Was buying a home in Knoxville cheaper six months ago? YES. Is it still a GREAT time for buying a home in Knoxville? YES!

Limited inventory and rising prices have created a seller’s market in Knoxville and we are seeing buyers competing fiercely for homes, even to the point of bidding wars, but that doesn’t mean that it’s still not a great time for buying a home in Knoxville.

Here is why:

•  HOME PRICES ARE STILL RISING

Because the housing market bottomed, reaching it’s lowest point in March of 2012, the price gains that we have seen recently still leave plenty of room for the home values to climb. What is causing the rising prices? Lack of supply, which is the result of slower homebuilding activity, diminishing foreclosures, and sellers slow to come to market because they are waiting for prices to increase further (much of this is because sellers who purchased during the height of the market owe more on their homes than their current value).

• RATES ARE LOW BY HISTORICAL STANDARDS 

Mortgage rates, currently hovering around 4.6 percent, have increased by a full percentage point since May – but they are still lower than they were just two years ago and far lower than the long-term average of about 8 percent.

• GETTING A HOME LOAN IS SOMEWHAT EASIER

Because of the rising interest rates, less people will be refinancing, making banks more willing to work with homebuyers.  Don’t get me wrong, the days of the “no-documentation”, “no down payment” days are long gone, but credit is available for borrowers who are qualified.

• OWNING A HOME IS STILL CHEAPER THAN RENTING

Even taking the recent price and rate increases into account, it is cheaper to buy than to rent in all 100 of the largest real estate markets, according to an analysis by Trulia.com. Nationwide, assuming a buyer stays in a home for at least 7 years, it is 37 percent cheaper to buy than to rent. Actually, studies show that in 78 of the largest 100 markets, rates would have to more than double to over 10 percent for markets to tilt in favor of renting.

• INVESTOR COMPETITION IS DECREASING 

Many of the factors stated above are driving investors out of the market.  The reduced amount of foreclosures coupled with rising prices are making investors lose interest.  Chief Economist with the National Association of Realtors, Lawrence Yun stated, “Investors are recalculating their numbers, because it might make less sense for them to buy in order to flip or rent now. That’s an opportunity for primary owner-buyers to have less competition and still a historically favorable environment, even if affordability is weaker.”

As you can see, it’s still a great time for buying a home in Knoxville.  But make no mistake, prices are still increasing and rates may as well.  The sooner you can buy the better.  Contact us today to get started!

 

Thinking of building or doing some remodeling on a home in Knoxville?  Each year new products hit the market that can give you ideas if you are building a home in Knoxville.  At this years International Builders Show in Las Vegas some of those new products were on display.  The video below shows some of the new innovative products hitting the building materials market.  If you are thinking of building a home in Knoxville or selling a home in Knoxville and need some advice, contact the 865 Real Estate team today and we’ll be happy to assist in any way that we can.

It’s finally done. The driving around. Looking at Knoxville real estate daily on the internet and in person. The offers. The counter offers. More counteroffers. The anxiety. The inspection. Now the time has come. That special day. Closing day, the day the keys are handed over and the movers are packed up and ready to deliver your life to a new home.

Troy Stavros, Broker and Partner with the 865 Real Estate team says, “Don’t breathe easy just yet. There are still some things to get in order to make the transition to your new home in Knoxville happen with minimum headaches. Some early planning can really make move-in so much better.”

Below are the Top 5 Things To Do Before and After Closing:

1) PLAN NEEDED REPAIRS WELL IN ADVANCE 
Whether it is needed repairs that the seller did not cover after inspections, or a small remodeling project to make the home more the buyer’s style, getting these lined up prior to closing will make the transition much easier. After closing the buyer’s hands will be full with unpacking and getting settled, so having these workers already in place will allow the work to get done faster and with less stress on the new homeowner.

2) SETUP THE UTILITIES
Most sellers will have arranged to have the utilities cut off on the day of closing. As if new homeowners don’t have enough on their plate with moving in, the last thing needed is no power or water. The best plan is to call the utility companies and setup the start date well in advance of closing. At that point the utility company may say that the seller has not given a notification of cancellation. If that is the case a simple reminder to the seller will be sufficient. Sellers are in the midst of packing up and may have forgotten as well. Take the lead and be proactive. Problem solved, future headache eliminated.

3) CHANGE THE LOCKS 
The new homeowner just received the keys to a new home. More than likely the buyers aren’t the only people with this same set of keys. Oftentimes a homeowner will give a key to neighbors, relatives, real estate agents, workman, etc. The moment the house and keys are in the hands of a new homeowner, it’s time to call a locksmith.

4) GET A CLEANING CREW
While some sellers will go to the trouble of having the home cleaned after move out, most do not. Who wants to move boxes and furniture, and basically everything a new homeowner owns into a dirty house. Start living in the home with a clean slate and a clean house.

5) HAVE A HANDYMAN READY FOR ACTION 
A new homeowner will have plenty going on during move-in. Having another set of hands around to take care of some of the projects might be just what the doctor ordered to save your back and sanity. Moving boxes to different rooms, moving furniture, etc. A few hundred dollars spent on a handyman or some college kids the day of move in is money well spent.

Troy Stavros, Broker and Partner with the 865 Real Estate team stated, “While there have been rumblings that the guidelines for qualifying for a mortgage in Knoxville may get a little more lenient this year, buyers still need to start the process with the basics.”

The following are the Top 10 documents an individual must have ready in order to apply for a mortgage:

1. Driver’s License
2. Secondary ID (could be a passport or social security card)
3. Most recent paystubs for a 1 month period (for salaried or hourly employees)
4. W2 forms for the past 2 years
5. Signed federal tax returns (all pages/schedules) for the last 2 years
6. Most recent bank and asset statements for the last 2 months
7. Fully executed contract on the Knoxville real estate being purchased
8. If refinancing, a copy of the deed on the subject property
9. Name, address, phone number of landlord (if you are currently renting)
10. Name, address, phone number of the title company or attorney handling the closing.

Stavros concluded, “If you are thinking of buying a home in Knoxville, get your documents in order so you can obtain a pre-approval prior to shopping. This will allow you and a potential seller to know that you have the ability to buy the homes you are viewing.”

Troy Stavros, Broker and Partner with the 865 Real Estate team stated, “We’ve witnessed time and again the incorrect information being displayed on many of the top, national real estate websites. The most accurate information can be found on local, brokerage sites, because they are pulling directly from the local Multiple Listing Service.”

While local Knoxville real estate brokerages have an agreement with each other to display the entirety of each other’s inventory of Knoxville homes for sale, other third-party listing portals, like Trulia and Zillow, may only receive some listings directly from an MLS. Individual brokers have the ability to withhold listings from these sites, and in many real estate markets, these websites must rely on individual brokerages, agents and third-party syndicators for listing data. The result in trying to pull this information from multiple sources is that these sites end up with incomplete or inaccurate listing data.

Recently, research was completed by Zip Realty, comparing the actual listings in certain zipcodes for sale, and verified on the MLS, to the listing data shown on Zillow and Trulia. The study claims that more than 15% of homes shown for sale on Zillow and Trulia weren’t actually on the market, and up to 30% of homes that were listed for sale in an MLS were not identified by Zillow and Trulia as being on the market.

Stavros concluded, “Ask any REALTOR how they feel about the accuracy of the pricing estimates given for homes on these sites, and the answers will be eye opening. While these sites can and do offer some great articles regarding buying and selling a home, when it comes to knowing the market, you must go local. This includes finding what is actually available for sale in the market place and getting an accurate analysis of the correct value of a home. Local REALTORS are in the trenches of the Knoxville real estate market every day, no mathematical formula will ever replace that experience.”