Does the Stock Market Affect the Real Estate Market?

Does the Stock Market Affect the Real Estate Market?

          The stock market and the housing market are two very different things, however, analysts have noticed a correlation between the two. Why is this? And how exactly does the stock market affect the housing market?          Some real estate agents tend to believe that a stock market slump always helps real estate, and in many ways that may be true. But the answers to these questions are not so black and white. Take for instance times of economic expansion such as October and November of 1987 or times of market corrections such as September 2001 following the terrorist attacks of 9/11; while the stock market took a huge hit, the housing market remained relatively unaffected. On the other hand, when looking at periods of recession, the stock market as well as the housing market were both affected negatively.          So what is the key difference? Well for one, the state of the economy as a whole. In times of economic expansion or market corrections often times MORE jobs are created, which means more people are capable of buying a home; In times of recession unemployment rates rise, consumer confidence declines, and current homeowners choose to hold on to the house that they have rather than sell. Now that is not to say that during times of market correction the housing market is not affected at all, there have been some studies that show that home sales declined slightly during the months following major corrections but this is likely due to the decline in stock assets for many potential...
3 Ways to Help Speed Up the New Mortgage Process

3 Ways to Help Speed Up the New Mortgage Process

The new “Know Before You Owe” or (Tila Respa Integrated Disclosure) rule by way of the Consumer Financial Protection Bureau (CFPB) has begun on October 3, 2015. The new mortgage disclosure rule replaces four disclosure forms with two new policies, the Loan Estimate and the Closing Disclosure. Though the rule doesn’t only bring the introduction of these two new forms, TRID will also change the way that real estate transactions are processed and closed. As a homeowner, it’s best to know what’s needed of you so that your side of the process can be expedited as much as possible. Not to mention that the new forms are easier to comprehend. The TRID rule also requires that you get three business days to review your Closing Disclosure and ask any questions you may have before closing on the mortgage. Here’s how to navigate the mortgage process on a fast-track with the new “Know Before You Owe” rules: Expect New Forms After you’ve signed on for your first mortgage, with the new policy, there will be a couple of documents immediately sent your way for your needs. Know what’s headed your way so you have a mental inventory if you don’t receive any of the listed documents below. You will receive the Loan Estimate (LE) no later than three business days after an initial application. You will receive the Closing Disclosure (CD) at least three business days before closing. The Loan Estimate and Closing Disclosure outline the consumer’s monthly payment, the costs of getting a mortgage, the costs to close and other important information about the loan. Know the New Timelines...
What is an REIT and is investing in one right for you?

What is an REIT and is investing in one right for you?

  What is an REIT and is investing in one right for you? A REIT is a Real Estate Investment Trust. These are companies that finance or own real estate that generates income such as a hotel, a hospital, shopping malls, storage centers, or apartment buildings. Similar to the structure of a mutual fund, a REIT can provide investors from all types of income diversification and long-term financial growth. REITs usually pay all of their taxable income out as dividends to their shareholders, which in turn, the shareholders pay income taxes on said dividends. REITs provide a way for investors to earn a share of the income generated by a commercial real estate project without ever having to purchase commercial real estate themselves. In fact, many REITs are publicly registered with the SEC and traded on the stock market. These are what you would call publicly traded REITs. Some others are registered with the SEC yet not publicly traded. These are what you would call non-traded REITs. This is a very important distinction between the multitude of different kinds of REITs. Before investing, you should always know whether or not the REIT is publicly traded or not, and how this could affect your risk vs. reward. REITs offer investors a number of rewards which include, Dividends: Stock exchange-listed REITs have provided a stable income stream to investors. Adding Diversity to your portfolio: Liquidity: REIT shares that are listed with the stock exchange can be easily bought and sold- the same is not true for ones that are privately listed. Performance: Over long term investment, the stock exchange listed REIT...
Top 10 Cities for Millenial Home Buyers

Top 10 Cities for Millenial Home Buyers

I hear it all the time, “kids these days.” or “I can’t find a decent executive assistant because millennials are so entitled.”. Millennials take a lot of heat for being entitled, unmotivated, and over-educated. Many claim that millennials would rather live at home than move out or rather rent than commit to a home. These people are vastly mistaken. The millennial generation hit the job market during one of the greatest recessions of all time- and while many past generations have endured similar problems, the millennial generation is unique the sense that they are facing a globalized economy in which large corporations can outsource jobs to foreign nations for much less than they could pay a recent college graduate here in the United States. On top of that, due to the recession, they also have to compete with candidates who are 10-20 years their senior who lost their jobs for the same entry level positions. They got stuck in a catch 22 where no one would hire them after graduating college because they “lacked experience” which they obviously could not get without someone hiring them. So it’s not that millennials are disinterested in buying and owning their own home, it’s more likely that they are simply not sure if it’s possible. The issue lies in the fact that roughly 97% of them need a home loan and this can be tricky when they are just starting their careers, or possibly still working a part time job that they are overqualified for while they seek full-time employment in their field of choice. BUT, there is good news! According to Realtor.com...

Why Buying your First Home is an Investment

Buying your first home is an investment, regardless of your intent because your first purchase not only brings lifestyle changes for yourself but it’s also about managing an appreciating asset as well. In today’s society, homeownership is still considered a major pillar of the American Dream and it can be seen as a direct reflection of financial stability. But the weight of this decision shouldn’t ever be taken lightly and it should be seen as an investment so that decision is fruitful in the long run. Here are some things to consider when looking to purchase your first home in hopes of turning it into an investment rather than just your first property.   Take Advantage of Your Age Buying your first home when you’re young compared to later in your life leaves you much more of a leash for your residential future. Your personal situation is more likely to be in a better place when you’re young as far as credit history, family size, as well as other aspects that should be accounted for. If you’re single, or in a relationship without kids, you may have more flexibility as far as location and property size which could be better for your bank account. Choosing a location that will sit well with future buyers can be profitable for you when you’re looking to sell. It’s good to stay conscious of schools in the area, possible traffic, and the neighborhood’s environment. Consider Developing Communities Developing neighborhoods usually are undergoing an internal and external infrastructure change and in these instances, housing properties aren’t as pricey as surrounding communities that have been...
Things to Consider When Transitioning from  Rent to Mortgage for the First Time

Things to Consider When Transitioning from Rent to Mortgage for the First Time

Moving into your first home is an exciting time but it can also come with an array of worries. There’s many things to consider when transitioning from renting a property to owning one. Often, the thrill of moving into your own home can blind you from considering certain factors in the process. Here are a few things to take into consideration when looking to buy your first home: Look at your expenses in total When building your housing budget, take into consideration all of your expenses as a whole rather than just your mortgage payments. One of the most nerve-wrecking things as a home buyer is unaccounted for bills. To avoid that issue, take into account your expenses in total so that you can budget correctly. Consider your mortgage payments, interest, possible taxes and insurance, and of course your utilities. You’ll also want to take into account your transportation costs. If you’re living in a metropolitan city then your monthly public transportation costs stay at a pretty standard rate but if you own a car then you’ll need to consider car payments as well as a gas budget. Create a must-have checklist Home buyers can have a tendency to fall in love with the feel of a home and often ignore the necessities that they required in a home from the start. Make a checklist before beginning your search of the things you need in a home and the things you’d like to have so that you know the difference. It’s always great to have a good feeling about a prospective home but you don’t want to buy a...