Don’t Worry About Home Prices Dipping This Year (Unless You’re Among This 3% Of Homeowners)

It’s natural for people to be concerned that they’re buying a house when prices are at their peak, and people worry about that in almost any market. So when you start hearing news about the market shifting, and home prices coming down, you might wonder if your house is worth less than you paid for it (if you bought it in the past couple of years).

It can (and does) happen. Real estate values aren’t on a constant upward trend; they do take a dip here and there. But overall, the value of your house will appreciate over the years, despite some dips. So, unless you have to sell when prices are lower than you paid for your house, you can always just wait for the market to bounce back before selling.

The good news is that while prices have been adjusting down in some areas, they haven’t been falling drastically. In fact, home prices are only predicted to decline 4% in the coming year, as this Yahoo article states. Considering how much appreciation many homeowners gained in the past few years, that would mean many homes will still be worth more than when they were purchased.

So, for the most part, you don’t have to sweat the news that prices are coming down.

However, it can be an issue if you find yourself in a position where you’re unable to pay your mortgage and your value has dropped. According to this article from First Journal Tuesday, mortgage delinquencies have been on the rise recently. They increased from the recent bottom of 2.75% homeowners (at least 30 days behind) back in May 2022, up to 3% in November.

That’s not a huge increase, and it’s still fairly low, but if you find yourself in that percentage of people, it can be scary and concerning.

When people find themselves behind on mortgage payments, there can be a tendency to wait until it’s too late to deal with it. Just hoping things will get better and resolve themselves is not the best approach.

Here are some things you can do if you’re having trouble making your payments:

• Call and discuss your circumstances with your lender. If it’s a temporary issue and you can reasonably expect to get caught up and continue paying in a short period of time, they may be willing to work with you. They might give you a forbearance (a temporary hold on your payments) while you get back on your feet. Or they might be willing to give you a modified payment for a period of time. But if they are unwilling to help in any way, they may at least give you time to sell your house—or approve a short sale if necessary—rather than initiate the foreclosure process.
• Consider selling your house. If you’re having trouble keeping up with payments, it may make sense to sell your house and buy a lower priced one, or rent for a while. Just because you’re unable to make your payments doesn’t mean you can’t or won’t make money on the sale of your house. Speak to a local real estate agent and get a feel for how much your house is currently worth. Despite prices coming down in some areas, you might find that there is enough equity to sell and walk away with a profit, considering how much values have gone up in the past few years.

Whichever route you choose if you’re struggling to pay your mortgage, the key is to do it sooner rather than later to avoid getting too far in the hole with your lender, or before prices potentially drop further than forecasted.

The Takeaway:

While there’s a lot of news about home prices falling, the forecast of a 4% drop in the next year shouldn’t be an issue for most homeowners, even if they bought in the past couple of years.

But there is a slight uptick in the number of people who are at least 30 days behind on their mortgage payments. If you’re one of the 3% of people who are delinquent on their mortgage, make sure to discuss the issue and potential resolutions with your lender. Or, if they aren’t willing to cooperate with you, consider selling your house. You might find that you could make a profit considering how much homes have appreciated in the past few years.

Buying a Home? Make Sure to Look for These Energy-Efficient Features

The cost of owning a home is rising, in large part due to rising energy costs. For example, according to the U.S. Energy Information Administration, the cost of heating oil could increase up to 45 percent year-over-year, alongside projected 25 percent rises in the price of natural gas, and an 11 percent increase for electricity.

With costs on the rise, it’s more important than ever for buyers to purchase energy-efficient homes.

But how, exactly, do you do that?

A recent article from realtor.com outlined the key features potential buyers should be looking for if they want their home purchase to be as energy efficient as possible, including:

• Close to work. A long commute will use a significant amount of gas, which is not only bad for your budget, but bad for the environment. If you work in an office—and an energy-efficient home purchase is important to you—make sure to look for a property that’s close to your office and offers a short commute. (Bonus points if you can bike to work!)
• Proper insulation. If you don’t want to spend a fortune on heating your home, you want to buy a property with proper insulation. And we’re not just talking about walls. Heat rises, so the majority of your heating will eventually make it to the roof. If you want to keep heating costs low, you need to make sure your ceiling and attic are properly insulated as well.
• Energy-efficient appliances. The appliances in a home play a huge part in how energy efficient (or energy inefficient) it ultimately is. So before you commit to buying a home, make sure to review the appliances—and aim for both a water heater and furnace that are at least 95 percent energy-efficient.

Signs That It’s Time to Downsize Your Kitchen Gadget Collection

The right kitchen gadgets can make cooking significantly easier and less stressful. And there are some kitchen gadgets that are, for many, non-negotiables—like a microwave or coffee machine.

But too many kitchen gadgets can be a problem; not only do they take up precious storage space, but they can make your kitchen appear cluttered—which can be a problem when you decide to sell.

So, the question is, how do you know when your collection of kitchen gadgets has crossed the line into “too many” territory?

A recent article from realtor.com outlined clear indicators that it’s time to downsize your kitchen gadget collection, including:

• You have gadgets you don’t use. Many people buy kitchen gadgets they think they will use or should use (like a juicer or air fryer)—but then they just end up collecting dust on their kitchen counter. If you have gadgets you never use taking up space in your kitchen, it’s time to get rid of them.
• You have gadgets you can’t identify. Having kitchen gadgets you don’t use is a major waste of space. But having kitchen gadgets you can’t even identify? That’s even worse. If you’re in the dark about what a gadget is, what it does, or when you’d use it, it doesn’t belong in your kitchen.
• You have mini-versions of your favorite gadgets. Mini appliances have become more popular in recent years. But if you have a full-sized version of a kitchen gadget (like a waffle maker or blender), you don’t need a mini-version.

Home Selling Rules Are No Longer Relevant

The market is changing. While bidding wars, sky-high prices, and homes flying off the market were a reality just a few months ago, rising mortgage rates, changing economic conditions, and increasing inventory have caused a serious shift in some areas.

And if you’re selling your home, it’s important to operate under the conditions of the market the way it is now, not the way it was last year or a few months ago.

So what, exactly, does that look like?

A recent article from realtor.com outlined some of the widely believed rules about selling a home in today’s market that are no longer true (and that you’ll definitely want to consider breaking!), including:

• Pricing your home as high as you’d like. There was a time when sellers could virtually put any price tag on their home and it would sell, often for even higher than their asking price. But those days are over, and if you want to successfully sell your home in today’s market, you need to price your home conservatively and in line with its current market value.
• Don’t worry about offering concessions. At the height of the buying frenzy, buyers were bending over backwards for sellers, and that meant sellers could forgo any concessions. But now that the market has cooled, if you want to sell your home—and sell it quickly—offering concessions to buyers (like helping them “buy down” their mortgage rate or cover closing costs) isn’t out of the question.
• Home staging isn’t necessary. There was a time when just about any home would sell, regardless of how it looked. But now that buyers are more selective, you’ll want to do everything you can to make your home marketable and appealing—and that includes investing in professional staging.

Looking for a home in the past few years has been difficult for almost all buyers. Even those who have all-cash offers, waive every contingency, and offer well over asking price have been losing out on their dream homes.

It’s been so frustrating that it can bring you to tears at times…literally!

According to this Yahoo article, over half of home buyers cry at least once during their home search. Some of those surveyed claim to have cried up to four times during the process! And just because some people weren’t brought to tears doesn’t mean they didn’t find the process stressful—90% of them said at least one aspect of it was stressful.

As stressful as the recent market has been, this isn’t a new issue. Buying a home always ranks as one of the most stressful life events in a person’s life. All you have to do is search the Internet and you’ll find articles like this one published by Housing Wire in 2018 (well before the current market conditions) citing home buying as one of the most stressful events in modern life.

This is why it’s so important to hire a real estate agent who can empathize with you and help you cope with the ups and downs throughout the process.

Fortunately (or unfortunately), while home buyers have to deal with the roller coaster of emotions during the time it takes to search for and successfully close on a home, real estate agents are on a never-ending roller coaster ride. So an agent is able to help give you perspective and hope that things will work out just fine—even when there are bumps in the road—because they go through it with other clients and on a personal level every single day.

That said, not all agents are able to cope with the stress themselves, or aren’t as sensitive to a buyer who may need a shoulder to cry on (literally or figuratively). Some agents get so emotional themselves, it’s hard for them to keep their cool when things go wrong. Others are so unemotional, that they may come across as uncaring about how upset you are when things throw you for a loop. That’s not to say they’re bad agents! They may very well be great at every other aspect of being an agent…just not at helping you through the emotional moments.

The Takeaway:

No matter when you decide to buy a home, or what the market is like at the time, the chances are you’re going to experience some stress, and maybe even a few tears. So, besides everything else you want to look for in an agent (like being a market expert, great negotiator, responsive, etc.) make sure the agent you hire is able to empathize with you.

That’s not to say you want an agent who bursts into tears with you! You want one that understands and feels for you, but can stay centered and calm enough to help you work through the emotions to make level-headed decisions. That way, you can shed tears of joy when you finally close on your home!