When "Reduced" Rehoboth Asking Prices Signal True Bargains
When you are skimming through the Rehoboth Beach listings, now and then you come across attention-grabbing terms like “one of a kind” or “extremely motivated seller.” “Reduced” is another one.
After all, who doesn’t like a bargain? Especially when that bargain is associated with a major commitment, who wouldn’t think it’s worth looking into? Today’s listings may no longer be saturated with short sales, foreclosures, and scores of listings reduced by enormous percentages, but patient Rehoboth Beach house hunters can still strike pay dirt if they are diligent and methodical. Nevertheless, there are some tried-and-true cautions that need to be observed to ensure that the “penny-wise, pound foolish” saying doesn’t wind up describing the result.
Most of what is being written on the subject of real estate bargain hunting falls into the common sense category—for instance
- Low-balling the offer seldom works. The hope that you can create a bargain just by making a shot-in-the-dark low-ball offer is much more likely to result in a resentful homeowner than a successful deal. As in most business transactions, success is more likely to develop when both sides understand the motives and goals of the other. Since any seller whose Rehoboth Beach property is on the market is assuredly quite well aware of the likely value of his offering, unless the seller is in desperate need of a deal, this tactic is counterproductive (and if the seller does really need to move on, odds are the property has already been reduced to reflect that).
- ‘As-Is’ also means ‘Heads-Up!’ A home that’s been “reduced” simply means the market is suggesting that an asking price correction is needed. When “as-is” is appended, it could also indicate that the place probably needs work—maintenance work (and work from potential buyers to discover how costly that maintenance is likely to be). In some cases—when a home has been perfectly maintained—it could mean that some features that are expected in today’s Rehoboth Beach homes are missing. In any case, “as-is” means “heads-up.”
There is one more caution that isn’t usually written about, but which can be easy to overlook when an epic bargain looks to be within reach. Since the process of buying a house takes some time to accomplish, it’s one that often occurs before it’s too late, anyway—namely, it’s not a bargain if it’s not what you really want! It can happen that the asking price is so affordable for a home that has more (or better) features than you thought you could manage, that you are in danger of being charmed into making an offer on something that’s not a very good fit. When you discover a property that’s been reduced to bring it within your price range, it still needs to fit your family’s most important requirements. An Olympic-sized swimming pool can add an exciting and unexpected dimension, but if the place is one bedroom short, in the long run, it might not be such a bargain, after all.
- Written by Russell Stucki
Location, Location, Location! Can Have Differing Meanings
“Location, location, location!” is one of the few proclamations which needs no verb, no adjective, no preposition to fully communicate its message. Everyone in Rehoboth Beachunderstands—and usually agrees with—its meaning: The location [of something] is all-important.
In the commercial context, it used to mean “your store better be situated somewhere that gets a lot of the right kind of traffic.” Today, in the same context, that “traffic” can be clicks on the web rather than auto or foot traffic. Either way, location, location, location! stands for a truism that’s inarguably valid.
What’s interesting about the Rehoboth Beachlocation, location, location! axiom when it’s invoked in a residential real estate context is how true it remains—though for different reasons. When it comes to buying or selling an Rehoboth Beachhome, location isn’t vitally important because of its being visible or easy for prospective buyers to find. This meaning of “location” points to a property being more or less desirable for a variety of reasons:
- Accessibility—offers easy access to Rehoboth Beachplaces of business, recreation points, etc.
- Inaccessibility—provides an oasis of privacy
- Position—offers superior orientation: for instance, receives more (or less) sunshine.
- Geography—takes advantage of superior land features: for instance, is on a hilltop, by a stream, etc.
- Exclusivity—it’s in a respected, physically safe neighborhood, home to successful families
- Community—offers desirable schools, lower tax rates, well-kept parklands and the like. The Brookings Institution finds that living near a high-scoring school can increase a home’s value by $100,000—or more!
Needless to say, another facet of location, location, location! in Rehoboth Beachis how important it can be in dollars and cents. It isn’t just that houses are listed for different prices depending greatly on their neighborhoods and even locations within the same neighborhoods, but the ease of buying and selling can also be location-dependent. The “comps”—estimated values assigned by reports of sales of similar properties—are assembled taking into account how near or far they are, as well as the characteristics of their neighborhoods.
For the most part, people tend to agree on the value of those location, location, location! characteristics—but in case you aren’t one of the crowd, the financial repercussions can be noteworthy. If, for instance, your ideal degree of privacy makes you value a home that’s considered to be too far out of town for most people, the asking price could be at a considerable discount from the same house closer in. If you prefer cool, shady backyards over more open and sunny ones, your offer might be accepted by an eager owner who’s not had many other takers.
- Written by Russell Stucki
Rehoboth Beach Jumbo Mortgage Outlook Continues to Brighten
“The Jumbo Jungle” may sound a little like the elephant compound in a wild animal park, but it’s actually a seldom-quoted tab under The Wall Street Journal’s online Real Estate section. The “jumbos” being discussed are the trunkless kind—the hefty mortgage loans whose center rings are found in binders instead of circus tents.
Judging from the latest discussions Rehoboth Beachhomeowners will find lately, these jumbos aren’t about to become endangered anytime soon. For one thing, 2015 registered the highest activity for the behemoth loans ever. This year’s follow-up, according the WSJ, will be unlikely to slow the pace.
The reason behind the jumbo mortgage market’s strength has a lot to do with the down stock market. Last week ended with another swoon, led by the tech stock sector. Investors were thought to have been worried by some poor earnings performance and a general “realization that the world is slowing.”
According to Inside Mortgage Finance, jumbos accounted for a full fifth of all mortgage lending last year—the highest percentage of the market since 2002. Rehoboth Beachresidents looking to borrow in the high end market may also find a variety of interested lenders as asset investment dollars shift into real estate as “a safer investment.”
It was widely held that the market dip made it more likely to momentarily halt any rise in interest rates. By week’s end, mortgage rate research website HSH.com marked another drop in conforming rates, as well as the “Federal Reserve’s apparently more cautious position with regard to raising interest rates.” That “apparently” was probably well-advised, given industry experts’ recent history of hit-and-miss prognosticating.
Nonetheless, the Jumbo Jungle writers boldly headlined“WHAT’S AHEAD FOR JUMBO-LOAN BORROWERS in 2016.” Their answer was increased likelihood for jumbo loan interest rates holding below 4% “…for a while longer, which also could make borrowing large sums more attractive.” Going further, JJ quoted one mortgage sales manager suggesting that the fear of eventual rate rises could spur a “home buying frenzy” in the spring, adding to a rush of refinancing by adjustable-rate borrowers reaching the end of their fixed-rate terms.
- Written by Russell Stucki
The Question: Is Now a Good Time to Sell a Rehoboth Beach Home?
“Is now a good time to sell?”
A Rehoboth Beach home is never put up for sale on a whim. Although outside events can conspire to control the timing of that kind of major real estate venture, in most cases, the sale or purchase of a home happens on a timetable the Rehoboth Beach buyer or seller thoughtfully works out. That can be when a move will least interfere with everything else that’s going on (school and career schedules are often the ruling considerations). Or, it can be when surrounding conditions seem particularly auspicious.
The answer to the “is now a good time to sell” question looked to be a pretty firm ‘yes’ last fall for a number of reasons. The rebound in Rehoboth Beach home values had been underway for long enough that in many instances, previous high water marks had been equaled. Many who would have expected low appraisals as few years back could now anticipate friendlier results. The volume of sales seemed mainly limited by the number of homes being offered; and if fewer competing properties were available, all the better. In the background, good economic news began to arrive more frequently…
Also, there was one well-publicized additional factor that made it look as if the “good time to sell” might not last much longer. It was widely anticipated that action by the Federal Reserve Board to finally raise the Fed funds rate would rain on the Rehoboth Beach real estate parade, since that would certainly force banks to raise home loan interest rates.
Nationwide, those reasons had the expected result. Per Reuters in last Friday’s New York Times, apparently it had been a very good time to sell. “HOME RESALES RALLIED IN DECEMBER, AND PRICES ROSE AS WELL” was the headline describing last month’s activity. Unseasonably warm weather had helped, but “buyers rushing into the market in anticipation of higher mortgage rates” may have been more of a factor.
Sure enough, the Fed did raise the benchmark Fed funds rate, causing mortgage interest rates to…er…
That’s where the analyses, expectations, predictions, forecasts and conjecture fell to pieces. The banks were supposed to have to raise home loan rates to match, yet by last Friday they had shed another quarter of a percent. As the Times reported, “…rates on 30-year mortgages have dropped below 4%, and many mortgage experts expect them to stay below 4.25% this year.”
As the Rehoboth Beach real estate market prepares for the upcoming spring selling season, that unexpected boost seems to herald a lengthy extension of the extremely favorable borrowing environment. When Rehoboth Beach homeowners ask themselves “is now a good time to sell?”—the answer seems to have gone from a “yes” to “yes, indeed!”
- Written by Russell Stucki