In Naples, Florida’s prestigious Aqualane Shores — consistently ranked as one of the most expensive residential areas in the nation — a breathtaking new listing has hit the market for $16.5 million.
This modern marvel, designed by the acclaimed Jonathan Kukk and decked out by Amy Storm & Company, spans nearly 5,500 square feet and features five bedrooms, each with its own ensuite bathroom, and a slew of luxurious amenities including an elevator, pool, spa, and direct Gulf access.
The listing, brought to market by the power team at the Dawn McKenna Group, one of Coldwell Banker’s leading real estate teams, stands out with its impeccable design and bright, light-filled spaces and we’re here to take you on a quick tour of the striking abode.
What $16.5M buys you in Naples, Florida
Nestled in the heart of Naples, Florida, the newly built luxury home stands two stories tall, overlooking the canal.
Spanning nearly 5,500 square feet, this beauty comes with five bedrooms plus a den, five and a half baths, and luxe amenities like an elevator, a shimmering pool and spa, plus a view of the canal with Gulf access.
And if you think $16.5 million is a steep price to pay to enjoy living in Naples, know that a nearby property is asking $174 million, while another 9-acre compound in the area landed on the market with a bang earlier this year, asking $295 million. The price point instantly made it the most expensive house for sale in the entire country.
Architectural artistry by Jonathan Kukk
Designed by the esteemed Jonathan Kukk, CEO and Founder of Kukk Architecture & Design, this house is a testament to modern architectural genius.
Kukk, known for his ability to blend functionality with aesthetic appeal, has created a structure that’s not just a house, but a piece of art. His designs often feature clean lines and open spaces that maximize natural light, and this home is no exception.
Interior elegance by Amy Storm & Company
The interior of this home is the first project in Naples for Amy Storm & Company, a top-tier Chicago-based design firm.
They’ve brought their renowned expertise to the table, creating interiors that feature natural materials, layered neutrals, and finishes that radiate harmony. Every corner of the home reflects their signature style of understated elegance combined with modern comfort.
Anchored by a beautifully appointed kitchen
At the heart of the home, the custom-designed kitchen is a chef’s dream. It boasts Aella Marble countertops and backsplash, a top-notch La Cornue stove, and state-of-the-art appliances.
Whether you’re whipping up a quick breakfast or hosting a gourmet dinner, this kitchen doesn’t just keep up; it stands out.
See also: Top 10 Celebrity Kitchens We Can’t Get Over
Grandeur in the great room
Adjacent to the kitchen, the great room is where this home’s personality shines. It’s a sprawling space meant for living large, whether you’re hosting a party or unwinding after a long day.
With its high ceilings, sophisticated lighting, and a layout that encourages easy conversation, it’s the perfect backdrop for making memories.
Blissful bedrooms
Upstairs, down the hall, everywhere you look — comfort meets style in the five generously sized bedrooms, each featuring an ensuite bathroom.
Thanks to the thoughtful placement of bedrooms over two levels and an elevator to stitch the spaces together, convenience is literally at every turn.
See also: Shaquille O’Neal’s house in Orlando — with the Superman Bed
Outdoor oasis
Step outside to a southern exposure that bathes the landscape in sunlight.
The home’s outdoor area is an entertainer’s paradise, complete with a plush lanai, an outdoor kitchen, and a plaster-clad fireplace for those chillier evenings. Whether it’s pool parties by day or cozy fireside chats by night, this space is ready for any event.
Living it up in Aqualane Shores
Aqualane Shores isn’t just any neighborhood, it’s one of Naples’ most exclusive addresses.
Known for its luxurious homes and pristine waterways, living here means you’re part of a vibrant community that enjoys the finer things in life — boating, easy Gulf access, and breathtaking views are just the beginning.
And properties come with mark-ups to match: The median listing price for the neighborhood sits at a hefty $16 million, per Realtor.com, with a median price/sq. ft. of $2.8k, which makes the coveted community one of the most expensive residential areas in the country.
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Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors’ opinions or evaluations.
As we head into peak home-buying season, signs of life have begun to spring up in the housing market.
Even so, still-high mortgage rates and home prices amid historically low housing stock continue to put homeownership out of reach for many.
Moreover, the National Association of Realtors agreed to a monumental $418 million settlement on March 15 following a verdict favoring home sellers in a class action lawsuit. Still subject to court approval, the settlement requires changes to broker commissions that will upend the buying and selling model that has been in place for years.
Housing Market Forecast for 2024
Elevated mortgage rates, out-of-reach home prices and record-low housing stock are the perennial weeds that experts say hopeful home buyers can expect to contend with this spring—and beyond.
“The housing market is likely to continue to face the dual affordability constraints of high home prices and elevated interest rates in 2024,” said Doug Duncan, senior vice president and chief economist at Fannie Mae, in an emailed statement. “Hotter-than-expected inflation data and strong payroll numbers are likely to apply more upward pressure to mortgage rates this year than we’d previously forecast.”
Despite ongoing affordability hurdles, Fannie Mae forecasts an increase in home sales transactions compared to last year. Experts also anticipate a slower rise in home prices this year compared to recent years, but price fluctuations will continue to vary regionally and depend strongly on local market supply.
U.S. home prices declined in January for the third consecutive month due to high borrowing costs, according to the latest S&P CoreLogic Case-Shiller Home Price Index. But prices year-over-year jumped 6%—the fastest annual rate since 2022.
Chief economist at First American Financial Corporation Mark Fleming predicts a “flat stretch” ahead.
“If the 2020-2021 housing market was too hot, then the 2023 market was probably too cold, but 2024 won’t yet be just right,” Fleming said in his 2024 forecast.
Will the Housing Market Finally Recover in 2024?
For a housing recovery to occur, several conditions must unfold.
“For the best possible outcome, we’d first need to see inventories of homes for sale turn considerably higher,” says Keith Gumbinger, vice president at online mortgage company HSH.com. “This additional inventory, in turn, would ease the upward pressure on home prices, leveling them off or perhaps helping them to settle back somewhat from peak or near-peak levels.”
And, of course, mortgage rates would need to cool off—which experts say is imminent despite rates edging back up toward 7%. For the week ending April 11, the 30-year fixed mortgage rate stood at 6.88%, according to Freddie Mac.
However, when mortgage rates finally go on the descent, Gumbinger says don’t hope they cool too quickly. Rapidly falling rates could create a surge of demand that wipes away any inventory gains, causing home prices to rebound.
“Better that rate reductions happen at a metered pace, incrementally improving buyer opportunities over a stretch of time, rather than all at once,” Gumbinger says.
He adds that mortgage rates returning to a more “normal” upper 4% to lower 5% range would also help the housing market, over time, return to 2014-2019 levels. Yet, Gumbinger predicts it could be a while before we return to those rates.
Nonetheless, Kuba Jewgieniew, CEO of Realty ONE Group, a real estate brokerage company, is optimistic about a recovery this year.
“[W]e’re definitely looking forward to a better housing market in 2024 as interest rates start to settle around 6% or even lower,” says Jewgieniew.
NAR Settlement Rocks the Residential Real Estate Industry
Following years of litigation, the National Association of Realtors (NAR) has agreed to pay $418 million to settle a series of antitrust lawsuits filed in 2019 on behalf of home sellers.
The plaintiffs claimed that the leading national trade association for real estate brokers and agents “conspired to require home sellers to pay the broker representing the buyer of their homes in violation of federal antitrust law.”
Though the landmark settlement is subject to court approval, most consider it a done deal.
The settlement requires NAR to enact new rules, including prohibiting offers of broker compensation on multiple listing services (MLS), the private databases that allow local real estate brokers to publish and share information about residential property listings. The rule is set to take effect in mid-July, once the settlement receives judge approval.
Moreover, sellers will no longer be required to pay buyer broker commissions and real estate agents participating in the MLS must establish written representation agreements with their buyer clients.
NAR denies any wrongdoing and maintains that its current policies benefit buyers and sellers. The organization believes it’s not liable for seller claims related to broker commissions, stating that it has never set commissions and that commissions have always been negotiable.
How Will the New Rules Impact the Buying and Selling Process?
Per the settlement’s terms, the costs associated with buying and selling a home are set to change dramatically.
“The primary things that will change are the decoupling of the seller commission and the buyer commission in the MLS,” says Rita Gibbs, a Realtor at Realty One Group Integrity in Tucson. “It’s gonna cause some chaos.”
While sellers will no longer be able to offer broker compensation in the MLS, there’s no rule prohibiting off-MLS negotiations. Because of this, Gibbs suspects buyers and sellers will continue offering broker compensation off the MLS.
The Department of Justice confirmed it will permit listing brokers to display compensation details on their websites. However, buyer agents will need to undergo the tedious task of visiting countless broker websites to find who’s offering what.
Michael Gorkowski, a Virginia-based real estate agent with Compass, is also trying to figure out how to manage the potential ruling.
“We often work with buyers for many months and sometimes years before they find exactly what they’re looking for,” Gorkowski says. “So in a case where a seller isn’t offering a co-broker commission, we will have to negotiate that the buyer pays an agreed-upon commission prior to starting their search.”
The Changes Will Impact These Home Buyers Most
“In the short term, it is absolutely going to injure buyers, especially FHA and VA buyers,” Gibbs says. “With rare exception, these buyers are not in a position to pay for their own agent.”
Gibbs says that if sellers don’t offer compensation, many buyers who can’t otherwise afford to pay a broker will choose to go unrepresented.
Gorkowski notes that veterans taking out VA loans face a unique challenge under the new rules. “[P]er the VA requirements, buyers cannot pay so it must be negotiated with the seller for now.”
As a result, NAR is calling on the U.S. Department of Veterans Affairs to revise its policies prohibiting VA buyers from paying broker commissions. Even so, there’s skepticism that the federal government will be able to implement changes in time for the July deadline.
Gibbs and Gorkowski are among the many agents especially concerned about first-time home buyers. After July, first-time and VA buyers will be required to sign a buyer-broker agreement stating that they will compensate their broker—but Gibbs says many won’t have the means to do so.
In this situation, agents would likely only show buyers homes where sellers are offering compensation.
“This is a very troubling situation,” Gorkowski says.
Housing Inventory Forecast for 2024
With many homeowners “locked in” at ultra-low interest rates or unwilling to sell due to high home prices, demand continues to outpace housing supply—and likely will for a while—even as some homeowners may finally be forced to sell due to major life events such as divorce, job changes or a growing family.
“I don’t expect to see a meaningful increase in the supply of existing homes for sale until mortgage rates are back down in the low 5% range, so probably not in 2024,” says Rick Sharga, founder and CEO of CJ Patrick Company, a market intelligence and business advisory firm.
Housing stock remains near historic lows—especially entry-level supply—which has propped up demand and sustained ultra-high home prices. Here’s what the latest home values look like around the country.
Yet, some hopeful housing stock signs have begun to sprout:
Existing inventory is showing signs of loosening as impatient buyers and sellers have begun to accept the reality of mortgage rates oscillating between 6% and 7%.
Home-builder outlook also continues to get sunnier, trending back up amid declining mortgage rates and better building conditions.
The most recent National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), which tracks builder sentiment, saw a fourth consecutive monthly rise, surpassing a crucial threshold with an increase from 48 to 51 in March. A reading of 50 or above means more builders see good conditions ahead for new construction.
At the same time, new single-family building permits ticked up 1% in February—the 13th consecutive monthly increase—according to the latest data from the U.S. Census Bureau and U.S. Department of Housing and Urban Development (HUD).
Residential Real Estate Stats: Existing, New and Pending Home Sales
Though some housing market data indicates signs of growth are in store this spring home-buying season, persistently high mortgage rates may hinder activity from fully flourishing.
Here’s what the latest home sales data has to say.
Existing-Home Sales
Existing-home sales came to life in February, shooting up 9.5% from the month before, according to the latest data from the NAR. Sales dipped 3.3% from a year ago.
Experts attribute the monthly jump to a bump in inventory.
“Additional housing supply is helping to satisfy market demand,” said Lawrence Yun, chief economist at NAR, in the report.
Existing inventory rose 5.9%—logging 1.07 million unsold homes at the end of February. However, there are still only 2.9 months of inventory at the current sales pace. Most experts consider a balanced market falling between four and six months.
Meanwhile, existing home prices continue to soar to unprecedented heights, reaching $384,500, which marks the eighth consecutive month of yearly price increases and a February median home price record.
New Home Sales
Sales of newly constructed single-family houses ticked down by a nominal 0.3% compared to January, but outpaced February 2023 sales by 5.9%, according to the latest U.S. Census Bureau and HUD data.
Amid a high percentage of homeowners still locked in to low mortgage rates, home builders have been picking up the slack.
“New construction continues to be an outsized share of the housing inventory,” said Dr. Lisa Sturtevant, chief economist at Bright MLS, in an emailed statement.
Sturtevant notes that declining new home prices are coming amid a recent trend of builders introducing smaller and more affordable homes to the market.
The median price for a new home in February was $400,500, down 7.6% from a year ago.
Source: U.S. Census Bureau and U.S. Department of Housing and Urban Development
Pending Home Sales
NAR’s Pending Homes Sales Index rose 1.6% in February from the month prior even as mortgage rates approached 7% by the end of the month. Pending transactions declined 7% year-over-year.
A pending home sale marks the point in the home sales transaction when the buyer and seller agree on price and terms. Pending home sales are considered a leading indicator of future closed sales.
The Midwest and South saw monthly transaction gains while the Northeast and West saw declines due to affordability challenges in those higher-cost regions.
“While modest sales growth might not stir excitement, it shows slow and steady progress from the lows of late last year,” said Yun, in the report.
Ongoing Affordability Challenges Could Throw Cold Water on Spring Home-Buying Hopes
Though down from its 2023 high of 7.79%, the average 30-year fixed mortgage rate in 2024 remains well over 6% amid rising home values. As a result, home buyers continue to face affordability challenges.
According to data from its first-quarter 2024 U.S. Home Affordability Report, property data provider Attom found that median-priced single-family homes remain less affordable than the historical average in over 95% of U.S. counties.
For one, the data uncovered that expenses are eating up more than 32% of the average national wage. Common lending guidelines require monthly mortgage payments, property taxes and homeowners insurance to comprise 28% or less of your gross income.
At the same time, home prices and homeownership expenses continue to outpace wage growth.
Consequently, the latest expense-to-wage ratio is hovering at one of the highest points over the past decade, according to the Attom report, despite some slight affordability improvements over the last two quarters.
“Affording a home remains a financial stretch, or a pipe dream, for so many households,” said Rob Barber, CEO at Attom.
Pro Tips for Buyers and Sellers
Here are some expert tips to increase your chances for an optimal outcome in this tight housing market.
Pro Tips for Buying in Today’s Real Estate Market
Hannah Jones, a senior economic research analyst at Realtor.com, offers this expert advice to aspiring buyers:
Know your budget. Instead of focusing on price, figure out how much you can afford as a monthly payment. Your monthly housing payment is influenced by the price of the home, your down payment, mortgage rate, loan term, home insurance and property taxes.
Be flexible about home size and location. Perhaps your budget is sufficient for a small home in your perfect neighborhood, or a larger, newer home further out. Understanding your priorities and having some flexibility can help you move quickly when a suitable home enters the market.
Keep an eye on the market where you hope to buy. Determine the area’s available inventory and price levels. Also, pay attention to how quickly homes sell. Not only will you be tuned in when something great hits the market, you can feel more confident moving forward with purchasing a well-priced home. A real estate agent can help with this.
Don’t be discouraged. Purchasing a home is one of the largest financial decisions you’ll ever make. Approaching the market confidently, armed with good information and grounded expectations will take you far. Don’t let the hustle of the market convince you to buy something that’s not in your budget, or not right for your lifestyle.
Pro Tips for Selling in Today’s Real Estate Market
Gary Ashton, founder of The Ashton Real Estate Group of RE/MAX Advantage, has this expert advice for sellers:
Research comparable home prices in your area. Sellers need to have the most up-to-date pricing intel on comparable homes selling in their market. Know the market competition and price the home competitively. In addition, understand that in some price points it’s a buyer’s market—you’ll need to be prepared to make some concessions.
Make sure your home is in top-notch shape. Homes need to be in great condition to compete and create a strong “online curb appeal.” Well-maintained homes and attractive front yards are major features that buyers look for.
Work with a local real estate agent. A real estate agent or team with a strong local marketing presence and access to major real estate portals can offer significant value and help you land a great deal.
Don’t put off issues that require attention. Prepare the home by making any repairs or improvements. Removing any objections that buyers may see helps focus the buyer on the positive attributes of the home.
Will the Housing Market Crash in 2024?
Despite some areas of the country experiencing monthly price declines, the likelihood of a housing market crash—a rapid drop in unsustainably high home prices due to waning demand—remains low for 2024.
“[T]he record low supply of houses on the market protects against a market crash,” says Tom Hutchens, executive vice president of production at Angel Oak Mortgage Solutions, a non-QM lender.
Moreover, experts point out that today’s homeowners stand on much more secure footing than those coming out of the 2008 financial crisis, with many borrowers having substantial home equity.
“In 2024, I expect we’ll see home appreciation take a step back but not plummet,” says Orphe Divounguy, senior macroeconomist at Zillow Home Loans.
This outlook aligns with what other housing market watchers expect.
“Comerica forecasts that national house prices will rise 2.9% in 2024,” said Bill Adams, chief economist at Comerica Bank, in an emailed statement.
Divounguy also notes that several factors, including Millennials entering their prime home-buying years, wage growth and financial wealth are tailwinds that will sustain housing demand in 2024.
Even so, with fewer homes selling, Dan Hnatkovskyy, co-founder and CEO of NewHomesMate, a marketplace for new construction homes, sees a price collapse within the realm of possibility, especially in markets where real estate investors scooped up numerous properties.
“If something pushes that over the edge, the consequences could be severe,” said Hnatkovskyy, in an emailed statement.
Will Foreclosures Increase in 2024?
In February, total foreclosure filings were down 1% from the previous month but up 8% from a year ago, according to Attom.
“These trends could signify evolving financial landscapes for homeowners, prompting adjustments in market strategies and lending practices,” said Barber, in a report.
Lenders began foreclosure on 22,575 properties in February, up 4% from the previous month and 11% from a year ago. Meanwhile, real estate-owned properties, or REOs, which are homes unsold at foreclosure auctions and taken over by lenders, spiked year-over-year in three states: South Carolina (up 51%), Missouri (up 50%) and Pennsylvania (up 46%).
Despite foreclosure activity trending up nationally and certain areas of the country seeing notable annual increases in REOs, experts generally don’t expect to see a wave of foreclosures in 2024.
“Foreclosure activity is still only at about 60% of pre-pandemic levels … and isn’t likely to be back to 2019 numbers until sometime in mid-to-late 2024,” says Sharga.
The biggest reasons for this, Sharga explains, are the strength of the economy—we’re still seeing low unemployment and steady wage growth—along with excellent loan quality.
Massive home price growth in homeowner equity over the past few years has also helped reduce foreclosures.
Sharga says that some 80% of today’s homeowners have more than 20% equity in their property. So, while there may be more foreclosure starts in 2024—due in part to Covid-era mortgage relief programs phasing out—foreclosure auctions and lender repossessions should remain below 2019 levels.
When Will Be the Best Time To Buy a Home in 2024?
Buying a house—in any market—is a highly personal decision. Because homes represent the largest single purchase most people will make in their lifetime, it’s crucial to be in a solid financial position before diving in.
Use a mortgage calculator to estimate your monthly housing costs based on your down. But if you’re trying to predict what might happen next year, experts say this is probably not the best home-buying strategy.
“The housing market—like so many other markets—is almost impossible to time,“ Divounguy says. “The best time for prospective buyers is when they find a home that they like, that meets their family’s current and foreseeable needs and that they can afford.”
Gumbinger agrees it’s hard to tell would-be homeowners to wait for better conditions.
“More often, it seems the case that home prices generally keep rising, so the goalposts for amassing a down payment keep moving, and there’s no guarantee that tomorrow’s conditions will be all that much better in the aggregate than today’s.”
Divounguy says “getting on the housing ladder” is worthwhile to begin building equity and net worth.
Frequently Asked Questions (FAQs)
Will declining mortgage rates cause home prices to rise?
Declining mortgage rates will likely incentivize would-be buyers anxious to own a home to jump into the market. Expect this increased demand amid today’s tight housing supply to put upward pressure on home prices.
What will happen if the housing market crashes?
Most experts do not expect a housing market crash in 2024 since many homeowners have built up significant equity in their homes. The issue is primarily an affordability crisis. High interest rates and inflated home values have made purchasing a home challenging for first-time homebuyers.
Is it smart to buy real estate before a recession?
If you’re in a financial position to buy a home you plan to live in for the long term, it won’t matter when you buy it because you will live in it through economic highs and lows. However, if you are looking to buy real estate as a short-term investment, it will come with more risk if you buy at the height before a recession.
Property preservation company MCS announced last month that it had entered the reverse mortgage business after acquiring Five Brothers Asset Management Solutions. In part one of RMD’s interview with MCS CEO Craig Torrance, he explained his company’s interest in the reverse space.
In the second part of the interview, Torrance goes deeper into the value proposition of engaging in the reverse mortgage business; the ways companies like his might be able to simplify certain necessary property obligations; and more about what the company is inheriting from Five Brothers in terms of knowledgeable people and reverse industry relationships.
Editor’s note: This interview has been edited and condensed for clarity and readability.
Chris Clow/RMD: What do you hope the industry can do to offer more or better information about how MCS will pursue continued business in the reverse mortgage space?
Craig Torrance: I think [we] will naturally, hopefully, bring in the lenders to think through what this relationship will look like going forward, and to identify what else we can do to help folks in the space. Generally, I think as we pull together resources and understand as an industry what we can do, there will be more of that type of thinking around what services can be created for reverse mortgage owners to utilize and say, ’Hey, I need work done. I need somebody to cut my grass.’
In many cases, some of those services are managed by family members. So, you’ve got the elderly folks in the reverse mortgage, and the kids are the ones trying to figure out how to maintain mom’s house. If we can professionalize that so people feel good knowing the person performing this work at mom’s house is from a solid, reputable company — and that the lender, the servicer and everybody’s kind of involved in that — it’s probably an upside for the whole community.
Clow: It’s my understanding that Five Brothers was a member of the National Reverse Mortgage Lenders Association (NRMLA). Is that a membership MCS will continue with?
Torrance: Yes. We grabbed everything out of the business, and we’re also going to continue with the team there. They bring a lot of industry expertise, and the business was huge: It was a 50-year-old business. They spent a lot of time in this space, with a lot of people there having 20 to 25 years of experience in reverse. Part of the deal was to bring all that expertise into MCS and continue.
So, we really want to be active in the reverse space, be a participant in the industry, be part of the conversations and share what we think we can do to help out. Hopefully, everyone can raise their hands.
Clow: What’s your assessment of the competitive landscape for this specific segment of the reverse business?
Torrance: We don’t see any direct competitor to our place. We see direct competitors in certain segments, like property preservation in forward (lending). There are competitors in single-family rental (SFR) service centers. In reverse, there are a few competitors. But to us, what is key is that when you put it all together, there isn’t any one company that can do all the things we can. That’s why we feel good about the business model.
Adding in reverse allows all those reverse companies to pull from a commercial business, from our single-family rental business and from our forward mortgage business. That ultimately means we have more vendors, better technology and tools — we believe — than our competitors. So, we have individual competitors in certain segments but no one overall competitor, which makes us somewhat unique.
Clow: HousingWire is read by people across the business — from loan originators up through executives at lenders and servicers, as well as government officials. Is there anything in particular you think they should know about MCS getting into reverse?
Torrance: I think the key message that I would double down on is the conversation around labor in the U.S. and how costs to perform this kind of maintenance work have only accelerated over the last few years. What we’ve found is that this is ultimately a fee-based business. When you perform some of these basic types of maintenance services, there’s a cap on how much you can charge for that.
What has happened is we have seen vendors leave the space, so we are at a point where they would rather work for Amazon than cut grass because they can make more money than cutting grass on a defaulted reverse mortgage property. So, what we’ve seen is people shy away from this segment and these FHA-backed properties. MCS is trying to solve that problem by bringing more work to the vendors today through reverse, forward, commercial and SFR.
Clow: Is there anything that we didn’t speak to about this entrance into the space that you think people should know?
Torrance: The only thing I would add in is that Five Brothers has built a technology platform to really enable the reverse process very well. When it comes to technology, people say you can build anything. It’s just ones and zeros at the end of the day. And to an extent, that’s true, but the reality is that it’s hard to build the platform to do reverse mortgage process servicing.
It’s hard to build a servicing platform, and the servicing platform that reverse people use is different from forward. So, thinking through that, what they’ve really done over the last 20 to 30 years is they’ve created a process flow and enabled that process for a really slick tech engine that you can now move through the reverse process very easily. It’s transparent, and we can unlock a lot of efficiencies, and ultimately get to compliance and deliver great service through there.
That was critical for me. Technology needs to unlock this. Five Brothers probably has the best property preservation platform for reverse in that segment. We now have that platform, will continue to invest in it and we can only just accelerate that over the next few years.
Building equity is one of the biggest advantages of owning a home. With a home equity loan or home equity line of credit (HELOC), you can take advantage of that equity to finance home improvements, consolidate debt or pay for other big expenses.
While getting home equity financing is a fairly simple process, it’s important to review the details before applying. Lenders have standard criteria that homeowners must follow to qualify for either loan, as well as their own specific requirements. Make sure to compare different lenders and take a look at the requirements before applying.
Below, we’ll cover the general criteria for home equity loans and HELOCs as well as more on how to choose the right financing option for you.
How do home equity loans and HELOCs work?
Home equity loans and HELOCs are secured loans that act as second mortgages. Both use your property as collateral for the debt.
With a home equity loan, you get access to a lump sum of cash upfront and pay it back over a period of five to 30 years at a fixed interest rate.
A HELOC is an ongoing line of credit from which you can withdraw funds as needed. With a HELOC, you have the draw period and the repayment period. During the draw period (typically 10 years), you can borrow money on a revolving basis, up to a limit, and you’ll typically pay interest only on what you’ve borrowed. During the repayment period (often 20 years), you’ll pay back both the principal and interest on the loan.
Both are good options for homeowners in need of access to cash, but there’s always a risk when you borrow against your home. If you default on your payments, you run the risk of losing your property.
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Requirements to borrow home equity
The requirements to qualify for either a home equity loan or HELOC are similar. Although each lender has its own qualifications, the following checklist provides general criteria to help you get started.
1. Have at least 15% to 20% equity in your home
Home equity refers to the ownership stake in your home. Your equity is calculated by the amount of your down payment together with all the mortgage payments you’ve already made. With each mortgage payment you make, the less you owe on your home and the more equity you have. If an appraisal increase the value of the home, that will also yield more equity.
Most lenders require you to have at least 15% to 20% equity in your home to take out a home equity loan or HELOC. If you made a 20% down payment when you purchased your property, you’ll have already met the requirement to borrow against your equity.
2. Your loan-to-value ratio shouldn’t exceed 80%
Your loan-to-value ratio, or LTV, is another factor lenders consider when deciding whether to approve you for a home equity loan or HELOC. Your LTV is determined by dividing your current mortgage balance by the home’s appraised value. Having a lower LTV means less risk for mortgage lenders.
If your home is worth $300,000 and your loan balance is $200,000, here’s how you’d calculate your LTV:
$200,000 / $300,000 = 0.67
Your LTV is expressed as a percentage. In this example, your LTV is 67%, meaning you have 33% equity in your home.
While requirements can vary across lenders, the rule of thumb is that your LTV shouldn’t exceed 80%. Making a higher down payment and paying down your mortgage are two ways to lower your LTV.
3. Have a credit score in the mid-600s or higher
Most lenders want to see a minimum credit score of 620 in order to qualify for a home equity loan or HELOC.
Lenders use your credit score to determine the likelihood that you’ll repay the loan on time, so a better score will improve your chances of getting approved for a loan with better terms. A higher credit score of 700 or more will make you eligible for a loan at a lower interest rate, which will save you a substantial amount of money over the life of the loan.
4. Your debt level shouldn’t exceed 43%
Your debt level is determined by your debt-to-income ratio, which is your monthly debt payments divided by your gross monthly income. Your DTI ratio helps lenders determine if you’re capable of paying back your loan on time and of making consistent monthly payments.
To calculate DTI, lenders tally the total monthly payment for the house — mortgage principal, interest, taxes, homeowners insurance, direct liens and homeowner association dues — and any other outstanding debt. That total debt is then divided by your monthly gross income to get your DTI ratio.
Some lenders prefer that your monthly debts don’t exceed 36% of your gross monthly income, but many others are willing to go as high as 43%. If your DTI ratio is higher than 43%, consider paying down your debts first to lower your DTI.
5. Have sufficient income
Lenders want to make sure that you can pay back the loan, so they’ll lend only to those who can prove sufficient income. If you don’t have traditional employment or a stable source of income, you may have trouble qualifying for a home equity loan or HELOC.
How much can you borrow with a home equity loan or HELOC?
The more equity you have in your home, the more you’re eligible to borrow. In general, you can borrow around 80% to 85% of the equity in your home, minus your current mortgage balance.
You can determine how much money you’ll be able to obtain from a home equity loan by starting with the current value of the home. If, for example, your home is worth $300,000 and a bank lender allows you to borrow up to 80% of the value of your home, you simply multiply the two values to get the maximum amount you can borrow, which is $240,000.
$300,000 x 0.8 = $240,000
But if you have a balance on your mortgage of $200,000, you need to subtract it from the $240,000 maximum the bank will let you borrow.
$240,000 – $200,000 = $40,000
That means you can borrow $40,000 for a home equity loan or HELOC.
Should you get a home equity loan or a HELOC?
Home equity loans and HELOCs can be used for similar purposes, but they have some important differences. Neither product is better than the other, so consider your own expenses and goals.
If you need to fund a single project with a set cost, a home equity loan may be the better option, especially if the predictability of a fixed interest rate and monthly payment appeals to you. A HELOC may make more sense if you want flexible access to funds over a long period of time rather than an upfront sum of cash.
You should get a HELOC if:
You need access to credit for an extended period of time. HELOCs have a draw period that typically last five to 10 years.
You need more time to repay the loan amount. The repayment period for HELOCs ranges from 10 to 20 years.
You aren’t sure how much money you’ll need. HELOCs give you the flexibility to withdraw money in installments and not all at once. During the draw period, you can borrow up to a limit as many times as you like, and only pay interest on what you borrow. This makes HELOCs a good option for managing variable or unpredictable costs.
You should get a home equity loan if:
Your want a predictable monthly repayment schedule. Unlike variable-rate HELOCs, home equity loans have fixed interest rates, making it relatively easy to factor into your monthly budget.
You have a specific expense in mind. You receive 100% of the funds from a home equity loan upfront, which can be useful if you need a set amount of cash to cover a home improvement project, pay off high-interest debt or another need.
Alternatives to home equity loans and HELOCs
A home equity loan or HELOC can be a good way to fund large expenses, but there are other financing options that may be a better fit for your situation. Some alternatives you may want to consider include:
A cash-out refinance. With a cash-out refinance, you are cashing out the equity you’ve built in your home over the years. You replace your existing mortgage with a new, larger one and pocket the difference as cash. The money you borrow is rolled into your new mortgage, so you’ll have only one monthly payment. A cash-out refinance is a good option if you can get a better rate than the one on your existing mortgage.
A personal loan. If you need to borrow only a small amount of money, a personal loan might be a better fit than a home equity loan or HELOC. The interest rate will typically be higher and the loan term shorter, but it’s less risky because it’s an unsecured loan. Plus, you won’t have to go through a home appraisal or pay closing costs.
A balance transfer credit card. If the main reason you’re looking to take out a loan is to consolidate other high-interest debt, balance transfer credit cards let you combine your debts into one card that has a long 0% APR introductory period. If you can pay off the debt before the 0% introductory period ends, you’ll get rid of your debt faster. Just be sure to plan ahead carefully: If you’re still carrying a balance by the end of the introductory period, you’ll be charged the regular credit card APR, which can be high.
The bottom line
A home equity loan and HELOC are two ways you can tap into the equity of your home. To qualify for either loan with reasonable terms, you should have at least 15% to 20% equity in your home, a LTV ratio of 80% or lower, a credit score of at least 620 (the higher, the better) and a DTI ratio no higher than 43%.
Though specific qualifications vary between lenders, make sure you have a reliable payment history and source of income to be eligible for a home equity loan or HELOC.
FAQs
Some lenders will provide a home equity loan or HELOC if you don’t have a job or are retired, but instead have regular income from a retirement account such as a pension. The income can also come from a spouse or partner’s employer, government assistance or alimony.
Lenders are typically seeking at least 15% to 20% equity in your home in order to qualify for a home equity loan or HELOC. However, some lenders will allow you to borrow with less equity.
Minimum credit scores vary from lender to lender, but most require you to have at least a 620 credit score. You’ll have a better chance of qualifying and getting access to lower interest rates if your credit score is 700 or above.
You can improve your credit score before you apply for a home equity loan by making payments on time, paying down the amount that’s owed on credit cards and avoiding taking out any new loans or making any major purchases.
In the private mountainside community of Ascaya, located in Henderson, NV, a new residential project called The Canyon at Ascaya aims to set a new standard for luxury living.
The Canyon will be just 20 minutes from the Las Vegas Strip, offering a serene retreat near the city’s vibrant culture, adding to a growing number of options for luxury homebuyers looking to settle down in Sin City.
And there’s no shortage of wealthy buyers scooping up properties in (and around) the city.
Las Vegas is increasingly becoming a hotspot for luxury home buyers, including celebrities seeking privacy and exclusive amenities away from the public eye. Celine Dion sold a house here for $30 million last year, setting a new local real estate record and making a killer profit in the process.
Actor Mark Wahlberg bought himself a $14.5 million bungalow in The Summit Club (which he has since sold) while waiting for his mansion to be built on a separate 2.5-acre lot in the same community, which he purchased for $15.6 million. But the newest enclave isn’t necessarily targeting high rollers.
The Canyon at Ascaya will offer architecturally significant homes designed by acclaimed Nevada-based firm, Blue Heron, known for its integrated architectural, interior design, and construction services.
Sales are set to launch this spring, with potential buyers encouraged to register online for more details. But we’re here to give you a sneak peek inside the modern desert abodes.
Architectural excellence
Each home in The Canyon will be crafted to be a work of art, featuring a modern desert design that maximizes views and privacy.
These residences are strategically positioned across elevated terraces to enhance the connection between indoor and outdoor spaces. Large glass doors and expansive windows are designed to bring in natural light and offer residents unobstructed views of the surrounding desert canyon landscape.
The residences
The homes will range in size from 3,391 to 4,407 square feet, with configurations that include three and four bedrooms. The design emphasis is on creating spaces that are both aesthetically pleasing and functionally sophisticated.
The residences boast dual primary suites, spacious great rooms, and a layout that promotes seamless flow from indoor to outdoor living areas.
See also: What $20 Million buys you at The Summit Club, Las Vegas’ most exclusive residential community
Lifestyle and wellness
Beyond the stunning architecture, The Canyon promotes a lifestyle enriched with wellness and relaxation. The community features landscaped communal areas with pools, spas, and outdoor kitchens. Additionally, private wellness parks with yoga decks and meditation spaces offer residents opportunities for personal health and tranquility.
“Our architectural philosophy is rooted in the belief that a home should be a sanctuary, and at The Canyon, we’ve created sanctuaries that celebrate the distinct canvas of the desert landscape,” shares Chris Beucler, President of Blue Heron. “In every detail of The Canyon homes, you’ll find a commitment to excellence, sustainability, and design that enhances the human experience. This is modern desert living reimagined.”
Community and amenities
Residents of the new enclave will have access to the extensive amenities of the Ascaya community, in addition to the exclusive amenities within The Canyon.
This includes a 23,000-square-foot clubhouse, a 50-meter pool with private cabanas overlooking the Las Vegas Strip, and a sports pavilion offering tennis and pickleball, and a two-acre Family Park, complementing the serene living environment and providing a balanced lifestyle of leisure and activity.
Connection to Las Vegas
Located just 20 minutes from the Las Vegas Strip, The Canyon at Ascaya will offer a retreat from the bustling city life while still providing convenient access to its vibrant cultural and entertainment offerings. This balance will make The Canyon an attractive option for those seeking a peaceful home environment with the excitement of Las Vegas readily accessible.
Related: Why Summerlin is the pinnacle of luxury living in Las Vegas
Market position and sales
With a starting price of $2,900,000, The Canyon homes are positioned as a premium offering in the luxury sector of the Las Vegas real estate market. A public sales launch is scheduled for this spring, and prospective buyers can now register online to receive more information.
Lock-and-leave lifestyle
The community was designed as a lock-and-leave community — meant to be as low maintenance for the homeowners as possible, allowing them to lock the front door and be on their way to their next adventure.
“The Canyon at Ascaya represents a defining moment for lock-and-leave, resort-style living in Las Vegas,” said Sam Brown, Development lead for Ascaya. “Our vision for The Canyon at Ascaya is to craft a one-of-one community that embodies both the serenity of desert living and the convenience of modern luxury. We believe we’ve achieved that balance perfectly.”
Adding to Ascaya’s already impressive offering
Ascaya is a luxury community carved into the mountainside of the McCullough Range. It offers unparalleled views of the Las Vegas Valley and a commitment to architectural excellence that defines its collection of contemporary desert architectural homes. Each residence within Ascaya is unique, yet the community represents a cohesive expression of desert contemporary living.
Adding to the offering, The Canyon at Ascaya project extends Ascaya’s vision of delivering a luxury living experience that is both distinctive and harmonious with the desert landscape. For those seeking a modern, luxurious home in Las Vegas, The Canyon will be a compelling new option.
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Call it the Yellowstone effect, but ranch living is definitely having a moment.
In recent years, countless homebuyers seeking a blend of luxury, privacy, and a closer connection to nature have opted for rural properties that offer more bang for your buck — and a tranquil lifestyle that promises less fuss and more rewards.
This trend has not gone unnoticed in the celebrity world, with notable figures like Donald Glover, Kelis, and even Calvin Harris (who ventured as far as Ibiza to secure a 183-acre farm) embracing the ranch lifestyle.
And now, there’s a new option on the market for prospective buyers seeking to own a piece of rural California.
The Green Acre Ranch — a nearly 20-acre property in Somis, California with mini-horse stables and over 1,500 income-producing fruit trees — has just been listed for $7.35 million, presenting a unique blend of luxury ranch living and lucrative agricultural potential.
Rochelle Maize and Myra Nourmand of Nourmand & Associates hold the listing, and they’ve given us all the deets on this unique opportunity.
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An income-producing ranch
Located conveniently an hour’s drive from Los Angeles and a stone’s throw from the charming towns of Camarillo and Moorpark, the Green Acre Ranch offers a perfect retreat for those wanting proximity to the city while enjoying the tranquility of the countryside.
The property spans 20 acres and is adorned with 1,500 matured avocado, pomegranate, and lemon trees, which have historically turned a profit, generating $72k and $84.5k in revenue in 2023 and 2022, respectively.
The estate boasts an array of features designed to cater to the luxury-minded homeowner with a penchant for outdoor living.
From a long gated driveway lined with roses to a swimming pool and a large pond that mirror the property’s serene setting, each detail has been curated to enhance the ranch’s natural beauty and its panoramic views of the valley.
The sprawling property has a charming, Mediterranean-style home that allows guests and residents to soak in the picturesque canyon views from nearly every room of the house.
“The estate is set away from the street, which gives the homeowner ultimate privacy,” listing agent Myra Nourmand tells us.
See also: Is the Yellowstone ranch real? We found the Dutton ranch in real life
Inside the 5-bedroom home
Featuring 5 bedrooms, 5 bathrooms, an inviting eat-in kitchen, and a showstopping Spanish-tiled staircase, the interiors draw you in as much as the idyllic surroundings.
Built in 2008, the house features tile, wood, and stone flooring with two fireplaces adding to the coziness of the home. And the rooms are as grand and impressive as the rest of the property.
The heart of the home
The great room stands out as the property’s crown jewel, providing breathtaking views of the expansive yard and the canyon beyond.
As Myra Nourmand highlights, the ranch offers vistas on par with those found in Italy, creating a scenic backdrop that could rival scenes from “The Sound of Music.”
“The Green Acre Ranch’s views are truly magnificent,” agent Myra Nourmand tells us. “I’ve traveled extensively across Europe and can say that this property is on par with the views found in Italy. As you walk through the property’s French doors, it’s like you’re in “The Sound of Music” with these stunning views of the hills and canyon.”
A rich historical tapestry
The Green Acre Ranch carries a storied past with Hollywood connections, having been a preferred gathering spot for musicians at the behest of previous owner Mary Hollander.
Mary Hollander directed and produced for the Sagamore Players, a local theater troupe, often staging shows in her home. Her husband, Max Hollander, was a violinist in the early 1940s and he was an associate concertmaster for the NBC Symphony Orchestra led by Toscanini.
According to our sources, Hollander used to have parties at the property where all these Hollywood musicians would come up on the first Sunday of the month. The ranch’s Hollywood legacy, coupled with its robust agricultural potential, makes it a property with both charm and investment value.
It has an orchard with 1,500 fruit trees
Rochelle Maize emphasizes the ranch’s vast outdoor amenities, including an 11-stall horse stable, a luxurious BBQ pavilion, and the possibility to add more facilities such as sports courts or additional animal shelters.
The property also boasts an orchard of 1,500 fruit trees, including avocado, orange, lemon, guava, grapefruit, pomegranate, and more, offering a trove of California produce just moments away. With this much land, prospective buyers can cultivate a vineyard, build sports facilities like a pickleball court, or construct more animal shelters and barns for pigs, ducks, or goats. All animals are welcome!
The property’s orchard not only enhances its appeal but also offers a sustainable living option by allowing homeowners to cultivate a variety of fruits.
See also: Sandra Bullock sells 91-acre compound with organic avocado, citrus orchards
Stables for mini-horses
Possibly the most charming amenity is reserved for the equestrian enthusiast, as the property can easily be turned into a miniature horse farm.
An 11-stall miniature horse stable stands ready to accommodate small equine companions, with the flexibility to convert for full-size horses.
There’s even a private pond
In line with the whole “trading the city life for quiet ranch living”, this particular luxury listing comes with both the traditional pool AND a cute little pond.
The tranquil private pond adds a touch of whimsy to the landscape, offering a serene backdrop for entertainment and relaxation.
See also: Suzanne Somers’ beloved 28-acre Palm Springs retreat re-lists for $8.95 million
Located in Somis, California
“Somis is conveniently located just an hour’s drive from Los Angeles, making it ideal for someone who seeks a quiet and relaxing retreat but still wants to be close to city life,” listing agent Rochelle Maize says in an exclusive quote for Fancy Pants Homes.
“Situated amidst the charming towns of Camarillo and Moorpark each just a short 15–20-minute drive away, residents and visitors alike can enjoy outlet malls, scenic hiking trails, and country club golf courses. The town of Somis itself is ripe with neighboring farms and nurseries that provide fresh local fruits, vibrant flowers, and delicious nuts, adding to the area’s idyllic rural charm.”
A multifaceted opportunity
Beyond its enchanting living spaces and outdoor amenities, the ranch serves as a fully functional farm.
The previous owner leveraged the orchard’s produce to create a line of kitchen and bath products, from gourmet balsamic vinegar, including fig and pomegranate flavors, to avocado soaps, body scrubs, and body lotions, showcasing the estate’s versatility and entrepreneurial potential.
The Green Acre Ranch is more than just a home; it’s a lifestyle choice for those seeking privacy, luxury, and the opportunity to live off the land, all within reach of Los Angeles.
As the trend towards ranch living grows among celebrities and luxury homebuyers alike, this listing represents a rare chance to own a piece of California’s coveted rural lifestyle.
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Artit_Wongpradu/Getty Images; Illustration by Issiah Davis/Bankrate
Key takeaways
An FHA construction loan is a type of FHA loan that covers the cost of building a home, including the land or lot purchase, building materials and labor.
There are two types of FHA construction loans: an FHA construction-to-permanent loan and a FHA 203(k) loan.
FHA construction loans can be rolled into an FHA permanent mortgage.
If you’d rather build a home than buy one, an FHA construction loan could help pay for the project. Like a regular FHA loan, this type of financing is insured by the Federal Housing Administration (FHA) and offered by FHA-approved mortgage lenders. Here’s how to get one.
What is an FHA construction loan?
An FHA construction loan is a type of FHA loan used to build a home. It works like a conventional construction loan by providing short-term financing for a range of construction costs, from the architect’s fee to the certificate of occupancy. Often, borrowers convert these loans to long-term mortgages once the house is built.
Unlike conventional construction loans, however, FHA construction loans are insured by the FHA. That means if you have a down payment of at least 3.5 percent, you could qualify for the loan with a credit score as low as 580.
How does a construction loan work?
Construction loans aren’t like regular mortgages. They typically last for one year, during which time the lender releases payments, usually directly to your contractor. The lender enlists an inspector to evaluate the project at various stages, and releases more funds once everything checks out. Once construction is finished, the loan either converts to a traditional mortgage or the borrower obtains a mortgage to pay it off.
Types of FHA construction loans
FHA construction-to-permanent loan: An FHA construction-to-permanent loan finances the ground-up construction of a home — including the purchase of the land or lot — then converts to a regular FHA mortgage. This is also known as a one-time or single-close loan; you won’t have to pay closing costs for two separate loans.
FHA 203(k) rehab loan: An FHA 203(k) loan finances the cost of buying an existing home plus renovations and repairs. There are two types of 203(k) loans: a standard 203(k) for renovations costing $35,000 or more; and a limited 203(k) for smaller-scale, less expensive projects. Either option allows you to obtain one loan to buy and fix up a home, instead of two loans.
FHA construction loan requirements
The qualifying requirements for an FHA construction loan are similar to those for standard FHA loans, but with a few additions.
To qualify for any FHA loan, you’ll need to meet the following criteria, at minimum:
Credit score: At least 580, or as low as 500 if putting down at least 10 percent
Debt-to-income (DTI) ratio: No more than 43 percent (with some exceptions)
Down payment: 3.5 percent with a credit score of at least 580, or at least 10 percent with a credit score between 500 and 579
Loan limits: No more than the FHA loan limits for the year; for 203(k) loans, no more than the FHA loan limits, the home’s after-renovation value plus improvement costs or the home’s after-renovation value, whichever is less
Mortgage insurance: Upfront and annual FHA mortgage insurance premiums, paid for the life of the loan in most cases
Occupancy: Primary residences only
On top of these requirements, FHA construction loans require satisfactory documentation detailing the construction or renovation project, including information about the contractor you plan to work with. For a standard 203(k) loan, you’ll be assigned a 203(k) consultant to estimate the remodeling or repair costs.
Whether you get a construction-to-permanent or rehab loan, the work will also be subject to inspection as the project progresses.
How to get an FHA construction loan
You can get an FHA construction loan from an FHA-approved lender, though not every FHA lender offers this type of financing. If you’re not sure where to start, search the U.S. Department of Housing and Urban Development’s list of lenders by state or county. You can filter for 203(k) lenders, too, if that’s the type of loan you’re after.
From there, the process involves connecting with a contractor and getting preapproved for financing. Here’s an overview:
Prepare your credit and finances. Construction loan interest rates are often higher than the rates for a regular mortgage. While you can get an FHA loan with a relatively low credit score and down payment, a better score and a higher down payment could help you get a lower rate and pay less in mortgage insurance. If you plan to build a brand-new home, you’ll also want extra stashed away for the inevitable budget snags that come up in construction. Here’s more on the cost of building a home.
Partner with a contractor and real estate agent. Whether you plan to build a home or renovate an existing property, you’ll need to work with a contractor to learn your costs and draw up plans, then provide these details to your lender for approval. If you’re getting a standard 203(k) loan, you’ll also work with a 203(k) consultant to estimate costs. From there, a real estate agent can help you find the right parcel of land, lot or fixer-upper.
Get preapproved for a construction or rehab loan. You’ll need to meet all of the FHA loan requirements and any other criteria your lender stipulates. If you qualify, your lender will base the loan amount on the appraised after-construction or after-renovation value of the home.
Alternatives to an FHA construction loan
An FHA construction loan is just one type of construction financing. While it can help you build or renovate a home, you can’t use it for an investment property or vacation home, and you’ll have to pay mortgage insurance premiums, which add to your costs. Here are alternatives to consider:
Conventional construction loans: More widely available than FHA construction loans, conventional construction loans include construction-to-permanent and construction-only options. The downsides: You’ll need to come up with a higher down payment than the FHA version, as well as have a higher credit score. You won’t have to pay mortgage insurance for the entire loan term, however, unlike most borrowers with an FHA loan.
Renovation loan: Instead of a 203(k) loan, you might look into a conventional HomeStyle renovation loan, which provides financing up to 75 percent of the home’s after-renovation value.
VA or USDA construction loans: If you’re a service member or veteran or have a lower income and want to build a home in a qualifying rural area, consider a VA or USDA loan, respectively. These don’t require a down payment or mortgage insurance and can have flexible credit standards. You’ll need to pay a one-time funding fee for the VA loan and guarantee fees for a USDA loan, however.
Home equity options: If you want to make improvements to your home or another property you own, you might have enough equity in your current home to make that happen. Depending on your needs and goals, the options include a home equity loan (a second mortgage) or a line of credit, known as a HELOC.
Refinance and take cash out: If interest rates have gone down since you got your mortgage, you might be able to refinance to a new, bigger loan with a lower rate and cash out some of your equity to pay for renovations. Generally, this option works best for homeowners who can get a lower rate, have equity to spare and plan to do extensive remodeling.
FAQ
Many types of mortgage lenders offer FHA loans, but not all offer FHA construction loans. You can search FHA-approved lenders in your area on the U.S. Department of Housing and Urban Development’s website, or start with our guides to the best FHA mortgage lenders and best FHA 203(k) rehab mortgage lenders.
If you’re making a down payment of 3.5 percent, the minimum credit score for an FHA construction loan is 580. If you have at least 10 percent to put down, you could qualify with a score as low as 500.
Work doesn’t take a break when the cameras stop rolling.
Fresh off the heels of a hit new season of “Buying Beverly Hills“, the real estate power team at The Agency is bringing another showstopping property to the market, one with architectural pedigree, plenty of acreage, and a long history of celebrity owners — and guests.
Set in La Quinta, Calif., the estate once owned by game show legend Merv Griffin hit the market last week for a staggering $36 million, with The Agency’s Zac Goldsmith and Mauricio Umansky holding the listing.
This sprawling 39-acre property, nestled in the heart of California’s desert landscape, features a luxurious 5,409-square-foot main residence, a total of 13 bedrooms, 12 bathrooms, and several additional structures including guest pods (with vacation rental potential) and a gatehouse.
Renowned for its unique blend of Moroccan elegance and modern California style, the former Merv Griffin estate has been a sought-after party destination during the Coachella music festival, hosting celebrities like Post Malone, Katy Perry, and Jack Harlow.
And it boasts dazzling interiors inspired by Yves St. Laurent’s Marrakesh home. So let’s take a quick tour of this legendary celebrity home — before a buyer takes it off the market.
The estate’s grandeur
Spread across an extra generous 39 acres in the heart of La Quinta — a desert resort city in Riverside County, Calif. rightfully dubbed “the Gem of the Desert” — the property consists of seven different structures including a majestic 5,409-square-foot main residence.
Beyond its 13 bedrooms and 12 bathrooms, the former Merv Griffin estate has everything from a private lake to an orchard, equestrian facilities, and even comes with its own water supply.
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The main house
The main house alone is a sight to behold, flanked by four cozy 500-square-foot pods, a West Building, and a gatehouse, all enveloped in lush landscapes against a mountainous backdrop.
Moroccan-inspired architecture
The estate’s architecture is a love letter to Moroccan elegance, seamlessly fused with modern Californian flair. Its grandeur is matched by its design, which includes intricate chandeliers, hand-placed mosaic tiles, and circular guesthouses that add a unique touch to its layout.
See also: Bing Crosby’s Estate in Rancho Mirage — That Once Welcomed JFK and Marilyn Monroe
Designer interiors
The interiors, masterfully put together by renowned Los Angeles interior designer Waldo Fernandez, speak volumes of luxury and style. Taking inspiration from Yves St. Laurent’s iconic Marrakesh home, each room tells a story, blending Moroccan charm with a modern twist that’s as enchanting as it is welcoming.
Guest pods oozing charm
While there’s plenty to love about this idyllic desert escape, it’s the four guest pods that won us over. The charming little guest houses — which have solid vacation rental potential and have been listed on popular rental platforms alongside other structures on the property — each contain one queen-sized bed, an ensuite bathrooms with shower/bathtub combos, a gas fireplace, TV, and private entrances.
Outdoor amenities include a lake and orchards
Stepping outside, a whole series of outdoor amenities add to the appeal of the property. And they go beyond your regular pool and spa, found in most celebrity homes.
The 39-acre estate has a roughly 2.5-acre man-made lake, Lake Merveilleux, home to thriving populations of koi, bass, and turtles, an equestrian facility, and lush orchards of oranges, grapefruits, lemons, limes, pomegranates, and guavas — along with the iconic King Fig Tree, one of the largest in the Coachella Valley.
Post-Griffin era
After Merv Griffin passed away in 2007, the estate found its new owner in real estate investor Mark Majerovic, who bought it for a cool $7 million in 2013. Majerovic turned the estate into a sought-after venue for high-end vacation rentals, events, and, of course, unforgettable parties.
The ultimate party destination
Under Majerovic’s ownership, the estate embraced its new identity as party central, opening its doors to thousands of party-goers looking to experience the glitz and glamour of Hollywood in the heart of the desert.
A celeb hotspot during Coachella
A-listers like Post Malone, Katy Perry, and Jack Harlow, among others, have stayed here during the Coachella music festival, with the house playing host to a veritable who’s who of Hollywood and continuing its legacy as a landmark of high-profile entertainment.
See also: Inside Rod Stewart’s house in Beverly Park — a ritzy $74 million manor with its own soccer field
Home to a TV legend
Built by the late TV host in the 1980s, the property then became Merv Griffin’s longtime home. Griffin, most famous for hosting his talk show, The Merv Griffin Show, was a multifaceted American entertainment mogul best known for his work as a television host and the creator of two of the most famous game shows in American television history: Jeopardy! and Wheel of Fortune.
Beyond his on-screen presence, Griffin was also a successful businessman, with ventures extending into real estate and the hotel industry. And he made quite the profit from his La Quinta property, as the estate was far larger during his ownership.
The estate once spanned 240 acres
Originally spanning over 240 acres, the estate was pared down when Griffin sold off 200 acres for the Griffin Ranch community. Yet, the essence of the estate’s grandeur remains, with its 39-acre heart still beating strong.
Now listed for $36 million
After over a decade of work on the property, real estate investor Mark Majerovic is bringing the former Merv Griffin estate to market. Enlisting the help of top industry pros Zac Goldsmith and Mauricio Umansky (The Agency), the iconic La Quinta property is now on the market for $36 million, offering a rare opportunity to own a piece of luxury and entertainment history in the heart of California’s desert landscape.
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While more stable over the past nine months, the economy was highly volatile from 2020 through the first half of 2023.
After the pandemic hit, the Fed dropped the fed funds rate to zero and demand surged in the housing market causing home values to skyrocket. Then, inflation began to run away and the Fed hiked rates 11 times. Meanwhile, the average 30-year fixed mortgage interest rate went from 2.8% in late 2021 up to a 22-year high of 7.79% in October 2023.
Since December, mortgage rates have been more stable, fluctuating between 6.5 and 7%. However, many are now wondering if rumored Fed cuts will change that.
“As the market gains more certainty and as inflation curbs, it is very likely that there will be rate cuts this year,” says Scott Haymore, senior vice president and head of mortgage capital markets and product management at TD Bank. “Currently, Fed Funds futures contracts have three rate cuts built in starting in the second half of this year,” he says.
If Fed rate cuts do happen as many expect, how far can you expect mortgage rates to drop, if at all? We asked some experts for their rate predictions.
See how low of a mortgage interest rate you could secure here now.
How far will mortgage rates fall when the Fed cuts rates?
Here’s where three experts predict mortgage rates are heading:
Around 6% or below by Q1 2025: “Rates hit 8% towards the end of last year, and right now we are seeing rates closer to 6.875%,” says Haymore. “By the first quarter of 2025, mortgage rates could potentially fall below the 6% threshold, or maybe even lower.”
Hold steady through 2024: Afifa Saburi, a capital markets analyst for Veterans United Home Loans, doesn’t think rates are going to drop much this year. “Mortgage rates won’t fall much from where they are today because the rate cuts that the Fed has penciled in are already priced in by the markets. This means that almost all of the rate relief that we would see from rate cuts is already here,” Saburi explains.
Hold steady through mid-2025: Jeremy Schachter, branch manager at Fairway Independent Mortgage Company, says he expects rates will stay in the higher 6% range and won’t fall much in 2024 or even early to mid-2025. “With goals of the Federal Reserve to get inflation around the 2% mark, I don’t expect the Feds to lower rates until September or later in 2024,” Schachter says. “Unfortunately, we still have to have a bit more pain in the economy with higher unemployment to see the Federal Reserve lower rates.”
The bottom line? While rates may drop modestly, we likely won’t be getting back to the 3 to 5% rates that were the norm from 2010 to 2020 in the upcoming year.
Learn more about today’s mortgage rates online now.
Should you wait to buy a home?
If you find a great home and the financing fits into your budget, experts say you typically don’t want to wait.
“The best advice is still: When you find a home you love inside your budget, buy it. Mortgage rates are unpredictable but, right now, home values are not,” says Dan Green, chief executive officer at Homebuyer.com. If rates do drop, you can always refinance to secure a lower rate but you won’t always be able to buy a particular home.
You should also consider the opportunity cost of waiting. “On average home appreciation is between 4 and 5% each year. If you decide to hold off until 2025, how much will that home be worth vs. purchasing it now?” asks Schachter. He explains that if you decide to wait and time the market, a home that is worth $500,000 now could have appreciated $25,000 in 2025 (a 5% increase). “The adage, buy the home, date the rate is a perfect example of this scenario,” Schachter added.
A drop in rates also often causes more buyers to enter the market which drives up home prices. “I believe we will see rate cuts come in the fall if at all this year. Along with that, you will see buyers come back to the fray and it will make competition even harder in a housing shortage-dominated market. Yes, rates will be lower but prices may be much higher,” predicts Ralph DiBugnara, president of Home Qualified and senior vice president at Cardinal Financial.
Xactus chief revenue officer Greg Holmes commented: “Tom’s mortgage association background, where he dealt with both lender and vendor members, has cultivated his deep, holistic understanding of the entire mortgage lending process. This outside experience will enable him to bring a fresh perspective to our sales approach. Tom is well respected in the industry and … [Read more…]