis eases, more homeowners will be comfortable putting their houses on the market.
2. Some households impacted financially by the pandemic will be forced to sell.
Housing Demand Low mortgage rates have driven buyer demand over the last twelve months. According to Freddie Mac, rates stood at 3.72% at the beginning of 2020. Today, we’re starting 2021 with rates one full percentage point lower than that. Low rates create a great opportunity for homebuyers, which is one reason why demand is expected to remain high throughout the new year.
Taking into consideration these projections on housing supply and demand, real estate analysts forecast homes will continue to appreciate in 2021, but that appreciation may be at a steadier pace than last year. Here are their forecasts:
Bottom LineThere’s still a very limited number of homes for sale for the great number of purchasers looking to buy them. As a result, the concept of “supply and demand” mandates that home values in the country will continue to appreciate.
Robert McArtor, Maryland Homes Team of RE/MAX Components - FREE Home Valuation HERE
The current spread of coronavirus (COVID-19) and the efforts to contain it have impacted almost all aspects of daily life – and real estate transactions are no different. Yet despite current circumstances, real estate agents are still seeing sellers and buyers move forward with their plans in what is historically an active spring market.
“Precautions have changed, and people are doing life differently, but the demand and decision to buy a home is currently still very strong,” says Kerron Stokes, Manager of RE/MAX Leaders & Team Leader of Resource Group in Centennial, Colorado. “Our team has taken on two new listing clients and three new homebuyer clients this week, and have new buyer consults set up next week as well.”
Yet even with willing sellers and eager buyers, the current U.S. government guidelines recommend social gatherings be limited to fewer than 10 people – among other safety measures – which means selling a home this spring may look differently than in years past.
“It’s going to require being creative and innovative, but there are still ways for real estate agents to interact with listing clients and potential buyers by leveraging technology,” Stokes says.
Ready to Sell? Keep Calm and Log On.
With COVID-19 at the forefront of many sellers’ minds, for the time being, many home tours will start online. But according to Stokes, that’s nothing new and can be a powerful tool in marketing a home to buyers.
“A lot of these virtual tactics are things we’ve already been deploying for 5-6 years for clients who can’t be in a physical space,” Stokes says.
He cites investors, or potential buyers that work irregular hours, as an example.
“We’ll FaceTime them at work so they can ask questions about the property.”
According to Ryan Smith, Broker/Partner of RE/MAX Properties in Western Springs, Illinois, video tours between agents and buyers have been a useful tool in a variety of market conditions. Especially with current health concerns, he says more agents are using virtual tours to help reduce the number of buyers walking through a property.
“Things can look differently in photos than even a FaceTime call,” Smith says. “It can help narrow down properties in a buyer’s price range so they know which ones they want to see in person.”
If an interested buyer is ready to visit a property, Smith still recommends limiting the number of people that tour a listing.
“Agents aren’t bringing caravans of people into a home,” Smith says. Only when a buyer is seriously considering putting in an offer can additional stakeholders return to see the listing.
"Agents have to be aware and smart – wash hands more often, use hand sanitizer, avoid touching your face and do more calls on speaker phone to avoid phone-to-face contact,” Smith says.
Still weighing your options? Get to work while you think it through!
"There are absolutely things sellers can do while we’re being asked to stay home,” Stokes says. “If you can get to a Home Depot, get paint and start doing touch-ups around the house. Or begin packing and put your stuff in the garage or basement in a central location. That way as we start to return to a more normalized market, you are ready to show your home.”
And of course, Vitamin D can help with stress relief.
“Take time to be outside,” Stokes says. “Get your yard cleaned up and landscaping prepped. Ask your agent for ideas of what you can do.”
Stokes adds that RE/MAX agents are not only some of the most professional in the industry, they’re also well-connected.
“We have some great resources at our disposal,” Stokes says. “This is a great time to reach out to your agent to see what services they have that can make your life easier.”
Be prepared for a market - and world - that is constantly changing
When it comes to COVID-19 and real estate, no one can accurately predict what the future holds. But in the current moment, Smith is seeing movement in the market.
“There’s still buyer interest – I currently have 50-60 listings, and we’ve had activity all weekend,” Smith says. “There are some challenges and hurdles behind the scenes – appraisers are sorting out their own safe-practices, title companies are considering creative and cautious options to facilitate closings, and local villages have closed, which is causing some delays in being able to obtain transfer stamps but only by a few days.”
Stokes points out that historically, real estate can lag behind other industries when showing the effects of a change in the economy.
“We really won’t know the full effect for a couple of months,” Stokes says. “But currently, it’s business as usual in a lot of ways as we work to anticipate and meet the new needs of buyers and sellers.”
The COVID-19 emergency is constantly evolving. Smith encourages everyone in real estate to stay informed.
"Like most agents, I will be watching the market's reaction to all of this closely."
Written by Stephanie Visscher
Over the last several years, many Maryland “baby boomers” have undergone a metamorphosis. Their children have finally moved out and they can now dream about their own future. For many, a change in lifestyle might necessitate a change in the type of home they live in.
That two-story, four-bedroom colonial with three bathrooms no longer fits the bill. Taxes are too high. Utilities are too expensive. Cleaning and repair are too difficult. When they decide to travel to be with friends and family, locking up the house is too time-consuming and worrisome.
Instead, a nice ranch home in Baltimore County or Harford County with 2-3 bedrooms and two baths might better fulfill their new needs and lifestyle. The challenge many “boomers” have faced when trying to downsize to the perfect new home has been a lack of inventory.
The average number of years a family stays in their home has increased by fifty percent since 2008, causing fewer houses to come to the market. During the same time, new home builders were concentrating most of their efforts on large, luxury, expensive houses.
However, that is starting to change.According to the U.S. Department of Housing and Urban Development and the U.S. Census Bureau, sales of newly built, single-family homes rose to a seasonally adjusted annual rate of 692,000 units in March. The great news is that more of those homes were sold at the lower end of the price range.
In a press release last week, the National Association of Home Builders (NAHB) explained that:
“The median sales price was $302,700, with strong gains in homes sold at lower price points. The median price of a new home sale a year earlier was $335,400.”
NAHB Chief Economist Robert Dietz offered further detail:
“We saw a large gain at lower price points where demand is strong. In March of 2019, 50% of new home sales were priced below $300,000, compared to 39% in March of 2018.”
Bottom Line If you are a “boomer” in Maryland and thinking of selling your old house in order to buy a new home that better fits your current lifestyle, now may be the perfect time!
Call Robert McArtor, Team Leader with Maryland Homes Team of RE/MAX Components at 443-885-0875 or
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Thinking of Selling your home in 2019? Don't roll the dice to decide on how to price your home. Interview at least 3 Real Estate Professionals and find out what your home is TRULY valued at for re-sale. If you have any questions, please feel free to call us for your FREE In-Home Consultation at 443-885-0875
How to protect yourself and your family from radon
What is radon? Why is it Important?
Radon is an invisible, odorless radioactive gas in the earth that can get into your home. Exposure to the combinationof radon gas and cigarette smoke creates a greater risk of lung cancer than exposure to either factor alone.
The only way to know how much radon is in your home is do a radon test. If your home has too much radon, it is possible to remove it and lower the risk of cancer for you and your family. If you are considering relocating to Maryland and need to start your home search. CLICK HERE to get started.
Where is radon found in Maryland? (See Map Below)
Although radon can be found anywhere, some parts of Maryland have soil that make radon more likely. Basement and first floors typically have the highest radon levels because of their closeness to the ground.
Why should I test my home for radon?
Radon causes cancer. The longer you and your family are exposed to radon, the greater the risk of lung cancer. The risk is especially high for people who also smoke.
How do I test my home?
Testing your home is easy. Maryland Homes Team of RE/MAX Components recommends hiring a licensed home inspector with a certification to conduct radon tests which we believe are the most accurate. For a list of our preferred vendors, please contact us at 443-885-0875 or email us at firstname.lastname@example.org You can also look for test kits in most area hardware stores and home improvement stores. Look for test kits that are certified by NRPP or NRSB, and follow the directions on the package. Generally, you should:
- Place the test kits in the lowest level that people will occupy, and/or the areas that are most heavily used (like bedrooms and playrooms).
- Place the kits in a dry area (not bathrooms or kitchens) where the kits will not be disturbed, and are not near moving air (windows, ventilation ducts)
- Leave the kits for somewhere between two and 90 days (the longer the test, the more accurate it is), seal them up immediately and mail to the testing company.
For more information call the Environmental Health Helpline: 1-866-703-3266
What Does My Test Mean?
Your radon test result is used to decide whether additional testing or some mitigation (removal of radon) is necessary. If our test is:
Less than 2 pCi/L - No further action is needed at this time; consider another test in the future if the condition of the home changes (cracks in the basement, etc.)
2-Less than 4 pCi/L - No action is needed, but you should re-test at least every five years or if home conditions change (construction, new basement, etc.)
4 pCi/L or more - You should do another test (either short - or long term) to confirm the results; if confirmed, consult a certified radon mitigation contractor. Maryland Homes Team has a list of preferred vendors we can share with you. Simply call us at 443-885-0875
Can I fix my home if it has radon?
Yes, Fixing your home is usually easy and not very expensive. Maryland Homes Team can certainly help you with obtaining the appropriate licensed contractor with the property credentials with the American Association of Radon Scientist & Technologist (AARST).
What about buying or selling a home?
MDE and MDH recommend testing your home for radon before you sell it. It's good for both you and the buyer to know. If you are buying a home, MDE and MDH recommend asking about radon, and about any testing or mitigation that has been done. Maryland Homes Team can help guide you through this process whether Buying or Selling your home.
New homes can be built with features to reduce radon.
Building new homes with simple and cost-effective radon-resistant features can reduce radon entry. Maryland Homes Team will contact your Builder of choice and gather more information for you.
Every home should be tested before, or soon after, you more in. Even homes built with radon-resistant construction features should be tested. If high radon levels are found, it is easier and costs less to reduce radon levels in homes that are built radon-resistant.
The lack of existing home inventory for sale in the Baltimore Metro and Maryland Area has forced many home buyers to begin looking at new construction such as Gemcraft, Toll Brothers, Ryan Homes, Lennar and Ryland just to name a few. When you buy a newly constructed home instead of an existing home, there are many extra steps that must take place. To ensure a hassle-free process, Robert McArtor with Maryland Homes Team of RE/MAX Components at 443-885-0875 reviews the 5 tips to keep in mind if you are considering new construction. If you are thinking of Buying a New Construction Home, get the representation you need and deserve. Visit http://www.MarylandHomesTeam.com and lets get started today! Equal Housing Opportunity!
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