To say 2010 is off to a great start is an understatement. This year there has been 186 closings, 31% more than at this same point last year. In 2010 the average sold price of a house is up 12.6% from the end of 2009 and 13.5% from October ‘09, the last month prices declined. With the pace of buyer activity not slowing down I think we will continue to gain momentum.
The majority of the homes sold, 75% continue to be in the under $500,000 category. However there is more movement in the higher price ranges mostly due to the easing of obtaining Jumbo Loans plus with decreased pricing and solid rental income those homes are getting 8-10% Gross
Return on Investment (ROI). That makes for an attractive return that we have not seen on the Outer Banks for years.
The majority of rental management companies are reporting strong pre-bookings for the 2010 rental season. These bookings are ahead of last years pace which are helping to lead the way for these houses to have a strong ROI.
There is another interesting statistic I just discovered that shows the market is coming back. For the first 2 months of the year the average price of a house under contract, $383,543, was lower than the average price of a sold house, $386,181. Normally houses sells for less than the listed price. I have not seen houses sell for more than the listing price since the “boom days” of 2001-2005. For the 186 closed sales this year buyer’s on average are paying more than full price. We are not back to the “boom days” and most of this can be attributed to multiple offers on foreclosures/short sales. The point is that buyer’s are now realizing that our market has turned a corner and they are taking advantage of it. They realize that prices are at 7 year lows, have stabilized and rental income remains strong. That’s a great combination!! Low prices + strong rental income= Great Opportunity !!
About the author of this blog:
Matt Huband, SFR is Broker/Owner of Hometown Realty in Kitty Hawk, NC and a Certified Short Sale & Foreclosure Specialist. Matt works with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com . Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, Market Conditions, For Sale, Announcements, Finances, Buyer Information, Seller Information, Community Information, Outer Banks, Corolla, Foreclosures, Dare County, Property Values, Hatteras, North Carolina, Seller's, Bank Owned, Buyers, Seller, Buyer, OBX, Retirement, Kitty Hawk, 2nd Home, Vacation Rental, Sellers, Buying, Mortgage Rates, Nags Head, Vacation, Housing Market, Interest Rates, Kill Devil Hills, Avon, Currituck County, Duck, Travel, Southern Shores, Tourists, Beach, Short Sale, Outer Banks North Carolina, Matt Huband
Many people would love to own a beach house on the Outer Banks but have no idea how much it costs or what’s involved.
Since most of the houses on the Outer Banks are used as weekly vacation rentals many people want to know what portion of the rental income will help pay for the expenses and what will be left over to go towards the mortgage? As a general rule you can use a 60/40 split. 60% of the gross rental income will go towards the expenses of the house such as, utilities, management fees, pool/hot tub cleaning, maintenance, taxes and insurance. The other 40% will be left to help cover the mortgage. The expenses on these houses will vary depending on size, whether you have a pool or hot tub, and what the current management companies charge among other things. The gross rental income will vary by the amount of weeks the owner keeps the house open for rentals or how much the owner uses the house during peak rental months.
Example: Average 4-5 Bedroom home on the Outer Banks cost approx. $500,000
$500,000 x 20%($100,000) down =$400,000 Mortgage @ 5% 30yr P&I payment=$2148 month
$2148 (monthly payment) x 12= $25,776 annual cost of mortgage
Average annual gross rental income $35,000
$35,000 Rental Income X 60%= $21,000 to cover annual household expenses including taxes & insurance
$35,000 - $21,000(expenses) = $14,000 left to go towards the annual mortgage payments
$25,776(annual cost of mortgage) - $14,000= $11,776 annual cost to own a beach house or $981.33 a month.
Knowing how much the house is going to cost to operate along with your down payment amount and mortgage payment will give you the information you need to make an informed decision. Also keep in mind that they are tax advantages to owning a 2nd home or investment property. Consult your tax advisor for more information. If you are looking at houses on the internet and want a quick calculation the 60/40 method is a good start. Remember; always consult a local Realtor for exact income and expense histories on a specific property to determine if that property is right for you.
You never know, owning a beach house on the Outer Banks may be more affordable than you think!
About the author of this blog:Matt Huband, SFR is Broker/Owner of Hometown Realty in Kitty Hawk, NC and a Certified Short Sale & Foreclosure Specialist. Matt works with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com. Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, Market Conditions, For Sale, Buyer Information, Outer Banks, Corolla, Foreclosures, Dare County, Property Values, Hatteras, North Carolina, Bank Owned, Buyers, Buyer, OBX, Retirement, Kitty Hawk, 2nd Home, Vacation Rental, Buying, Mortgage Rates, Nags Head, Vacation, Housing Market, Kill Devil Hills, Avon, Currituck County, Travel, Southern Shores, Short Sale, buyers guide2nd Home, Outer Banks North Carolina, Matt Huband
Turn Key Ready For New Buyer
• 1,008 sq. ft., 2 bath, 3 bdrm single story - 
MLS® $275,000 - Short Sale- Walk To Beach
Dare County, North Carolina - Fantastic Short Sale opportunity! Walk to the Atlantic Ocean or the Pamlico Sound. The Hatteras Kite House has an awesome location in the center of the Hatteras Island Kite boarding and Surfing Community of Waves. Walking distance to Real Water sports, Kitty Hawk Kites, Hatteras Island Surf & Sail plus a shortwalk to the beach makes this an excellent 2nd home or rental. The house was new in December 2006, has been used lightly as a 2nd home. In 2009 ownerrented the house with VRBO and was very successful with 16 weeks rented. For 2010 there were 6 weeks reserved but due to the short sale owner is hascancelled those weeks. However VRBO website is paid for 2010 and still up so new buyer can start renting again. The house is set up for the beach andwater sports vacationers with a huge lockable storage room for all kinds of gear and an outside shower (private) under the house so you can live the beachlifestyle. This property is in great condition and turn key for a new buyer. Come experience life on Hatteras Island!
Property information
About the author of this blog:
Matt Huband, SFR is Broker/Owner of Hometown Realty in Kitty Hawk, NC and a Certified Short Sale & Foreclosure Specialist. Matt works with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@Hometownobx.com Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, Market Conditions, For Sale, Announcements, Buyer Information, fishing, Investments, Dare County, North Carolina, Buyers, Buyer, OBX, 2nd Home, Vacation Rental, Buying, Housing Market, Surfing, Relaxing, Travel, Tourists, Beach, Short Sale, buyers guide2nd Home, Investment guide, kiteboarding, Cape Hatteras National Seashore, Outer Banks North Carolina
Walk To Beach
• 1,205 sq. ft., 2 bath, 3 bdrm manufactured home - MLS® $215,000 - Short Sale Opportunity
Dare County, North Carolina - Short Sale opportunity to pick up a nice house in a great location in Waves. Short walk to the beach and close to all the Hatteras Island water sports such asReal Kiteboarding, Kitty Hawk Water Sports and more. A perfect beach getaway without a big price tag or use for an investment. Currently rented year roundfor $1000 a month. Long time tenants would like to stay but can be out in 45 days.
Property information
About the author of this blog:
Matt Huband, SFR is Broker/Owner of Hometown Realty in Kitty Hawk, NC and a Certified Short Sale & Foreclosure Specialist.
Matt works with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property,
new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, For Sale, Announcements, Buyer Information, Outer Banks, Dare County, North Carolina, Buyers, OBX, 2nd Home, Vacation Rental, Buying, Housing Market, year round, Tourists, Short Sale, buyers guide2nd Home, Real Kiteboarding, Cape Hatteras National Seashore, Outer Banks North Carolina, Matt Huband
For over 20 years the Outer Banks Restaurant Association has hosted the annual Taste of The Beach and this year is no exception. This year’s Taste of The Beach will begin on March 11 with numerous Outer Banks restaurants sponsoring tasting’s up and down the beach. This grand food festival event will feature wine tastings, cooking classes, special menu presentations, celebrity guest chef appearances by Ed Brantley & Heba Salama from "The Biggest Loser", brewery tours, tapas crawls and many more events with exciting array of creative combinations of culinary delights and fun activities on the Outer Banks. The event will conclude on with The Beach Expo on March 14th with over 20 of the Outer Banks top chefs all in one location cooking up a wonderful array of culinary delights.
The Taste of The Beach Weekend is a fantastic way to get out of the winter doldrums and sample the fare of several fine restaurants on the Outer Banks in one fun-filled, food-centric weekend! Casual chefs to full-on foodie fanatics will revel in innovative culinary opportunities offered up by members of the Outer Banks Restaurant Association. You can indulge in a fancy wine dinner one night and mix with the masses in an organic farm to fork experience the next. Or maybe an intimate cooking class with one of the area's world class chefs is more your speed.
Coastal Living Magazine has named the Outer Banks Taste of The Beach one of the Top 10 Seafood and Wine festivals in the USA. So what are you waiting for?? Make plans now to reserve your hotel or rental house and enjoy one of the best weekends (surely one the tastiest) the Outer Banks has to offer.
To learn more go to The Outer Banks Taste of The Beach & Accommodations
About the author of this blog:
Matt Huband, SFR is Broker/Owner of Hometown Realty in Kitty Hawk, NC and a Certified Short Sale & Foreclosure Specialist.
Matt works with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property,
new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
It’s been a long time coming but after 4 1/2 years of price declines and decreased sales the Outer Banks real estate market is back!!
While the beginning of 2009 started off looking like a repeat of 2008 with prices continuing to decrease things turned around in the fall. Buyers finally decided that the time was right and the average price of a sold house went up in November and December. The total number of sold houses for 2009 also increased from 2008, another first since 2005. Another sign of a market recovery, the number of houses currently listed are down approx 20% from the peak.
Have we seen the bottom? I think we have!
Every buyer is still looking for the "deal". There are plenty out there and they are not all foreclosures and short sales. Speaking of short sales they continue to be a major source of frustration for buyers and sellers. The average wait time for the lender to respond to a offer is close to 4-6 months. Not to mention the closing ratio is for every 10 offers only 3 close due to a variety of reasons. While they can be great deals it requires a special buyer that has lots of patience. Foreclosures are still coming on the market with regularity however when a great deal hits the market you can expect to contend with multiple offers and a sale price at or above the list price. If you are in the foreclosure market you need to have your pre-approval letter in hand, make an offer the day the listing hits the market or soon after, and be prepared to offer at or above the list price with no contingencies.
The start of 2010 has been extremely strong with the average sold price increasing again for the 3rd month in a row. With mortgage rates still around 5% I feel like this trend will continue and come December we will see our first annual price increase in 5 years.
All signs point to 2010 being the turning point for the Outer Banks real estate market market.
About the author of this blog:
Matt Huband, SFR is Broker/Owner of Hometown Realty in Kitty Hawk, NC and a Certified Short Sale & Foreclosure Specialist.
Matt works with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property,
new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, Market Conditions, For Sale, Announcements, Buyer Information, Outer Banks, Corolla, Foreclosures, Dare County, Property Values, Hatteras, North Carolina, Bank Owned, Buyers, Mortgage, Buyer, OBX, 2nd Home, Buying, Nags Head, Economy, Housing Market, Interest Rates, Prime Rate, Kill Devil Hills, Currituck County, Duck, Rodanthe, Short Sale, kiteboarding, Outer Banks North Carolina, Matt Huband
IT HAS FINALLY HAPPENED!!!!
The average price for a home sold on the Outer Banks has finally stopped going down!! As a matter of fact it actually went up just a bit. For the first time in 2009 or 2008 for that matter prices have finally leveled off (follow the monthly trend on the OBX Stats page of my website). The average sold price in October was $334,141 and for November it was $334,743. With the way the market is going I don't think we will see a big drop in prices again. At the beginning of the year buyers began to trickle down to the Outer Banks and now the trickle has turned into a steady stream. If you have been on the sidelines waiting for prices to level off now is the time to get into the Outer Banks real estate game.
Attn iPhone Users: You can go to the homepage on my website and download the new Search MLS app to search the Outer Banks MLS. It’s on the right side of the page. It’s FREE and easy to use!!
About the author of this blog:
Matt Huband is Broker/Owner of Hometown Realty in Kitty Hawk, NC. Working with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, Market Conditions, Announcements, Buyer Information, Outer Banks, Corolla, Dare County, Property Values, Hatteras, North Carolina, Bank Owned, Buyers, Buyer, OBX, Kitty Hawk, 2nd Home, Buying, Nags Head, Housing Market, Avon, Currituck County, Duck, Southern Shores, Rodanthe, Short Sale, Outer Banks North Carolina, Matt Huband
North Ridge Estates, Nags Head - Just Listed: 3405 Buccaneer Dr, a 1,700 sq. ft., 2 bath, 4 bdrm 2 story. Now MLS® $199,000 -
Great house, great location, great pool, bad tenants. This 4bd/2bth house was in great shape but was rented out. Now it needs a new owner to bring it back to
life. With a little work this house would be a true gem. Carpet, paint, applainces, yard work and some minor repairs will bring back this house to it's former
glory. Close to beach, shops and restaurants. According to the seller new roof in 2004, HVAC in 2005, pool pump in 2005. Great Price for a year round, 2nd
home or rental house.
Great house that needs a new owner to bring it back to life. Close to the beach, shopping, and restaurants. Priced right to sell quick!!
Great house, great location, great pool, bad tenants. This 4bd/2bth house was in great shape but was rented out. Now it needs a new owner to bring it back to
life. With a little work this house would be a true gem. Carpet, paint, applainces, yard work and some minor repairs will bring back this house to it's former
glory. Close to beach, shops and restaurants. According to the seller new roof in 2004, HVAC in 2005, pool pump in 2005. Great Price for a year round, 2nd
home or rental house.
Great house, great location, great pool, bad tenants. This 4bd/2bth house was in great shape but was rented out. Now it needs a new owner to bring it back to
life. With a little work this house would be a true gem. Carpet, paint, applainces, yard work and some minor repairs will bring back this house to it's former
glory. Close to beach, shops and restaurants. According to the seller new roof in 2004, HVAC in 2005, pool pump in 2005. Great Price for a year round, 2nd
home or rental house.
Property information
About the author of this blog:
Matt Huband is Broker/Owner of Hometown Realty in Kitty Hawk, NC. Working with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, For Sale, Seller Information, Outer Banks, Dare County, North Carolina, OBX, 2nd Home, Vacation Rental, year round, Outer Banks North Carolina, Matt Huband
The Virginia Pilot reported today that construction on the Mid-County Currituck Bridge is scheduled to begin in February or March next year. While there are still many details to work out it is seems that after 20 years the bridge will finally get built. Once completed, scheduled for 2013, the bridge will help ease the summer traffic coming onto the Outer Banks for everyone. Those tourists traveling to Corolla will save at least an hour of travel time if not more by using the bridge. For many it will be a huge sigh of relief when this bridge is finally done.
To read the article go to “Shortcut To Paradise”
About the author of this blog:
Matt Huband is Broker/Owner of Hometown Realty in Kitty Hawk, NC. Working with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, Announcements, Community Information, Outer Banks, Corolla, Property Values, North Carolina, OBX, 2nd Home, Currituck County, Mid County Bridge, Travel, Tourists, Outer Banks North Carolina, Matt Huband
The Outer Banks real estate market continues to put up good numbers as we head into the last quarter of 2009. For the 5th straight month the number of sold houses were over 100. If the number of sold houses continues on its current pace in October it will be 6 months in a row. Buyers are realizing that the prices and mortgage rates are just too good to pass up. Out of the 126 sold properties only 24 were either foreclosure or short sales. There are some great properties on the market that are not distressed.
There has also been an increase in higher priced homes selling in recent months. This can be attributed to mortgage rates for jumbo loans dropping and the availability of 10% down programs for 2nd homes. In my opinion, the buying environment will be extremely favorable for the next few months. Sooner rather than later mortgage rates will be going up and that is going to impact every buyer. The cost of waiting to buy can significantly impact the price of the house you can afford. The tide of the real estate market on the Outer Banks is turning!!
About the author of this blog:
Matt Huband is Broker/Owner of Hometown Realty in Kitty Hawk, NC. Working with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Real Estate, Market Conditions, For Sale, Announcements, Buyer Information, Outer Banks, Foreclosures, Dare County, North Carolina, Bank Owned, Buyers, Mortgage, Buyer, OBX, 2nd Home, Mortgage Rates, Housing Market, Interest Rates, Currituck County, Short Sale, Outer Banks North Carolina, Matt Huband
I wanted to pass along a great story that was posted in The Outer Banks Sentinelabout a local cancer survivor named Ed. I am sure everyone in America knows someone who has had cancer, both my parents are cancer survivors. Each and every person who survives cancer goes through a great amount of shock, grief, and then the torture of chemo or radiation. Like so many other survivors Ed has as a story to tell. He was able to take is own personal experience and capture it by writing a book titled"Ed ... It Was Malignant". The book talks about the struggles Ed endured and the great resources that are available that helped him get by each day. Ed now trains for the OBX Marathon which falls 1 year and 1 day from the time he was diagnosed with cancer. Ed thought it would be a great testament to all those who inspired him and to those who lost their fight to be able to finish the marathon. If you know someone who is currently battling cancer reach out to them and pass this article along.
Ed is donating a portion of the proceeds from his book to The American Cancer Society. Each and every year my family donates and takes part in the American Cancer Society's Relay For Life and I encourage everyone else to do so. To read the story go to When Cancer Called Ed
About the author of this blog:
Matt Huband is Broker/Owner of Hometown Realty in Kitty Hawk, NC. Working with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
It's great that Corolla is finally getting a bike trail. I see so many people walking and biking along Hwy 12 and it is very dangerous. The roads are curvy with lots of blind spots so this trail will help keep the locals and tourists safe. After all the money the government has wasted over the last few years of bailouts I am glad to see that at least some of it is going to good use. Below is an article from The Daily Advance on the bike trial.
Thanks to a $500,000 state grant, Corolla residents will soon have a trail for walking, jogging and biking.
Currituck County officials announced Friday that the county has been awarded the grant by the North Carolina Parks and Recreation Trust Fund. The $500,000, combined with $500,000 in county funds, will help pay the $1 million cost of constructing a 10-foot wide, 1.2-mile paved trail in Corolla.
“We’re really excited about it,” said Holly White, senior planner in the Currituck Planning Department. “Right now there’s nothing there, so people are riding bikes and moms are pushing strollers along the side of the road.” To learn more go to Corolla Bike Trail
About the author of this blog:
Matt Huband is Broker/Owner of Hometown Realty in Kitty Hawk, NC. Working with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt's extensive area knowledge to work for you.
To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive a FREE Foreclosure & Short Sale List
Filed under: Announcements, Community Information, Outer Banks, Corolla, North Carolina, OBX, Currituck County, Government, Outer Banks North Carolina, Biking, Corolla Bike Trail, Walking
No matter when you come to the Outer Banks there always seems to be a breeze blowing. Now Mother Nature is going to work when Duke Energy plans to install 3 test wind towers off the coast of Hatteras next year. The test towers will be monitored to see how effective and what impact they will have on generating "green" electricity. If the test proves to be successful a large scale wind farm will be built approximately 7 miles off the coast of Hatteras in the Pamlico Sound. For years the state had plans to try and harness the wind that continually blows on the Outer Banks. Now with the "green" movement all the rage the timing is right. Many local and state leaders were in Hatteras last week to kick off the campaign and talk to local residents. There are already 2 wind towers on the Outer Banks, one at the Coquina Beach access and at The Outer Banks Brewing Station.
I think the project can be a great asset to the Outer Banks if done properly. Many residents on Hatteras and the Outer Banks lose power during storms. Hopefully these wind towers can provide the power needed to keep the lights on and ultimately help lower our energy bills.
To learn more about the wind tower project go to the Charlotte Observer
About the author of this blog:
Matt Huband is Broker/Owner of Hometown Realty in Kitty Hawk, NC. Working with buyers and sellers from Corolla to Hatteras interested in foreclosures, short sales, 2nd home, investment property, new construction, and condo sales. Put Matt’s extensive area knowledge to work for you. To learn more about Outer Banks real estate go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Sign up to receive FREE Foreclosure & Short Sale List
Filed under: Real Estate, Announcements, Dare County, Hatteras, North Carolina, OBX, 2nd Home, Economy, Energy, Avon, Tropical Storm, Government, Cape Hatteras National Seashore, Outer Banks North Carolina, Matt Huband, wind turbines, Outer Banks wind towers
If you have been following the financial news lately you may have started to hear talk about when the FED is going to raise interest rates. It should be no surprise that sooner or later the FED will have to raise rates since they have been at all time lows for many years. The FED is going to have to be extra careful when the time comes to raise rates. When do they do it?? How much?? When do they stop?? In the next 3 to 6 months I think we will find out the answer to all of those questions. In the meantime it’s time to start thinking about how it's going to impact you, me, everyone.
First and foremost raising rates will hurt anyone currently making payments on revolving lines of credit like credit cards, home equity lines, and any loan based on the prime rate. Those minimum payments are going to go up each time the FED raises rates. Many people are struggling to make ends meet and rely heavily on credit to get by and now is the time to make those extra payments to pay down some of that debt if possible. Another thing to consider might be moving all of the remaining revolving debt to a fixed loan and take advantage of low fixed loan rates. The payments may be more in the short term because you are paying down principal and interest but in the long run may save you if rates increase dramatically. Do your homework to see what options are right for. On a more positive note for everyone who has been getting those ridiculously low interest rates on checking, money market, cd’s and money market accounts will be happy as those rates will rise paying out more interest.
Now let’s talk about what affect all of this will have on mortgage rates. Finally the real estate market is starting on the road to recovery, at least here on the Outer Banks it has, and low mortgage rates have had a big impact on that. When the FED does decide to raise rates mortgages will follow suit as well. As mortgage rates rise it decreases a buyer’s purchasing power substantially.
Example: If a buyer is qualified for a maximum monthly principal & interest payment of $1500 month with 20% down a buyer can purchase a house for $418,750. However when mortgage rates go up 1% the buyer can only purchase a house for $375,000 to still have a P&I payment of $1500 a month.
Purchase price $418,750-$83,750(20% down)=$335,000 Loan amount
Loan amount $335,000 X 5% 30yr Fixed Mortgage=$1500 P&I payment
Purchase price $375,000-$75,000(20% down)=$300,000 Loan amount
Loan amount $300,000 x 6% 30yr Fixed Mortgage=$1500 P&I payment
Just a 1% increase in mortgage rates decreases a buyer’s purchasing power by $43,750!! If you are currently looking to buy or on the sidelines waiting you need to consider what kind of impact rising mortgage rates will have on your ability to buy. Get with your local lender and Realtor to find out what prices are doing in your area(remember real estate is local not national) and ask them to help you figure out how much rising mortgage rates will hurt you. You may realize that now is the time to jump off the fence and get the house you have always wanted.
For more information about the Outer Banks real estate market go to www.HometownOBX.com or email MattHuband@HometownOBX.com
Matt Huband is Broker/Owner of Hometown Realty in Kitty Hawk, NC working with buyers and seller from Corolla to Hatteras.
Filed under: Real Estate, Market Conditions, Finances, Buyer Information, Outer Banks, Corolla, Dare County, Property Values, Hatteras, North Carolina, Buyers, Mortgage, Buyer, OBX, Buying, Mortgage Rates, Federal Reserve, Economy, Housing Market, Interest Rates, Currituck County, Outer Banks North Carolina, Matt Huband
OK, it’s time to breath again after a busy summer season on the Outer Banks.
Now comes what I consider the absolute best time to visit the Outer Banks, Fall!!
As for the Outer Banks real estate market many of you have been waiting and waiting for what you would consider the “right time” to buy. Here on the Outer Banks for the 4th month in a row home sales have reached 100+. This has not occurred in over a year and so far this month we are on pace to make it 5 in a row. Also the percentage of distressed properties sold peaked in Feb. 09 for Short Sales and March ‘09 for Foreclosures Mortgage rates are still hovering around 5% and lenders are anxious to lend money, underwriting standards are easing and old mortgage programs are available again. With prices back to 2003-2004 levels and sellers still willing to negotiate on price ( 6% on avg.), to say it’s a buyer’s market is an understatement. The most glaring statistic that shows the Outer Banks is bottoming out is the average sold price decreased just 1.6% at the end of August compared to July. I anticipate this price stabilization will continue and by next year start to go in the other direction. Due to the unique nature of our market, statistically the Outer Banks has always been ahead of the national real estate market in terms of a decline and recovery. The Outer Banks started to decline almost 2 years ahead of the national market. If the same holds true our recovery is already 8 months underway which means the national market is about a year away from stabilizing. Remember, real estate is local and therefore what you hear on the TV or read about does not accurately reflect what is happening in every location. Every market is different and is recovering at a different pace.
The Outer Banks market is well on the road to recovery!!
For more information about the Outer Banks real estate market contact MattHuband@HometownOBX.com or go to www.HometownOBX.com
Go to Outer Banks Foreclosures & Short Sales to get a FREE foreclosure and short sale list.
Filed under: Real Estate, Market Conditions, For Sale, Buyer Information, Seller Information, Outer Banks, Foreclosures, Dare County, Property Values, North Carolina, Seller's, Bank Owned, Buyers, Seller, Mortgage, Buyer, OBX, 2nd Home, Sellers, Buying, Mortgage Rates, Housing Market, Interest Rates, Currituck County, Short Sale, Outer Banks North Carolina, Matt Huband