Posts from December 2018

What is a Guaranteed Home Sale Program? A Guaranteed Home Sale Program is a promise by a real estate agent to do something (usually sell a home within a specific time frame, or above a certain price) and if what's promised doesn't occur, then the agent guarantees to do something in return (usually sell your home for free, or even buy it themselves). The programs can be marketing eye candy for consumers. However, once a consumer better understands the conditions associated with the guarantees and remind themselves of the obvious - agents generally are not in the business of buying a seller's home, nor are they in business to sell a home for free - then the value of these programs have a tendency to quickly disappear. Here are some of the programs currently marketed by certain agents in the Northern Virginia region.

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Most Important First Step is Selecting a Realtor® 
Whether you're a first-time home seller in Northern Virginia, or you have sold multiple homes in your lifetime, the process of selling a home can be involved and time consuming. It requires the help of an experienced real estate professional. The life change that brings a seller to the decision point to sell their home is as important as the process of selling the home itself. Both the seller's decision to sell and the actual process of selling are integrally connected and require the utmost attention and care from the right real estate professional.

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Buying a Home Requires Less Income Than Renting a Home (~20% less income)
If you are renting a home in Northern Virginia and you think you can't afford to buy a home - THINK AGAIN - buying costs significantly less than renting.  This is surprising to most people, BUT YES, it generally takes less of your income to buy a home in Northern Virginia than it does to rent a home.  In fact, historically across the U.S. it requires 21% of the median income to purchase the median priced home.  This compares to 26% of the same income to rent the same home.  The difference of five points doesn't seem like much, but it's 19% of one's income - no small amount.  In the Northern Virginia region it takes relatively more income to purchase and rent, because our housing cost is relatively higher than the U.S. average.  However, the spread is still the same as shown in the example below.  Most renters don't realize this, but once they do, it opens up all types of fantastic possibilities for them in terms of home ownership and wealth creation.  I frequently remind renters, you're technically paying a mortgage when you rent, it just happens to be the property owner's mortgage.  Why not make it yours instead?

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There are Numerous Benefits to Owning a Home Compared to Renting
In previous articles, I addressed the numerous benefits of buying a home in Northern Virginia compared to renting.  I showed that it surprisingly takes 20% less income to buy a home than it does to rent the same home. The U.S. tax code favors home ownership. Owning a home has several qualitative benefits including stability, positive impacts on child development and school performance, and fulfillment of the American dream.  Many renters are under the misconception that a mortgage loan is out of their reach and it requires a large down payment.  I also showed buying a home can be done with little to no down payment and across a wide range of credit scores. Credit scores under 620 can even qualify.

Home Ownership is the Proven Escalator to Wealth in America
By far, buying a home is the strongest path to wealth creation.  There are certainly a number of anecdotal quotes by successful real estate investors who address the subject.  Like David Bach from AE Wealth Management who said, "If you're not prioritizing home ownership, you are making a costly mistake.  Buying a home is the escalator to wealth in America.  Homeowners are worth forty times more than renters."  Then there's Thomas Stanley, author of The Millionaire Next Door who said, "There are under accumulators of wealth, average accumulators of wealth, and prodigious accumulators of wealth.  If you want to be a prodigious wealth accumulator, then own real estate."

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Most Important First Step is Selecting a Realtor® 
Whether you're a first-time home buyer, a move-up purchaser, acquiring an investment property, or relocating across the country to find a home, buying a home is one of the most thrilling events experienced in your lifetime. The process can be a confusing one for some, or simply a re-fresher for others who have bought and sold multiple homes.

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