May 2022 Newsletter

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Homeownership Offers Stability and Security
If you’re following along with the news today, you’ve likely heard about rising inflation. You’re also probably feeling the impact in your day-to-day life as prices go up for gas, groceries, and more. These rising consumer costs can put a pinch on your wallet and make you re-evaluate any big purchases you have planned to ensure they’re still worthwhile.

While inflation and rising interest rates may be giving you pause as to whether or not now is still a good time to buy a home, it's important to note that home price appreciation outperformed inflation in most decades going all the way back to the seventies - making homeownership a strong hedge against inflation.

Buying a home also allows you to stabilize what’s typically your biggest monthly expense: your housing cost. If you get a fixed-rate mortgage on your home, you lock in your monthly payment for the duration of your loan, often 15 to 30 years. James Royal, Senior Wealth Management Reporter at Bankrate, says:

“A fixed-rate mortgage allows you to maintain the biggest portion of housing expenses at the same payment. Sure, property taxes will rise and other expenses may creep up, but your monthly housing payment remains the same.”

So even if other prices rise, your housing payment will be a reliable amount that can help keep your budget in check. If you rent, you don’t have that same benefit, and you won’t be protected from rising housing costs.

While it’s true rising mortgage rates and home prices mean buying a house today costs more than it did a year ago, you still have an opportunity to set yourself up for a long-term win. Buying now lets you lock in at today’s rates and prices before both climb higher.

Most Economists Forecast a Continued Strong Sellers Market

Housing experts are bullish about the current market because of what they call “solid fundamentals.” Creditworthy borrowers and strict mortgage qualifications coupled with a basic supply-and-demand imbalance have created a strong seller’s market that, according to some, could last at least 10 years.

“In the long run, the party won’t go on forever, but it will absolutely go on for the next five to 10 years. Millennials are driving the housing market, and even Gen X and baby boomers are looking for places to live—so that’s all healthy demand,” says Ralph McLaughlin, chief economist at Kukun, a real estate analytics company. “

According to the NAR, single-family home construction has lagged so dramatically that we’re now facing a 5.5 million home shortage. And if you add home casualties caused by “demolition, natural disaster or functional obsolescence” to the list, that undersupply spikes to 6.8 million homes.

Home prices, much like other consumer goods and services, continue to be pressured by supply chain constraints. CoreLogic last reported a 20.8 percent annual rise in Denver home prices, with a cumulative gain of 30.5 percent since the start of the pandemic. DMAR’s March data reflected a median closed price growth of 20.55 percent and an average of 19.88 percent. Days in the MLS continue to be a blip of only 4 days for an average close-to-list of 106.46 percent. The price of everything clearly includes housing and homeowners and sellers are on the winning side. So, what should you do?  BUY NOW.

It's not easy to hear, but home prices will continue to go up. Hopefully, appreciation will slow as more inventory comes online and rates continue to rise. So, buy now, refinance then, and build equity and stability between now and then because the alternative is paying 15.5 percent more in rent.

WHAT IS TITLE INSURANCE?

Title insurance protects real estate owners and lenders against any property loss or damage they might experience because of liens, encumbrances or defects in the title to the property.

• A lender’s policy is generally required when a lender issues a mortgage loan. The loan policy is usually based on the dollar amount of the loan and it protects the lender’s interests in the property should a problem with the title arise. It does not protect the buyer. The policy amount decreases each year and eventually disappears as the loan is paid off.
• An owner’s policy, purchased at closing, provides coverage for the homeowner. It is usually issued in the amount of the real estate purchase and is valid for as long as the owner or his heirs have an interest in the property. Only an owner’s policy fully protects the buyer should a covered title problem arise with the title that was not found during the title search.

The policy, which is one-time fee paid at closing, covers the homeowner for as long as they or their heirs have an interest in real property. For more information on Title Insurance, or how to get a copy of your policy, please reach out. RECIPE OF THE MONTHCARNE ASADA

A dear friend just shared this recipe with me and I just say: it's incredible. Perfect for feeding a crowd and just in time for Cinco de Mayo!  I use sirloin steak and a cast iron skillet for extra flavor. It freezes well, so make a ton! INGREDIENTS:

• 3 lbs stew meat (I recommend sirloin)
• 1 tablespoon oil (lard, bacon grease, etc)
• 1 medium onion, diced
• 1 small green bell pepper, diced (optional)
• 3 tablespoons tomato sauce or 1 large tomato, diced
• 1 teaspoon garlic powder or 3 cloves of garlic, minced
• 2 teaspoon ground cumin
• 2 teaspoons salt
• ½ teaspoon black pepper
• 2 tablespoons all-purpose flour
• 1 cup water or chicken stock
• Flour tortillas, rice or mashed potatoes, for serving

‍DIRECTIONS:

1. In a large pan, brown the stew meat in oil of choice with onions and green pepper (if using) over high heat.
2. Add the tomato sauce (or tomato), garlic powder (or fresh garlic), cumin, salt and pepper and stir well.
3. Sprinkle the flour over the meat and mix well. Add the water (or stock) and mix well so there are no lumps.
4. Bring to a boil, cover pan and reduce heat to low. Cook for 1 ½ hours, or until meat is tender.
5. Taste and adjust seasonings if necessary.
6. Serve with rice, tortillas or mashed potatoes.

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FiveFour Real Estate is the one-stop shop for those who are ready to take their home or investment to the next level. Our name FiveFour derives from 5.4%: the average annual home appreciation rate in the US over the last 50 years. We know that your real estate investment is one of the largest and most important purchases of your life. With that in mind, our focus and strategy revolves around you. We hold our licenses at the brokerage Five Four Real Estate.  If you buy a home and put 20% down, you are leveraging your money 5X. A 5.4% increase in your home's value means a 27% ROI.

Thinking of Buying or Selling?  Know someone who is?We are NEVER too busy for your referrals!

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OUR PROMISE TO OUR CLIENTS

This could be one of the largest and most important financial decisions you will make in your lifetime, and you deserve an experienced partner that understands the intricacies of Colorado real estate.

We promise to always keep you informed about the rapidly changing market and educate you throughout the entire process. We promise to protect your best interests and treat your home or investment like it’s one of our own. We promise to work our hardest to find the perfect home for you and your family with as little stress as possible.  

We value your trust and hope to continue supporting you in your lifetime even after your sale or purchase is complete. This goes beyond real estate to us, it’s the beginning of a lifelong friendship.

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