The stock market is at an all-time high ….. nearly 17,000…S&P has almost reached 2000 which was thought to be unreachable and there’s been no correction for 23 months of 10% or more, which normally happens every 18 months, so get ready for a correction, it is inevitable. If you need further evidence, look at what Main Street has been doing lately. Mutual fund investors have been dumping their stock funds since late April, with investors withdrawing $13.3 billion more from domestic stock funds and they have invested….
So where do you put your money?…… Houses…..real estate!!!
Consumers should still take advantage of the all time low interest rates! For the last 8 to 10 months prices have flattened out and there is more inventory to choose from, so now is a great time to buy!
Last week I got an opportunity to help young family trade their old house for a brand-new home! This young family had an opportunity to buy a new home at builder cost because the builder was offering a special incentive for their employees but in order to take advantage of this opportunity they had to figure out how they could trade in their old house. Fortunately, we were able to help!
This family elected to keep their home as an asset and offer a lease option to a prospective buyer…….that way the buyer would take excellent care of the home, treating it as their own from day one. The lease option was for three years which would allow the buyer, who was in a previous short sale, to rebuild their credit, still build equity monthly and also lock in fixed prices over the next three years. We were able to show the family that with a little extra money monthly thrown towards principle and the tenant paying the mortgage, they could pay off the home in as little as 15 years. They would also be able to close on their new home at a cost of $200,000 that would be worth $300,000 the day they closed escrow. Imagine having $100,000 equity the day you close on your new home and owning your old house in 15 years! To truly make this a dream come true we are having them consider a 15 year mortgage on the new home which is below 4% so they will own their new home and their old house both within 15 years…….this is building wealth!
3% for a 30 year fixed rate loan is ancient history. That should not surprise anyone. Who thought that would last?
Here is what it means for buyers and sellers: