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What Does 2022 Hold for Real Estate Market?

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The COVID-19 gave wings to the real estate market in 2021 and it soared high. Low interest rates paired up with the shortage of inventory made the market way too competitive. One wonders, if 2022 will follow into the similar footsteps, as marked up prices and low inventory result in faster turnarounds. 2022 is being predicted as, again, the year of home sellers.

  1. Supply-Demand Upset:

The inventory available in the market is still too scarce to meet the rising demand of the living spaces. Due to COVID-19, the labor has been short hence the production has slowed by huge margin. There are likely to be more listings during the prime season, but it is still might not meet the growing stipulations and concerns.

2. Rising Interest Rates as Silver Lining:

 It is a known fact that the interest rates will be increased this year as well. In conclusion, mortgage rates will rise with them. Now, it is not necessarily a bad thing because people who buy houses with higher mortgage rates tend to live in them rather than flipping them over for profit. It’s good news for the average buyer and will hopefully stabilize the real estate market.

Conclusion:

In such uncertain times, first-time homebuyers need to be very careful when looking at their prospects and options. Even with the elevated prices, one should not be overpaying for the property. That’s where we come in. American Mortgage Resource, Inc.  is a trusted name in the real estate market. We cater to all the people, whether they are first time home buyers or seeking loans and other finance options. Contact us at (617) 972-8588 and we will help you in buying your dream home.

4 Factors to Consider Before Getting a Mortgage

Buying a house is one of the biggest financial decisions that you can ever make, and therefore you need to make an informed choice. This is critical, especially if you will get your house on mortgage terms. There are several steps that you need to follow before you can begin the process.

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  • Start by Checking Your Credit Score

Before you can start a mortgage application, the first thing that you need to do is to check your credit score. A higher credit score plays a significant role in your mortgage approval process. Before any lender can approve a mortgage, the first thing that they do is to check the creditworthiness of an individual. Ensure that your credit score is accurate to increase your chances of approval.

  • Larger Down Payment

When you make a large down payment for your mortgage, you get better terms. Putting more money as a down payment ensures that you pay less every month. This simply means that if your down payment is high, you do not require as much money from your lender. In addition, the lender considers you as a lower-risk borrower.

  • Steady Source of Income

Besides the lenders accessing your credit history and the ability to make a down payment, they also review the employment history. This is to ensure that you have a steady source of income every month and that you can service your loan. Therefore, it is best to avoid switching careers or changing jobs when you are activity looking to buy.

  • Check Pre-Payment Penalties

You need to check with your lender if you will incur penalties for early loan repayment. Some homeowners, once they experience a cash windfall, may decide to double up their payment, clear the loan sooner and end their term. Check to make sure that if you decide to do the same, you will not incur any pre-payment penalties.

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Conclusion

Homeownership is a dream come true for most people. However, sometimes a mortgage is the only option to getting your dream home. The terms of getting a mortgage can sometimes be complex. Therefore, it’s advisable to speak to mortgage professionals at American Mortgage Resource Inc. We can advise you on refinancing your mortgage, buying a new home, and cashing out on your home equity, as well as assist you to apply, qualify, and get approved for a new loan.

Things to Know Before Turning Your Property into an Airbnb

Establishing a side hustle is a goal that many people try to strive for, especially for that extra stream of income. Some turn to becoming an Airbnb host, because after all, it can be a very successful opportunity in well-traveled locations. While turning a second property into an Airbnb can be a very lucrative investment, it also comes with its own set of challenges. If you’re interested in becoming an Airbnb host, here are some things you should know before making that investment.

Research Your Location

For starters, you have to determine if the location of your property has a lot of demand. Are you located near tourist hotspots? Is your potential Airbnb near public areas such as restaurants and grocery stores? These are just a couple of questions you should ask yourself in order to determine if hosting in the area is worth it. Keep in mind that the earning potential for your property is largely determined by location and demand for travel.

Another thing to check is to make sure it is legal to host in your area and what requirements you need to meet. In many cases, the city needs to be informed that you plan to rent out your property as an Airbnb and some paperwork will be in order. If applicable, also be sure to check any rules enforced by the homeowner’s association, condo board, or landlord.

Decorating and Marketing

Airbnb hosts actually have to invest a great deal of money into their property to enhance its attractiveness to travelers before gaining profit. Redecorating and cleaning is the first task on the agenda. Your Airbnb should start from a clean slate and include relatively new furnishings and household equipment that are comfortable and high quality. Interior design is extremely important and should appeal to a wide target audience – not just you. Hosts can also consider consulting with professional interior designers for advice.

You will be competing with other hosts in the area, so you’ll need to have good marketing on your listing. It’s worthwhile to invest in a professional photographer for a comprehensive photoshoot. Visuals are everything and your first impression will be through digital photos. Always try to highlight unique aspects including your décor and amenities. In addition, it’s always good to have descriptive listings describing your space as best as you can. Be clear about what you’re offering in order to manage your potential guest’s expectations.

Have Good Amenities and Plentiful Supplies

If you want to host an Airbnb, never skimp on your amenities. Travelers are looking for a comfortable place that meets all of their needs and requirements while they’re on vacation. At the very least, having fast and strong WiFi is an absolute must. Another great thing to have is a Smart TV with integrated services such as Netflix, Hulu, Disney Plus, etc. You can also go the extra mile and pay for a streaming service for your guests to use. If you’re still in the market for a property, owning a place with unique amenities such as a pool or hot tub can be a great bonus on your listing.

You are also responsible for double checking stock and supplies before your guests check-in. They should not have to run to the store just because you don’t have the basic essentials. Here is a quick checklist to go over:

  • Toiletries (shampoo, soap, toilet paper, etc.)
  • Hangers
  • Hair dryers
  • Towels and hand rags
  • Extra blankets, pillows, and linens
  • Kitchen supplies and pantry staples (salt, pepper, oil, etc.)
  • Water and ice trays

Hosts Must Always Be Available

During the course of a traveler’s stay, anything can come up at any time. Perhaps the AC unit isn’t working or they need more bathroom supplies. As a host, you will be their point of contact for anything that they need. You are expected to remain attentive and available for your guests, morning or night. Providing great customer service and fast responses plays a major role in how well your guests enjoy their stay. The difference between a good and bad review can affect your profitability, reputation, and future bookings.

Conclusion

Remember that in order to gain profit from renting out an Airbnb means that a lot of work needs to be put into it. If you’re ready to take on these challenges and are set on investing in a second property, American Mortgage Resource, Inc. can help you find the best loans. Feel free to visit our website to learn more. Consult with our loan experts today!

Responsibilities of Being a Landlord

Becoming a landlord is an investment that will bring in another stream of income as you rent out your property to eager tenants. However, it also comes with a multitude of responsibilities that you are legally obligated to commit to. Your top priority is to provide a reasonable and safe living space that includes security and maintenance. If you’re interested in becoming a landlord, continue reading to learn more.

Provide a Habitable Living Space

As landlord, you must ensure that your tenants have access to a clean and comfortable living space. Depending on local laws, you are obligated to maintain the property and keep it up to standards. This includes:

  • Ensuring all structural elements are safe and intact.
  • Keeping the plumbing, electrical, heating, and ventilation in good working order.
  • Supplying trash cans and dumpsters.
  • Eliminating any vermin or infestation.
  • Following safety codes and disclosing any history of hazards such as asbestos, lead paint, bed bugs, etc.
  • Maintaining any common areas.

Ensure a Quiet Living Environment

It’s best to foster a peaceful community so all tenants can enjoy their residence without conflicts. Landlords should consider specifying in their lease that tenants should maintain a reasonable noise level so others are not disrupted. This will increase your reputation as an amicable place to live and attract more renters. 

Maintain Tenant Safety

Maintaining safety is one of your most important responsibilities as a landlord. You are obligated to ensure all tenants are safe and that your property is well-monitored. The legal requirements may vary depending on the local law but regardless of where you live, here are some things to take into account:

  • Double check all locks on doors, windows, and garages. Remember to rekey or replace locks after an old tenant moves out.
  • Ensure common areas such as the parking lots are well-lit and monitored with cameras.
  • Make sure all units have functioning smoke and carbon monoxide detectors. Other safety and rescue equipment like fire extinguishers must also be easily accessible.
  • Supervise hired personnel such as contractors, plumbers, electricians, etc.

Perform Repairs and Maintenance

Landlords must respond to any issues that may impact a tenant’s quality of life. Urgent repairs for electricity, plumbing, mold, and so on should be addressed as soon as possible. For most major issues, you should respond within 24 hours of the complaint. Response times can vary for lesser concerns but its best to handle it quickly to prevent further damage. Another thing to remember is that unless it’s an emergency, landlords should notify tenants ahead of time before entering the rental property and should only visit during reasonable day time hours.

Track the Unit Conditions

When tenants move out, landlords are responsible for repairing anything that is considered normal wear and tear such as repainting scuffed walls, replacing damaged carpets, repairing loose or worn hardware, and more. Keeping a checklist of the unit’s condition when a tenant moves in and out can help keep track of things to review. Landlords can also collect a security deposit to cover any damage exceeding normal wear and tear.

Conclusion

There are many things landlords are responsible for and local laws can have additional things to keep track of. If you’re ready to become a landlord and you’re considering a second property to rent out, consult with American Mortgage Resource, Inc. Over the years, we have helped numerous homebuyers and homeowners with their mortgage and financing options. Learn more by visiting our website and schedule an appointment with an expert today.

How Do Fixed-Rate and Adjustable-Rate Mortgages Work?

When talking to a lender, there are two basic type of mortgages they will offer you. These are called fixed-rate and adjustable-rate mortgages. For most homeowners, fixed-rate loans are preferable if they plan to live in the home for an extended time. However, adjustable-rate mortgages are also offered for those who want lower interest rates with a shorter loan term. Keep reading to learn more about these two mortgage loans and see which one is right for you.

Fixed-Rate Mortgage

As this loan implies, the rate for the mortgage is fixed, meaning that it does not change for the life of the loan. Likewise, the monthly payment remains the same too. Repayment of a loan can range from 30 years to shorter lengths of 10-20 years. If you do choose a short loan term, understand that you will have larger monthly payments, but lower total interest costs over time. On the hand, a longer loan term with lower monthly payments is a more desirable option for committed buyers.

Adjustable-Rate Mortgage

If you plan to live in your home for a few years, then an adjustable-rate mortgage, or ARM, may be more suitable for you. Since the monthly payment is not set, it will change over the life of the loan. Rates for the loan will also fluctuate, although there is usually a limit on how much it will go up or down. “Lenders often offer lower interest rates for the first few years of an ARM, sometimes called a teaser rate, but rates can change after that– as often as once a year. The initial interest rate on an ARM tends to be significantly lower than that on a fixed-rate mortgage.”

Conclusion

Before making a big decision on a mortgage loan, make sure you are informed first. At American Mortgage Resource Inc., we offer the lowest competitive mortgage rates in Waltham, MA and surrounding areas. Let us help you choose the right home loan by contacting us at (617) 972-8588. You can also find more information on our website visitamr.com. Call today!

Condo vs. Townhouse

Condos and townhomes can offer many comforts and homely characteristics that traditional homes offer, if not more! Many families, couples, and individuals choose to buy and rent these types of homes for their appealing amenities accompanied by their smaller price tags. In this month’s blog, we break down the major differences and similarities between condos and townhomes so that you may discover which is the right choice for you!

Similarities

Both condos and townhomes are attached homes, meaning they share one or more walls with a neighbor. Despite ownership of the home, many of these communities are run by a home owners association (HOA) made up of other residents. HOAs almost always charge their residents a monthly fee to cover the upkeep of landscaping, pools, fitness centers, and common areas.

These homes typically have less square footage and outdoor space than detached single family homes do and can be anywhere from one to three stories tall. The resale value of these spaces largely depend upon how well the HOA manages the property as well as how well the owner upkeeps their individual home.

Notable Differences

There are several notable differences to consider when comparing condos and townhomes, most of them regarding their physical build. Townhomes are built on land that the owner purchases with the home whereas condos are more like apartments and no land ownership is involved.

When you purchase a condo, you personally own your individual unit and share joint ownership of the building with the other owner-tenants. That joint ownership includes not just the building structure itself, but its common areas, such as the gym, pool, and grounds, as well as the airspace. Some condos may resemble townhomes but unless the land is also owned by the homeowner it’s still technically a condo.

Final Thoughts

There are so many decisions to make when buying a home from location and price to size and available amenities. Regardless if you want a traditional detached home or a condo, it’s crucial to never buy more home than you can afford! This reason is often what makes condos and townhomes such great choices for first-time homebuyers or anybody shopping for a home on a smaller budget. Head to our website or contact our team directly at (617) 972-8588 for local brokerage and mortgage services you can count on every time!

Pros and Cons of Buying a Second Home

Many people dream of owning a second property, whether it be a beachfront vacation home or a home in the mountains. A second home can also be rented out and used as another source of income. Regardless of the reason, investing in real estate can be a costly and time-consuming endeavor and there are any considerations to take into account. In this month’s blog, we list the pros and cons of buying a second home.

Things to Consider

So why do people bother investing in a second home in the first place? As mentioned, many people look for a second home to use as a vacation house in another state or country. It makes personal vacations easy and is a great spot for family and friends to gather. Others may look into a second property to lease out to renters in the area and have another stream of income.

However, a very important thing to consider is to make sure you can actually afford another home. There are many costs associated with it and you should evaluate your financial situation beforehand, such as any debts, retirement funds, college savings for your children, and so on. Once you’re sure you have the financial means and budget to purchase a second home, it’s time to weigh the pros and cons.

Pros

There are many advantages when it comes to owning a second home. Here are some benefits:

  • You can use it however and whenever you like.
  • If you’re using it as a vacation home, you can travel light and don’t have to worry about booking a hotel.
  • You can lend it to friends and family.
  • You can rent it out for extra income and use it to cover ownership costs.
  • It can give you tax benefits such as deductions for any rental-related expenses.
  • It will be an asset that can have positive capital appreciation, or an increase in its value.
  • You can retire there.

Cons

Of course there are some downsides and considerations that you have to take into account. Buying a second home is a very important decision that you should think through, especially when it comes to costs and the time you need to put into it. Here are some cons:

  • Second homes are expensive and are very costly. Other than mortgage payments there will be property taxes, insurance premiums, utilities, and other maintenance fees including repairs and renovations.
  • The distance may be a problem and can be a hassle to travel there if you need to handle maintenance or any issues.
  • Unless you hire a property manager, you will be responsible for maintaining the home. This includes things like yard work, house cleaning, scheduling appointments with contractors and maintenance workers, etc.
  • Depending on the housing market, it can be difficult to sell it later on.
  • You may also have difficulty finding renters and can lose out on rental income.
  • Some people may experience staleness with their vacation home location.

Learn More

Investing in another property should be considered carefully with the pros and cons in mind. If you’re ready to make the decision to buy second home, you’ll have to decide how you will finance it. Here at American Mortgage Resource, Inc., our professionals can help you decide on the best loan options and what to do moving forward. We offer mortgage consultation to homeowners and home buyers in Boston, MA and the surrounding areas. Learn more by visiting our website or make an appointment with an expert today.

Home Loans and Fixer Uppers

There are countless reasons why fixing up old homes has turned into one of the most colossal real estate trends over the past decade. While it seems everyone talks about fixing up an old home one day, not many people are speaking about what it’s like to finance such a project. Fixer upper loans combine the purchase or refinance of a property with the cost of renovating it. This unique mortgage option addresses the challenge buyers often face when figuring out how to finance a fixer upper. Follow along below as we discuss why you should invest in a fixer upper and what loan options may be available to you.

Reasons to Purchase a Fixer Upper

  • You can build the custom home of your dreams
  • You can flip it for a profit
  • It’s typically cheaper than purchasing a newer home
  • There’s less competition when purchasing it
  • You fell in love with the property or neighborhood, but not the home itself

Loan Options

  • FHA 203(k) Loan – This government backed loan will require that you to adhere to FHA guidelines and limitations when completing renovations. In some cases this loan will not allow for much DIY work, as the government will require that licensed contractors complete most major tasks.
  • VA Renovation Loan – Some eligible service members, veterans and qualifying spouses can use this loan to combine a VA purchase loan or VA cash-out refinance with their renovation costs. Other major advantages of this option include not having to pay a down payment or any closing costs on the property at the time of purchase. In some cases the VA accommodates a higher purchase price based on the home’s expected value once renovations are complete
  • HomeStyle Loan – Referred to as a Fannie Mae convention loan, a HomeStyle loan is a fixer upper loan similar to a FHA 203(k) loan, but with increased limits for borrowers. Due to the fact that this is a conventional rehab loan, homebuyers finance their home directly with private banks or mortgage companies that offer this product, and Fannie Mae purchases the loans from lenders.
  • CHOICERenovation loan – Also dubbed the Freddie Mac loan, CHOICERenovation can be used to finance a fixer upper project through traditional means in conjunction with the refinancing of a separate existing property. This option is great for those who plan on purchasing the fixer upper as a second home or as an investment property.

Final Thoughts

Before you commit to spending your free time renovating a fixer upper, make sure you know exactly what to expect throughout the process financially. For free and honest advice from the pros, contact the team at American Mortgage Resource, Inc. in Boston, MA. Visit our website to learn more about the loans we offer or contact our team directly Monday – Saturday at (617) 972-8588.

Housing Indicators to Sell or Rent Your Home

When the times comes to move on from your current property, you may be left wondering: “should I sell or rent my house”? While putting up your property for sale on the market may be the most common choice, you can also rent it out as another stream of income. It’s best to watch out for housing indicators to aide in your decision. Learn more about the four housing indicators you should watch out for when it comes to selling or renting your home in this month’s blog.

Are home sales high?

Home sales indicate how much competition there is for homes on the market. If home sales are high, then that means more buyers are moving into the area and are competing for real estate. You’re more likely to get a higher selling price if you sell your home while home sales are high.

This is the opposite when home sales are lower and on the decline. In this case, fewer buyers are moving into the area which means there is less competition and buyers have more choices. With lower sales, consider renting out your property and then selling it when home sales increase again.

Are home prices on the rise?

Knowing the average selling prices of homes can help you determine if selling or renting your home will be profitable. High home prices are good for both leasing and selling your home and you’ll be able to secure a higher selling price. You’ll also be able to charge more rent since more people will be moving into the area and there are fewer homes available.

How is the housing supply?

Understanding the competition for real estate in your area is key in determining when to sell or rent. Housing supply indexes let you know how many vacant home are available for sale in your area and are strongly correlated with price. If the housing supply goes down, this indicates that there is more competition for real estate – which in turn drives up the property prices. When the housing supply is low, you may want to consider putting up your home for sale to quickly attract potential buyers.

If there is a high housing supply or there are many vacant homes available for sale, then that indicates there are most likely fewer buyers looking for a home. You’re less likely to profit from a high selling price in this case. You may want to consider renting your home until the home supply in your area lowers.

How affordable is the rent?

Rental affordability refers to the percentage of an average family’s income that goes towards paying rent. Low rental affordability means you can attract more tenants if you decide to rent out your home. However, you may be limited in how much you can charge for rent.

High rental affordability means that the rental property in your area is more expensive. This can be tricky for landlords because although you’ll profit more in collecting rent each month, you’ll most likely have trouble finding tenants who can afford it.

Conclusion

Overall, renting makes more sense if you owe more on the property than you can sell it for and if the housing market is currently weak in your area. On the other hand, selling your home is best when there is a high demand for homes due to more buyers wanting to move into the area. If you want to make profit, you’ll need to crunch those numbers while keeping an eye out on the current housing market.

To learn more about the housing market and for more mortgage advice and information, visit American Mortgage Resource, Inc. We provide the best financial resources in Massachusetts and our team is here to help you with all of your mortgage and home loan needs.

Using a Comparative Market Analysis (CMA)

When it comes to selling your home, knowing its value can help you gauge how to price it effectively on the market. Comparative Market Analysis (CMA) reports can help with this by allowing you to compare your property to other properties recently sold within the area. Comparables have similar square footage, age, conditions, upgrades, and locations. A CMA can be generated with the help of a real estate agent and can act as an informal appraisal before you make things official. Interested in getting a CMA for your property? Continue reading to learn more about the data generated in a CMA and how to understand it.

Data found in a CMA

CMA reports can vary in length and complexity depending on the market and the real estate agent’s business practices. Generally, the type of data found in a CMA includes:

  • Active listings – Homes that are currently for sale.
  • Pending listings – Formerly active listings that have not closed yet and are in a pending sale.
  • Sold Listings – Homes that have been sold within the past 3 months. These are your comparable sales that will be used when appraising your home’s value. If there are not enough sales within the past 3 months, then comps within the past 6 months can be used.
  • Expired Listings – Properties that were not sold. This can be due to a number of reasons such as being unreasonably priced, not being marketed, or it was in need of repairs.
  • Withdrawn/Cancelled Listings – Properties that were taken off of the market for a variety of reasons. These were also most likely too expensive. In general, expired and withdrawn listings have the highest median prices which made them undesirable along with other potential factors.

Understanding the CMA Report 

Now that you understand the type of data found in a CMA report, it’s time to understand how to use the actual report to your benefit. Once your real estate agent has generated it, look at each comparable and see how it matches to your property. Each comparable listing will include a description, floor plan, number of rooms and bathrooms, square footage, sales price, any dollar adjustments, and the fair market value.

There will be at least 3 to 5 comparables to analyze and this will help you appraise the value of your home. However, a consideration to be aware of is that there may be a difference in value if there were any upgrades or amenities involved. For example, a comp may be very similar to your property but if their property was completely renovated rather than fixed-up, then the value will be much higher than yours. Another consideration would be the property location which can also play a major role in its value. 

Learn More

Overall, a CMA will allow you to set a competitive listing based on the average price the comps were sold at. American Mortgage Resource, Inc. is the premier choice when it comes to loans and mortgage advice. Visit our website to learn more or call (617) 972-8588 to speak with an expert.

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