By Erin Wright & Christina Waterhouse

Questions to Ask and Information to Gather Before You Refinance

Low interest rates are attracting more and more people to the market, especially those who are looking to refinance their mortgages. Clients have been reaching out to us to ask if they should be refinancing their homes. Our general response is, “it depends”. There are a few questions and pieces of key information you should gather before deciding whether to refinance.

With interest rates at an all time low, everyone should ask, “Is refinancing a good decision for me?”

1. What is the difference between your interest rate and current interest rate?

A good rule of thumb is for the current rate to be at least .5 – .75% less than your interest rate. This rule can change greatly depending on the size of the loan though. The more money that is being borrowed, the larger the difference is going to be in both your monthly payments and your total interest paid. You can find the daily interest rate here.

2. How close are you to paying off your mortgage

At the beginning of a loan, most of the monthly payment is going to interest. Only a small portion of the payment goes towards paying off the principal balance of the loan. As payments continue, the amount that goes towards interest goes down and the amount that goes towards the principal balance goes up. It is worth looking at an amortization schedule to see if refinancing will save you money over the life of the loan. You can find an amortization calculator here.

3. Has your credit or employment changed?

Employment history, debt to income ratios, and credit scores all impact the rate you will receive when applying for a loan. Speak to your lender regarding any changes in these areas to make sure you would qualify for a refinance and see what rate you would likely qualify for. Then you can determine if it is worth refinancing.

4. What is the property being used for?

Properties that are used as primary residences qualify for lower interest rates than those used as investment properties (usually .5 – 1% lower). If you purchased the property as a primary residence and subsequently turned it into a rental, you might not see much of a change in your interest rate or possibly your interest rate as an investment property could be higher. Speak with your lender to see what the current interest rate would be for the specific property.

5. Should you refinance into a 15 year loan or 30 year loan?

If you do decide that it is worth refinancing your loan, consider looking at both a 15 year and 30 year loan. Right now the interest rate for a 15 year loan is in the mid 2% range, while the interest rate for a 30 year loan is in the high 2% range. A 15 year loan will save you a lot of money in interest over the life of the loan. This is a great way to build strong equity in your property and pay it off in half of the time.

As always, we welcome any questions you may have and are happy to offer advice.

Mortgage insight and references provided by: Mathew Mattila, Cascade Northern Mortgage

By Erin Wright and Christina Waterhouse

The weather is heating up and Clark County is starting to open up. Vancouver has a robust food scene and with many of the restaurants re-opening, it can be hard to know where to start. We wanted to take a moment to highlight a few of our favorite places to go and eat or get a sweet treat.  All have excellent options for those with dietary restrictions!

In addition to Sushi and other Japanese foods, Sushi Mo serves cuisine from their native Korea.

1. Sushi Mo – Fresh sushi is a perfect meal on a hot day! Sushi Mo is our favorite sushi spot and it is located right in downtown Vancouver. They offer the tried and true traditional rolls, along with some with creative flair. I often get a glass of white wine, an order of edamame, and 2 rolls to enjoy. They also offer an excellent presentation and there is a good chance one of the two owners will be there to greet you. It is my first choice for a meal out on a hot summer day.

Sushi Mo:  1012 Washington St Vancouver, WA 98660  360 – 953 – 8860

2. Margarita Factory – I almost jumped for joy when Margarita Factory re-opened in the middle of May. They make the best margaritas and guacamole. When you are looking for a more filling meal, they have excellent enchiladas and burritos. If you want something on the lighter side, their Live Fit Taco Salad is a great choice! Either way, try pairing your meal with their fresh, chunky guac and their Jorgita Margarita! Yum!

Margarita Factory:  8902 NE 5^th Ave. Suite 101 Vancouver, WA  98665  360 – 433 – 2557

“All of our pies are made with local ingredients- we’re regularly whipping up full-size and hand-size pecan, Apple, Pumpkin, Marionberry and Cherry pies. “

Simply Sweets – For that sweet tooth, there is nothing quite as satisfying as a fresh baked cookie or cupcake. Simply Sweets tops the charts for both. Their sugar cookie with butter cream frosting is a favorite among our families and clients. If you are looking for something a little different and fun, I highly recommend their hand pies. Pair that with one of their barista made coffee drinks and you are in for a sweet treat in deed.

Simply Sweets: 3100 Columbia St Vancouver, WA 98660 360 – 896 – 7321

Let us know if you go & enjoy any of these restaurants or if you have others you would like us to highlight. Enjoy! 

Procedures for Real Estate, How Covid-19 has Changed the Experience of Selling Real Estate

By Erin Wright and Christina Waterhouse

What challenges do sellers face when putting their house on the market? How can sellers help create a safer environment for showings? This week we continue to focus on the challenges that are currently being faced by buyers and sellers transacting real estate and how our local market has responded to those challenges to make the process safer and easier.

The Seller Process During Covid-19

Selling a house is always a stressful time, add a worldwide pandemic and it can seem overwhelming. However, speaking with an agent can help increase preparedness and reduce stress.

Before Going on the Market

The first step is always getting the house ready for the market. Although it is fun to watch a house makeover in real time, it is best to avoid being home during this part of the process. Allow the landscapers, stagers, and photographers to focus on making the house look its best instead of maintaining social distance standards. Also, if the agent does not offer it, have the house thoroughly cleaned and disinfected by a professional right before going on the market.

A virtual floor plan and virtual tour of a property can help limit showings to only those buyers that the home is a good fit for.

Virtual and Paperless Marketing

The house is ready for the market. Work with the agent to give as many details about the house as possible to put into the MLS. This is a great time to have room measurements and amenities added. Virtual tours and floor plans allow perspective buyers to get a good idea of the house before a showing. Have a sturdy, permanent flyer attached to the sign post in lieu of paper flyers. I love a good flyer and being able to take one, but now is not the time to have lots of hands on pieces of paper being passed out to the public. If brochures are used inside of the house for showings, only put out one at a time prior to the showing.

Being Prepared for a Showing

Limit showings to pre-approved buyers only. This will minimize the number of people in the home. The buyers who do see the home will be the serious ones. Try to not be home for the first five days on the market. This allows buyers easier access and makes it easier to clean when you return. Have all lights on and doors open for a showing. This minimizes how many surfaces are touched inside of the home. Be prepared for showings to take longer since not everyone in a group can see the house at the same time. The agent should be providing ample shoe covers to be used inside. Place them by the front door. The best practice right now is to have buyers use the shoe covers and take them after the showing. Single use shoe covers minimize touching. Consider placing hand sanitizer with a pump at the front door for people to disinfect upon entering and leaving the home.

Sanitizing frequently touched surfaces after a showing is a good idea when selling a home during Covid-19

Sanitize When Returning Home

Thoroughly sanitize common surfaces when returning home. Places to consider are cabinets, countertops, door handles, handrails, and light switches.

When first listing a home, this can be overwhelming. Consider making a checklist so the house is prepared for every showing and sanitized after. For more information on how to stay safe and what to expect as a seller in this market, please feel free to comment on this blog post or reach out to us directly.

As always, we welcome any questions you may have and are happy to offer advice.

How Covid-19 has Changed the Experience of Buying Real Estate

By Erin Wright and Christina Waterhouse

Over the last three weeks, we have explored the economic impacts of Covid-19 on our local Real Estate Market. These next two weeks we will be focusing on the challenges that are currently being faced by buyers and sellers transacting real estate and how our local market has responded to those challenges to make the process safer and easier.

The Buyer Process During Covid-19

Implementing the Governor’s Rules

Buying a house in the current pandemic has proven to be a bit challenging. There are some new practices we are seeing to help keep everything organized and try to keep people safe. We will start by reviewing what is required by the Governor of Washington State for Clark County. Currently there are two rules in place, no more than two people can be inside of a house at a time during a showing. Also,  people must maintain six feet between them for social distancing. This means that buyers can only enter a house one at a time with a Realtor. This can be difficult because families, couples, friends, or investors cannot be in the house at the same time discussing their thoughts on it. We have found it helpful to take Buyers in one at a time while maintaining the 6 feet for a buffer, and then reconvene in the street in front of the house to discuss the property while it is still fresh in everyone’s mind. The sooner all buyers can discuss the property together the better to ensure that nothing is lost. This process does increase the time it takes to view properties. We plan on showings taking about twice as long because each person is shown individually and then we discuss at the end instead of while actually going through the property.

Virtually Viewing a Neighborhood and House

Researching a neighborhood online before doing a drive by is a great way to learn more while sheltering in place.

Prior to actually viewing a property in person, there are many things a buyer should plan on doing before ever having the agent schedule the showing. First, a buyer should become very familiar with a desired neighborhood. This can be done by discussing the neighborhood with a Realtor. Ask about the schools, amenities, and house styles to start. A Realtor can also send you links to local publications, neighborhood data, and school sites . It is also a good idea to take a drive through the neighborhood and see what it is like in person.

Once the desired neighborhoods have been pinpointed, take advantage of all of the online tools to view specific properties. When looking at houses online, switch the map function to show an aerial view of the property. Look for both pros and cons of the property’s location. Are there parks nearby? Power lines? Is it on a busy road or to close to a large freeway? Once the properties with desirable locations are found, thoroughly look at the photos of the property. Pay attention to the sizes of rooms by using the furniture in the photos as a gauge. Also, pay attention to how the house flows, again furniture can be used to help identify how the photos are moving through the house. When available, look at the online floor plan and virtual tour. Combined, these tools help Buyers understand the property better to see if it is a fit for what they are looking for.

Hand sanitizer, shoe covers, and face masks are both common things to expect while viewing properties during Covid-19.

What to Expect During Showings

With a narrowed down list of approved properties, buyers should call their Realtors to set up showings. We already discussed the rules of showings above based on the Governor’s guidelines. However, there are additional things buyers should expect during this time. First and foremost, get pre-approved. Almost all sellers are requiring pre-approved buyers only to view properties. Once pre-approved send the letter to your Realtor, they may be required to submit it prior to a showing. Additionally, some sellers are having buyers and their Realtors submit a basic health questionnaire prior to a showing. With the showing scheduled and all necessary information submitted, be prepared to take a few extra steps to keep things sanitary. Sellers are requiring a variety of things for people going into their homes: masks, sanitation wipes, gloves, hand sanitizer, and shoe covers to name a few. Most items requested to be used will be provided at the house itself. If they are not provided at the house and you do not have access to them, request them from your Realtor. If the request is made in advance, it can often be accommodated.

When you first enter the market, this may all seem a bit alarming. However, we have seen several companies, agents, and sellers really step up to keep everyone safe and make everyone feel comfortable. For more information on how to stay safe and what to expect as a buyer in this market, please feel free to comment on this blog post or reach out to us directly.

As always, we welcome any questions you may have and are happy to offer advice.

How the Current Selling Season Compares to Last Year’s Selling Season

By Erin Wright and Christina Waterhouse

We have been closely watching our local real estate market since the start of the pandemic. There is a lot of conflicting information about how the market is currently doing. Transactions are happening, but is it business as usual?

For this week’s blog topic, we are further looking into how the real estate market is currently performing and how it compares to last year. The quick answer is that we are still in a seller’s market, seeing homes go pending quickly for close to or over asking price. The more accurate picture is a bit more complicated. Last year Clark County saw a robust selling season, with the months of March through November having over 1,400 active listings per month up to over 1,800 active listings per month.[1] Additionally, the months of March through August in 2019 had over 800 pending listings per month.[2] Our current market is performing at about 80% of last years market. Last month we had 1,279 active listings and 608 pending listings. [3]

This is important to note because although we are seeing a seller’s market with quick activity, similar to last year, we are not seeing a normal amount of inventory or buyers. Currently we are seeing multiple offers and houses in certain price points selling for over asking. However, with fewer active buyers and fewer active sellers, there are some variables in our market to consider for how it will proceed moving forward. This current ratio of supply and demand may continue, more buyers may enter the market without more listings to buy, or more sellers may enter the market without more buyers to buy. If the ratios stay the same, we will continue to experience a relatively quick market favoring sellers. If more buyers enter the market without increasing the supply, we will experience an even more favorable seller’s market, encouraging multiple offers and driving prices up. If more sellers enter the market without an increase in buyers, we will begin to see a softening and a more neutral market where buyers and sellers both share equal bargaining power. Though no one knows for sure what will happen, there seems to be a consensus among real estate economists that home sales will be down 10-15% this year compared to last year.[4] Additionally, homes may experience a slight drop in value during the 3^rd and 4^th quarter of this year, but still appreciate marginally year over year by about 2.5%.[5]  For more information on the specific economics of the housing market this year, please feel free to watch the video below from economist Matthew Gardner.

As always, we welcome any questions you may have and are happy to offer advice.

[1] History of Monthly Active Listings According to Trendgraphix

[2] Last Months Active and Pending Listings According to Trendgraphix

[3] Last Months Active and Pending Listings According to Trendgraphix

[4] Market Forecast According to Matthew Gardner

[5] Market Forecast According to Matthew Gardner

Understanding Why Interest Rates Impact Buyer Activity in the Market

By Erin Wright and Christina Waterhouse

Last week we reviewed the overall Real Estate Market in Clark County since the start of the pandemic. This week we are looking deeper into why interest rates are impacting buyer activity.

Interest Rates, Buying Power, & Inventory

Home buyers have seen historically low interest rates since the end of the Great Recession, between 3% and 5% roughly, compared to the average mortgage interest rate over the last 50 years of 7.91%.^[1]

Since the start of the current pandemic, interest rates have continued to lower. The rate as of today (Thursday, May 14, 2020) is 3.13%.^[2] In the chart below, you see that even the small changes in interest rates from about 18 months ago until today make a big impact on buying power. This is crucial because in a market like Clark County where there is a housing crisis due to the rapidly rising cost of real estate, more buying power opens up more inventory. Just since the start of 2020, Buyers looking for a $1,500 payment a month for principal and interest (not including taxes and insurance) saw their borrowing power increase from $329,000 to $350,000. To showcase how this impacts their choices, we ran a search on Redfin for a detached, single family home in Clark County. There are currently 28 houses listed for sale up to the price of $325,000. When we move that budget up to $350,000, there are 80 houses listed for sale. Just that $25,000 increase in budget, returned 3x the inventory on the market.

Interest Rates and Monthly Payments

Let’s also look at how the interest rate impacts a monthly payment and therefore a buyer’s monthly budget. In the chart below, you can see how the interest rate would impact a monthly payment for principal and interest (not including taxes and insurance) if a buyer purchased a house at an interest rate from 18 months ago, the beginning of this year, and today. There is a 23% difference in the monthly payment from the most recent high interest rate in November 2018 vs the interest rates today. For a $400,000 house, that equates to an extra $400 a month. This is important because even though some buyers are qualified to purchase a house, they do not feel comfortable spending more than a certain amount per month on their housing. With the interest rate saving $100’s of dollars a month, new buyers will be able to feel comfortable entering the market.

With Buyers able to enter the marketplace and have more buying power since the start of the pandemic, there is still a demand to purchase real estate. As we discussed last week, this demand mixed with fewer new listings coming on the market that would typically be seen this time of year has led to a strong Sellers’ market. The current demand mixed with the lower supply has kept prices stable even during a pandemic with high unemployment.

Mortgage insight and references provided by: Mathew Mattila, Cascade Northern Mortgage: https://www.mathewmattila.com/

As always, we welcome any questions you may have and are happy to offer advice.

^[1] History of Monthly Interest Rates According to Freddie Mac: http://www.freddiemac.com/pmms/pmms30.html

^[2] Daily Interest Rates According to Mortgage News Daily: http://www.mortgagenewsdaily.com/data/30-year-mortgage-rates.aspx

Understanding the Current Real Estate Market in Clark County

Our team has received a lot of inquiries regarding the real estate market during Covid-19. There are valid concerns and questions surrounding how this has impacted the market so far and what will happen in the future. We decided to share with you all the various statistics that we review to gauge the health of the real estate market and help you understand what they mean. This is part 1 of a series of real estate economic blog posts we will be publishing weekly.

What our local Market is currently doing and why

Clark County Washington is experiencing a Seller’s Market. We are seeing new listings that are priced appropriately selling quickly with multiple offers. This may seem counter intuitive, given that unemployment is up and so many businesses are closed. These things are true. Real estate is a perfect example of supply and demand. The pandemic has decreased demand, and we are seeing fewer buyers in the market than we would typically see this time of year. Some buyers are waiting to see what happens with their jobs, the economy, or just do not feel safe viewing properties. However, the pandemic has decreased the supply further. According to RMLS the week prior to the state-wide lock down, there were 272 new listings on the market. This past week there were only 173 new listings on the market, a decrease of 36%. To further tighten the inventory, during the past week, 183 listings went pending, which is 10 more listings than came on the market.

This data provides a good picture of what is going on in terms of numbers, but what does it mean to the buyers and sellers in the market today? We received multiple offers on our last 3 new listings during this pandemic. We have also had multiple buyers in bidding wars over the last couple weeks. For Sellers, this is showing that there is strong interest in the market right now due to the incredibly low inventory. We strongly advise Sellers to fully prep, clean, landscape and stage houses. This, along with pricing at market value will enable sellers to capitalize on the high demand and hope for multiple offers. For Buyers, this means that if you like a house, you need to make a quick decision to write an offer and really put your best foot forward. This can be difficult if you are looking for a good deal. Our best recommendation to such buyers is to look for properties that have been on the market for 30, 60, 90+ days and try to negotiate those sellers down on price. For all buyers right now, be prepared to lose out on a few houses because you have a lot of competition. Be patient, the right house will come around.

As always, we welcome any questions you may have and are happy to offer advice.

Erin & Christina 

Looking for a fun event to do in March with the whole family? This month to give back, Erin Wright Homes is partnering with Habitat for Humanity for a fun night playing Bingo for a cause. Join us Friday, March 18, 2016 for a fun night of Bingo while helping support the Evergreen Habitat for Humanity. Games are $2 a piece and all prizes are valued at $25 or more! Complimentary snacks provided and beer and wine available for purchase. This event is family friendly, so bring your kids! Want to get even more involved? Join Erin Wright Homes for our Habitat Build April 2, 2016! We would love to see everyone there!

What: Bingo for Habitat for Humanity

When: Friday, March 18, 2016 from 6pm-8pm

Where: Clark County Habitat Store
10811 SE 2nd Ave.
Vancouver, WA

Please RSVP to Erin Wright by Wednesday, March 16, 2016 by e-mail at ErinWright@Windermere.com
or by phone by calling 360-356-1445

Hope to see you all there!

For more information on the Evergreen Habitat for Humanity, please visit their website at:

http://www.ehfh.org/

***Want to plan ahead for April’s Community Event? We will be doing a Habitat for Humanity Build with the Evergreen Habitat for Humanity on Saturday, April 2, 2016. We would love to see everyone there. This event is for people 18 years and older.***

Donations from February 2016 Pet Food Drive

Thank you to everyone who donated pet food during our Pet Food Drive for the Humane Society of Southwest Washington for the February Community Event with Erin Wright Homes. Clients, friends, family, and myself were able to almost fill the back of my SUV with donations for the Humane Society. Donations consisted of both wet and dry cat and dog food. All donations were delivered directly to the Humane Society in the middle of February. The pet food that was donated will help the Humane Society care for the over 8,000 animals they care for each year.

For more information on the Humane Society of Southwest Washington, please visit their website at:

https://southwesthumane.org/about/

Thank you again everyone!