We are nearing the end of yet another year. 2015 is coming. So what are your real estate goals for next year?
Are you thinking of buying a home in Los Angeles? Are you thinking of selling your Los Angeles home? If you find some spare time during the busy holiday season it would be a good time to set your goals for 2015.
What is the situation with buying a home in Los Angeles right now?
Mortgage interest rates are still low, under 4%. However prices are high. So you may be tempted to see if prices will come down next year. They could. They could also go up, and if the interest rate goes up you will be in the same situation. Right now Los Angeles home prices have flattened somewhat, so now is as good a time as any to buy. If you do decide to go that route here are some things to consider:
- Downpayment. Ideally you will need to put down 20% of the home price as a downpayment. Anything less will make you a less desirable buyer in a competitive situation. Multiple offers have died down a little but they are still there, especially when a hot property comes on the market. There are some loan programs which may not require you to pay Private Mortgage Insurance (PMI) but if you do have to your monthly payment will increase. The 3% FHA downpayment is back but this comes with a hefty PMI and you will definitely not be competitive with this type of loan.
- Watch your spending. If you intend to apply for a mortgage don’t treat yourself to a new car for Christmas or make any large expenditures. This also applies to the whole period during which you are getting your pre-approval.
- Get your taxes done early. The sooner you do the sooner you can start looking.
- At the beginning of the year you should see more properties coming on the market so prepare yourself for the prospect of finally becoming a homeowner. You will not regret it.
Are you thinking of selling your Los Angeles home?
Inventory is still low, consequently it is still a sellers’ market. Still presenting your home in the best light will get it sold much quicker and for the right price.
You don’t have to worry about frozen pipes and other winter woes that may occur in the rest of the country, but you need to take stock of the condition of your home before selling:
- Take care of deferred maintenance. If something needs fixing take care of it.
- You may want to add a coat of paint to the home and take care of landscaping. First impressions are important.
- Get rid of clutter. Prospective buyers want to see the home and how they will fit into it. Let them see as much of it as they can.
- The buyer is going to get a home inspection. It might be a good idea to get your own home inspection so you can take care of any problems before they arise. The cleaner the home inspection for the buyer the less negotiating there will be for repairs, and the more money you will keep.
- Think carefully before making any upgrades prior to selling your home. Your taste may not match a prospective buyer’s. It is better to price the home appropriately and let the buyer make their own upgrades.
- If you need to sell before buying another home you might consider renting while you look. In a sellers’ market you do not need the pressure of trying to manage both concurrently, certainly because you will most probably not be able to make your purchase contingent upon the sale of your home.
Timing the market is impossible. If you sell high you will be buying high and vice versa. If your goal is to buy or sell a home in 2015 just line up those ducks.
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