Bridgeville real estate trends don’t always trace patterns that are precisely identical to those in the rest of the state or nation, but sooner or later the local market almost always responds similarly. That’s because there is a certain amount of momentum—positive or negative—that is automatically spawned by the good or bad real estate market news reported in the mass media.

So when last week’s Commerce Department report on new residential home sales was released, Bridgeville real estate watchers had reason to smile. Delightedly.

It wasn’t just that the bottom line number for February’s new home sales was substantial (estimated at 539,000, seasonally adjusted annual rate); it was how all the other stats supported them. Forbes headlined that February’s numbers hit a 7-year high. The financial web site Calculated Risk observed that although the report contained only two months’ worth of this year’s data, “Sales in 2015 are off to a solid start.”

In fact, just about all the accompanying details were heartening. The monthly new home sales are always revised several times as final real estate figures become available, and this time ‘round, January’s already-strong numbers were revised further upward. And the Census Bureau also tracks not seasonally adjusted sales (NSAs)—and so far this year they are up a full 19% above the same beginning months 2014. For February alone, sales were up 24.8% year-over-year.

So, does that mean we should assume Bridgeville’s real estate sales are certain to jump by a full 24%, too? That would be terrific—but let’s not get carried away. For one thing, the new home sales statistics are a lot more volatile that real estate sales as a whole (new homes comprise less than 20% of the overall market). And the technical way the Commerce Department samples makes it prone to error. They put the margin of error at 15%, which makes for a lot of wiggle room.

Yet the sheer size of the sales increase makes it pretty unlikely that the trend won’t be borne out. Per Forbes, this report’s results are “viewed by economists as a measure of economic momentum and an indicator of future consumer purchases…” Those purchases are in furniture and appliances which traditionally accompany strong home sales.

Forbes’ “solid start” is exactly what we would hope for—especially since it tracks activity that was taking place even before the spring selling season got underway. It’s getting started in earnest right now, so if you are interested in establishing your own Bridgeville real estate trend, this is the right time to give me a call!

Delmar real estate trends don’t always trace patterns that are precisely identical to those in the rest of the state or nation, but sooner or later the local market almost always responds similarly. That’s because there is a certain amount of momentum—positive or negative—that is automatically spawned by the good or bad real estate market news reported in the mass media.

So when last week’s Commerce Department report on new residential home sales was released, Delmar real estate watchers had reason to smile. Delightedly.

It wasn’t just that the bottom line number for February’s new home sales was substantial (estimated at 539,000, seasonally adjusted annual rate); it was how all the other stats supported them. Forbes headlined that February’s numbers hit a 7-year high. The financial web site Calculated Risk observed that although the report contained only two months’ worth of this year’s data, “Sales in 2015 are off to a solid start.”

In fact, just about all the accompanying details were heartening. The monthly new home sales are always revised several times as final real estate figures become available, and this time ‘round, January’s already-strong numbers were revised further upward. And the Census Bureau also tracks not seasonally adjusted sales (NSAs)—and so far this year they are up a full 19% above the same beginning months 2014. For February alone, sales were up 24.8% year-over-year.

So, does that mean we should assume Delmar’s real estate sales are certain to jump by a full 24%, too? That would be terrific—but let’s not get carried away. For one thing, the new home sales statistics are a lot more volatile that real estate sales as a whole (new homes comprise less than 20% of the overall market). And the technical way the Commerce Department samples makes it prone to error. They put the margin of error at 15%, which makes for a lot of wiggle room.

Yet the sheer size of the sales increase makes it pretty unlikely that the trend won’t be borne out. Per Forbes, this report’s results are “viewed by economists as a measure of economic momentum and an indicator of future consumer purchases…” Those purchases are in furniture and appliances which traditionally accompany strong home sales.

Forbes’ “solid start” is exactly what we would hope for—especially since it tracks activity that was taking place even before the spring selling season got underway. It’s getting started in earnest right now, so if you are interested in establishing your own Delmar real estate trend, this is the right time to give me a call!

When you own the Bridgeville home your family lives in, you are by definition a real estate investor: it comes with the turf. Your investment is essentially a passive one. Until the day you decide to sell and move on, any improvement in its value is secondary to how well it serves to shelter your family.

How you think about your investment—and how you proceed to manage it—is altogether different when you buy a home purely as a financial venture. For one thing, you face an immediate strategic decision: will you be flipping for a quick short-term profit, or aim for the long term through a buy-and-hold strategy? You have to weigh some pros and cons in order to make the right decision.

Flipping

Pro: Capital is Freed

A flipping strategy minimizes the amount of time your investment capital is committed, freeing it for other uses. Should you identify another potentially lucrative investment, you will be able to take advantage of it.

Con: Unexpected Challenges

While flipping for short-term profit has definite ‘hands-on’ appeal, first-time investors can be surprised by unexpected complications. Properties that appear to be undervalued (and ripe for a quick flip!) may require costly fixes. Overspending on renovations quickly eats into profits, but underspending can lead to a lengthier holding time. Experienced Bridgeville flipping veterans have learned to successfully gauge a property’s true turnaround value.

Additional Consideration: Taxes

Sussex County flipping has tax implications that impact the bottom line. Profits from a property owned more than a year are generally taxed at the ordinary income tax rate, while a property held for less than a year may be taxed at the capital gains rate. Local and state tariffs need to be considered as well—this is where input from a qualified professional is important.

Buy-and-Hold

Pro: Passive Investment

If management is outsourced to a professional property manager, the buy-and-hold strategy will require less personal attention than flipping does. Preparing a property for a flip often involves considerable time commitment and adept contractor schedule-juggling.

Con: Management Costs

The passive investment advantage holds true if outside management is contemplated— with commensurate expense. If you enjoy the challenge of successfully managing a property, this negative doesn’t apply.

Pro: Fewer Properties Need To Be Identified

Ultimately, successfully executing a flipping strategy means scrutinizing a huge number of properties over the course of time. In contrast, a buy-and-hold strategy necessitates finding only a few great bargains. Pursued intelligently, both buy-and-hold and quick flip strategies have proved profitable for many investors. Both call for finding solid value in Bridgeville properties—which is where giving me a call comes in!

For Bridgeville renters who are beginning to investigate the possibility of buying a first house, the prospect can look like more than just a steep hill to climb—it can look more like a cliff! Just recently, the Daily Real Estate News cited recent research that indicates in most places (512 counties surveyed, in fact) it can take the average family more than twelve years to save up for a 20% down payment. When you consider the significant financial advantage that a first house brings its Bridgeville owner, the situation seems like a Catch-22. How can you save any faster when that big tax advantage goes only to the existing homeowners?

If a decade-plus wait sounds unreasonable, there’s a lot you can do to trim the delay—

1) (Obvious) Cut excess spending

If you take notes for a month or so about how you really spend your money, you find that the little things really add up: morning coffee, daily lunches, planned and unplanned shopping expeditions all put serious dents in your wallet. Spot the expenditures, you can cut back on, then reduce or eliminate them as soon as possible.

2) (Less Obvious) Create a ‘First House’ account

Create a separate savings account with the single purpose of holding your first house down payment. Watching it grow month by month will more than make up for the inconveniences caused by scrimping on daily and other spending.

3) (Way Less Obvious) Pick up extra work

You may never have considered it, but sometimes moonlighting is a great way to add additional income that quickly build your First House account. If you have a hobby that lends itself to web sales, think of starting a store on sites like Etsy or Amazon.

4) Reduce your current bills

There are those bills that you can't quite get rid of -- cell phone, credit cards and other bills don't just go away because you're saving for a new Bridgeville house. For some bills, though, there are options for slimming down your monthly payments. Try negotiating a lower APR or reducing your phone or cable plan.

5) Make (and stick to) a budget

Those notes you made up there on 1) can be the raw material for making a detailed budget that separates necessary expenditures from extras like gifts, trips and special nights out. Find creative ways to entertain yourself and get together with your friends. Hosting movie nights, finding free concerts, and moving cocktail hour to home are all surprisingly doable.

7

) Downsize

It may seem counterintuitive: why would you decrease the size of your current digs? If you can temporarily scale back, the lowered rent can materially boost your savings. If it’s at all practical, living with relatives might move the process along even more quickly!

The kind of scaling back that builds for a local first house down payment is a lot more fun if you can see quick progress. And the possibility of qualifying for a smaller than 20% down payment is also currently increasing. Give me a call for a realistic discussion of your own Bridgeville first house purchase!