Eugene Oregon Real Estate Blog

Good Monday Morning!

We are in mid Spring and the home buying/selling season is upon us in the Eugene and Springfield areas.  The good news is that there are plenty of new home listings hitting the market right now.  This is welcome news after months of extremely low inventories of homes for buyers to look at.  Along with more homes to look at, home buyers are also enjoying the fact that mortgage interest rates continue to decline.  We may have a window here that is very favorable for home buyers and this will also become an opportunity for home sellers. Right now, just might be the best time this year to purchase or sell a home.  

The following is an article from "Forbes" that gives you information on what has been taking place with home mortgages.  I am not sure as to how long these favorable rates are going to last, but for right now, buyers are able to take advantage of some really good rates.

Mortgage rates are showing signs of moderating this month, following increases in April. Borrowers are discovering much lower rates compared to a year ago.

“A combination of low mortgage rates, a strong job market, and modest wage growth should spur home buyer interest and also serve as an incentive for homeowners looking to refinance this spring,” says Sam Khater, Freddie Mac’s chief economist.

Freddie Mac reports the following national averages with mortgage rates for the week ending May 9:

• 30-year fixed-rate mortgages: averaged 4.10%, with an average 0.5 point, falling from last week’s 4.14% average. Last year at this time, 30-year rates averaged 4.55%.
• 15-year fixed-rate mortgages: averaged 3.57%, with an average 0.4 point, falling from last week’s 3.60% average. A year ago, 15-year rates averaged 4.01%.

5-year hybrid adjustable-rate mortgages: averaged 3.63%, with an average 0.4 point, falling from last week’s 3.68% average. A year ago, 5-year ARMs averaged 3.77%.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

2945 Ava Street  

Price: $325,000    Beds: 3    Baths: 2.0    Sq Ft: 1570

New Construction. This home is sure to impress. Open Living, Dining, & Kitchen. Great for entertaining. Master suite with walk-in closet and master bath. Two additional bedrooms are on opposite side of house. This home includes a Laundry room and a...View this property >> 

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Good Monday Morning!

National Real Estate economists are now changing their thoughts about the 2019 national housing market.  The following is an article that was recently published in "Realtor.com", that gives an updated prediction for the 2019 U.S. housing market.

Despite a real estate slowdown gripping the nation, this year's housing market is expected to be busier than realtor.com® economists originally predicted late last year. That means more home sales—and higher prices—are on the way.

The anticipated uptick in activity is due to lower mortgage rates, which make homes more affordable for buyers. The economic team expected rates to climb to 5.5% in 2019, but instead they have hovered around 4%. (They were 4.17% on 30-year, fixed-rate mortgages as of April 18, according to Freddie Mac data.) Economists say rates are now likely to rise a little to 4.5%, still well below what buyers were dreading.

However, it'll be nothing like the feeding frenzy of recent years.

"It's still going to be a lukewarm year for the housing market," says Chief Economist Danielle Hale of realtor.com. "We're going to see higher prices and slightly higher home sales than we expected. But home sales are still going to decline slightly as a result of the housing slowdown. There's a gap between what sellers are looking for and buyers are hoping to pay."

While a single percentage point difference may not seem that significant, it can add more than $100 to the monthly loan payment on a median-priced home of $300,000. (This assumes buyers put 20% down.) That can translate into tens of thousands of dollars over the life of a 30-year loan.

The downside for buyers—and upside for sellers—is that prices are expected to rise more than Hale's team originally forecast, going up 2.9% in 2019 instead of 2.2%. That's because the swelling ranks of buyers motivated by those lower mortgage rates will increase demand—and therefore prices.

Meanwhile, realtor.com's economists predict the number of home sales will almost hold steady, dipping just 0.3%. They originally believed the number of sales would fall by 2%.

The market has slowed down from previous years because sellers, seeing an end to the good days of high prices, rushed to put their homes on the market. But this happened at the same time that many buyers backed off because of those same high prices. The glut in supply led to lower price growth and fewer home sales.

But as always, local conditions will be the main factor for real estate in your market, Hale says.

"In some markets there’s still not enough housing available, so buyers are likely to find a competitive market," she says. "But in some markets prices are so high that buyers are choosing to be patient and sit on the sidelines."

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

3913 Royal Ave  

Price: $350,000    Beds: 3    Baths: 2.0    Sq Ft: 1572

New Construction that backs up to an expansive Park. Open Living, Dining, & Kitchen. Master bedroom with walk-in closet. Carpet in all bedrooms. Home has vaulted ceilings, granite counters, high end cabinets and wood floors. This home includes an in...View this property >> 

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Good Monday Morning!

If you have a home to sell this year, there is no doubt that right now is the perfect time to put it on the market for sale. Home sale conditions are extremely good in the Eugene and Springfield area and your chances of selling quickly and at top dollar are excellent.  The following is an article from US News that talks about why now is the perfect time to sell your home.

Spring is in the air and homebuyers are coming out of hibernation. With the holidays over and the weather warming up, it’s the time of year that's typically considered a hot period for the housing market.

If you’ve considered selling your home, here's why spring is a great time to move forward with those plans:

• Warmer weather makes buyers active.
• The market is in the right place.
• There are plenty of buyers.
• You can get a head start.

Spring is the undisputed champion of seasons for selling a home. Not only are flowers in bloom and the sky blue for some great marketing photos, but also people are chomping at the bit to start the closing process so they can move in and get settled before fall.

Homebuyers have a tendency to taper off in the winter, and not just in parts of the country that typically have frigid weather. A mixture of holiday obligations and kids in school lead to more homes coming off the market temporarily and buyers pressing pause on checking out new listings.

By the time spring hits, cabin fever has people anxious to start touring homes. Dina Gorrell, a real estate agent for Redfin focused on the northern Virginia area, says the first two weeks of April have been the busiest so far in 2019. "When the blossoms come out, everyone goes nuts for it," she says.

With work, school or family obligations at the end of summer, spring is the optimal time to take on house hunting and get moving on the purchase process. "We can see a clear indication that the market its turning back up," says Dario Cardile, vice president of growth at real estate brokerage Owners.com.

The Market Is in the Right Place

A combination of low interest rates and low single-family housing inventory means there are a lot of eager homebuyers forced to compete for what’s on the market.

After increasing interest rates to 2.5% in December 2018, the Federal Reserve has expressed plans to keep interest rates at the same level through 2021. While rising interest rates previously scared off unsure buyers, Cardile points out that the steady outlook for interest rates since December has encouraged more buyers to resume shopping for homes.

Mortgage News Daily reports the average interest rate for a 30-year, fixed-rate mortgage is 4.34% as of April 16, 2019. The rate is a decrease of 0.16% compared to the year prior, and Mortgage News Daily shows the average mortgage rate has steadily declined since November 2018.

While housing has largely been in a seller's market over the last few years – meaning the seller has an upper hand since there are more buyers than homes available – the natural real estate cycle of indicates that's easing. Depending on where you live, there may be more new houses under construction to help ease demand or fewer active buyers.

Still, a softer market doesn't mean you won't be able to sell your house or that it's worth less. The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which measures price increases in single-family homes across the U.S., found home prices increased by 4.26% from January 2018 to January 2019 – and they have been steadily climbing since February 2012.

There Are Plenty of Buyers

Just a few years ago, millennials were brand-new to homebuying, but they've since become a staple demographic of the real estate market. With them, the real estate industry has evolved to better utilize technology and data to help home shoppers search for available homes. Now when a real estate agent lists a house on the local multiple listing service, it also gets picked up by consumer-facing portals like Zillow, realtor.com and Redfin to reach homebuyers directly.

Of course, this doesn't exclusively benefit millennial buyers. The National Association of Realtors’ 2018 Profile of Home Buyers and Sellers reports that first-time homebuyers made up 33% of the total share of homebuyers last year, with a median age of 32. The median age for all homebuyers, however, was 47, indicating that new home purchases certainly aren't limited to first-time buyers or millennials.

Additionally, the move-in ready expectation that accompanied the rise of the millennial homebuyer is now widely embraced. To make your home as marketable as possible to all potential buyers, you should update key rooms like the kitchen and master bathroom, which are known to get a lot of attention from homebuyers. Consider replacing major appliances or systems that have reached the end of their life, such as the water heater or roof, since being able to say they're brand-new can add value to the house. Selling your home "as-is" promises quite a bit more work than a first-time buyer is willing to take on.

You Can Get a Head Start

There’s still time to get your home on the market this spring to take advantage of the growing number of interested buyers, but successfully reaching potential buyers requires a bit more work than just an online listing, and it’s best to get started sooner rather than later. Gorrell recommends reaching out to an agent at least a few weeks before you'd like to put the house on the market to know what you need to do early on, so you can avoid a time crunch.

“It's smart to have a Realtor come and look through the house room by room and make suggestions,” Gorrell says.

Selling your home also likely means you'll be buying a new one, and the earlier you start on one the sooner you can make moves on the other. Cardile encourages home sellers to be active in the homebuying process at the same time. Especially if you need to be moved in before the end of summer, it's best to tour houses and have a head start on house hunting, even if you don't want to make an offer until your own home is under contract.

Here are four tips for taking advantage of the springtime homebuying surge:

• Prep your home. It’s a year-round rule that you should be putting your home’s best face forward, from planting flowers along the walkway to updating appliances in the kitchen or bathroom. While an interested buyer may be competitive about bidding on a home, he or she will also be well-informed, and prepping your home is imperative to getting the highest possible return on your investment. Staging is also a key component, Cardile says: "If you stage correctly, you have the right light, the right environment ... you showcase the house at its best."
• Price it right the first time. If your home is priced too high, it’s much harder to bring back the homebuyers who moved on to other listings because the asking price was out of their range. Redfin reports that as of mid-February, more than 1 in 5 homes for sale on the site have undergone a price drop, an increase of about 3.5% of homes seeing price drops around the same time 2018.
• Aim for a Thursday. A separate Redfin study reveals homes listed on a Thursday are more likely to sell above list price and find a buyer faster than homes put on the market any other day of the week. "Thursdays are perfect because it gives people a chance to look at what's coming and make their plans for the weekend," Gorrell says.

Stay competitive. Even in a seller’s market, there’s no guarantee your home will be scooped up quickly – or even scooped up at all. It’s important to pay attention to homes going on the market in your area and to emphasize the particular strengths of your home. And while many markets are heating up or hot already, it’s important to keep in mind that a jump in home values in one area doesn’t promise high home values anywhere else.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

3913 Royal Ave  

Price: $350,000    Beds: 3    Baths: 2.0    Sq Ft: 1572

New Construction that backs up to an expansive Park. Open Living, Dining, & Kitchen. Master bedroom with walk-in closet. Carpet in all bedrooms. Home has vaulted ceilings, granite counters, high end cabinets and wood floors. This home includes an in...View this property >> 

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Good Monday Morning!

Talk of a potential slowdown in the U.S. economy is currenty having little effect on the national housing market.  Any current slowdown in housing right now is most likely going to be fueled more by inflation with home prices.  The unknow is, how much inflation will influence the potential for a recession.  Here is an article from "Realtor.com" that talks about recession risks and the national housing market.

While the U.S. economy has been chugging upward for the last seven years, the good times could be coming to an end. But that isn't deterring determined home shoppers from trying to close on a home.

Whether it's sooner or later, most home buyers, according to a recent realtor.com® survey, believe a recession is on the way (much like winter on "Game of Thrones"). About 70% of home shoppers believe the United States will enter a recession within the next three years.

More than 1,000 active home buyers participated in the survey.

"There may be concern among some consumers, but economists and analysts generally expect that the next recession will be more mild than the [Great Recession], particularly in the housing market," says Danielle Hale, realtor.com's chief economist.

However, these gray clouds on the horizon could have a silver lining. If a downturn hits, about 41% of shoppers expect the housing market will fare better than it did in the Great Recession of a decade ago. Another 36% of respondents believe it's going to be worse, while 23% think it'll be just as bad.

Yet other life factors are simply closer to home.

Another recession isn't going to stop information technology specialist Richard Fame, 51, of Eastpointe, MI, from selling his home to buy a new one.

"It is inevitable," Fame adds, of his family's facing the possibility of an economic downturn. "If I make money on my current house, that's great, but I know I'm going to need to move."

In his family's case, moving to a better school district outweighs fears of a housing crash.

"Our next house will be for the long term," explains Fame.

Low mortgage interest rates could help to buoy the housing market as well. Rates fell to just 4.06% this week on 30-year fixed-rate loans, according to Freddie Mac. This could spur more buyers to close before rates go back up again.

The housing slowdown, which began over the summer as prices in many markets reached unheard-of highs and more sellers rushed to list their homes to cash in, could also lure buyers to seal the deal. It's resulted in more inventory and given home shoppers more options. And while home prices aren't coming down in most of the country, they are seeing a slower rate of appreciation.

Why a recession could be heading our way 

There are a number of factors that suggest a downturn could be looming—but that doesn't mean folks should panic just yet. Despite high home prices, it doesn't appear that there's a housing bubble about to burst due to bad mortgages and an over-inflated market. Instead, a U.S. trade war with China could spur one; or a disastrous Brexit. Or it could just be that after some really good years, the good times eventually have to end.

"Workers are scarce, with the unemployment rate near record lows, and that's pushing up wages," says Hale. "Employers have to pay to attract workers, which could eventually translate into higher prices and cause consumption to slow."

That can cause inflation, a problem that can snowball if it increases at a higher pace than wages. The U.S. Federal Reserve typically tries to keep inflation in check by raising interest rates. This, in turn, makes it costlier for companies to borrow money to open up new operations, invest in new equipment, or hire new employees. And that can slow down the economy.

"I don't think the next recession will be as severe for the housing market as the last one," says Hale. "This one isn't likely to be as bad."

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

5241 Sugarpine Cir  

Price: $265,000    Beds: 2    Baths: 2.0    Sq Ft: 1188

Charming home thats been well maintained. Covered front entry with 2 car garage. Open kitchen & dining combo, tile floors, white cabinets, laundry room, and walk-in pantry. Open living room with pellet stove. Fenced & private back yard with patio and...View this property >> 

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Good Monday Morning!

I am seeing a trend in our local housing market that is not good.  The overall market remains strong, but the inventory of homes remains low and dropped from that of March.  In February we had an inventory of 2.2 months and this declined in March to 1.8 months.  At the same time, we had an increase in the cost of homes in our area.  There are fewer homes on the market and those homes that are for sale are continuing to be more expensive.  The primary issue here is that there really are not many homes available for the first time buyer in our area.  First time buyers purchasing homes are what keeps a housing market healthy.  Our market in Eugene and Springfield in my mind is anything but healthy at this point.  It has been a great market for sellers and a horrible market for buyers for some time now.  Now with housing prices soaring, the market is becomeing tougher for sellers, even though the inventory is lower.  This is due to affordability.  This cannot sustain itself and I am predicting that at some point this year, we will see this market shift dramatically. Time will tell.  Here are the numbers for Lane County home sales during March of 2019.

March Residential Highlights

Lane County saw an uptick in seasonal activity this March, but had cooler activity than in 2018. There were 453 pending sales, ending 7.4%under the 489 offers accepted last year in March 2018 but 47.1% aheadof the 308 offers accepted last monthin February 2019.

New listings, at 444, slipped 16.4%from March 2018 (531) but ended 35.0% ahead of the 329 new listings offered last month in February 2019.

Closed sales (314) fared similarly, showing a 22.3% decrease from March 2018 (404) and a 9.0% increase compared with February 2019 when 288 closings were recorded.

Inventory decreased to 1.8 months in March, with total market time decreasing to 60 days.

Average and Median Sale Prices

Comparing the average price of homes ending March 31st of this year ($311,900) with the average price of homes sold in the twelve months ending March 2018 ($292,800) shows an increase of 6.5%. The same comparison of the median shows an increase of 7.5% over the same period.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

2945 Ava Street  

Price: $337,000    Beds: 3    Baths: 2.0    Sq Ft: 1570

New Construction. this home is sure to impress. Open Living, Dining, & Kitchen. Great for entertaining. Master suite with walk-in closet and master bath. Two additional bedrooms are on opposite side of house. This home includes a Laundry room and a...View this property >> 

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Good Monday Morning!

Nationally, homes sales were up slightly during the month of March of 2019. At the same time, home prices increased slightly as mortgage interest rates dipped.  This slight increase in both sales and home prices is good news for what is now appearing to be a steady Real Estate market for most of the country in 2019.  If mortgage interest rates hold or even decline further, this will certainly help maintain an active market. The key is to keep home prices from escalating at any kind of fast pace.  Home price increases would potentially negate the decrease in mortgage interest rates.

With a market that appears to be stable and home prices remaining high, this is a very good time to think about selling your home.  This is especailly true in the Eugene and Springfield area where demand for homes remains very high and inventories remain low.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

3329 Coburg Road  

Price: $455,000    Beds: 3    Baths: 2.5    Sq Ft: 1771

New Construction. Acacia engineered hardwood in entry. Office, living room, kitchen, and family room. Bathrooms and utility room have tile flooring. Home has stained hickory cabinets & quartz countertops throughout. Master suite with tile bathroom...View this property >> 

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Good Monday Morning!

Both the national and local housing markets are very interesting to watch right now.  Mortgage interest rates have just recently taken a large drop and are now hovering at just over 4%.  Mortgage rates are predicted to stay low and we may even see a further decline in rates ahead.  Typically, a decrease in mortage rates is followed by an increase in home sales activity.  This could take place, but nationally we saw a significant decrease in the number of home sales in Febraury. Home sales have been trending downwards and the mortgage interest rate decline could slow or even put a stop to the home sale trend.  Locally, home sales have slowed and the housing market in the Eugene and Springfield area feels to be very fragile. One of the largest concerns for our local market is the continued lack of home supply.  The number of active homes for sale remains extremely low and this situation does not seem to be easing.  The lack of inventory over the past several years has fueled home prices and now home affordability has become a huge factor in our local market.  Could we actually see a market with very low inventory and low demand as well.  This is quite possible and the next several months will certainly tell the story.

My advice to anyone thinking about selling a home in the Eugene and Springfield area in 2019 is to get your home on the market right now.  By waiting until late Spring or even Summer to sell your home, you are gambling with what price your home might sell for.  Right now the inventory of homes for sale in most local areas remains extremely low, especially in the $350,000 range and below.  Buyer demand in most price ranges other than the upper tier ranges remains good.  This however could change as we move through the year.  Right now just may be your best opportunity to sell at higher price

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

2945 Ava Street  

Price: $350,000    Beds: 3    Baths: 2.0    Sq Ft: 1570 

New Construction. this home is sure to impress. Open Living, Dining, & Kitchen. Great for entertaining. Master suite with walk-in closet and master bath. Two additional bedrooms are on opposite side of house. This home includes a Laundry room and a...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

If you are considering the purchase of a home soon and you have been waiting for mortgage interest rates to drop, this could be your time to act.  Mortgage interest rates are down across the board and they may stay down for several months.  If you have been waiting for a window to buy, this is it. Lower rates mean lower payments and also can increase purchase power.  With Spring coming and more homes due to hit the market, the next couple of months could be the best time to purchase a home this year.  The following article is from "Realtor.com" and it talks about the current mortgage loan market.

Rates for home loans fell, with no bottom in sight as investors increasingly brace for slowing economic growth.

The 30-year fixed-rate mortgage averaged 4.28% in the March 21 week, mortgage guarantor Freddie Mac said Thursday. That was down 3 basis points during the week and a 13-month low for the popular product, which has managed a weekly gain only twice during 2019.

The 15-year adjustable-rate mortgage averaged 3.71%, down from 3.76%. The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.84%, unchanged during the week.

Fixed-rate mortgages follow the benchmark U.S. 10-year Treasury note, although they move with a bit of a lag. Investors have been piling into bonds over the past week, betting on a more dovish stance from the Federal Reserve.

That turned out to be the right call. After the release of the central bank’s statements, bond prices jumped, pushing yields down sharply. Freddie’s weekly mortgage survey captures activity through Tuesday, so the big bond market moves of this week will likely be reflected in mortgage rates next week.

This may be the sweet spot for borrowers. Lower rates are obviously a boon for the housing market, which has struggled in the face of a supply crunch, rising prices, and outsize demand. But the economy hasn’t slowed enough that people are losing their jobs. Americas are still showing signs that they want to try to become homeowners. Mortgage applications rose 1.6% over the past week as rates drifted down, the Mortgage Bankers Association said Wednesday.

But few of the other obstacles have been resolved. The average mortgage application size hit a fresh high for the third week in a row as the supply of entry-level homes dwindled, the MBA said. The upcoming spring selling season will be watched very closely for clues about how the market is doing.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

2230 Comstock Ave  

Price: $575,000    Beds: 4    Baths: 4.5    Sq Ft: 2904 

Builder's home with only one owner. Quiet park-like backyard. Master with his/hers sinks, jetted tub, large dual head shower, private camode, walk-in closet, two sided/see-through fireplace. Upstairs hall closet laundry plus a full laundry room area...View this property >> 

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Good Monday Morning!

The Eugene, Springfield area and the entire State of Oregon is heading in direction that is very dangerous for homeowners.  The Oregon legislature has recently passed legislation that has put some strict rent control measures into effect.  Over time, this alone will create increases in rent rates.  But, the most dangerous legislation is now being talked about by the Oregon legislature.  Our representatives are discussing massive property tax increases and at the same time looking at removing some of the property tax safe guards that have aided in keeping property taxes under control in the past.  This is a dangerous road for Oregon to go down, because rental rates are already extremely high in many areas, including the Eugene/Springfield area.  Any property tax increases are going to be passed right on to the renters and this will lead to rents that spiral out of control over time.  It will also lead to fewer investors who are willing to build, purchase or retain rental properties.  Property tax increases put a squeeze on the rental inventory as well and again this leads to higher rental rates.  How does this effect the housing market?  We already have a housing crisis in the Eugene/Springfield area, where home prices have risen sharply over time and now there are few homes available that are in the price range suitable for first time homebuyers.  This has been caused by an enormous increase in land prices due to the County and City governements refusal to expand urban growth boundaries, higher labor costs, increased building material costs and already high property taxes.  Now you increase property taxes by and estimated 20% to 30% or more and you have just wiped out the potential for most first time buyers to ever purchase a homein our area.  At the same time as the home prices have increased, so have rents.  This creates a situation where would be first time home buyers are paying so much for rent that it is almost impossible for them to save enough money for a down payment and closing costs for a home.  The first time home buyer market also fuels the rest of the housing market.  This situation will have enourmous effects on our overall local housing market.

Is this what we want for Oregon and the Eugene/Springfield area?  It is dangerous road to be on and it is one that once you go down it, there is little chance of turning back.  It can lead to long term depression for our area and even worse it can lead to a situation to where young people and young familes can't afford to live in our community.  It also puts extreme pressure on retired people and those with fixed incomes.  If you are interested in stopping this potentially harmful legislation, then I suggest that you contact your state representative and voice your opinion right away.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

24542 Bolton Hill  

Price: $949,000    Beds: 4    Baths: 3/1    Sq Ft: 3700 

Stunning estate w/ amazing valley view! Enjoy beautiful sunsets & sunrises over Fern Ridge Lake & Three Sisters mountains from a serene & private hillside. Oak & hickory hardwoods, marble & porcelain tile. Master suite. Bonus rm w/ balcony, office & wet bar. Outdoor fireplace/pizza oven, patios, 5-car attached garage, covered RV parking, 6-car shop. Merchantable timber...View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!

Good Monday Morning!

There are many mortgage loan option available today and choosing the one that is best for you is important.  One of the key things that you must consider if you are in the market to purchase a home and in need of a mortgage loan, is how much money do I need to have for my down payment and how much money should I put down.  Here is an article form "Realty Times" that give you some great information on down payments.

You'd be a homeowner right now if it weren't for one thing: the down payment. Right? Even for those who have decent credit and make good money, the down payment is often the great homeownership killer.

For many others, who do have enough money set aside to make a substantial down payment, the question is: how much? Conventional wisdom—not to mention most of the banks and a good portion of homebuying and financial experts—will tell you that 20 percent is the standard bearer when it comes to down payments. But is it really necessary to put 20 percent down?

The short answer is: no.

Now for the long answer.

"Raising a 20 percent down payment isn't an easy thing to do. Fortunately, you don't have to. "It's a myth that all homebuyers must have a 20 percent down payment to buy a home," says Nancy Herrera-Siples, a Riverside, Calif., branch manager at Primary Residential Mortgage on U.S. News. "So why do you constantly hear that you need to put 20 percent down? Because if you don't, it usually means you'll have to shell out money for either private mortgage insurance or government insurance, which is usually financed by the Federal Housing Administration (FHA)."

And there's another rub for those who are already struggling to come up with the minimum down payment: that extra couple of hundred dollars per month feels like a penalty. It's not, of course—"Mortgage insurance protects the lender in case you can't make your payments and the house is foreclosed on," said U.S. News—but that money can make a significant difference for those who are stretching to buy a home.

Still, when your only option to buy is a low down payment, which can mean an FHA loan or one of the new low down payment loans from Freddie Mac and Fannie Mae—"At the end of 2014, the two government-backed companies announced plans to slash down payments from 5% to 3%," said CNN—PMI might literally be a small price to pay. Especially if swelling rents are making homeownership look more and more promising. Remember that PMI does go away eventually when your loan balance is 80 percent or less of the home's value. If you're in an area where homes are rising in value, this could happen sooner than you think.

Still confused about the ins and outs of down payments? Here are a few reasons to go high…or low.

When to make a substantial down payment

• When you're looking to keep your monthly payment as low as possible and have cash to spare
• When you just can't fathom paying PMI
• When your goal is to buy a forever home and own it free and clear
• When you are approaching retirement age and can envision a reverse mortgage sometime down the line
• When you want to buy your house and pay it off as quickly as possible
• When the rate is lower with a higher down payment. "The more you put down, the better position you are in for negotiating a lower interest rate with your lender," said Credit.com. Plus, a "low down payment might affect other loan features, such as…the points, which are upfront interest charges," said Banking My Way.
• If you're worried about being under water. If the market should drop in your area, you run the risk of owing more than your home is worth

When to go low

• When you don't have the funds for a higher down payment and can't earn or borrow them quickly enough
• When the rate on your FHA or Fannie or Freddie loan is comparable to that you'd get with a higher down payment
• When you need to escape a high-rent situation and the monthly payment on a house is lower than what you're currently paying, even with the PMI factored in
• When you're confident your home will appreciate quickly, allowing you to refinance and get rid of PMI quickly
• When your investments can't be touched without a penalty or are returning better than the interest rate you'll get on your home
• If you have something better to do with the money. "If you bought a $400,000 home, 5% down would be $20,000, while 20% down would be $80,000—a whopping difference. An immediate need such as a college tuition payment would make the smaller down payment more appealing," said Banking My Way.
• When you feel more secure setting money aside for emergencies instead of tying it all up in your house.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

2230 Comstock Ave 

Price: $575,000    Beds:4     Baths: 3.5    Sq Ft: 2904

Quiet park-like backyard. Master with his/hers sinks, jetted tub, large dual head shower, private camode, walk-in closet, two sided/see-through fireplace. Upstairs hall closet laundry plus a full laundry room area. Guest bedroom with murphy bed set in beautiful cabinetry can double as bonus area... View this property >> 

AND HERE'S YOUR MONDAY MORNING COFFEE!!