10 Simple Ways You Can Save Money on Your Next Mortgage

You’ve heard the news – mortgage rates surged from below 3% to as high as 5.5% in the span of a few months.

And they don’t appear to be coming down anytime soon. While that’s up for debate, the trend is clearly NOT your friend when it comes to securing a low interest rate on your home loan.

But that doesn’t mean you just throw the rules out the window and apply with any bank or lender willing to approve your mortgage application.

Nor should you just accept the first lowish interest rate presented to you, as enticing as it might be.

This is actually a great time to be even more aggressive, knowing that mortgage rates continue to trend higher, and competition is fierce.

1. Shop Your Mortgage Rate!

I’ve said it once and I’ll say it again, and again after that. You have to take the time to compare rates and lenders if you want to secure the lowest interest rate on your mortgage.

There are studies that prove this – it’s not just boilerplate advice.

A recent study from Freddie Mac revealed that getting just two quotes as opposed to one could save you thousands.

And it actually gets even better the more you shop. Three quotes saves even more. Sure, it’s no fun, but neither is paying a sky-high mortgage payment.

Don’t complain about the rates not being as low as you heard if you haven’t put in the time to shop.

If you make the effort to track down a coupon code for your simple online purchase, you should take the time to gather multiple mortgage rate quotes. Period.

This is especially true now as lenders may be offering a wider range of rates during this volatile period.

2. Improve Your Credit Scores, Then Apply

mortgage credit scores

Also a cliché in the mortgage industry, but a very real and important tip. It’s no secret that those with higher credit scores gain access to lower interest rates.

Just take a look at this chart above of real-time rate lock data from Optimal Blue (part of Black Knight).

Notice the borrowers with 740+ FICO scores have average rates of 5.211%, while the sub-680 borrowers have average rates of 5.619%.

That’s nearly a half-point higher simply because you haven’t addressed whatever credit issues are holding you back.

So if you’re not doing your absolute best credit score-wise, you’re doing yourself a disservice. Take the time to work on your credit if it’s not where it should be.

Generally, a 760+ FICO score is sufficient to obtain the lowest mortgage rates possible, at least when it comes to your credit score.

3. Come in with a Larger Down Payment

While perhaps not as easy as maintaining excellent credit history, a larger down payment can result in a lower mortgage rate, which will save you money each month for a long, long time.

Not everyone has extra money lying around to do this, but if you do, or you can save more before buying, it can work to your benefit when it comes time to apply for a mortgage.

Those who are able to put down 20% or more can obtain lower interest rates and avoid mortgage insurance at the same time.

It’s actually a triple bonus because you avoid pricing adjustments at the 80% LTV+ threshold, the PMI, and wind up with a lower loan amount.

If refinancing your mortgage, you might be able to execute a cash in refinance and lower your LTV to snag a better interest rate.

4. Pay Some Points

While somewhat counterintuitive, if you pay now you can save later on your mortgage.

What I mean by that is offering to pay discount points at closing.

They’re basically a form of prepaid interest that will lower your interest rate for the life of your loan.

For example, if the 30-year fixed is pricing at 5.125%, but you can pay 1% of the loan amount today for a rate of 4.875%, it could save you a lot more money over the duration of the loan term.

Just be sure it makes sense financially, and that you plan to stay in the home/mortgage long enough to recoup the upfront cost.

If you don’t actually keep the home loan or the house for more than a few years, this could actually cost you.

And with rates so high at the moment, with dare I say a chance to drop in the next 12 months, it might be best to settle for a market rate sans points and hope to refinance to cheaper later.

5. Consider All Loan Programs

Yes, the 30-year fixed is in the 5.25% range now. But no, it’s not the only loan program available to home buyers and those looking to refinance an existing mortgage.

There are lots of different home loan types out there, many with lower interest rates than the 30-year fixed.

For example, the 15-year fixed prices closer to 4.50%, and adjustable-rate mortgages like the 5/1 and 7/1 ARM are also significantly cheaper than fixed-rate products now, around 4% or lower.

They also provide a fixed rate for several years before you have to fret about a rate adjustment.

Consider an ARM if you want to save money, especially if you don’t plan on staying in the property for a long period of time.

Your interest rate may never actually adjust if you don’t keep it past the initial teaser period. And you could save a lot of money during those years.

6. Negotiate Harder

You can negotiate mortgage rates and fees. Maybe not all banks and lenders allow you to do this, but many do.

It’s also possible to compare mortgage brokers and have them compete for your business with their many wholesale lender partners. Someone will come up with better than the next guy/gal.

If you don’t bother attempting to negotiate, you’ll never know what’s possible. If the lender says they can’t budge, move on to one that will.

Never accept the first price you’re shown, like anything else in this world.

It doesn’t hurt to ask for lower, especially when it comes to a mortgage. After all, you could be saving money every month for the next 30 years.

7. Lower Your Max Purchase Price

If you want to save money, you might have to make some concessions. That could mean lowering your max purchase price if you’re in the market to buy a home.

I’ve already noted that it could be wise to lower your maximum price threshold on those Redfin and Zillow apps in anticipation of a bidding war.

And while there’s no clear correlation between home prices and mortgage rates, a higher home price will obviously drive up your monthly housing payment.

Either lower your max bid or negotiate more with the seller, or do both. If you can secure a lower purchase price, you’ll need less mortgage. That lower loan amount will save you money.

It’s important to negotiate on the purchase price AND the mortgage. Don’t concede in any area along the way if you want to save money.

Also negotiate with your own real estate agent! They are on your team, but also need to fight for you.

8. Consider a Second Mortgage

Back in the early 2000s, it was common to take out a first and second mortgage concurrently, with the latter known as a piggyback mortgage.

The purpose was to keep the first mortgage at a loan-to-value (LTV) of 80%, thereby avoiding PMI. This method could also be employed to stay at/below the conforming loan limit.

If your down payment is limited, it could make sense to tack on a second mortgage to save some dough.

The blended rate between first and second mortgage sans PMI and higher pricing adjustments could be just the ticket to savings.

If you’ve been considering a cash out refinance, but don’t want to lose your low fixed rate, a standalone HELOC or fixed-rate second mortgage could help you keep your first mortgage intact.

9. Pay It Back Faster

I dedicated a whole article to this one recently. If mortgage rates are high, it makes sense to pay back the mortgage faster.

If your fixed rate is super low, well, take your time in paying back your loan. Or at least don’t rush it.

It’s simple really – the faster you pay the mortgage, the less interest you pay.

You basically want to pay back a low-rate mortgage as slowly as possible, and a high-rate mortgage as quickly as possible, assuming there aren’t better places for your money.

So if you get stuck with a pesky 5% mortgage rate, which is actually pretty decent historically, you can make extra payments each month to lessen the blow.

You could actually pay enough to offset the higher rate and effectively turn it into a 4% mortgage rate.

10. Let It Ride

Lastly, you could wait things out and/or float your mortgage rate if you’ve already applied. You don’t have to accept today’s rates if you’re not entirely happy with them.

Sure, most folks expect mortgage rates to move higher in the near term, but as I’ve said a few times in the past, we’re often surprised at the time we least expect it.

Just consider the recent pullback after it seemed mortgage rates were headed for 6%. Once the spring home buying season wraps, rates could cool off even more.

Typically when new highs are being tested, there are periods of relief along the way. And vice versa. They may not last very long, but it is possible to experience dips and opportunities.

Of course, this can be a risky game to play. But if we’re talking about a refinance, which is entirely optional, you can bide your time and only strike when the timing is right.

Keep an eye on the market, mortgage rate data, and look out for trends and try to lock your interest rate accordingly.

Bonus: Apply for a Mortgage at the End of the Year

After some research, I discovered that mortgage rates tend to be lowest in fall, especially in the month of December.

This is typically a slower time of the year for mortgage lenders, and when they’re not as busy, they may lower their rates to drum up business.

So you might be able to shave an additional .125% or .25% off your mortgage rate if you apply in the later months of the year. This isn’t always true, but it’s something to consider if you’ve got time or flexibility.

It’s actually beneficial for another reason – other than a potentially lower rate, things should be quieter, meaning you might get a more attentive broker/loan officer and a smoother loan process that could move along quicker.

Source: thetruthaboutmortgage.com

Is Buying Farmland a Good Investment? 4 Reasons to Own Agricultural

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Real estate is one of the most popular alternative investments. When most people think about real estate, they imagine rental homes, office buildings, and storage units.

But what about farmland?

Some of the world’s wealthiest people use farmland to diversify their portfolios, and for good reason. Fertile crop lands are known for producing returns that outpace most assets while offering reduced volatility. 

Of course, as with any other investment there are risks to consider. Bad weather can cause significant reductions in returns, the cost of operating a farm can become intense quickly, and if you run a farm yourself, the work is arduous, to say the least. 

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So, is farmland a good investment when you consider all factors?

Is Buying Farmland a Good Investment?

There’s no question that farmland is an attractive investment option for the right buyer. The key is research and ensuring that you get a quality deal. There are several reasons farmland makes a good investment:

1. Farmland Returns

Regardless of what you’re investing in, a strong investment is one that creates strong returns. Let’s face it, you’re not investing for the sheer purpose of owning assets; you’re investing as a means to achieve financial stability, increase your net worth, or set up a comfortable retirement. Life isn’t all about the money, it’s your investments are all about the benjamins. 

So, how does farmland stack up?

You might be surprised that farmland has been one of the best returning asset classes for the past 20 years, producing a 12.24% average annual return according to AcreTrader. That’s impressive by any benchmark. Just look at some of the average annual returns of more traditional investments:

  • Stocks. The S&P 500, the flagship stock market benchmark for the United States, has generated annualized returns of about 10.5% over the past several decades. 
  • Gold. According to Statista, gold — one of the world’s most prized safe-haven investments — generates average annual returns of around 10.61%. 
  • Silver. According to data from Macrotrends, silver saw annualized returns of around 10.33% from 2009 through 2020, although there was quite a bit of turbulence throughout this period. 

Of course, fixed-income investments like bonds are known for producing even lower returns. 

So, when looking at the long-term return rates of various investment vehicles, it quickly becomes clear that the more than 12% average annual return enjoyed by farmland investors in recent decades is impressive. 

2. Land Values Are Expected to Continue Rising

What makes land as an asset class so special?


Although it may seem as though land is abundant today, that’s far from the case, and the global supply of real estate for sale continues to shrink. An increasing global population means more demand for crops and a growing demand for land, both for farming and living on.

Stating the obvious, there’s no way to create more Earth; our planet is only so big. By the law of supply and demand, the finite supply of land itself and the fact that demand is increasing by the day suggest price appreciation will occur over time, meaning that farmland values must rise.

Land is in finite supply. Sure, the Earth is a decent-sized planet, but it’s not growing! 

As the global population continues to grow, new homes will need to be built and farms will need to supply more food for people to eat. As this trend continues, land values are only likely to continue on the upswing, leading to significant growth in prices.

3. Farmland Provides Passive Income

Price appreciation isn’t the only way to make money with farmland investments. 

Farms are active operations that make money each and every year. As long as you own farmland, you have the opportunity to earn reasonable returns by growing crops on the land. 

Of course, running a farm can be expensive and time consuming, but as we’ll discuss shortly, there are many ways to go about investing in farmland. Unless you’re buying the physical land and working it yourself, the farming operations are handled by a third party. 

By doing your due diligence and investing in farmland that’s best for high-value crops, you’ll have the ability to generate meaningful passive income through your investments. However, there are a few factors that influence a farm’s passive income:

  • Different Crops Have Different Values. Paying close attention to the crop produced on the farm you’re investing in is crucial. For example, 1,000 pounds of pistachios is far more valuable than 1,000 pounds of corn. 
  • Different Crops Take Longer to Mature. Although pound for pound pistachios are more valuable than corn, corn matures far faster than pistachios. If you’re looking to generate immediate income, it’s best to invest in farmland known for producing crops that mature quickly. 
  • Environmental Factors. Finally, environmental factors will play a role in the cost of operating a farm, whether you own the entire farm or shares of it. For example, a farm in a region known for high levels of rain will be less expensive to water than one in a dryer climate. Weather factors like severe temperatures or varying rainfall amounts can greatly impact a farm’s yield in a given season. 

4. Food Demand Points to a Strong Long-Term Investment

Once you get into farmland ownership, whether directly or indirectly, you may decide you’ll never sell your holdings, and for good reason. Food demand is growing sharply for two reasons.

First and foremost, the global population is growing quickly and that growth has been accelerating. This trend is expected to continue for the foreseeable future. After all, more babies today means more weddings in 20 years and more families having more babies. According to SeafoodSource, about 2.3 billion people will be added to the global population by 2050, requiring 70% more food then than the global population requires now. 

That growth in demand for the crops produced on farmland means the revenue generated per acre is likely to climb dramatically over the coming decades. As a result, there’s a strong argument that farmland isn’t just a strong investment in terms of price appreciation, but that it’s worth holding onto for the long run in order to reap the benefits associated with feeding the world. 

Pros and Cons of Farmland as an Investment

Every asset class has its strengths and weaknesses, and farmland is no different. Here are the major advantages and disadvantages of investing in farmland.

Pros of Investing in Farmland

There are several reasons to consider investing in farmland. It has the potential to generate strong, relatively stable returns while making you feel good about what your investment dollars are supporting. Here are some of the biggest benefits to farmland investments. 

High Returns

You often hear stories or read ads about returns of 100% or more on an annualized basis. The truth is, those types of returns are ridiculously difficult to achieve, if not impossible in most cases. The general rule of thumb is that if you’re producing 10% or more per year in your portfolio, you’re doing very well. 

Farmland is more than capable of doing just that. 

As mentioned above, the average return on a piece of farmland over the last couple of decades has been about 12.24%, outpacing stocks, bonds, gold, and silver. If money talks, farmland is definitely doing the talking. 

Low Volatility

Most investments that tend to outperform some of the most watched benchmarks come with incredibly high levels of volatility, meaning that the assets are known for wide swings in value. While land does increase and decrease in value, it generally does so at a relatively steady pace. 

This lack of volatility is a big draw for many investors, especially the risk-averse crowd. 

The Feel-Good Effect

There are tons of different things you can do with your investment dollars — some a bit more noble than others. Investing in farmland is a venture that’s both profitable and valuable to society. You’ll know that your investments aren’t just making money for you, they’re playing a role in making it possible to meet the growing demand for food, a basic humanitarian need. 

Passive Income 

Those looking for income from their investments can benefit greatly from investing in real estate. Rental properties provide investors with rental payments, but farmland makes passive income from the crops it produces.

After all, when you own a farm, you’re not just holding an asset that was designed to sit idle and await price appreciation. You’re investing in an asset that’s made for making regular annual income sometimes literally grow on trees. 

Cons of Investing in Farmland

Sure, there are plenty of reasons to consider investing in a farm, but there are also risks to consider. Some of the most significant risks include:

Market Risk 

The amount of money you make from crops on your farm will depend heavily on commodity prices. Should commodities fall in value, there’s a good chance your farmland investments will underperform. 

Liquidity Risk

It’s far easier to sell a share of Apple stock than it is to offload a piece of land. When investing in farmland, you may be stuck with your investment for years before a buyer comes along. 

Poor Weather Conditions

From time to time, severe weather or an unexpectedly harsh winter or summer will lead to lower-than-expected yields, directly affecting the return on investment you’ll experience. 

High Cost of Exposure

Buying farmland isn’t cheap, and with limited inventories available, it’s only getting more expensive. As a result, farmland investments are usually only available to those with a relatively high value investment portfolio. 

How to Invest in Farmland

As mentioned above, there are quite a few ways to go about investing in farmland. Some of the most common include:

Buy Farmland Directly

The most obvious way to go about making a farmland investment is buying the land outright. To do so, you’ll find yourself searching websites like Zillow and Realtor.com for agricultural land for sale. Unfortunately, you’ll also find that your options are limited. 

According to the U.S. Sustainability Alliance, 98% of farms in the United States are owned by families, representing about 86% of U.S. farmland production. Much of the remainder of the farmland is held by institutional investors and high net worth individuals. Even Bill Gates owns 242,000 acres of cropland in 19 different states. 

As a result, the supply of agricultural properties available for purchase is quickly diminishing, with the vast majority already owned by a holder that’s not interested in selling. However, with a bit of research, you may be able to find a worthwhile property. 

Invest In Farming ETFs

One of the simplest and most common ways to access farmland investment is to invest in exchange-traded funds (ETFs) dedicated to farming. ETFs are a popular type of investment vehicle that pool money from a large group of investors to buy assets according to the fund’s prospectus. 

Farming ETFs invest in stocks that represent farming companies or in commodity futures. For example, one of the most popular is the Invesco DB Agriculture Fund (DBA), which invests in a wide range of agricultural futures from cotton to soybeans. 

Invest In Farming REITs

Another way to go about making investments in farms is to invest in farming-focused real estate investment trusts (REITs). REITs are funds that pool investment dollars from a large group of investors, much like ETFs. However, farmland-focused REITs use those investment dollars to purchase and maintain farmlands on behalf of shareholders. 

By investing in these companies, your investments are supporting large corporations that have farming down to a science. For example, one of the largest farming REITs is known as Gladstone Land (LAND). The fund owns land in 14 states and actively produces returns for its investors through farming operations. 

Be Part of the Crowd

Crowdfunding has become a popular way for companies to raise the money they need, and many of those companies are farmers. In fact, there are several websites and apps dedicated to connecting retail investors to farmers in need of funding. The rise of real estate crowdfunding has made it easy for everyday investors to participate in farmland investments.

When taking advantage of these investment opportunities, investors are generally granted a percentage of ownership in the farms they support. So, when the farmer earns money from the crops produced, the investors will each receive their share of the profit.  

Where to Invest in Farmland

One of the biggest obstacles to farmland investing is figuring out where exactly to go to make the investments. These days, there are several options to consider. 

Real Estate Listings

If you’re interested in buying physical land and managing the farm on your own, you’ll want to go to real estate listing websites like Zillow, Realestate.com, and LandWatch.com. These websites have a central focus on selling real estate, and most have sorting options that allow you to browse land-only listings rather than residential properties.

Before purchasing a physical piece of land for farming, make sure that land is zoned for agricultural use. 

Crowdfunding Platforms

There are a few major challenges associated with buying land directly. Not only is the initial investment required going to be pretty hefty, farming isn’t easy work. That’s why many investors prefer buying land through crowdfunding platforms. 

By purchasing land this way, the farming operations aren’t your responsibility. Instead, they’re the responsibility of the farmer who’s selling shares of the land. Moreover, crowdfunding platforms allow you to invest in farmland with less out-of-pocket cost. Although most platforms have minimum investments ranging from $10,000 to $15,000, that’s far less than you’d pay to own a farm and the equipment required to operate it. 

Crowdfunding platforms geared toward farming are essentially in the business of connecting farmland partners that are interested in forming long-term, profitable partnerships. Some of the most popular platforms include AcreTrader, FarmTogether, and FarmFundr. 

Unfortunately, however, the vast majority of crowdfunding platforms for farmland are reserved for accredited investors with high incomes or high net worths. It can be harder to find opportunities that allow investors with more modest means to buy into shares of farmland.

Buy Farming Stocks, ETFs & REITs

For most investors, the best way to go about investing in farmland is to buy farming stocks, ETFs, or REITs. These investments are accessible to everyone, and the minimum investment required equates to the cost of a single share of the company, fund, or trust, which is generally under $100. 

You can purchase these assets with any popular broker like Charles Schwab, E*Trade, and TD Ameritrade, among a long list of others. 

Final Word

All told, farmland is a great asset to add to your investment portfolio. While there are hurdles to purchasing physical farmland, whether directly or through a crowdfunding platform, it’s easy to gain access to these assets in the stock market by purchasing stocks, ETFs, or REITs focused on farming. 

As is the case with any investment, it’s always important to do your due diligence. That’s true regardless of the type of farmland you’re planning on buying or whether you plan on investing in it directly or indirectly. Research is the foundation of any strong investment decision. 

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GME is so 2021. Fine art is forever. And its 5-year returns are a heck of a lot better than this week’s meme stock. Invest in something real. Invest with Masterworks.

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Joshua Rodriguez has worked in the finance and investing industry for more than a decade. In 2012, he decided he was ready to break free from the 9 to 5 rat race. By 2013, he became his own boss and hasn’t looked back since. Today, Joshua enjoys sharing his experience and expertise with up and comers to help enrich the financial lives of the masses rather than fuel the ongoing economic divide. When he’s not writing, helping up and comers in the freelance industry, and making his own investments and wise financial decisions, Joshua enjoys spending time with his wife, son, daughter, and eight large breed dogs. See what Joshua is up to by following his Twitter or contact him through his website, CNA Finance.

Source: moneycrashers.com

Are Home Prices Falling? The Devil Is in the Details

How’s this for a dramatic headline: “Home prices are falling!”

But before you get too excited, assuming you’re a prospective home buyer, there are some strings.

What was almost unthinkable a month or two ago is now apparently becoming reality.

A new analysis from Realtor.com found that asking prices are actually down year-over-year in several large metropolitan areas nationwide.

Does this mean the seller’s market is finally coming to an end, driven by markedly higher mortgage rates? Let’s find out.

Where Home Prices Are Down the Most

The Realtor.com data team analyzed year-over-year median list prices in the 100 largest metros nationwide in the month of March.

They then limited their list to just one metro per state as a means to ensuring “geographic diversity.”

The result is a top-10 list of metros “where home prices are falling the most.”

The list is as follows:

1. Toledo, Ohio (-18.7%)
2. Rochester, New York (-17%)
3. Detroit, Michigan (-15.4%)
4. Pittsburgh, Pennsylvania (-13.7%)
5. Springfield, Massachusetts (-5.8%)
6. Tulsa, Oklahoma (-5%)
7. Los Angeles, California (-5%)
8. Memphis, Tennessee (-4.6%)
9. Chicago, Illinois (-3.7%)
10. Richmond, Virginia (-3.4%)

As you can see, there is quite a range in listing price drops among the top ten, with a high of -18.7% in hard-hit Toledo, to a mere 3.4% drop in Richmond, VA.

So what exactly is going on here? Weren’t home prices expected to keep rising, despite significantly higher mortgage rates?

Well, in Toledo specifically, the issue has been an elevated unemployment rate, coupled with an overheated housing market.

This has put a big strain on affordability as mortgage rates jumped from sub-3% levels in late 2021 to their current mid-5% range.

The same is largely true of the other four metros in the top five, which all happen to be located in the Rust Belt as well.

In these communities, home prices may have simply gotten way too ahead of themselves, and are simply falling back down to earth.

Of course, earth is relative because they’re likely still up tremendously from their lows seen a decade ago.

Is the Housing Market Simply Evolving?

home price forecast

They say real estate is local, in that you shouldn’t worry about the national trend as much as the neighborhood in which you’re looking to buy a home.

In other words, who cares if home prices are down in Toledo if you’re attempting to purchase a property in Phoenix?

That being said, there appears to be an emerging trend in the remaining five metros on the list that is more indicative of an evolving housing market.

In places like Chicago, Los Angeles, and Tulsa, it appears smaller properties are making their way to market.

As such, the median listing price is “down” from a year ago, but often times the price per square foot is up.

This is somewhat similar to your bag of Doritos still costing 99 cents but containing a few less chips.

For example, a prospective home buyer in Los Angeles may now be settling for a 1,500-square-foot cottage instead of say a 2,500-square foot home.

And in Chicago, there are apparently 6,000 condominium units on the market, which also drags the median list price lower.

Condos are always cheaper than single-family homes, so the -3.7% reduction in median listing price might be a bit deceiving.

Often times, condos begin to creep higher in price during the latter stages of a seller’s market as buyers look for more affordable options.

That could explain some of what we’re seeing in this early, seemingly negative data.

The other reason listing prices might be down is simply a marketing tactic. Real estate agents are listing lower to garner interest, instead of taking the risk of having to make a price cut.

This means the homes may sell for more than what they sold for a year ago when all is said and done.

On a national basis, home prices are still expected to rise a whopping 14.9% through March 2023, per Zillow.

That’s down slightly from the 16.5% year-over-year forecast made in February, as seen in the image above.

What’s incredible is this would be the highest home price growth ever recorded by Zillow prior to June 2021.

And the 6.09 million in expected existing home sales would be the second best calendar year since 2006.

So while there might be some signs of a slowdown in certain markets, don’t get your hopes up.

Home prices likely aren’t falling just yet, despite some cracks starting to show.

Lastly, if mortgage rates peak and begin to recover, we could see a new surge in buyer interest…

Source: thetruthaboutmortgage.com

Here’s the Average Retirement Age in Your State

George Rudy / Shutterstock.com

Most Americans may think of age 65 as the target retirement age, but many people stop working before they reach that age.

Money Talks News analyzed data from the U.S. Census Bureau’s latest American Community Survey to determine the average retirement age in each state — or, more precisely, the age at which a majority of people in each state stop working.

The average retirement age nationally is 64, and the average retirement age by state is as low as 61, our analysis found. Only in a few states do a majority of residents work past age 65.

As we note in “8 Reasons Your Parents Had an Easier Retirement Than You Will,” some workers end up having to leave the workforce sooner than they intended:

“Many workers today are counting on working into their late 60s and early 70s. But poor health, a job loss or the need to care for loved ones can force people to retire before then.”

Read on to learn the average retirement age in every state and Washington, D.C.

Age 67

MH Anderson Photography / Shutterstock.com

The nation’s capital has the nation’s highest average retirement age, with most District of Columbia residents staying in the workforce until age 67.

Of course, Washington, D.C., also has a steep cost of living, so working longer may be necessary for lots of folks. As of the second quarter of this year, its cost of living was higher than that of any U.S. state except for Hawaii, according to the Missouri Economic Research and Information Center (MERIC).

A recent Zillow analysis found that the median cost of a starter home is higher in Washington, D.C., than in any state, even Hawaii, as we report in “How Much Is a Starter Home in Your State These Days?”

Age 66

CREATISTA / Shutterstock.com

Hawaii might be the ideal retirement destination for many people, and South Dakota was named the best state to retire in by Bankrate last year. But the Aloha State and the Mount Rushmore State are among three states with the second-highest average retirement age in the nation.

Those states are:

  • Hawaii
  • Massachusetts
  • South Dakota

Incidentally, Hawaii and Massachusetts have the highest and fifth-highest cost of living, respectively, according to the MERIC ranking. South Dakota, however, ranks in the middle of the pack among U.S. states based on its cost of living.

Age 65

retirement party
Ulf Wittrock / Shutterstock.com

The big 6-5 isn’t just the traditional retirement age. It’s also the most common average retirement age among U.S. states, shared by 15 of them.

Those states are:

  • Colorado
  • Connecticut
  • Iowa
  • Kansas
  • Maryland
  • Minnesota
  • Nebraska
  • New Hampshire
  • New Jersey
  • North Dakota
  • Rhode Island
  • Texas
  • Utah
  • Vermont
  • Virginia

Age 64

Spotmatik Ltd / Shutterstock.com

Sixty-four is the average retirement age in 11 states — including the one that WalletHub rated as the best U.S. state for retirees in 2019.

Those 11 states are:

  • California
  • Florida
  • Idaho
  • Illinois
  • Montana
  • New York
  • Pennsylvania
  • Tennessee
  • Washington
  • Wisconsin
  • Wyoming

Age 63

Flashon Studio / Shutterstock.com

Age 63 is the third-lowest average retirement age by state, and it’s shared by a dozen states.

They are:

  • Arizona
  • Delaware
  • Georgia
  • Indiana
  • Maine
  • Mississippi
  • Missouri
  • Nevada
  • North Carolina
  • Ohio
  • Oregon
  • South Carolina

Age 62

Senior black couple
pixelheadphoto digitalskillet / Shutterstock.com

Seven states share the second-lowest average retirement age, 62, which also happens to be the age at which you generally become eligible to start receiving Social Security retirement benefits:

  • Alabama
  • Arkansas
  • Kentucky
  • Louisiana
  • Michigan
  • New Mexico
  • Oklahoma

Age 61

Eric Fahrner / Shutterstock.com

Two states enjoy the distinction of having the nation’s lowest average retirement age of 61:

  • Alaska
  • West Virginia

Are you surprised by the average retirement age in your state? Share your thoughts by commenting below or on the Money Talks News Facebook page.

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

Source: moneytalksnews.com

When Market Realities Bite, Stay Flexible and Adapt

Purchasing a place to live is one of the biggest decisions of your life. Even in an ideal scenario — a buyers market with plenty of affordable houses and scant competition — the stress of buying a home is not something to take lightly. And today’s buyers are not living that ideal: Prices remain high, inventory cannot satisfy demand, and competition for the few homes available often leads to bidding wars (fortunately, there are some effective ways to prepare for that). Add to all of this rising interest rates, and it’s a potentially intimidating time for homebuyers.

To better understand how to prepare emotionally for what can be a marathon search, we spoke with Christina Koepp, a licensed mental health counselor at Wellspring Family Services, and asked her to weigh in on what home shoppers can do to cope with this pressure-cooker of stress.

What makes buying a home so stressful?

Buying a home can invite pressure from every direction. Let’s look at just a few of the potential stressors.

Choosing a home

A home purchase is one of the most significant financial decisions many people make in their lifetime, and on top of that, the process affects basic necessities like shelter and safety.

Buying a home taps into all parts of our mind: our basic need for shelter, our attachment needs for a safe place to connect with ourselves and others,” says Koepp. “To take the risk and make an offer on a home, we need to be willing to attach to a new place to live, and — simultaneously — hold it loosely enough that it won’t be devastating to lose the bid. It’s a narrow path of guarded optimism.”

The real estate market 

Just about anywhere you look in the U.S. these days, you’ll find a sellers market. This can make the stress of buying a house feel even more pronounced. A sellers market can bring anxiety accelerators like seemingly endless open houses, bidding wars, and getting outbid by all-cash buyers. 

The loan approval process 

If you’re working with a lender, the process can take weeks or longer. Expect lots of paperwork, which can be all the more grueling if your dream home is waiting. (To ease some of this tension, get pre-qualified before you find a place you want.)

Working with an agent who’s not a fit 

Almost one in five buyers (18%) report that it’s “difficult or very difficult” to find the right real estate agent. If your agent isn’t a good fit, they can add pressure where they should be alleviating it.

Read on for tactics on how to navigate what can be both a stressful and exciting journey.

How can I mentally prepare for the stress of buying a house?

“If you ‘fall in love’ with every home you see, it leaves little room for discerning which is the best fit,” Koepp says. “And you can quickly become emotionally fatigued with each lost bid or opportunity.”

Instead, it can be helpful to think of your home buying journey as a balancing act between vulnerability and healthy detachment. In other words, try to be “vulnerable enough to imagine your life in this potential new place,” says Koepp, while simultaneously employing “the very healthy protective impulse of avoiding getting attached too fully and too quickly.”

Some more tips:

Think about your hopes and preferences in general terms 

With each new home, ask yourself how you’ll feel if you don’t get it, says Koepp. When you encounter a loss, talk about it with someone. Discuss what excited you about the home, then carry that forward in your search. In short, keep an open mind as you search for your dream home.

Avoid all-or-nothing thinking by considering your preferences in a general sense — an updated home, an architectural style, a set of neighborhood characteristics, etcetera. This can remind you that there’s more than one place to find joy and contentment.

Identify your non-negotiables as clearly as possible 

The way to balance being general with your wants is to be as clear as possible with your deal-breakers. “Know before you look if you’re really only open to a condo with three or more bedrooms, or a house with a garage,” says Koepp. “It’s easy to be swept up in a home that may have some dream elements, even though it has deal-breaker issues.”

Above all, Koepp says, offer yourself the grace that this won’t always be a neat and tidy process. “You get to be human in the midst of it.”

Find the right agent to help you cope with the stress of buying a house

Your agent is your guide through an often complicated journey. Make sure they provide peace of mind and not the opposite. If your agent is doing something that makes you uncomfortable, communicate it to them. Further, clearly articulating your wants, preferences, and non-negotiables will help your agent get aligned. This can ease your mind and allow you to focus on what’s important. If it’s still just not a fit, consider looking for a new agent. 

Tips for easing the stress of buying a house in the current housing market

Manage your expectations

“Prepare for a marathon, even if it’s just a sprint,” says Koepp. You don’t know how long it will take to have an offer accepted. “It could be a couple homes you offer on; it could be 12.” Keeping your expectations flexible helps avoid disappointment.

Extend kindness to yourself 

Koepp says this part can be challenging for some people. “It can be easy to doubt your judgment, become angry with your home-buying partner, or get obsessed with searching,” she says. “All these responses are understandable! Being kind means finding ways to rest, recharge and integrate each step along the way.”

A few things to try: Take a short break from scrolling through listings to re-center yourself, prepare a comforting meal after a lost opportunity, or be intentional about regularly getting to bed earlier, if you can.

Talk about your home buying stress with someone you trust

It’s helpful for many people to simply “say out loud what’s rolling around in their mind,” says Koepp. “Some prefer to journal. Use whatever works for you; try to share the challenges, insights, dreams and goals that you’re noticing. Reach out often to loved ones to keep your awareness, energy, and perspective in line with your goals and hopes.” This will help you process as you go. 

How to bounce back after an unsuccessful offer

First, pause to reflect, then let it go 

Koepp says it’s important to honor the deep disappointment that can result from a lost opportunity you felt invested in. “Take a few hours or even a couple days to acknowledge that experience, and know it will fade.” Next, find a way to feel gratitude. This may help counter the propensity to dwell solely on what was lost. 

Learn from each loss 

“In my experience, each bid process is unique and comes with its own challenges and insights,” says Koepp. “Again, note what you were surprised by and integrate it into your process for future bids.”

This article was originally posted in January 2021.

Remember, these tips are intended as general advice. If you have specific concerns, are struggling or need help, contact a licensed mental health professional.

A good agent can help you through this journey. Find information and reviews for local Zillow Premier Agent partners who can walk you through the buying process and help you find the right home. Then learn more about financing options and get a better understanding of your total monthly expenses from the experts at Zillow Home Loans.

Source: zillow.com

Are the Housing Bears Being Too Rational?

Now that 30-year fixed mortgage rates are flirting with 5%, there’s been quite the uptick in housing bubble chatter.

The basic reasoning is because interest rates are higher, the balloon that is inflated home prices must certainly pop.

On the surface, it’s a seemingly logical argument. The financing cost has gone up substantially, so the price should come down.

But the cost of just about everything has gone up, and we’re still buying it, whether it’s bread, toothpaste, toilet paper, gas, you name it. Because we want and need it, similar to shelter!

Here I attempt to argue why the rates up, prices down theory might not be correct. And why we could be rushing the eventual downturn.

Do Higher Mortgage Rates Really Lower Home Prices?

I’ve already written an entire article on the supposed negative correlation between mortgage rates and home prices.

But to revisit, the simple argument is that if one goes down the other goes up. And vice versa.

For example, if interest rates go up (the cost of financing a home purchase), property values must go down to compensate.

In essence, nothing changes, the net price stays the same? You get a lower mortgage rate but a higher home price.

A higher mortgage rate but a lower home price? The cost of housing just stays constant no matter what?

Once you start to look beyond this apparent obvious correlation, it seems to make a lot less sense, at least to me.

My car didn’t go down in price because gas prices went up. Both rose in tandem! Now it’s more expensive to buy a vehicle and to operate the thing! What gives?

Well, because I want and need a car, as does everyone else. And there’s a limited supply. So prices go up, even if it costs more to own one.

Similarly, mortgage rates and home prices can rise or fall at the same exact time. There’s no special balance that must be adhered to in the universe.

Home Price Gains Can Moderate Due to Higher Mortgage Rates

I think folks often jumble falling home prices with moderating home price gains.

In other words, higher interest rates can be a headwind to home price appreciation, especially if it’s been super strong.

For example, over the past few years we’ve seen double-digit gains in home prices annually.

Now that we’ve enjoyed those massive gains AND mortgage rates are a lot higher, subsequent gains may be tougher to come by.

This is similar to higher mortgage rates going even higher – hopefully the recent big gains will make it more difficult for them to break even higher.

But that’s not even necessarily true…

Anyway, the new mortgage rate reality doesn’t mean home prices just plummet. But it could make it harder for property values to rise another 20% in 2022.

Of course, Zillow recently said it expects annual home value growth to continue accelerating through the spring, peaking at a whopping 22% in May.

Then to gradually slow down to a still remarkable 17.8% by February 2023.

Meanwhile, housing market experts and economists polled by Zillow between February 16th and March 2nd predicted home values to rise 9% (on average) in 2022.

Of course, most of those responses were made before mortgage rates jumped, and the much higher mortgage rates could dampen those estimates.

Either way, the 9% gain would be less than half the 19% home price appreciation seen in 2021, which means decelerating home prices, not falling home prices.

It also means the next housing market crash may not take place until 2024 or beyond.

Are Home Prices as High as Everyone Thinks?

home price chart

That same Zillow survey shows where home prices are, per the Zillow Home Value Index (ZHVI) and where housing experts expect them to be.

More notably to me, is the pre-bubble trend of home prices, which shows where they’d be without the bubble and bust in the early 2000s.

Interestingly, home prices today are only a few years ahead of this expected trend. And it wasn’t until recently that they even began to deviate from that course.

If you look back to around 2006, home prices got way ahead of themselves. Today, they’re only a few years ahead of themselves.

Still, even the most pessimistic quartile of respondents expects them to move higher from current levels, albeit not by much.

The basic explanation is that home prices underperformed for several years post-housing crisis, namely between 2008-2013, then eventually took off.

They’ve since made up for lost time, but when viewed through a wider lens, maybe aren’t as crazy high as everyone thinks.

And the lock-in effect of higher mortgage rates (for existing homeowners) makes the supply/demand imbalance even worse, which again supports even higher prices.

Don’t We Still Need a Few Years of Creative Financing Before Things Go Kaput?

The last thing I’ll mention is creative financing, which is typically what leads to bubbles in the first place.

The housing crisis in the early 2000s was caused by truly appalling mortgages, namely option ARMs with a 1% payment feature.

Today’s home loans are pretty much all 30-year fixed mortgages. Oh, and some 15-year fixed mortgages.

They’re also fully underwritten via the verification of income, assets, employment, and credit history.

The mortgages of yesteryear were mostly stated everything. AKA I’ll tell you what I do, what I make, how much money I have, etc. But don’t actually verify it. And we paid for that, big time.

Logic tells me banks and mortgage lenders are going to have to get creative now that volume has dried up seemingly overnight.

This means introducing and/or pitching more risky loan products such as adjustable-rate mortgages, interest-only mortgages, and so on.

As I noted the other day, the 5/1 ARM is now pricing about 1% below the prevailing rate on a comparable 30-year fixed.

Home buyers may choose to go with such loans to keep costs down. And while the 5/1 ARM is by no means a toxic option ARM, it does carry more risk than a 30-year fixed.

If lenders go even more risky, well, those products combined with even higher home prices could lead to the inevitable end we’ve all been worried about.

Still, that could take a couple of years to play out, at least…so while the housing bears will eventually be right, it might not be this year or even next.

Read more: What will cause the next housing market crash?

Source: thetruthaboutmortgage.com

See Inside the House Dan Bilzerian Grew Up In, Now on the Market for $6 Million

Just a few short days after the Bel-Air mega-mansion he rented for $200k/mo was listed for sale — asking a whopping $67.5 million — Dan Bilzerian’s childhood home in Tampa, Florida also re-surfaced on the market.

The sprawling estate that Bilzerian’s dad, Paul Bilzerian, built in the early ’90s (prior to serving a brief stint in prison for illegal stock manipulation) is now up for grabs, asking $5,999,000.

Listed with Compass agents Eric Dungy and Jon Fincher, the property is one of Tampa’s most notorious estates.

Known as the Bilzerian Mansion, a moniker that dates back decades before Dan Bilzerian became the ‘King of Instagram’, the massive 28,000-square-foot home sits on a lush 3.4-acre waterfront lot.  

Dan Bilzerian's sprawling estate sits on 3.4 acres within the Avila Golf and Country Club in Tampa, Florida.
The sprawling estate sits on 3.4 acres within the Avila Golf and Country Club in Tampa, Florida. Image credit: Vistabee
The 28,000-square-foot compound was custom-built for Dan's father, Paul Bilzerian.
The 28,000-square-foot compound was custom-built for Dan’s father, Paul Bilzerian. Image credit: Vistabee
The notorious estate has countless amenities, including a pool with slide and waterfall, a racquetball court, indoor basketball court, vintage movie theater, and a massive open floor game room.
The notorious estate has countless amenities, including a pool with slide and waterfall, a racquetball court, indoor basketball court, vintage movie theater, and a massive open floor game room. Image credit: Vistabee

Inside the Bilzerian mansion, one of Tampa’s most notorious properties

Dan Bilzerian’s house was famous well before he was.

The 28,000-square-foot mansion has often made front page news following dad Paul Bilzerian’s arrest and decade-long legal battles.

It was once listed for $18 million before being foreclosed on and sold for significantly less. Rumor has it that before hitting the auction block, it was still owned by an entity related to the Bilzerians (masked behind an LLC controlled by a family friend).

And while we won’t give course to the many controversies that followed both Bilzerian and his dad, one thing’s for sure: Dan Bilzerian has always been exposed to the finer things in life, as his childhood home stands to show.

Located in the exclusive Avila gated community, known for its upscale golf course and country club, the house has a total of 10 bedrooms and 19 bathrooms.

Grand staircase inside the luxurious Bilzerian mansion.
Inside the luxurious Bilzerian mansion. Image credit: Vistabee
Living room inside the luxurious Bilzerian mansion.
Inside the luxurious Bilzerian mansion. Image credit: Vistabee
Dining room inside the luxurious Bilzerian mansion.
Inside the luxurious Bilzerian mansion. Image credit: Vistabee
Bedroom inside the luxurious Bilzerian mansion.
Inside the luxurious Bilzerian mansion. Image credit: Vistabee

There are entire wings dedicated to entertaining guests, with game rooms around every corner, as well as a grand entryway, master suite, conference room, and indoor basketball court.

A closer look at the childhood home of the pro-poker-player-turned-influencer gives us a good idea of how Dan Bilzerian came to enjoy the ultra-luxurious lifestyle he’s now famous for.

Despite being vacant for years, the opulent mansion retains most of the luxury amenities the Bilzerians enjoyed at the height of their wealth and fortune.

That includes a racquetball court, exercise room, vintage movie theater, and a massive open floor game room.

Game room inside the luxurious Bilzerian house.
There’s plenty of room for games and entertaining guests in the former Bilzerian house. Image credit: Vistabee
Vintage movie theater inside the luxurious Bilzerian mansion.
The former Bilzerian house comes with a vintage movie theater. Image credit: Vistabee

The house’s backyard leads straight to the lake, with a dedicated swimming area that includes a waterfall, slide, diving board, and hot tub.

Pool of the Bilzerian mansion.
The pool outside the Bilzerian mansion. Image credit: Vistabee

There’s also a 5,800-square-foot guest house on the property.

Dan who? What is Dan Bilzerian famous for?

For those of you unfamiliar with Bilzerian, he is an Armenian-American trust fund baby. Born to a corporate takeover specialist, Bilzerian is widely known as a professional poker player and social media influencer.

From his inherited fortune, Bilzerian founded Ignite International Brands, Ltd., which sells electronic cigarettes, CBD oils, vodka, water bottles and other products. 

While his trust fund money has gone a long way, Bilzerian makes headlines with his lavish lifestyle, which includes lots of women, fast cars, guns, tons of parties and oodles of mind-altering substances.

Dan Bilzerian at the 2016 Maxim Halloween Party at Shrine Auditorium in Los Angeles.
Dan Bilzerian at the 2016 Maxim Halloween Party at Shrine Auditorium in Los Angeles. Image credit: Kathy Hutchins / Shutterstock.com

Dan’s dad, Paul Bilzerian, is just as much of a controversial figure as his son, if not more.

Initially a prominent local business figure in Tampa, he went on to serve 13 months in prison for illegal stock manipulation. After his troubles with the law, he left the US and sources say he is now living in self-imposed exile on the Caribbean island of St. Kitts.

A look inside the $67.5 million Bel-Air mansion Bilzerian rented in recent years

Love him or hate him, Bilzerian has impeccable taste when it comes to dope dwellings.

In recent years, the Instagram playboy lived in the lap of luxury for a whopping $200,000 per month in this stunning Bel-Air mansion.

Spanning 30,000 square feet, 10979 Chalon Road is one of the most luxurious Los Angeles homes on the market. And the price sure does reflect that: the house is now listed for $67.5 million.

Boasting 13 bedrooms and 24 full bathrooms, the stunning estate in the Bel-Air West Gate offers jaw-dropping views of the Bel-Air golf course, the city of Los Angeles and the majestic Pacific Ocean.

The mega-mansion Dan Bilzerian rented in Bel-Air is on the market for $67.5 million.
The mega-mansion Dan Bilzerian rented in Bel-Air is on the market for $67.5 million. Image credit: MLS / Zillow

Raising the bar for luxurious living, the 3-story manse sits on 1.03 acres of gorgeous landscaped greens.

The mega mansion features all the bells and whistles you could imagine, including, multiple staircases, an elevator, a 40+ seat home theater, multiple living and dining areas, a 2-lane bowling alley, salon/ spa, 14 attached garage spaces, rooftop infinity pool, rooftop gym, 12-foot waterfall, tennis courts, putting green and 5 wet bars, to name a few.

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Source: fancypantshomes.com

Where does LeBron James Live Now? A Look at the NBA Superstar’s Impressive Homes

LA Lakers superstar LeBron James is winning on and off the court.

Not only did he star in one of this year’s biggest movies, picking up where Michael Jordan left off by starring in Space Jam: A New Legacy, but also setting new records: James became the first player in NBA history to accumulate $1 billion in earnings as an active player.

Nicknamed “King James”, LeBron is widely considered one of the greatest players in NBA history, and is the only player to have won NBA championships with three different franchises (the Cleveland Cavaliers, the Miami Heat, and the Lakers).

James’ many achievements extend off the court too.

He’s an actor (Trainwreck, Space Jam: A New Legacy), producer (he won two Sports Emmy Awards as an executive producer), part owner of leading soccer team Liverpool FC (his team won the 2018–2019 UEFA Champions League and 2019–2020 Premier League) and a well-known philanthropist (he founded the LeBron James Family Foundation, which so far opened an elementary school, housing complex, and community center/retail plaza in his hometown of Akron).

Naturally, the basketball icon also has an impressive real estate portfolio. So just in case you were wondering where LeBron James lives, and just how lavish his digs are, we’ve put together a complete complete breakdown of King James’ homes in California.

After leading the Miami Heat and Cleveland Cavaliers to NBA titles, the father-of-three signed with the Los Angeles Lakers in 2018. After that, the James family-of-five packed up and moved to the West Coast.

So where’s a four-time NBA champ to live? A look at LeBron’s first California property

After selling his Miami waterfront mansion for $12.75 million in 2015, James moved out west when he joined the Lakers.

The first house King James bought in California.
The first house King James bought in California. Image credit: Realtor.com

Actually, that’s not the full story. The four-time NBA MVP purchased his first California property before the move, when he was still playing for the Cleveland Cavaliers, Dirt reports. 

Back in October 2015, King James bought a Brentwood mansion for $21 million on Rockingham Drive — the same street that became infamous a couple decades back due to fellow athlete O.J. Simpson, who was living here when he led the police on a horribly slow chase down the I-405 leading back to his Brentwood home.

It’s no surprise the NBA superstar picked this area (for both his first and second Los Angeles homes). Brentwood is one of LA’s leading neighborhoods, home to various Hollywood celebs, a world-class museum, and plenty of local attractions.

But LeBron didn’t hold the property too long. Five years after he bought it, the property was listed for sale.

Although James was asking $20.5 million for the Brentwood estate that he hadn’t lived in for years, it sold for $19.6 million in September 2021 in an off-market deal to Hon “Alexander” Shing, founder of the LA-based real estate investment firm Cottonwood Management. 

A quick peek at his recently sold Rockingham Rim Brentwood home 

I’m sure this was a tough goodbye!

Spanning 9,440 square feet, the 2011-built mansion sits on the coveted Rockingham Rim area of Brentwood.

The palatial property includes six bedrooms, oakwood floors, detailed ceilings, multiple fireplaces, a paneled library, a gym, elevator, media room and two family rooms, to name a few of the fab features.

The first house LeBron James owned in Los Angeles, which he sold in 2021 for $19.6 million.
The first house LeBron James owned in Los Angeles, which he sold in 2021 for $19.6 million. Image credit: Realtor.com
 Inside the Brentwood home where LeBron James previously lived.
Inside the Brentwood home where LeBron James previously lived. Image credit: Realtor.com
 Inside the Brentwood home where LeBron James previously lived.
Inside the Brentwood home where LeBron James previously lived. Image credit: Realtor.com
 Inside the Brentwood home where LeBron James previously lived.
Inside the Brentwood home where LeBron James previously lived. Image credit: Realtor.com
 Inside the Brentwood home where LeBron James previously lived.
Inside the Brentwood home where LeBron James previously lived. Image credit: Realtor.com

Not to mention the luxe outdoor amenities such as the infinity pool and spa, a pool-side cabana, resort-like grounds and (of course) a basketball net at the end of the driveway. 

So where does LeBron James live now?

As it turns out, the Space Jam star also bought his second Los Angeles home while still playing for Cleveland. In 2017, James bought a new spec mansion in Brentwood for $23.5 million.

Set on Tigertail Road, one of most prestigious streets in Los Angeles, LeBron’s pad spans 15,846-square-feet and opens up to beautiful views spanning from downtown Los Angeles to the ocean.

The impressive property features eight bedrooms, French oak and marble throughout, a wet bar and giant home theater, an indoor-outdoor gym, a steam room and sauna.

LeBron James' second house in Brentwood, Los Angeles.
LeBron James’ second house in Brentwood, Los Angeles. Image credit: The Agency

Combining a warm, traditional-style exterior with the highest caliber of contemporary European finishes, including soaring, 14-foot ceilings and antique reclaimed marble floors sourced from villas in Spain, the mansion is a thing of beauty.

Designed with entertainment in mind, LeBron’s house has an expansive daylit lower level which holds a fully-soundproofed theater with a massive screen and professional sound system, as well as a 1,500-bottle wine cellar and wine tasting and cigar lounge with Casino-grade, air purifying technology.

Outside, the posh property boasts an oversized swimming pool and spa and grassy fields for days. There’s also a private driveway studded with 100-year-old, imported Sevillano olive trees that leads to a grand, cobblestone motor court.

Zip code envy! It’s not just Brentwood, but also Beverly Hills for King James

James’ enviable real estate portfolio doesn’t end there. 

In 2020, the basketball superstar purchased a pricey pad in Beverly Hills for a whopping $36.75 million, Los Angeles Times reports. 

LeBron James' most expensive home is a striking $36.75 million property in Beverly Hills which was once owned by Hugh Hefner and occupied by Katharine Hepburn.
LeBron James’ most expensive home is a striking $36.75 million property in Beverly Hills which was once owned by Hugh Hefner and occupied by Katharine Hepburn. Image credit: Zillow

The palatial property was sold by the estate of Lee Phillip Bell, co-creator of The Young and the Restless, who died in 2020. But there’s more star power to this Old Hollywood home.

The hilltop 90210 compound sits on a 2.5-acre property and was built back in 1934. The mansion, once owned by Hugh Hefner and occupied by Katharine Hepburn, boasts four bedrooms, eight bathrooms, and 9,146 square feet of living space. 

Inside LeBron James' house in Beverly Hills, Los Angeles.
Inside LeBron James’ house in Beverly Hills, Los Angeles. Image credit: Zillow
Inside LeBron James' house in Beverly Hills, Los Angeles.
Inside LeBron James’ house in Beverly Hills, Los Angeles. Image credit: Zillow

The main house contains two suites, multiple entertaining areas and seven fireplaces, with its rooms opening up to striking, unobstructed views.

Including not one, but two guest houses, the Mediterranean-style home also features a hedge-lined driveway and palm-topped motor court to greet residents and guests in style.

The posh property also includes a screening room, a lighted tennis court, pool, and pool house with two bathrooms, all in a dramatic, private unparalleled setting — fit for a King.

LeBron James' house in Beverly Hills opens up to sweeping views of Los Angeles.
LeBron James’ house in Beverly Hills opens up to sweeping views of Los Angeles. Image credit: Zillow

More sports celebrity homes

Basketball Icon Michael Jordan is Struggling to Find a Buyer for His Longtime Home Near Chicago
Serena Williams’ House in Florida is Bold and Beautiful, Just Like Her
Wayne Gretzky ‘s $22.9M California Home Designed by ‘The Megamansion King’
5 Fabulous Homes of Your Favorite Formula 1 Drivers

Source: fancypantshomes.com

3 Steps to Buying a Vacation Home With Friends

In this article:

Get a group of friends together, and there’s a good chance that the climbing costs of housing is going to come up at some point. And for some, lamenting the quickly rising rents and steroidal home prices could easily segue into plotting an alternative housing solution: going in on a home purchase together.

Buying a home with a friend can make home ownership more affordable since the down payment, mortgage payment and costs for upkeep can be shared between two or more people. A recent Zillow survey on co-buying found that affordability is a top reason people buy with others: 33% of successful co-buyers and 45% of prospective co-buyers surveyed cited buying with someone else as more affordable than purchasing a home on their own.

While money is a significant concern, co-buying agreements should take into account more than money. Good friends are precious and rare. Buying a home with one could mean losing that friend if things go bad and you can’t work things out. 

How one ‘risk-taker’ bought a home with friends — successfully

That wasn’t the case for Alecia Pillatos. Aged 21 and a self-described risk-taker, she roped in a good friend who wanted the same thing she did: a toe-hold in a supercharged housing market where homes were appreciating at double-digits.

“I couldn’t afford a home and I was sick of living in apartments,’’ Pillatos, now 37, said of the 2008 purchase. “We had this great plan where we’d flip it and have all this money and we’d be rich.”

33% of successful co-buyers cited affordability as the top reason they bought with someone else.

Things didn’t quite work out that way, but they did work out. 

Three years after they bought the $329,000 home in a Seattle suburb, her friend had a baby and moved with her husband to another home to raise their family. Pillatos ended up keeping the house for more than a decade.

When she sold the home in 2020 for $510,000, she used the proceeds from the sale to buy a $900,000 property with her sister-in-law.

Pillatos is now a real estate broker and a growth advisor at Zillow who educates and coaches other brokers, sales teams and real estate agents on how to best support customers who are buying and selling homes. In some cases, she said, those customers may be friends co-shopping together.

Buying with a friend, she said, isn’t for everyone. She wouldn’t recommend it  unless there’s “extreme trust” in the relationship, and each party gives lots of thought to details a single buyer wouldn’t have to consider.

If you have such a friend, she said, consider what co-ownership might look like with them, and the benefits it could deliver.

“Don’t wait for the dream house,’’ she said. “When your life changes, your dreams change. Just buy something and fix it up while you live in it.”

Alecia Pillatos bought a home with her sister-in-law.

Alecia Pillatos (pictured right) bought her current home in a Seattle suburb with her sister-in-law Ashley Pillatos (left) in 2020.

What to think about before buying a home with a friend

The steps involved in buying a home with a friend — or even a group of friends — are the same as buying alone or with a partner. However, buying with a friend requires extra planning to ensure accountability and provide protection in case plans change.

It’s always a good idea to consult with an attorney before making such a large financial commitment with another person. And, as always, working with a good agent can help you navigate any zoning issues or restrictions on how the home can be used.

Before deciding to move ahead with a joining purchase, here are some issues to consider:

What type of home should you buy with a friend?

Think about how you want to live. Do you want a roommate situation where you share common spaces? Or do you want a separate unit, a division of the home, or something along the lines of a duplex or even triplex? 

13% of prospective buyers intend to buy with a friend in the next 12 months.

When Pillatos and her friend searched for their first property, they looked for homes that had separate living spaces or that could be easily divided to create separation. They found a 4-bedroom, 1.75-bath home in a quiet suburban Seattle neighborhood. Her friend put down $5,000, and Pillatos took over the loan when her friend moved out, more or less equalizing their contributions.

Pillatos said, however, that ideally, she would have preferred the down payment be split equally.

Pillatos said she found her second property by searching online listings for homes that mentioned Accessory Dwelling Units (ADUs) or mother-in-law (MIL) units, which would make it easy to divide the property.

Separate units may also allow for rental income outside a roommate situation if one friend decides to move out. 

How much of my financial life will I have to share with my friend?

There should be no secrets when it comes to income, savings, debts and spending habits. Make sure you’re comfortable sharing important financial details with your co-buyer, even if it’s not required by a lender.

If you’re purchasing with a mortgage, you and your friend will both need to qualify for financing. Co-applicants can apply for a loan without sharing personal financial information such as pay stubs and tax returns with each other, but they are required by the lender. If either of you has a low credit score, debts that eat up a large chunk of income every month, or collections on your credit report, you might not qualify for a mortgage, or it could cost more.

How will buying with a friend affect my finances?

Even though you may be splitting the mortgage payments, the entire mortgage obligation will be reported to lenders as your sole responsibility when calculating your debt-to-income ratio, which is a measure of how much debt you owe in relation to your income.

The larger debt assigned to you could increase your cost of borrowing on things like credit cards and auto loans.

If your friend is suddenly unable to pay their share of the mortgage and costs, that also would have a huge impact on your finances, as you would be responsible for the entire cost.

What are the legal arrangements when buying a home with a friend?

There are a variety of different arrangements that can be explored when co-owning property. You should speak to a legal and tax professional for more information and to decide what options might exist in your state and what would work best for you.

Is co-buying common?

Zillow’s co-buying survey found that 13% of successful homebuyers bought their home with a friend, and 13% of prospective buyers intend to buy with a friend in the next 12 months.

Questions to ask before you buy a home with a friend

Who pays for what? Buying a home with a friend: Zillow's Co-Buying Survey results

The first thing to decide is the upfront cost of buying the home: How much is each person putting down on the purchase, and how will you split the cost of the appraisal and closing costs?

The costs don’t necessarily have to be split evenly — they can be split according to room or unit size. But it’s important to clearly document how you plan to handle the costs.

It also takes money to maintain and improve a home. Are you in agreement on what improvements you want and how you’re going to pay for them? Do you both have money to pay for repairs or do you want to start a Home Maintenance Fund? How are you going to plan for expenses? What about utilities?

When Pillatos bought her first home with a friend, they split everything 50/50 — not only the costs of buying, but the cost of fixing it up and maintaining it. Any repairs required full agreement by both, and if one couldn’t afford a project the other wanted, it would be nixed.

When she bought her second property with her sister-in-law, they configured the monthly costs according to the space each occupied.

How will disputes and differences of opinion be resolved?

When Pillatos bought her first home, she and her friend didn’t have a legal agreement drawn up by an attorney — something experts recommend to provide legal recourse in case things go wrong.

But they did have a detailed set of house guidelines that covered everything from preferred bedtimes (no noise after 10 p.m.) to chores and shared meals. Their close friendship and trust was the glue that bound the agreement.

Ask yourself: How well do you know your friend and how well do you get along? Can you work through disagreements in a respectful and fair way? Do you share similar lifestyles and habits, or will you have to spell out even ordinary things such as laundry days? 

Can your friendship withstand the stress test?

Cohabitation came easy for Pillatos and her friend, mostly because they were young and accustomed to it.

“You’re fresh out of college and you’re used to living with other people,’’ Pillatos said. “But you’ve got to be close to someone and want to spend time with them.”

Disagreements are going to come up, and how they get resolved can have a lasting effect on the friendship. People can get weird when it comes to money. Is it worth risking a friendship or is the friendship so strong that the risk seems minor compared to potential benefits? 

What if one of us needs to move out?

Life is unpredictable. You can chart a course for your life, but any number of things can throw you off, for better or worse. Loss of a job. An opportunity in a different city. A new love in your life. A bad investment. You may find at some point that your home no longer fits into your plans — or your friend’s.

Do you have the option to buy the friend out? Can you afford to refinance it or does the home go up for sale? If a buyout is possible, how is the price determined? Things happen. You won’t likely need every contingency, but it’s good to have a plan just in case.

When Pillatos’ friend decided to move out, the pair owed more on the house than it was worth — a common problem for people who bought in 2008, just before the start of the Great Recession. If the pair had decided to sell, they would likely have had to sell at a loss.

Pillatos said she was able to remain in the home mainly because her friend didn’t ask for it to be sold or to have her down payment returned. Had she made that request, Pillatos would have been in the position of negotiating a buyout or some other arrangement. 

As the sole owner living there, Pillatos installed a second full bath, and rented out the bottom of the home to help with the mortgage and improvements. When she sold it at a profit, she offered to share the proceeds with her friend, who refused it since Pillatos had lived there for more than 10 years. 

“I’ve been lucky to work with generous people,’’ said Pillatos. “Be sure that you’re working with generous people who support each other and want to be kind.”

*Results of the Zillow Successful and Prospective Buyer Survey on Cobuying, conducted in February & March 2022.

Source: zillow.com

Mortgage Rates Have Jumped. Just How Bad Is It?

In a word, bad. At least in terms of historic interest rate moves, which have rarely rivaled the massive increases we’ve seen in such a short span.

But you have to consider context as well, such as the starting point for mortgage rates before this recent spike higher (near all-time lows).

Along with how impactful the increase in monthly payment will be for home buyers and those looking to refinance.

One should also consider that just about everything is going up in price (or already has), and that the U.S. dollar isn’t what it was once.

Taken together, it may not be all that horrible, though it does depend on individual circumstances, and for home buyers, is clearly another piece of unwelcome news.

Let’s Compare Monthly Payments on a Typically Priced Home

The typical home is valued at about $332,000, per the Zillow Home Value Index, a 20.3% increase from a year ago.

Meanwhile, the average 30-year fixed mortgage rate is pricing around 4.75% for vanilla scenarios, aka those with excellent credit, a 20% down payment, and so on.

At the start of 2022, the 30-year fixed was priced closer to 3.25%, so the move higher has been substantial. No one can debate that.

But let’s look at how it might affect the average home buyer’s pocketbook, instead of simply freaking out at the difference in rate.

We’ll assume our hypothetical home buyer purchases a property for $332,000 and puts down 20%. That leaves them with a loan amount of $265,600.

Had mortgage rates not budged since the start of 2022, they’d have a monthly principal and interest payment of $1,155.91.

Unfortunately, they have budged, in a major way, and are now closer to 4.75%, depending on the bank or lender in question.

Using the same loan amount, the monthly P&I is now $1,385.50, which is nearly a 20% increase.

On a dollar amount basis, it’s the difference of about $230, which again is nothing to sneeze at.

At the same time, in the grand scheme of things it’s not a massive amount of money, especially when we’re talking about a home purchase.

And again, because inflation is rapidly eroding the value of the dollar, that difference can be minimized to some degree, assuming wages are also increasing.

To put it in perspective, it’s the cost of filling up an SUV twice in many states these days, thanks to the high price of gasoline.

What About a Typically Priced Home in Los Angeles?

Now a difference of $200 a month doesn’t seem horrendous for a housing payment, despite clearly being more expensive.

But consider pricier housing markets nationwide, such as Los Angeles. There, the typical home value is a whopping $944,651, per Zillow.

Again, assuming a 20% down payment for a loan amount of $755,720, the monthly principal and interest payment was $3,288.94 to start off 2022.

Today, it’s $3,942.19, factoring in that much higher 4.75% mortgage rate. That’s a difference in monthly payment of $653.25.

While you could argue that incomes might be higher in Los Angeles, it’s still a pretty big chunk of change.

In fact, it’s nearly $8,000 more annually, while the typically priced U.S. home is now only $2,760 more per year.

Obviously both increases are a blow to home buyers, who are already grappling with housing affordability due to a massive increase in home prices.

But some housing markets are certainly worse off than others.

Check out my mortgage rate charts to quickly determine the difference in payment at various interest rates and loan amounts.

So What Should You Do? Wait to Buy, Hurry Up, or Just Rent?

Now that owning a home just got a lot more expensive, you might be wondering if it’s prudent to keep looking, keep renting, or get even more aggressive.

Personally, I think those in the market to buy a home should have adequate cash reserves to absorb a mortgage rate increase like this, whether the mortgage lender requires it or not.

If you’re planning to buy a home, you should have money for the down payment, closing costs, and several months of mortgage payments, ideally a year’s worth or more.

That way you can handle a higher mortgage rate and/or higher asking price. If you’re merely scrapping by, you’ve probably already been priced out.

If you have reserves, and ample income as well, chances are you can still proceed with a home purchase, despite the higher monthly payment.

And you should still want to be a homeowner, even if financing costs have risen. If you’re on the fence with rates above 4%, maybe you don’t want to be a homeowner.

It’s hard to predict what happens next, and I’ll admit I’ve been wrong lately with rates continuing to climb higher and higher this year.

But I still believe we’ll get some respite soon, given the nonstop increases with seemingly all the bad news baked in.

And while it’d be logical for home prices to drop given the higher cost of financing, that might not actually happen.

Both could continue to rise, which bolsters the argument to hurry up and find a home already.

Source: thetruthaboutmortgage.com