Thinking of Buying a Vacation/Retirement Home? Why Wait?

Posted: 15 Apr 2014 KCM Crew

Extended family walking on beachThe sales of vacation homesskyrocketed last year. A recent study also revealed that 25% of those surveyed said they’d likely buy a second home, such as a vacation or beach house, to use during retirement. For many Baby Boomers, the idea of finally purchasing that vacation home (that they may eventually use in retirement) makes more and more sense as the economy improves and the housing market recovers.

If your family is thinking about purchasing that second home, now may be the perfect time. Prices are still great. If you decide to lease the property until you’re ready to occupy it full time, the rental market in most areas is very strong. And you can still get a great mortgage interest rate.

But current mortgage rates won’t last forever…

According to FreddieMac, the interest rate for a 30 year fixed rate mortgage at the beginning of April was 4.4%. However, FreddieMac predicts that mortgage rates will steadily climb over the next six quarters.

Let’s assume you want to purchase a home for $500,000 with a 20% down payment ($100,000). That would leave you with a $400,000 mortgage. What happens if you wait to buy this dream house?

Prices are projected to increase over the next year and a half. However, for this example, let’s assume prices remain the same. Your mortgage payment will still increase as mortgage rates climb to more historically normal levels.

This table shows how a principal and interest payment is impacted by a rise in interest rates:

Cost of Waiting $400K

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What Happens When your Loan is Sold?, April 16th, 2014
When you get a mortgage loan, your lender has two alternatives. They can keep the loan in house — called a ‘portfolio’ loan — or they can sell or assign it to an investor. So why do lenders sell their loans?
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Follow Len and Leslie Marma of Success! Real Estate on their facebook business page, “Marshfield Matters” …. click LIKE to receive real estate info and what’s happening in Marshfield. 

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Builders Remain in a Holding Pattern, Expect Improvements

Builders Remain in a Holding Pattern, Expect Improvement

Builder confidence stayed mostly flat in April, nudging up slightly from a downward revision to March’s findings.

The National Association of Home Builders (NAHB) reported a one-point increase in its monthly Housing Market Index (HMI), a measure of builders’ confidence in the market for newly constructed single-family homes. March’s index was revised down to 46 from an originally reported 47.

Registering 47 as of the latest release, the index has now spent three straight months below 50, the threshold between a market viewed largely as “good” and one viewed as “bad.”

“Builder confidence has been in a holding pattern the past three months,” said Kevin Kelly, NAHB chairman. “Looking ahead, as the spring home buying season gets into full swing and demand increases, builders are expecting sales prospects to improve in the months ahead.”

Of the three component indexes measuring housing conditions, the gauges for both current sales conditions and traffic of prospective buyers remained steady at 51 and 32, respectively. The measure for expected sales in the next six months climbed four points to 57, reflecting greater optimism among builders.

“Job growth is proceeding at a solid pace, mortgage interest rates remain historically low and home prices are affordable,” said NAHB chief economist David Crowe. “While these factors point to a gradual improvement in housing demand, headwinds that are holding up a more robust recovery include ongoing tight credit conditions for home buyers and the fact that builders in many markets are facing a limited availability of lots and labor.”

At the regional level, the Northeast was the only area to report increased confidence, posting an index of 36 compared to 30 in March. Sentiment was down in the Midwest and West and stayed flat in the South.

Looking at the three-month moving average for each regional HMI, all regions saw declines in March, with only the West hovering above the 50 mark.

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Homeowners — Are You Really Insured?, April 16th, 2014
Homeowners insurance, also known as hazard insurance, provides you protection from the damage or loss of your property as well as liability coverage for anyone who has an accident on your property.
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Follow Len and Leslie Marma of Success! Real Estate on their facebook business page, “Marshfield Matters” ….. click LIKE to receive real estate info and what’s happening in Marshfield.  

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Today’s Update from Robert J Petrelli

Inflation at the consumer level rose in March, led higher by increasing costs for food and shelter. The Consumer Price Index rose by 0.2%, up from the 0.1% recorded in February. The recent rise in home prices coupled with tightening credit availability has pushed some would be home buyers into would be renters. In addition, food costs are higher due in part to the record high beef prices and the rise in the prices of milk, butter, eggs, fruit and vegetables.

The National Association of Home Builders (NAHB) reported that its April Housing Market Index rose to 47 from the 46 recorded in March. The NAHB said that for the past three months builder confidence has “been in a holding pattern” with readings below 50, which are viewed as poor conditions. Readings above 50 signal conditions as good. A NAHB spokesperson said that as the spring buying season comes into full bloom and demand increases, builders are expecting sales prospects to improve in the coming months.


Robert J. Petrelli | President

Mount Vernon Mortgage Corporation

440 Washington Street | Weymouth, MA 02188

ph. 781-337-2432 | ph. 800-869-5882 | fx. 781-337-2885 |

MLO13035 / NMLS13035 / MA Mortgage Broker License MB1492


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Real Estate: We are NOT the only Ones saying You Should Buy Now


Posted: 16 Apr 2014 KCM Crew

We have never hid our belief in homeownership. That does not mean we think EVERYONE should run out and buy a house. However, if a person or family is readywilling and able to purchase a home, we believe that owning is much better than renting. And we believe that now is a great time to buy.

We are not the only ones that think owning has massive benefitsor that now is a sensational time to plunge into owning your own home. Here are a few others:

Benefits of Owning

Joint Center for Housing Studies, Harvard University

“Homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord…Having to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings.”

The Federal Reserve

“Renters have much lower median and mean net worth than homeowners in any survey year.”

Benefits of Buying Now


“Buying costs less than renting in all 100 large U.S. metros… Now, at a 30-year fixed rate of 4.5%, buying is 38% cheaper than renting nationally.”

Freddie Mac

“One thing seems certain: we are not likely to see average 30-year fixed mortgage rates return to the historic lows experienced in 2012…Yes, rates are higher than they were a year ago – and certainly higher than two years ago. But if you look at the averages over the last four decades, today’s rates remain historically low.”

True real estate professionals have information like this at their fingertips. If you want to be seen as the go-to agent in your marketplace, watch a free replay of our recent webinar, Becoming the Industry Expert in Your Market.

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Countertops 101: Today’s Kitchen Trends, April 12th, 2014
Granite is still the big dog in kitchen countertops, and the No. 1 most requested material when it comes to kitchen remodels. But there are now many more options available:
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