Current concerns are shaping the housing market
Vicky Katz Whitaker
Creators News Service
With interest rates at historic lows, this may be the best time to buy a house or condo -- that is, if you can qualify for a mortgage.
Getting pre-approved for a mortgage can make the difference between being able to buy your dream home or watch your opportunity slip away.
"Particularly in today's market, it's important to secure funding," said Realtor Pat Vredevoogd Combs, vice-president of Coldwell Banker AJS-Schmidt in Grand Rapids, Mich. Combs, who served as president of the National Association of Realtors (NAR) in 2007, points out that despite a tightened credit market, financing is available for those who qualify.
It's a fact not lost on home sellers. "Many of the homes on the market today have a requirement that before an offer is submitted, a pre-approval letter must be attached to the offer," she said.
Some would-be house and condo buyers mistakenly think that if they wait long enough, they'll get that home at a rock-bottom price. "The problem with trying to time the market is that you cannot time the market," Combs cautioned. "Given what many buyers hear in the national media reports, some buyers make the mistake of thinking sellers will take any offer they make. All real estate is local, and depending on the market, there are still areas that see multiple bids on specific properties as well as healthy demand."
Meanwhile, those in search of a house are becoming more finicky about what they want -- and what they are frequently demanding are energy-efficient, environmentally-friendly homes, experts say. That reality is borne out in a recent NAR survey on Buyer's Home Feature Preferences that shows that 65 percent of new homebuyers make energy efficiency a very important consideration.
"Buyers who placed a priority on energy efficiency were also more likely to value other environmentally-friendly features such as proximity to parks, public transportation and the existence of sidewalks in the neighborhood," Combs pointed out. "Of course, price will dictate how much priority the buyers place on this in the long run."
The interest in eco-friendly homes has spawned a new type of real estate professional -- the certified EcoBroker -- as well as "green financing," whose broader parameters make it easier to purchase homes with energy efficient features. These can include low-e windows, good insulation, designated Energy Star kitchen appliances, dual-zone heating, bamboo or recycled flooring, low-flow toilets and showerheads, high-efficiency furnaces, demand water heaters, solar lighting and a solar electric system.
If you're thinking about going green on your next home purchase, you may want to consider applying for an energy efficient mortgage or energy improvement mortgage. Based on real or projected lower utility bills, they provide bigger mortgages to buyers who want to purchase a home that's already energy efficient or retrofit one that isn't.
Depending on the housing market in your area, these homes sell faster and can be more expensive than homes that are not energy efficient. This is the case in Seattle, said Realtor and EcoBroker Wendy Furth, where eco-certified homes sold 18 percent faster and 37 percent more than non-certified homes.
Furth, who works with RE/MAX Olson and Associates in Northridge, Calif., said local market conditions could shape your options. "In areas like southern California, most of our inventory is older properties. And with foreclosure, short sales and bank-owned properties, properties can be blighted or in poor condition with few or no appliances."
That can work to a buyer's advantage because they can be purchased "for much less money and retrofitted to become a buyer's dream, green home," Furth added. "We see properties with 'green' retrofits at all levels of the home market. The reason is that consumers are more environmental savvy, not just because they save on their fuel and water bills, but because it is better for their family and the right thing to do."
Shawn Powers, a Realtor-Associate and EcoBroker with RE/MAX Humboldt Realty in Eureka, Calif., concurred. "Homes with the right green features have more broad appeal when compared to a home that is energy inefficient." An energy-efficient home, he said, "means savings for the buyer month after month, year after year."