22 Cities Where Home Appreciation Is Spiking

Couple looking at their old home
Photo by Hurst Photo / Shutterstock.com

Extreme demand for homes is pushing home values up at a rate not seen since before the Great Recession, a new Zillow report finds.

Several trends — including new millennial homebuyers, record-low interest rates, trends related to the coronavirus pandemic and the relatively small pool of homes for sale — have converged to heat up the market. The hot sellers’ market is a contrast to flat growth in rental prices nationally, as we reported in “Rent Prices Have Dropped in These 9 Formerly Hot Markets.”

The Zillow Home Value Index rose 9.1% from January 2020 to January 2021, the report says. Year-over-year home value growth hasn’t been this high since June 2006.

That rate may even pick up a bit: Zillow economists expect values to rise 10.1% from January 2021 to January 2022.

The demand has shortened the length of time that homes stay on the market, to a median of just 18 days as of mid-January. Compare that to 46 days at the same time last year and the year before.

A demographic bomb is a factor in the hot market. Millennials — defined by Zillow as Americans ages 25-34 — are entering their peak homebuying years. The number of these millennials increased by 12% — or, about 4.9 million people — between 2010 and 2020.

The generation’s size adds to the housing demand. Also, younger buyers are less likely than older ones to sell a previous home when they buy, which is expected to help keep the pool of homes for sale tight.

Government-stoked low mortgage rates — averaging 2.74% for a fixed-rate 30-year mortgage in January — are driving demand as buyers try to seize the opportunity to either pay less for a home or buy a more expensive one than they otherwise could.

Says Zillow:

“An extraordinary number of home buyers, with budgets supercharged by rock-bottom mortgage interest rates, are competing over a limited supply of homes for sale.”

The pandemic is a final factor. Many workers are now clocking in virtually instead of at the office, driving some to seek larger homes and others to move to smaller, more-affordable markets, Zillow says.

While home values increased in all of the 50 largest metro areas in the U.S. from January 2020 to January 2021, some have seen steeper growth rates than others.

Here are the 22 major markets where home values grew 10% or more, along with their typical home price and their home price growth rate:

  • Phoenix: $335,975 (up 17.1% from January 2020 to January 2021)
  • San Jose, California: $1,314,799 (up 14.2%)
  • Austin, Texas: $384,446 (up 13.7%)
  • Salt Lake City: $436,390 (up 13.7%)
  • San Diego: $689,361 (up 13.5%)
  • Seattle: $594,223 (up 12.8%)
  • Tampa, Florida: $257,499 (up 12.8%)
  • Milwaukee: $219,381 (up 12.1%)
  • Cincinnati: $208,352 (up 12%)
  • Providence, Rhode Island: $357,761 (up 12%)
  • Riverside, California: $433,226 (up 11.7%)
  • Buffalo, New York: $193,583 (up 11.4%)
  • Sacramento, California: $478,817 (up 11.3%)
  • Indianapolis: $204,141 (up 11.3%)
  • Memphis, Tennessee: $174,063 (up 11.3%)
  • Cleveland: $176,069 (up 11.1%)
  • Charlotte, North Carolina: $265,397 (up 10.9%)
  • Columbus, Ohio: $234,276 (up 10.8%)
  • Philadelphia: $277,775 (up 10.6%)
  • Kansas City, Missouri: $227,059 (up 10.6%)
  • Pittsburgh: $178,282 (up 10.4%)
  • Detroit: $198,979 (up 10.3%)

If you’re in the market for a new home or refinancing for your existing home, check out the mortgage rate comparison tools in Money Talks News’ Solutions Center.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

Zestimate to double as Zillow’s iBuying offer

Zillow is putting their money where their Zestimate is, at least to a point.

The “Zestimate,” Zillow’s catchy (and soapy) name for estimated home values, will sometimes be used as the initial offer Zillow plans to pay to purchase a home, the company said on Thursday.

Zillow’s own estimated home value is to guide the company on a “limited subset of homes” in 20 markets. The largest of these are Los Angeles, Houston and Phoenix.

The firm’s announcement is an intriguing turn, because it folds up two company priorities into one – boosting consumer faith in the Zestimate, and highlighting Zillow Offers, the company’s instant homebuying, or ibuying, platform.

Even setting aside the various lawsuits that it has spurred, the Zestimate has had bumpy a 15-year journey, such as when former CEO Spencer Rascoff sold his Seattle home for 40 percent below its estimate (Rascoff would continue his seeming battle against the Zestimate, listing an L.A. home last year at $7 million more than its Zestimated price.)


How 2020 exposed a greater need for collaboration between real estate agents and LOs

Technology has given consumers the power of choice and expedited the entire real estate purchasing process. Successful agents, brokerages and loan officers of the future are going to rely significantly on technology to find, nurture and engage with buyers and sellers while also playing an expanding role as personal advisors.

Presented by: Propertybase

In response to a lawsuit over the accuracy of the Zestimate, Zillow in 2017 said the tool was within 5% of the sale price 53.9% of the time, within 10% 75.6% and within 20% nearly 90% of the time.

Still, the Seattle-based firm responded with efforts like computer vision to analyze aerial photos of a home, which followed a public competition, complete with $1 million prize, to improve the Zestimate.

Zillow Offers, meanwhile, came into focus in 2018 when Rich Barton stepped back into the CEO chair. In 2020, the business line accounted for the majority of the company’s revenue and expenses.

Zillow Offers is currently in 25 markets. Though the Zestimate may now dictate an initial offer, a final offer is predicated on a company representative actually visiting the home.

Source: housingwire.com

Years of Work Needed to Afford a Down Payment – 2021 Edition

Years of Work Needed to Afford a Down Payment – 2021 Edition – SmartAsset

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Assembling enough money for a down payment is typically the largest hurdle to clear when securing a mortgage. The median home price in the U.S. is up 14% year-over-year, according to a November 2020 Redfin report, and as the housing market gets more expensive, so too will the deposit that you have to front for a home. Working with professional financial advisors can help you strategize so that your money’s doing the most for you, but in some places compared to others, scraping together that bundle of cash can be particularly daunting. Keeping all this in mind, SmartAsset investigated where it takes longest to save for a down payment.

To do this, we examined data on the 50 largest U.S. cities, using median home values, median income figures and assuming that workers would save 20% of their income each year. We calculated the years needed to save for both the recommended 20% down payment as well a 12% down payment (the median down payment among all homebuyers in 2019, according to the National Association of Realtors). For details on our data sources and how we put all the information together to create our final rankings, check out the Data and Methodology section below.

This is SmartAsset’s fifth look at how many years of work it takes to afford a down payment. You can read the 2020 edition here.

Key Findings

  • Oakland takes over in the Bay. In the last three editions of this study, San Francisco homeowners have always needed to work longer than Oakland homeowners to afford a down payment. This year, however, Oakland has surpassed San Francisco and moved to the No. 2 spot, bumping the Golden Gate City to No. 3. San Francisco real estate is still pricier – with a median home value of more than $1.2 million – but the differences in average income make Oakland second only to Los Angeles on our list.
  • It still takes less time in Midwestern and Southern cities to assemble funds for a down payment. Residents in the East Coast and West Coast cities that comprise our top 10 will need more than three times longer to save up for a down payment than residents in the Midwestern and Southern cities that comprise the bottom 10. To save up for a 20% down payment, those in the top 10 will need to work an average of 8.90 years, compared to only 2.83 years in the bottom 10. For a 12% down payment, it will take 5.34 years for residents in the top 10 cities to reach their home buying goals, while it will take 1.70 years for residents in the bottom 10 to do so.

1. Los Angeles, CA

It will take residents in Los Angeles, California the longest to save for a down payment. The median home value is $697,200, which means that they will need to save $139,440 for a 20% down payment. If a person earns the median household income of $67,418 and saves 20% of that each year, then he or she will need to work 10.34 years to have enough money to afford a down payment.

2. Oakland, CA

In Oakland, California where the median home costs $807,600, a 20% down payment equals $161,520. The median household income here is $82,018, so a person saving 20% annually will need to work for 9.85 years to afford a down payment. For comparison, saving up a 12% down payment of $96,912 will require 5.91 years, but this means having to pay significantly higher mortgage payments.

3. San Francisco, CA

The median home value in San Francisco, California is $1,217,500 – the only city in our study with a seven-figure price tag. A 20% down payment on that median value would cost $243,500. With a median household income of $123,859, the average person saving 20% annually could afford a down payment in 9.83 years.

4. New York, NY

In the Big Apple, homeowners will need 9.81 years to make a 20% down payment on a home. The median home value is $680,800, which means a 20% down payment is $136,160. And for a comparison, a New Yorker saving 20% annually at a median household income of $69,407 will need 5.89 years to save for a 12% down payment of $81,696.

5. Long Beach, CA

Long Beach, California has a median home value of $614,400. To buy the median house with a 20% down payment, the average resident will need $122,880. If you earn the median income of $67,804 and save 20% of your income each year, then you will be able to afford a down payment in 9.06 years.

6. San Jose, CA

San Jose, California is in the heart of Silicon Valley, and as you might expect, the median home value is fairly high – at $999,990. A 20% payment on that home value is $199,980. The median household income in the city is $115,893, so if a resident saves 20% of his or her income each year, then the person could afford a down payment in 8.63 years.

7. Miami, FL

Miami, Florida is the only Southeastern city in the top 10 of our study. The median home value is $358,500, which means that a 20% down payment costs $71,700. The median income in Miami, however, is $42,966. So a resident saving 20% of that median household income ($8,593) each year could afford a 20% down payment in 8.34 years.

8. Boston, MA

It takes someone saving 20% of the median household income in Boston, Massachusetts 7.93 years of work to afford a 20% down payment on a home. The median home value is $627,000, with a 20% down payment coming to $125,400. The median household income in Boston is $79,018.

9. San Diego, CA

The median home value in San Diego, California is $658,400, which means that a 20% down payment is $131,680. Someone earning the median household income of $85,507 will need 7.70 years to afford that down payment. For comparison, a 12% down payment of $79,008 takes 4.62 years to save up for, with the caveat that paying a smaller down payment now means larger mortgage payments later.

10. Seattle, WA

Seattle, Washington rounds out the top 10 on our list, with a median home value of $767,000. This means that a 20% down payment is $153,400. So if you earn the median household income of $102,486, then it will take you 7.48 years – saving 20% of your income each year – to afford that payment.

Data and Methodology

To rank the cities where the average household would need to save the longest to afford a down payment, we analyzed data on the 50 largest U.S. cities. We specifically considered two pieces of data:

  • 2019 median home value.
  • 2019 median household income.

Data for both factors comes from the Census Bureau’s 2019 1-year American Community Survey.

We started by determining the annual savings for households by assuming they would save 20% of the median annual pre-tax income. Next, we determined how much a 20% down payment as well as a 12% down payment for the median home in each city would cost. Then, we divided each of the estimated down payments in each city by the estimated annual savings. The result was the estimated number of years of saving needed to afford each down payment, assuming zero savings to begin with. Finally, we created our final ranking by ordering the cities from the greatest number of years needed to the least number of years needed for each.

Tips for Hassle-Free Home Buying

  • Consider investing in expert advice. If you’re thinking of buying a home or starting to save, consider working with a financial advisor before you take the plunge. Finding the right financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in five minutes. If you’re ready to be matched with local advisors, get started now.
  • Prevent potential mortgage mishaps. The payments don’t stop after you’ve put money down; you’ll also need to make mortgage payments. Figure out what those might be before you move forward by using SmartAsset’s mortgage calculator.
  • It pays to read the fine print. When thinking about your home buying transaction, don’t forget closing costs. These may seem small compared to the down payment, but every dollar counts.

Questions about our study? Contact press@smartasset.com. 

Photo credit: ©iStock.com/valentinrussanov

Ben Geier, CEPF® Ben Geier is an experienced financial writer currently serving as a retirement and investing expert at SmartAsset. His work has appeared on Fortune, Mic.com and CNNMoney. Ben is a graduate of Northwestern University and a part-time student at the City University of New York Graduate Center. He is a member of the Society for Advancing Business Editing and Writing and a Certified Educator in Personal Finance (CEPF®). When he isn’t helping people understand their finances, Ben likes watching hockey, listening to music and experimenting in the kitchen. Originally from Alexandria, VA, he now lives in Brooklyn with his wife.
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Intense Demand and Low Mortgage Rates Drive Home Values to Record Highs – PRNewswire

Monthly appreciation of home values in January matched recent record highs, while annual growth is higher than any time since 2006. Home sales are moving briskly, with homes typically staying on the market for 18 days as of mid-January before the seller has accepted an offer from a buyer — 28 days faster than in 2020 and 2019. For-sale inventory declined again in January, and now stands 26.3% below levels from a year ago.

The Zillow Home Value Index (ZHVI) rose to $269,039 in January, up 1.1% month over month, matching December’s all-time record for monthly growth in data reaching back to 1996. Annual home value appreciation was 9.1% — the largest annual growth recorded since June 2006, before the Great Recession.

“Homebuying demand has pushed the pedal to the metal for price appreciation this winter,” said Jeff Tucker, senior economist at Zillow. “Normally we’d be talking about the spring selling season ramping up, but it looks more like last summer’s selling season simply never ended. Buyers eager to secure more space and lock in today’s rock-bottom interest rates are having to move quickly and aggressively to win out in this competitive market.”

Home values rose in all 50 of the largest U.S. metros, with the most drastic yearly growth in Phoenix (17.1%), San Jose (14.2%) and Austin (13.7%). The slowest growth — a relative term in this case — was seen in San Francisco (5.3%), Chicago (6.7%), and San Antonio (6.7%). 

A few major demand drivers are keeping competition high and the market hot through the customarily cool winter. For one, a wave of millennials are now entering their peak home-buying years. The number of Americans aged 25-34 was 12% higher in July 2020 than July 2010, according to Census estimates — an increase of approximately 4.9 million people. 

Another is mortgage rates, which averaged 2.74% for a standard 30-year fixed in January — up slightly from a historic low of 2.68% in December. These rates are making monthly mortgage payments more affordable as a percentage of income, even when considering rising prices. 

The COVID-19 pandemic and widespread changes to work-from-home policies have also pushed many to reconsider what they want and need in their living space, and where it should be. 

Looking forward, Zillow economists expect home values to grow 10.1% in the next 12 months. The Zillow forecast for existing home sales has been revised up since December, driven by improved pending sales volumes and home purchase applications. Existing home sales are expected to reach 7 million in 2021, 24.8% more than in 2020. 

While home prices are rising quickly, rents are relatively stagnant. The Zillow Observed Rent Index (ZORI) was $1,721 in January, just 0.5%, or $9, higher than in January 2020 and up 0.3% month over month. 

Rents in many expensive, coastal metros are currently much lower than a year ago — down 9.2% in San Francisco, 8.8% in New York, 7.2% in San Jose, and 6.3% in Boston. Many Sun Belt and Midwest metro areas, on the other hand, saw solid rent growth. Phoenix led the largest 35 metro areas with 8.4% annual rent growth, followed by Sacramento (7.6%) and Indianapolis (6.9%).

Metropolitan Area*

Zillow Home Value Index, January 2021

ZHVI – YoY Change, January 2021

Zillow Observed Rent Index, January 2021

ZORI – YoY Change, January 2021

United States

$269,039

9.1%

$1,721

0.5%

New York, NY

$516,732

7.7%

$2,465

-8.8%

Los Angeles-Long Beach-Anaheim, CA

$748,532

9.6%

$2,542

-0.8%

Chicago, IL

$259,459

6.7%

$1,614

-2.9%

Dallas-Fort Worth, TX

$273,348

7.9%

$1,555

2.0%

Philadelphia, PA

$277,775

10.6%

$1,578

2.3%

Houston, TX

$231,195

7.0%

$1,464

0.4%

Washington, DC

$475,850

8.6%

$2,006

-3.4%

Miami-Fort Lauderdale, FL

$323,431

7.7%

$1,913

2.1%

Atlanta, GA

$264,565

9.7%

$1,602

5.7%

Boston, MA

$539,592

9.4%

$2,277

-6.3%

San Francisco, CA

$1,178,615

5.3%

$2,876

-9.2%

Detroit, MI

$198,979

10.3%

$1,293

6.1%

Riverside, CA

$433,226

11.7%



Phoenix, AZ

$335,975

17.1%

$1,572

8.4%

Seattle, WA

$594,223

12.8%

$1,866

-5.5%

Minneapolis-St Paul, MN

$320,438

8.6%

$1,543

0.8%

San Diego, CA

$689,361

13.5%

$2,383

4.3%

St. Louis, MO

$197,073

9.0%

$1,093

3.8%

Tampa, FL

$257,499

12.8%

$1,589

6.6%

Baltimore, MD

$319,175

8.2%

$1,646

2.2%

Denver, CO

$488,746

9.0%

$1,709

0.1%

Pittsburgh, PA

$178,282

10.4%

$1,177

1.2%

Portland, OR

$458,486

9.7%

$1,649

1.2%

Charlotte, NC

$265,397

10.9%

$1,514

3.1%

Sacramento, CA

$478,817

11.3%

$1,916

7.6%

San Antonio, TX

$222,816

6.7%

$1,330

2.5%

Orlando, FL

$276,168

7.5%

$1,594

2.2%

Cincinnati, OH

$208,352

12.0%

$1,259

5.5%

Cleveland, OH

$176,069

11.1%

$1,121

3.7%

Kansas City, MO

$227,059

10.6%

$1,193

5.0%

Las Vegas, NV

$315,966

8.0%

$1,493

6.7%

Columbus, OH

$234,276

10.8%

$1,278

5.2%

Indianapolis, IN

$204,141

11.3%

$1,262

6.9%

San Jose, CA

$1,314,799

14.2%

$2,892

-7.2%

Austin, TX

$384,446

13.7%

$1,511

-1.2%

Virginia Beach, VA

$264,060

8.3%

$1,376

6.1%

Nashville, TN

$304,571

8.9%

$1,595

1.9%

Providence, RI

$357,761

12.0%

$1,603

8.2%

Milwaukee, WI

$219,381

12.1%

$1,169

2.7%

Jacksonville, FL

$252,678

9.4%

$1,370

5.6%

Memphis, TN

$174,063

11.3%

$1,337

10.0%

Oklahoma City, OK

$170,138

7.5%

$1,098

3.9%

Louisville-Jefferson County, KY

$197,548

8.7%

$1,044

4.7%

Hartford, CT

$260,546

9.5%

$1,353

5.0%

Richmond, VA

$268,405

8.4%

$1,294

4.8%

New Orleans, LA

$224,193

7.9%

$1,290

3.8%

Buffalo, NY

$193,583

11.4%

$1,124

5.3%

Raleigh, NC

$307,481

8.8%

$1,503

2.6%

Birmingham, AL

$188,327

9.8%

$1,129

5.5%

Salt Lake City, UT

$436,390

13.7%

$1,408

3.3%

*Table ordered by market size 

About Zillow Group

Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate to make it easier to unlock life’s next chapter. 

As the most-visited real estate website in the U.S., Zillow® and its affiliates offer customers an on-demand experience for selling, buying, renting or financing with transparency and nearly seamless end-to-end service. Zillow Offers® buys and sells homes directly in dozens of markets across the country, allowing sellers control over their timeline. Zillow Home Loans™, our affiliate lender, provides our customers with an easy option to get pre-approved and secure financing for their next home purchase. Zillow recently launched Zillow Homes, Inc., a licensed brokerage entity, to streamline Zillow Offers transactions.  

Zillow Group’s affiliates and subsidiaries include Zillow®, Zillow Offers®, Zillow Premier Agent®, Zillow Home Loans™, Zillow Closing Services™, Zillow Homes, Inc., Trulia®, Out East®, StreetEasy® and HotPads®. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). 

SOURCE Zillow

Related Links

https://www.zillow.com

Source: prnewswire.com

How Much Does a Home Appraisal Cost? – Redfin

Congratulations, you’ve found a home that you’re ready to buy. From the days of saving for a down payment, searching the housing market for your dream home, homeownership is almost in sight. So whether you’re a seasoned homebuyer or a first-time homebuyer, you’ll need to plan for a home appraisal before you can get final approval for your mortgage. 

You may be wondering just what is a home appraisal and how much does a home appraisal cost? Before heading into the final steps of the homebuying process, find out about the different types of home appraisals and what factors can change the price of a home appraisal.

home-appraisal-cost

home-appraisal-cost

What is a home appraisal? 

A home appraisal is a prerequisite for most mortgages, whether you’re living in Houston, TX or looking to buy a house in Philadelphia, PA. It determines a home’s value and your lender will use the house appraisal to generate an appraisal report. The report helps lenders decide an appropriate amount to lend to a potential homebuyer to purchase that property. State-certified professionals conduct appraisals to safeguard both buyers and lenders against inflated property valuations.

Who chooses the home appraiser? 

Your mortgage lender will often recommend from a list of preferred appraisers, chosen for their track records as reliable, high-integrity professionals. As the buyer you’ll have to pay the appraisal cost, which usually is a fee added to your closing costs. However, your lender should inform you how much the appraisal will cost when you begin the pre-qualification process, so you’ll know just what to expect.

How much does a home appraisal cost? 

A typical home appraisal can range from $200 to $450. However, the cost of your home appraisal will depend on the type of appraisal you need. Here are the four types of home appraisals you might run across:

1) Uniform Residential Appraisal Report (URAR)

This is the most common type of home appraisal out there and lenders typically require a URAR before approving your mortgage.

During a URAR, a trained and certified appraiser carefully reviews both the home’s interior and exterior. The home appraisal process takes two to four hours — and costs between $300 and $400. At the end of the evaluation, the appraiser will give you a detailed report breaking down your home’s value. This is the most extensive, and therefore most expensive, type of home appraisal.

Note: The remaining three types of appraisals are generally not considered sufficient to obtain a conventional loan, but there are reasons why you may want one of these appraisals.

2) Restricted-Use, Short-form Report, or Drive-by Appraisal: 

As you might expect, this type of appraisal provides less information than other types. Therefore, this home appraisal cost is generally less expensive, around $100 to $150. However, lenders generally do not accept this type of appraisal for mortgage approval. More likely, homeowners and real estate agents may use it to help determine a home’s listing price. For this type of house appraisal, a trained and certified appraiser evaluates only the outside of the house and relies on the owner to provide information about the home’s condition and other details inside. 

3) Comparative Market Analysis (CMA): 

Real estate agents use a CMA to value a home, considering factors like nearby home values, ratings for school districts, and the home’s general condition for their analysis. CMAs provide a reasonable estimate for a home’s value when setting a listing price. While this report is more likely used as a tool for sellers rather than buyers, you can always ask your real estate agent for a CMA if you’re looking to buy. It’s important to note that lenders do not consider a CMA as a valid appraisal to determine loan value. 

4) Online appraisals: 

Numerous online sites offer home appraisals directly to buyers who want to know how much their house is worth. An online home appraisal can be free or have some cost depending on how much information you request. Lenders do not accept this type of home appraisal as a valid appraisal. 

home-with-land

Factors that affect home appraisal cost

Before you have a home appraised, know the four important factors that can affect the cost of your home appraisal. 

Type of property

The type of property you plan to buy will influence the cost of your home appraisal. For example, an appraisal for a two-bedroom home will be less expensive than one with multiple bedrooms, a finished basement, and an attic. Additionally, if you plan to set up your home as a rental property to generate income, the appraiser will require a rent survey and an income statement, which may increase the cost.

The home’s value

The general value of the home affects the cost of the appraisal. As a rule of thumb, the larger the home, the more expensive the appraisal. A larger home will take more time to evaluate and results in a more extensive report. As a general reference point, properties priced at or less than $500,000 will typically result in an appraisal cost at the lower end of the range.

The home’s location 

How far does the appraiser need to travel to conduct the appraisal? Driving times and mileage are all accounted for these days, so you should expect to pay more for your home appraisal if the house is located out of town.

Type of mortgage you’re applying for

Depending on the type of mortgage you’ve applied for, it may result in a more costly home appraisal. For example, mortgages that involve a federal agency, such as the Federal Housing Administration (FHA), require an appraisal to include additional safety inspections, resulting in a higher cost. 

If you plan on getting a mortgage loan to purchase your new home, getting an appraisal will most likely be a non-negotiable requirement from your lender. Make sure to ask your lender ahead of time what to expect for the home appraisal cost, so you can be sure to set aside that amount to be paid as part of the home closing process. The more prepared you are throughout your homebuying journey, the more likely you’ll find yourself at ease and ready to become a homeowner.

Source: redfin.com

10 Best Cities to Sell a House in 2021

Sold house
LightField Studios / Shutterstock.com

This story originally appeared on SmartAsset.com.

Deciding to leave the home you own might be difficult given the precious memories you’ve made within its walls. But the process of selling it can be downright taxing, especially when the real estate market is unpredictable. Your asking price, mortgage rates and other factors will determine how hard this process will be. Location, however, is arguably one of the most important factors. With that in mind, SmartAsset crunched the numbers and identified the best cities to sell a house.

We compared data from 255 U.S. cities and ranked them according to the following metrics: five-year change in median home value, average number of days on the market, percentage of homes sold for a loss, average closing costs and real estate offices per 1,000 residents. For details on our data sources and how we put all the information together to create our final rankings, check out the Data and Methodology section at the end.

This is SmartAsset’s fifth annual study on the best cities to sell a house. Check out the 2020 edition here.

1. Aurora, CO

Aurora Colorado
Arina P Habich / Shutterstock.com

This suburb of Denver is the best city to sell your house, according to our study. The median home value in Aurora has increased 61.7% in the five-year period from 2014 to 2019, the 14th-highest jump for this metric in our study. Aurora homes average 53 days on the market, ranking 46th for this metric. Furthermore, Aurora holds the 24th-highest ranking for the number of real estate offices per resident – 1.92 for every 1,000 people.

2. Mesa, AZ

Mesa, Arizona
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Mesa, Arizona, is the first of six Arizona cities in the top 10 of this list. Houses in this Phoenix suburb average 44 days on the market, ranking 22nd-best for this metric. The median home value has gone up 50.2% in the five-year period from 2014 to 2019, finishing 37th for this metric overall. Additionally, just 12.17% of homes in this city were sold at a loss, ranking 54th-best for this metric across all 255 cities in the study.

3. Palmdale, CA

Palmdale California
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The median home value in Palmdale, California, has gone up by 61.2% from 2014 to 2019, the 15th-biggest five-year jump in the study. This suburb of Los Angeles has 1.53 real estate offices for every 1,000 residents, ranking 55th out of 255 for this metric. Palmdale is also in the top quartile of the study for its relatively low percentage of homes sold at a loss, at 10.79% and ranking 30th. However, it ranks in the middle of this study for closing costs, averaging $4,121.

4. Glendale, AZ

Glendale Arizona
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The average home in Glendale, Arizona, is on the market for 43 days, which is the 17th-fastest turnaround in our study. This city is another suburb of Phoenix and has risen 51.7% in median home value over the five-year period from 2014 to 2019, ranking 24th out of 255 for this metric. Closing costs for Glendale homes are $3,280, the 50th-lowest in our study.

5. Thornton, CO

Thornton Colorado
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Coming in as the No. 5 city in the U.S. to sell your home, Thornton, Colorado, is the second suburb of Denver (along with Aurora) that ranks in our top 10. The average time a Thornton home stays on the market is just 41 days, the 12th-shortest selling time in our study. The median home value in this city has also risen 53.0% in the five-year period from 2014 to 2019, ranking 22nd-best for this metric. What’s more, just 12.06% of the homes were sold at a loss, making Thornton 49th-best for this metric overall.

6. Antioch, CA

Antioch California
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Located in the East Bay of San Francisco, Antioch is the second California city in our top 10. The median home value rose 65.6% from 2014 to 2019, ranking ninth-highest in the study for this five-year change. Homes there take an average of 22 days to sell on the market, the third-shortest selling time in the study. Closing costs, however, are relatively expensive – averaging $4,722, which ranks 156th out of 255.

7. Surprise, AZ

Surprise, Arizona from above
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Surprise, Arizona, is the third suburb of Phoenix in the top 10. The average home takes 49 days to sell on the market, ranking 35th for that metric in our study. The median home value in this city has risen 39.5% in the five-year period from 2014 to 2019, with less than 13% of homes sold at a loss. Surprise has 1.46 real estate offices for every 1,000 residents, which, being a county-level metric, ties for 73rd out of 255.

8. Phoenix, AZ

Phoenix, Arizona
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Phoenix, Arizona, has seen a 51.0% increase in median home value in the five years from 2014 to 2019, ranking 32nd for that metric in the study. Phoenix ranks 39th-lowest out of 255 for the average number of days a home takes to sell on the market – less than two months (51 days). That said, 15.95% of homes are sold at a loss, which places Phoenix in the bottom half of the study for that metric.

9. Gilbert, AZ

Gilbert, Arizona
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Gilbert, Arizona, is the fourth suburb of Phoenix in our top 10. This city’s population has boomed from almost 30,000 in 1990 to more than 255,000 in 2019, making it one of the 10 largest municipalities in Arizona. Gilbert homes have the 19th-shortest selling time on our list, averaging 44 days on the market. Gilbert’s median home value has grown 42.2% over the five-year period from 2014 to 2019, ranking 65th overall for that metric. Closing costs in this city average $3,773.

10. Tempe, AZ

Tempe Arizona
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Located in the East Valley of metropolitan Phoenix, Tempe rounds out the top 10 in our study on the best cities to sell a house. Homes in this Arizona city average 37 days on the market, the seventh-shortest selling time on our list. The median home value has risen 38.4% in five years, from 2014 to 2019. Less than 14% of Tempe homes were sold at a loss – 13.54% to be exact, ranking 87th out of 255 for that metric.

Data and Methodology

home for sale
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To find the best cities to sell a house, SmartAsset considered available data for 255 of the largest U.S. cities across the following metrics:

  • Five-year change in median home value. This is the percentage change in median home values from 2014 through 2019. Data comes from the Census Bureau’s 2014 and 2019 5-year American Community Surveys.
  • Average number of days on the market. This is the average number of days a home is on the market before it is sold. Data comes from SmartAsset’s December 2020 study on the healthiest housing markets.
  • Percentage of homes sold for a loss. This is the percentage of homes sold for a price lower than the previous sale price. Data comes from SmartAsset’s December 2020 study on the healthiest housing markets.
  • Closing costs. This represents average closing costs by city. Data comes from SmartAsset’s December 2020 study on places with the lowest closing costs.
  • Real estate offices per 1,000 residents. This is the number of real estate offices per 1,000 residents. Data comes from the Census Bureau’s 2018 County Business Patterns Survey.

To create the final scores, we ranked all of the cities in each metric. Next, we found each city’s average ranking, giving a single weight to all measures except for the one measuring change in home value, which received a double weight. Using this average ranking, we created our final score. The city with the best average ranking received a score of 100 and the city with the worst average ranking received a 0.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

How to Buy a Home in Logan, Utah

Whether you’ve lived in Logan all your life and are ready to look for your first home or you’re looking to relocate to this charming Northern Utah town, there are a few things you should know about becoming a Logan homeowner. If you’re wondering where to start, we’ve got you covered. Here’s everything you need to know about the home buying process in Logan, Utah.

Check Out the Market Performance

Buying a home is a big decision and a big investment. Many Utah cities have high-performing markets right now, so how does Logan compare?

The median home price in Utah was $384,000 at the end of 2020. In comparison, Logan’s median price is $234,737. The affordability of Logan homes is great news for buyers hoping to enter the market for the first time. Anyone hoping to use their Logan home as an investment property should be similarly happy to know they don’t need quite as much cash upfront as they would in some of Utah’s pricier locations.

Although Logan prices are currently lower than the average in Utah, home values are forecasted to increase by as much as 5.7% in 2021, so you can feel confident about your investment.

Get to Know the Logan Culture

Before you become a Logan homeowner, you should get an idea of what it’s like to be a resident. Many people love Logan for its small-town charm, paired with some big-city amenities.

For many residents, Logan culture revolves around outdoor life. You’ll rarely find locals who haven’t been to Logan Canyon or Bear Lake. Because of the easy access to all kinds of outdoor activities, Logan locals are used to stunning sights that many people have to drive hours to reach.

In addition to the outdoor attractions, the city’s arts and culture scene is thriving. The Utah Festival Opera brings world-class talent to Logan every summer. There are also multiple dance companies and numerous theater performances, making this a perfect city for art lovers.

Utah State University also makes Logan a great place for owning rental properties. Whether you’re planning on making your home a rental property right away, or you have ideas of finding tenants years down the road, you’re unlikely to have any issues finding renters from Logan’s large student population.

If you’re already a Logan resident, you may feel like you know the city quite well, but there are regulations you may not be aware of that are unique to homeowners. If you’re planning on being a landlord, it’s important to be aware of rules about maximum occupancy, which vary by neighborhood. Be sure to look up the regulations in your prospective neighborhood before you make your purchase.

Determine your Financing Options

One of the first steps in becoming a homeowner deciding how you’ll finance your home. While some buyers make their purchase without a loan, it’s more common to work with a lender to finance your house.

While finding the right lender might not be the most exciting step in the home buying process, it’s the step that’s likely to have the biggest impact on you long term. If you go with a lender whose rates are too high, you could end up wasting thousands of dollars each year in paying extra interest.

Be sure to shop around to find a lender with a good interest rate who’s also easy to work with. Homie Loans™* has a guarantee that they can beat any other lender’s rates, and if not, they’ll give you $500 cash.**

Choose an Agent Who’s Got Your Back

If you’ve already started the search for an agent, you’re likely aware of how many options there are. While real estate agents aren’t too hard to come by, truly expert agents can be, and these are the types of agents who make all the difference.

Expert agents know how to negotiate prices to get you the price you’re looking for. They also know how to build a compelling offer so you get the house you want, even if you’re facing some competition. These agents also understand the ins and outs of the local Logan market.

It’s important to find an agent not only knows the intricacies of the industry but also who clicks with you. This agent will be a top-notch communicator, and they’ll be able to understand the details of your dream home. They’ll use this knowledge, combined with their local expertise, to find you a house you feel great about.

It may sound like an agent who is so highly skilled would be too good to be true or else they’d cost a fortune to work with, but at Homie, we have some of the highest performing agents in the industry. They’re ready to work with you without breaking the bank. In fact, when you work with a Homie agent, you get top-quality service and a $2,500 refund when you close. If you’re ready to work with a Homie pro to buy your Logan home, click here to get in touch!

***Subject to terms and conditions.

Learn More About Utah Real Estate!

Guide to Buying Rental Properties in St. George, UT
How to Buy Rental Properties in Park City, UT
What’s the Best Time to Sell a Home in Utah?

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Source: homie.com

How Much Does a Home Appraisal Cost?

Congratulations, you’ve found a home that you’re ready to buy. From the days of saving for a down payment, searching the housing market for your dream home, homeownership is almost in sight. So whether you’re a seasoned homebuyer or a first-time homebuyer, you’ll need to plan for a home appraisal before you can get final approval for your mortgage. 

You may be wondering just what is a home appraisal and how much does a home appraisal cost? Before heading into the final steps of the homebuying process, find out about the different types of home appraisals and what factors can change the price of a home appraisal.

home-appraisal-cost

home-appraisal-cost

What is a home appraisal? 

A home appraisal is a prerequisite for most mortgages, whether you’re living in Houston, TX or looking to buy a house in Philadelphia, PA. It determines a home’s value and your lender will use the house appraisal to generate an appraisal report. The report helps lenders decide an appropriate amount to lend to a potential homebuyer to purchase that property. State-certified professionals conduct appraisals to safeguard both buyers and lenders against inflated property valuations.

Who chooses the home appraiser? 

Your mortgage lender will often recommend from a list of preferred appraisers, chosen for their track records as reliable, high-integrity professionals. As the buyer you’ll have to pay the appraisal cost, which usually is a fee added to your closing costs. However, your lender should inform you how much the appraisal will cost when you begin the pre-qualification process, so you’ll know just what to expect.

How much does a home appraisal cost? 

A typical home appraisal can range from $200 to $450. However, the cost of your home appraisal will depend on the type of appraisal you need. Here are the four types of home appraisals you might run across:

1) Uniform Residential Appraisal Report (URAR)

This is the most common type of home appraisal out there and lenders typically require a URAR before approving your mortgage.

During a URAR, a trained and certified appraiser carefully reviews both the home’s interior and exterior. The home appraisal process takes two to four hours — and costs between $300 and $400. At the end of the evaluation, the appraiser will give you a detailed report breaking down your home’s value. This is the most extensive, and therefore most expensive, type of home appraisal.

Note: The remaining three types of appraisals are generally not considered sufficient to obtain a conventional loan, but there are reasons why you may want one of these appraisals.

2) Restricted-Use, Short-form Report, or Drive-by Appraisal: 

As you might expect, this type of appraisal provides less information than other types. Therefore, this home appraisal cost is generally less expensive, around $100 to $150. However, lenders generally do not accept this type of appraisal for mortgage approval. More likely, homeowners and real estate agents may use it to help determine a home’s listing price. For this type of house appraisal, a trained and certified appraiser evaluates only the outside of the house and relies on the owner to provide information about the home’s condition and other details inside. 

3) Comparative Market Analysis (CMA): 

Real estate agents use a CMA to value a home, considering factors like nearby home values, ratings for school districts, and the home’s general condition for their analysis. CMAs provide a reasonable estimate for a home’s value when setting a listing price. While this report is more likely used as a tool for sellers rather than buyers, you can always ask your real estate agent for a CMA if you’re looking to buy. It’s important to note that lenders do not consider a CMA as a valid appraisal to determine loan value. 

4) Online appraisals: 

Numerous online sites offer home appraisals directly to buyers who want to know how much their house is worth. An online home appraisal can be free or have some cost depending on how much information you request. Lenders do not accept this type of home appraisal as a valid appraisal. 

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Factors that affect home appraisal cost

Before you have a home appraised, know the four important factors that can affect the cost of your home appraisal. 

Type of property

The type of property you plan to buy will influence the cost of your home appraisal. For example, an appraisal for a two-bedroom home will be less expensive than one with multiple bedrooms, a finished basement, and an attic. Additionally, if you plan to set up your home as a rental property to generate income, the appraiser will require a rent survey and an income statement, which may increase the cost.

The home’s value

The general value of the home affects the cost of the appraisal. As a rule of thumb, the larger the home, the more expensive the appraisal. A larger home will take more time to evaluate and results in a more extensive report. As a general reference point, properties priced at or less than $500,000 will typically result in an appraisal cost at the lower end of the range.

The home’s location 

How far does the appraiser need to travel to conduct the appraisal? Driving times and mileage are all accounted for these days, so you should expect to pay more for your home appraisal if the house is located out of town.

Type of mortgage you’re applying for

Depending on the type of mortgage you’ve applied for, it may result in a more costly home appraisal. For example, mortgages that involve a federal agency, such as the Federal Housing Administration (FHA), require an appraisal to include additional safety inspections, resulting in a higher cost. 

If you plan on getting a mortgage loan to purchase your new home, getting an appraisal will most likely be a non-negotiable requirement from your lender. Make sure to ask your lender ahead of time what to expect for the home appraisal cost, so you can be sure to set aside that amount to be paid as part of the home closing process. The more prepared you are throughout your homebuying journey, the more likely you’ll find yourself at ease and ready to become a homeowner.

Source: redfin.com

Biden Administration Extends Forbearance and Foreclosure Protections Through June

Good news for Americans who are forced to skip their mortgage payments amid rising unemployment.

The White House is extending the foreclosure moratorium until the end of June for homeowners with mortgages backed by the Department of Housing and Urban Development, Department of Veterans Affairs, and Department of Agriculture. Homeowners will also have until the end of June to request forbearance, which allows them to pause monthly payments.

Originally, both protections were set to disappear at the end of March. The Trump administration put the protections in place almost a year ago as the coronavirus pandemic upended the nation’s economy.

Additionally, the White House announced that homeowners who had entered forbearance before June 30, 2020 will be entitled to an additional six months of mortgage-payment forbearance, broken up into three-month increments. Originally, mortgage borrowers could only receive up to 12 months of forbearance, split up into six-month segments.

The move by the White House comes roughly a week after the Federal Housing Finance Agency announced it would extend the forbearance period for borrowers with loans backed by Fannie Mae and Freddie Mac by three months. All told, the deadlines for forbearance were pushed back for nearly three-quarters of all borrowers with single-family mortgages, the Biden Administration said.

Thus far, the forbearance program has helped to prevent many Americans from becoming delinquent on their home loans, which would have put them at risk of foreclosure. Extending the protections is important, according to economic experts.

“The year-long forbearance initially afforded through the CARES Act seemed sufficient at the time, but the pandemic and its economic fallout is dragging on far longer than had been expected,” said Greg McBride, chief financial analyst at Bankrate.com. He added that the extra six months of forbearance “reflects the reality that long-term unemployment will be an ongoing issue.”

Currently, roughly 5.4% of mortgages across the country are still in forbearance, according to the Mortgage Bankers Association. That level is down from the peak reached last June, when the figure reached well above 8%. However, this winter the number of people exiting forbearance and resuming making their monthly mortgage payments has stagnated in tandem with the bounce-back in employment.

Currently, roughly 5.4% of mortgages nationwide are in forbearance, but around a quarter of these borrowers continue to make monthly payments.

Of the roughly 2.7 million borrowers who are in forbearance, around a quarter have continued to make their monthly payments, according to real-estate data firm Black Knight. There are also around 1.1 million borrowers who are delinquent but did not enter forbearance.

What will happen to all these mortgages when forbearance ends remains an open-ended question. But researchers at the Urban Institute, a think-tank based in Washington, D.C., projected that many people will be able to avoid foreclosure.

“Loss mitigation policies and substantial housing equity can keep foreclosures at bay in most states,” the researchers wrote.

When borrowers exit forbearance, they are not required to pay back all of their missed payments at once in a balloon payment, though loan servicers do offer that as an option. Instead, they can request that the forborne amount be moved to the end of their loan’s duration. That will allow borrowers to resume making payments at the amount they were paying before the pandemic, without incurring extra costs.

Of course, many borrowers will find homeownership unaffordable overall and may not be able to resume making their monthly payments ever because of extended job loss. For most of these borrowers, the higher level of equity built in their homes, especially compared with the foreclosure crisis that preceded the Great Recession, will serve as a buffer.

Researchers at the Urban Institute calculated that less than 1% of mortgages nationwide have negative equity, meaning the loan is larger than the home is worthy. And only 5.5% of loans were found to be near-negative equity. Following the Great Recession, nearly a third of homes were in negative or near-negative equity, they said.

Home-price gains over the past year have meant that most homeowners could sell their property and come out ahead on the sale — though home prices in some parts of the county, such as Chicago and Baltimore, remain below their record peaks.

As a result, most homeowners in forbearance could afford to sell their home rather than go into foreclosure. Of course, these homeowners may struggle to find other housing. And if foreclosure numbers were to increase, that could begin to have an impact on home values across the country and push more people into negative equity.

“A further extension may well be necessary,” the Urban Institute researchers wrote.

Source: realtor.com