Lending in the gig economy

Posted by at 12:20 pm

Plans are underway at Fannie Mae and Freddie Mac to make home loan qualification easier for people earning money in the “gig” economy. For those not familiar, the “gig” economy refers to the pursuit of flexible, freelance employment instead of full-time work on a traditional career path. In today’s ever-changing economy, finding stable, salaried positions that cover the bills isn’t always so easy. Other people simply find working as an independent contractor better fits their lifestyle. Workers in the gig economy often make similar income to salaried positions. Arguably, their income is more dependable than that of salaried employees, whose jobs are closely tied to the success of their employer and stability of their field. But in many cases, gig earnings don’t qualify as income under existing mortgage-industry guidelines. Typical mortgages tend to require W-2 forms and IRS information going...
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Looking out for Generation Z

Posted by at 11:51 am

It seems that almost every segment of the real estate profession today is aimed at the Millennial Generation. Makes sense. At 80 million strong, Millennials, born between 1981 and 1996, are the largest demographic in history. And now, most have graduated college, begun careers and families, and are settling nicely into the prime spending years. But time moves inexorably forward, and it’s not too early to be talking about the next wave of potential homeowners – Generation Z. Made up of the 75 million Americans born since 1996, Generation Z is expected to start buying homes in earnest within five to 10 years. Analysts say they’re going to be a bargain-hunting, tech-loving, real estate–savvy force to be reckoned with. Watching the Great Recession unfold, most are financially conservative. They know the value of a dollar and the mathematics behind long-term...
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Accessorize your dwelling with an ADU unit

Posted by at 2:56 pm

As home prices continue to  rise, many folks are left wondering how they can afford a piece of the American dream. Some have broached the idea of sharing, but co-ownership – even among family – is a little too cozy for most. The tenancy approach is probably the easiest. That’s why many buyers today are looking for homes with potential to add “accessory dwelling units,” or ADUs. ADU residences can be build-ons, re-purposed space or even a separate, free-standing unit. The main draw is practicality. ADUs provide a sense of autonomy for the renter at a lower cost, and can provide the homeowners with help paying their mortgage. The majority (62 percent) of U.S. households are made up of one or two people, while most new and existing homes are designed to accommodate three or four. Legacy housing stock is...
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Manufacturing a new real estate market

Posted by at 9:44 am

Like tiny homes, manufactured homes are emerging as a possible solution to the current housing shortage. For those with low-to-moderate incomes, who don’t want to sleep in a tiny home bed that folds out of a closet just above the kitchen sink, the manufactured home might make a more palatable choice. Previously referred to as mobile homes, manufactured houses are built in a factory, and transported to a site on a flatbed truck – not to be confused with pre-fab homes, which are transported in pieces and mostly built on-site. New manufactured homes cost a median of $73,800, or about a quarter the cost of new homes nationally, according to the latest U.S. Census Bureau. That might be just the remedy for first-time home shoppers who are having trouble saving up a down payment. But regulatory restrictions on zoning and...
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Rebuilding black homeownership

Posted by at 12:10 pm

After the Fair Housing Act passed in 1968, black homeownership in the U.S. increased steadily for 30 years, reaching nearly 50 percent in 2004. But those gains have all but disappeared since. The homeownership rate among African-Americans has tumbled below 43 percent in 2018, more than 20 percentage points lower than the national rate of 63.7 percent. While young people of all races are buying homes at lower rates than their parents, this is particularly true of young blacks. Fear and distrust of the system may be a motivating factor. Studies show African-Americans were disproportionately targeted by predatory lending practices in the run-up to the Housing Crisis, resulting in higher percentages of foreclosures and other adverse financial situations affecting credit. Market dynamics have made it difficult for many black households to regain a foothold. Today, only 20 percent of African...
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Shopping heats up for summer home season

Posted by at 12:42 pm

Just when you thought the housing market couldn’t get any hotter, it’s a buying frenzy as the summer season begins. Most buyers are beset with confidence in the job market, and many also carry the ticking biological desire to start families. Even with all the talk about rising prices, rising interest rates and reduced tax benefits in 2018, demand is not cooling. If anything, it appears the potential homebuyer is just becoming more rugged and resilient! According to a March survey, 40 percent of home shoppers have been looking for seven months or more, while 34 percent have been searching for four to six months. The numbers show that there is only enough inventory on the market to last 3.4 months. In a statement, Lawrence Yun, chief economist for the National Association of Realtors, reported: “supply is woefully low, and...
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Home water wells for more liquidity

Posted by at 3:10 pm

Well, well, well. Drilling a home water well could give you more liquidity – in your pocketbook. Cost to install a well depends on many factors, including where you live, but in most regions, it runs less than $5,000. After initial installation, any water you pump from the ground is free! Many urban homeowners use wells exclusively for outdoor watering, and in areas with shortages – and consequent bans on non-essential watering – a ready supply of well water can do wonders for lawn-lovers and gardening gastronomes. Water wells can also be used for drinking water, but these should be separated from any septic system by at least 100 feet. The well should be located on a level surface or uphill so that contaminants do not accumulate. If you plan to drink the water, you need to have it periodically...
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Artificial Intelligence and Real Estate Roles

Posted by at 3:14 pm

Some real estate agents may avoid technology out of concern it could lead to their eventual demise. There’s no need to fear the future. Computers don’t have much in the way of personality, but are amazing at crunching numbers. Their efficiency is undeniable. Home shoppers don’t have a lot of time, and appreciate a real estate agent who is plugged in, allowing them to peruse neighborhoods in their precious spare time. That’s why web designers and Search Engine Optimization (SEO) experts have an increasing role in real estate. All the technology has some firms dropping office space altogether and going “virtual.” Computer analyzed data saves a lot of time in marketing, too. A well-maintained database can quickly find everyone within a specific area who has the basic means and motivation to buy a listed home by reviewing recent purchases and...
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March 26th, 2018

Infrastructure builds the future of real estate

Posted by at 11:58 am

As the population grows, so too does the need for infrastructure improvements – more roads, more pipelines, more electricity and more water distribution channels – but who pays the price? Look at the Monopoly board. Players buy up properties, then add houses and hotels. In the game, the two utilities, Water Works and the Electric Company, do not  increase in value, no matter what happens on the rest of the board. That’s not a realistic representation – no increase in size or value of infrastructure would likely cause chaos. But beyond serving homes, infrastructure also pumps the lifeblood of America, the movement of goods along roads, highways, railroads and runways. The nation’s framework is extensive, but is aging. Existing infrastructure was built using engineering safety standards based on extreme loads seen in the past centuries. Historic flooding, hurricanes, and wildfires of 2017 showed...
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February 23rd, 2018

A more multi-generational mindset

Posted by at 2:41 pm

Multi-generational living – defined as two or more adult generations or grandparents and grandchildren living together – has seen steep declines in the Western world – especially the U.S. Before World War II, American seniors often moved back in with adult children in their later years, or even with adult nieces or nephews. Think Aunt Bee on the Andy Griffith show. Similarly, single adult children often remained at home until they were married and could get their financial feet on the ground. Researchers say 50 percent of U.S. homes were multi-generational prior to 1900. But around 1945, American ideals began shifting. The growing Social Security program gave senior citizens more freedom to choose privacy and independence. The suburban lifestyle was more suitable for two married adults and their minor children. If you weren’t on your own by age 18, you...
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