It’s Major Championship season in the golf world (way to go Scotti Scheffler) so you are going to get golf analogies in today’s post! In golf, you hit a lot of drivers and putts, but sometimes it’s your lob wedge that wins you the tournament. We’re going to talk a little bit about lob wedges today. In this uber-competitive market you need to look for any advantage you can get, both in competing and in battling the twin towers of higher interest rates and inflation on your budget.
Everyone knows about straight-up conventional loans, but what about more esoteric types of financing? Especially for first-time/entry-level buyers. Perhaps you’ve heard of VHDA financing? This is a great program that has lots of admirable features, from grants to low/no down payment loans, negligible mortgage insurance costs and rates up to 1% below market!. Yes there are income ceilings, but you’d be surprised how high they are in this region. The state has just replenished its Smart Funds all across the state but particularly in Loudoun county.
How about USDA? If you’ve heard of that you probably know it’s a rural development program. But like the income ceilings you’d be surprised at what constitutes “rural”. There is a ton of Northern Virginia that falls within the program’s purview. And it has numerous program advantages that might make the difference between you being able to qualify for your dream home or not.
Not all lenders do these loans, and even fewer of them do them well. So break out the fairway hybrid and get yourself a real estate broker (like moi) who is not only aware of these programs and who the best lenders for them are, but who can also explain them as part of contract negotiation process so that while you are taking advantage of them they aren’t hurting you when you are in competition. Let’s go bag the US Open together!
The Fed is meeting today about rates but it is looking less and less like there will be any pending cuts in the calendar year. Inflation last month was an unacceptable 3.5% and while I think they would desperately like to lower rates the economic fundamentals are just not there to allow it.
On to some general market trends. Inventory is coming up! Thank goodness. We are at 1,676 homes on the market, which is a lot better than the 1,000 or so we were facing at the beginning of the year though that is still a tortuously low number. That equates to a .7 months supply of houses. As always there are next to no distress sales. 5 foreclosures and 3 short sales.
One other important topic to cover: Homeowners insurance rates. They are going through the roof (pun intended)! They are rising much, much faster than inflation and are now more than an afterthought to your total monthly mortgage payment. Shop around and be smart about your coverage levels.
As always I’m here to help so please call with any needs that are even tangentially associated with real estate.
It’s a good life.
Chris
