Home buying webinar december 21 2012

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Transcript of Home buying webinar december 21 2012

  • 1. Home Buying 101 Webinar December 19, 2012 Presented By: Joe Krupsaw Redfins DCTeamSlide 1 of 27

2. A Little Bit About Who We Are Redfin is a real estate brokerage that has helped over20,000 people buy or sell a home; 97% would refer us to afriend. Customers, not commissions Informed decisions The right home for the right price No obligation Get back a portion of our commissionSlide 2 of 27 3. To Buy or Not to BuySlide 3 of 27 4. Why You Should Buy a Home You have a family and need room to grow You expect to stay put for 5 or more years You want a home that is difficult to rent Youre handy & and ready to invest Youve saved up a down paymentSlide 4 of 27 5. Why You Shouldnt Buy a Home You dont have a good reason like family or schools You cant afford the down payment You can rent for much less You plan on moving soon Youre worried about job securitySlide 5 of 27 6. Market ConditionsSlide 6 of 27 7. Case-Shiller: DC Area v. 20-City 300.00 250.00 200.00 150.00 100.0050.000.00Slide 7 of 55 8. Case-Shiller By the NumbersCase-Shiller: DC AreaUp 4.3% year-over-yearPeak was May 2006Down 22.7% from peakCurrently at August 2004 pricesCase-Shiller: 20-City CompositeUp 2% year-over-yearPeak was July 2006Down 29.4% from peakCurrently at September 2003 pricesSlide 8 of 27 9. Where to find dataSlide 9 of 27 10. Multiple Offer SituationsThis occurs when inventory is down and buyer interest is up5 Tips for Winning in a Bidding War 1. Make the competition eat your dust 2. Get pre-approved with a local lender & get underwriter approval 3. Start the conversation early 4. Write a letter & appeal to the seller 5. Know your limitsSlide 10 of 27 11. National Market Trends The key metrics across 19 major metropolitan markets are: October home sales were up 21.8% from a year ago, with an unusual 9.8% gain from September to October. Home prices in October increased 8.4% year over year, and were up just 0.4% month over month. The number of homes for sale declined 29.4% from October 2011 to October 2012 (even larger than the 28.1% drop in September), and declined by 5.3% since September. The percentage of listings that sold within 14 days of their debut inched up to 28.2% in October.Slide 11 of 27 12. What Happens After You Find a Home You Love?Slide 12 of 27 13. What to Ask Any Agent Is this your full-time job? Familiar with foreclosures or short-sales? Where were your last five deals? Who else will be working with me? Will you show me all properties for sale? When am I committed to working with you? Has a client ever filed a complaint? How are you paid?Slide 13 of 27 14. Traditional vs. RedfinSlide 14 of 27 15. Make Sure Hes a Good Fit See all deals & reviewsSlide 15 of 27 16. Redfins Partner Program Partner agents are employed by other brokerages, but have teamed up with us to provide Redfin-Certified service to a wider range of customers. Well refer you to a partner agent when: A home is outside of our direct service area A home is below our price minimum Were experiencing an unusually high customer demand We survey all partner agent clients All surveys are published on their Redfin page 97% of customers would recommend Redfin partnersSlide 16 of 27 17. Open Book Redfin Certified Providers Every professional is reviewed and all reviews are shown Search for local: Inspectors Lenders Title CompaniesSlide 17 of 27 18. We List Homes, Too! More people see your home Premium placement on Redfin.com Mobile apps target on-the-go buyers Professional flyers Youll know it all at every step Email all buyers who see your home See how many people have viewed your home Advise you at every step in the processSlide 18 of 27 19. MortgagesSlide 19 of 27 20. Getting Pre-Approved A pre-approval letter is a letter from a bank or a lender estimating how much theyll lend you Establishes what you can afford & makes offer process go faster Good for 90 days, depending on lender Ask for a few different amounts Redfin asks that you get pre-approved before your third tour Similar, yet different from pre-qualification Information needed: W-2, two pay-stubs, tax returns, bank statementsSlide 20 of 27 21. Organize Your Assets Get ready for the down payment Cash accounts (liquid funds) 401k, stocks, other investments Gift funds? (max. allowed varies) Move funds around earlySlide 21 of 27 22. Review Your Debt Pull credit report, look for errors Figure out how much monthly income goes towards debt:28 33% healthy Pay down credit balances to 1/3rd Dont open any new lines of credit Dont buy any big ticket items Co-borrower will need to do the sameSlide 22 of 27 23. Start Shopping for LendersCompile a list of 3-4 lenders & brokersGood sources include: Redfins partner lenders Referrals from friends, family & co-workers Banks or credit unions you have accounts at A large, national bank with an advertised rate Your real estate agent Online review sites, such as YelpSlide 23 of 27 24. Current Average Rates Type of LoanNovember 29, 2012 December 6, 2012 30-Year Fixed3.32% 3.34% 15-Year Fixed2.64% 2.67% 5/1 ARM2.72% 2.69% 1-Year ARM 2.56% 2.55%Slide 24 of 27 25. Comparing Loan Estimates Gather loan estimates A minimum of three, more is better These arent final numbers, but within a few thousanddollars Compare similar loans Program (FHA, conventional) Timeframe (same day) Compare costs side-by-side Discount & origination points Interest rates Insurance premiums (FHA, PMI) APR (interest rates + fees + points + PMI)Slide 25 of 27 26. Make Your Decision When possible, get a loan commitment Make alternative funds liquid (401k, stock) Good news! Loan payments are made in arrears, so your first loan payment wont be for two months.Slide 26 of 27 27. Next Steps Check out our agents and their reviews Study the inventory and houses in your areas Go out on Tour with us, no obligation Ask a lot of questions and see a lot of houses Email me: [email protected] Check the events page for upcoming classes Go back to work!Slide 27 of 27