A Lower Payment is Your Choice

94% of purchasers last year opted for a fixed-rate mortgage at some of the lowest rates in home buying history.  Yet, some of them will pay more in interest than necessary based on the time they’ll own the home.

If a person only plans to be in the home a few years, the adjustable-rate can offer significant savings.
Not only is the interest rate on the adjustable-rate lower than the fixed in the initial period, amortization on a lower interest rate amortizes faster than a higher interest rate.

In the example shown below, a $200,000 mortgage for 30 years is compared using a 4.25% fixed-rate to a 3.25% 5/1 FHA adjustable rate.  The first five years of the ARM generates a $113.47 a month savings which accumulates to $6,808.20.  In addition, due to faster amortization on lower interest rate loans, the unpaid balance at the end of five years will be $3,001 lower on the ARM for a total savings of $9,801.

Assuming the adjustable-rate mortgage was to escalate the maximum allowed at each period, the breakeven would occur in 8 years and 6 months. If a person were to sell the home prior to this point, the ARM would provide a lower cost of housing for the homeowner.

For some people, the uncertainty of how the interest rate may change is not acceptable.  On the other hand, for the risk tolerant individual who may be more confident in financial matters or who may know when they’ll be moving next, the ARM can be a smart choice.

To make projections using your individual numbers, see the Adjustable Rate Comparison.

While you can do some basic calculations to help you decide it is always best to talk with an experienced loan officer to review actual rates and mortgage options since not all variable rate mortgages work the same way. If you would like a recommendation for a loan officer/mortgage representative who can help you purchase a home in Wayland, Sudbury, Concord or any of the towns west of Boston, contact me anytime. There are lots of online mortgage options, however, working with a lender who knows the local market can make the process go a lot more smoothly for you.

Homes for Sale

Wayland Real Estate Report - Prices Up in 2013; Current Shortage of Houses for Sale!

2013 was a very positive year for home sellers in Wayland!

The median single-family house sale price was $612,000, approximately 13% higher than the 2012 median.

There were 80 closed sales; slighter fewer than in 2012. And it took less time sell a house.Click here for details.

Currently there are only 20 single-family houses for sale in Wayland. Last year there were 33. List prices range from $374,900 to $9,300,000. The median list price, $997,000 is higher than last year at this time when it was $939,000. The average list price is $1,668,845, also higher than last year.

"The early bird catches the worm"! If you want to sell your house, this is a great time to put it on the market. Buyers are waiting for listings so why wait for the competition?

Home-buyers, be prepared to move forward if you find a house that fits your needs. While can be difficult to make a decision if you have only seen one or two houses, if you wait you run the risk of not finding another house within your budget. As the spring market progresses, you will have more competition and limited supply will cause prices to go up. Additionally, there is a lot of discussion about mortgage interest rates going up too, further decreasing you purchasing power. Click here to contact an experience buyer agent/broker to help you set up a "game-plan" to put you in a winning position.

Sellers, it's easy to have unrealistic expectations in a "sellers' market". However, correct pricing is still the key to getting your property sold. As good a the market was in Wayland in 2013, there were 146 price changes on 89 single-family properties; the average price change was -7.51%. And, there were 40 "expired" listings; these are houses that did not sell during the listing contract period.
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Visit www.marilynmessenger.com for the latest market information for Wayland, Sudbury, Maynard, Stow, and Concord MA. 



 

It Can't Hurt to Wait, Can It?

It’s been said that more money has been lost due to indecision than was ever lost because of a bad decision. Regardless of whether you agree with the statement, delaying the decision to buy in today’s market is going to cost the buyer more. 

Home prices have gone up considerably in almost every market in the country in the past year and while inventories are beginning to grow, prices are expected to continue to rise. Mortgage rates jumped 1% from the beginning of May to now. They could easily reach 5% by the end of the year and continue to rise in 2014.

Many of the financial experts in the country believe that the economy will not be strong until rates are in the 7% area.
The two components that move the cost of housing are price and mortgage rates. Escalation of either one will have an affect but when both are going up simultaneously, it is dramatic. It can literally eliminate buyers who could have purchased earlier.

The following example shows what would happen to the payments on a $200,000 home if the price were to go up 3% at the same time that the mortgage rates went up 1%. Not only would the payments go up by $150.81 per month, the price of the home would be $6,000 more. Even though the down payment may not change much, the new owner would have to borrow more money. By not acting, it is costing them more in price and payment. The loss of the appreciation would have been equity had they purchased prior to the rise in price.

















A lot of people who would like to sell their house and buy another are also waiting because they want to sell for more money. Waiting will also cost move-up buyers and people who are down-sizing for the same reason: the home you are buying will cost more and you will also pay a higher interest rate.

Check out the Cost of Waiting to Buy to see what the effect will be using your own projections.

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Visit www.marilynmessenger.com to search for homes and get the latest real estate market reports for Wayland, Sudbury, Concord, Maynard, and Stow.

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When Rates Go Up

Rising interest rates are great if you are renewing a certificate of deposit but not so much when you’re borrowing money. With interest rates on the rise as well as home prices, housing affordability is a concern for would-be homeowners.

A rough rule of thumb is that a person’s or family’s housing should not exceed 28% of their monthly gross income. While rental rates and home prices have been consistently increasing, mortgage rates have been soaring in the past month. In one week, according to the Freddie Mac Primary Mortgage Market Survey, they jumped by .5%.

This means that people have to pay a larger percentage of their income for housing unless their incomes have been increasing at an equal pace.  A $200,000 mortgage would be over $100 more per month if closed in July compared to closing at the interest rates available in January of 2013.

If rates increase by .5% by the time you close on the same size mortgage, payments would increase by almost $60 per month. In order to keep the payments the same, a borrower would have to put an additional $11,000 down to lower the mortgage amount.



Check out how your payment would be affected if interest rates continue to rise.
The National Association of REALTORS® suggests that housing is more affordable now than one year ago. However, with all of the variables in play including inflation that was not addressed in this piece, it is unclear how long conditions will remain “affordable”.

Visit www.marilynmessenger.com for easy home searches - no sign up required or call 508-596-3501 to find out about recent price reduction in Wayland, Sudbury, Maynard, Concord and the towns west of Boston. There is still time to be in for school, so don't wait!
 
 

Sudbury (MA) Real Estate - Happy Buyers & Sellers in May!

Lots of happy home buyers in Sudbury this month! Whether it was low interest rates, lower prices, pent-up demand from lack of inventory, or people realizing that there may never be a better time to buy, people who want to live in Sudbury stepped up and decided to make offers that sellers were willing to accept. After a challenging winter, homeowners who wanted to sell were finally able to put their houses on the market and inventory levels are close to what they were last year at this time; of the 151 homes currently listed for sale, 40 came on the market during May. Thirty-one of the 151 properties have accepted offers and are being shown for back-up waiting for contingencies to clear. There are also 22 sales pending.


List prices for active/unsold listings range from $174,900 to $2,795,000. The median list price is 799,450 and the average is $915,477. The median list price at this time last year was $869,000 and the average was $1,013,727. There have been 34 price adjustments on 31 properties so far in May.

So far, there have been 12 closed sales in May and 2 more are anticipated to close by month’s end bringing the total number of closed sales to 14 compared to eight last May. The median sale price for the 12 that have closed in May is 645,000; the average is $716,433; will see how much that last 2 sales affect these prices. There were 8 closed sales during May of 2010; the median sale price was$695,500; the average was $798,500.

Check out http://www.marilynmessenger.com/ to find what’s available in Sudbury; get daily MLS updates; and the latest news and information about real estate market conditions in Sudbury, Wayland, Weston, Maynard and Stow MA. Seach for homes on Facebook at www.facebook.com/livingwestofBoston.

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How's the Wayland Real Estate Market?

List prices for single family homes in Wayland range from $179,000 to $24,500,000. The median price is $749,900; the average is $1,288,770 – both higher than last year at this time. Although 22 homes came on the market in March and 26 more so far in April, the number for single-family homes available remains low in Wayland with only 87 for sale compared with 104 one year ago. Of the 87, 14 already have accepted offers and are being shown until contingencies clear. The average time on the market is 171 days, a few days lower than last year. Additionally, there are 20 properties with sales pending.


Lower supply is generally good for sellers as there is less competition. However many buyers are still influenced by the national news and continue to believe that if they wait they will find a better house for a lower price and are not taking today’s low interest rates into consideration. When interest rates go up, and eventually they will, a lower sale price could end up costing more on a monthly basis. Also, houses in Wayland are so different from one another even when they are in the same neighborhood, the pros and cons of each property stands must be analyzed individually.

As in most places, first quarter sales for single family homes were down in Wayland; there were 15 compared with 19 for the same period in 2010. The median sale price was $480,000 and the average sale price was $525,000; both up but not significantly from last year. There were 6 closed sales during March, exactly the same number as in March 2010, however 2011 median and average sale prices were lower than last year. The median sale price was $466,000 and the average was $506,000.

Of course, the actual buying decisions for first quarter were made in the previous months during a most challenging winter which may be why condominium sales were up during first quarter. There were 10 closed sales compared with just 3 for the same period in 2010. At $539,900, the median price was also up substantially from $405,000 in 2010. Currently, there are 26 condominiums and luxury townhouses for sale in Wayland, Prices range from $249,000 to $985,000. The average time on the market is 126 days compared with 224 days last year.

Visit http://www.marilynmessenger.com/ to search complete MLS listings with addresses and maps; news and information and market reports for Sudbury, Stow, Maynard, and Weston MA. Facebook users, you can search without leaving FB at www.facebook.com/livingwestofboston and let us know what you think about Wayland.

Data source: MLSPIN (Multiple Listing Service Property Information Network.

Stow MA Real Estate - Prices Edge Up As Inventory Declines

There are currently 33 single family homes for sale in Stow MA. Four of the 33 already have accepted offers waiting for contingencies to clear. Last year at this time there were 39 listings. Both median and average list prices are up from last year at this time. The median is $599,900 compared with $498,900 last year; the average is $544,758 compared with $539,955.


List prices for single-family homes in Stow range from $157,500 to $1,095,000; 3 bedroom homes start at $208,026; 4 bedroom homes start at $399,000; and new homes with 1,900 square feet start at $539,900.

Currently, there are two homes with sales pending. Year to date (through 11/30), there have been 50 closed sales; the median sale price was $470,000; the average was $494,666. There were 5 closed sales during November 2009; exactly the same number of sales during November 2008. The median sale price was $572,000; the average was $565,000; both higher than the previous November median price of $555,000; and average $530,000.

Low interest rates are good for buyers, however, fewer choices give sellers a bit of an edge and will eventually put upward pressure on price. For now, I would say were still a ways from being a balanced market since most buyers look at more than one town and are likely to find areas where there are more homes available. In any case, don't believe the headlines - all real estate is local and especially in Massachusetts conditions can vary greatly from town to town, and often it's right down to the particular price range.

To find out about available homes in Stow MA, visit www.marilynmessenger.com where you'll find complete MLS listings with addresses and maps, along with local market information and news.



Source: MLSPIN