What to Expect When Purchasing an Older Home

Purchasing an older home can be a good decision. Not only can it help you save money, but it might also be your only option if you are interested in living in a certain neighborhood. Of course, older homes can also offer a certain kind of charm that cannot be achieved in newer homes and many offer mature trees and other well-established landscaping features. Before making a purchase, however, it is important to have a better idea of what to expect when buying an older home.

Performing Maintenance

When purchasing an older home, it is important to keep in mind that you will likely have more maintenance costs than you would if you purchased a new home. While there are no guarantees that a new home will not have problems, you are more likely to experience issues with an older home. Even routine maintenance issues, such as replacing your furnace or roof, are more likely to be an issue with an older home. Therefore, while you will usually save money when purchasing an older home, be aware that the money you save upfront may still need to be put into your home in terms of maintenance costs.

Addressing Safety Issues

Many older homes have certain safety issues that need to be addressed. When purchasing a new home, for example, you can be sure the wiring and plumbing will be in compliance with the most current safety codes. Older homes, on the other hand, may be grandfathered into the new codes. Therefore, if you want to ensure your home is as safe as possible, you may need to do some major work to get it up to code. As is the case with many Austin homes for sale and elsewhere, it is quite common in older neighborhoods for very few homes to already be up to code.

Making Upgrades

Even if your home is up to code and does not require any immediate maintenance, you may discover that the home needs some upgrades in order to compliment your lifestyle. Many older homes, for example, do not offer dishwashers, garbage disposals or other appliances that are commonly found in newer homes. Similarly, the home may not have energy-efficient windows, appliances or other desirable features. If you want to enjoy these amenities or other popular features, you will need to invest in your home in order to make the necessary upgrades.

For many people, purchasing an older home is the right decision. Before you decide to go this route, however, it is important to explore all of your options and to examine the pros and cons of each in order to determine which option is right for you.

Mortgage Broker vs. Bank Loan

When it comes to purchasing a home in Austin, Boston, or anywhere else in the country, buyers have two primary loan sources to select from: a mortgage broker or a bank. Since both options have pros and cons to consider, it is important to learn more about each one in order to determine which option is your best choice. To that end, here is a look at the pros and cons of mortgage brokers vs. bank loans.

Pros and Cons of Working with a Mortgage Broker

When working with a mortgage broker, you are working with someone who purchases loans from a variety of different mortgage lenders before selling them to another mortgage banker for a profit. Since mortgage brokers work with a variety of different lenders, they can often offer better rates to their clients than the typical bank. On the other hand, mortgage brokers do work on a commission and regularly charge extra fees that are not included with bank loans.

Perhaps the biggest benefit to working with a mortgage broker is that a mortgage broker can often get a loan for those who may otherwise have difficulty getting one. As such, working with a mortgage broker is a good option if you meet one of these criteria:

  • You are self-employed
  • You have less-than-perfect credit
  • You recently started a new job
  • You are carrying a high debt load

If none of these sound familiar, it may be in your best interest to obtain a loan through a bank.

Pros and Cons of Getting a Bank Loan

When obtaining a loan through a bank, you are typically getting a loan from a bank that is lending out its own money. The bank makes a profit as it collects the loan fees and interest from the customer. It is important to note, however, that your lender may change to a different bank over time. This is because most banks package their loans in bundles of $1,000,000 or more and then sell them to a secondary market in order to make a commission.

While there is a chance that your bank will sell your loan to the secondary market, obtaining a bank loan is generally a safe and easy bet for those in need of a mortgage loan. In general, bank loans are less costly upfront than loans obtained from a mortgage banker because there are not as many add-on fees. Furthermore, because banks do such a large amount of business, they are capable of cuttings costs and passing those savings on to their customers.

For those with bad credit, obtaining a bank loan may be difficult. This is because banks only give loans to those with good credit, a steady income and demonstrated job stability. While this is a downside for those with poor credit, the careful screening process helps banks keep the costs low for those with good credit. In addition, because bank loan officers usually do not receive a commission, they generally do not try to push customers to purchase expensive add-ons. Mortgage brokers, on the other hand, make more money if they are able to convince you to include additional items on your loan.

10 Reasons to Buy with a Realtor's Help

When it comes to buying a home, some buyers might be tempted to cut out the middleman and attempt to do all of the work on their own. While this is certainly one possible option, there are actually many reasons why a buyer should seek out the assistance of a Realtor when purchasing a home. So, why use a Realtor? Here is a look at the top 10 reasons to buy a home with the help of a Realtor.

Reason #1: Taking Advantage of Expertise

The simple truth is that Realtors are experts at what they do and buying a home can be more overwhelming and complex than many think. By working with a buyer’s agent when purchasing a home, homebuyers can take advantage of the expertise they bring with them. As a result, they are more likely to find the home they are looking for at a price they can afford in a much timelier manner.

Reason #2: Tapping into Connections

Since Realtors have experience working in the industry, they have already formed a number of connections that can help homebuyers save money and time. From mortgage loan officers to home improvement contractors, Realtors know who to work with and who to stay away from within the industry.

Reason #3: Determining Your Buying Power

Realtors know how to sit down with their clients in order to help them determine just how much they can truly afford to spend on a home. By helping the homebuyer narrow down options, the Realtor can help save time and money while preventing unnecessary headaches.

Reason #4: Saving Time

Because they are already familiar with the properties that are available on the market, Realtors can help homebuyers save a significant amount of time when it comes to finding the houses that suit their needs as well as their budgets.

Reason #5: Locating Rare Gems

Sometimes, homes that are on the market are not actively advertised. As such, buyers who choose to go it alone are likely to miss out on these rare gems. Those who work with a Realtor, on the other hand, are far more likely to learn about homes that may require a bit more investigation to find.

Reason #6: Comfort through Expectations

While you have been through the buying process at most probably 3-4 times, a Realtor does this for a living, and has been through countless transactions.  A Realtor knows the timeline and major transaction markers for home purchases in your market and can set expectations with you early on as to what to expect during the transaction process, putting your mind at ease.

Reason #7: Offering an Objective Eye

When searching for available homes, it is easy for a buyer to get caught up in the things he or she loves about a home without seeing the big picture. Since Realtors have access to a variety of different informational resources, however, they can provide objective input into the buying process that will help the buyer make a smarter decision.

Reason #8: Enjoying Increased Negotiation Power

When purchasing a home, there are many aspects that can be negotiated. This includes the price, the date of possession, the financing terms and more. With the experience of a Realtor at his or her side, the buyer will have the best chance of negotiating a favorable deal.

Reason #9: Choosing the Right Financing

Due to the experience and connections the Realtor has to offer, he or she can also help the homebuyer sort through the various financing options while also helping the buyer find the best lenders to suit their needs.

Reason #10: Knowing Someone Has Your Back

Perhaps the most important reason a homebuyer should work with a Realtor is simply because he or she can take comfort in knowing that someone has his or her back. Realtors provide due diligence during the evaluation of the property and can assist with having it inspected for asbestos, dry rot, faulty structure, termites and more. In addition, the Realtor can provide information regarding access rights and other concerns that might need to be addressed before a deal is made.

Why Use a REALTOR®?

Mortgage Rates Remain Low for Potential Home Buyers

According to a Reuters article released at the beginning of the month, mortgage rates throughout the United States had remained at or near record lows during the last week of May. Furthermore, the 30-year fixed rate came in at ½ percentage point lower than where it was at just one year ago. Additional reports indicated that home loan rates continued to make affordability high, while the demand for home loans fell to a 13 year low in May. Interestingly, during the weeks preceding this low, the demand for loans had spiked as buyers attempted to take advantage of the homebuyer tax credit that expired on April 30, 2010.

According to many experts, the drop in loan requests experienced in May is likely to be only temporary, as many of the increases in sales that typically take place during the spring simply took place a bit earlier as buyers attempted to take advantage of the tax credit. Furthermore, many experts agree that the low borrowing costs coupled with low home prices will likely put the United States housing market on a gradual path toward recovery during the second half of 2010. In fact, during the week that ended on June 3, fixed 30-year mortgage rates averaged a mere 4.79%. Although this is up by 0.01 percentage point when compared to the previous week, it is still a full ½ point lower when compared to the rates one year ago. Furthermore, this rate is still only slightly above the low of 4.71% that was reached last December (2009).

15 year home mortgage loan rates are also remaining quite low. In fact, a new record of 4.20% was set after the rate dropped an additional 0.01 percentage point. This rate is well below the 4.79% rate that was seen just one year ago.

“The economy grew at a slower rate than originally reported in the first three months of the year, according to the Bureau of Economic Analysis, which suggests inflation will remain tame in the near term,” said Frank Nothaft, who is the chief economist for Freddie Mac. “As a result, mortgage rates held at historic levels this week.”

These low rates are good news for buyers, real estate agents and the economy as a whole, as those who are interested in purchasing a home can potentially save thousands of dollars by taking advantage of these low interest rates. Real estate agents, on the other hand, are hopeful that these low rates will encourage people to continue to both sell and purchase homes despite the expiration of the homebuyer’s tax credit. This, in turn, will benefit the United States economy as it continues to work toward recovering from the recession.

Housing Market Recovery Likely Despite Increasing Interest Rates

Although the housing market has been enjoying a minor recovery, this recovery has relied heavily upon cuts in mortgage loan interest rates coupled with the tax credit made available to first-time homebuyers. As such, some industry experts are concerned about the future of the housing market once this tax incentive draws to an end in June and the $1.4 trillion mortgage-related Federal debt purchases program comes to an end.

Although analysts do believe there will be an increase in purchases in spring as buyers rush to beat the June tax credit deadline, they also anticipate experiencing a slowdown in activity during the second half of the year. As the economic recovery trickles down to the labor market, however, many experts anticipate seeing another pick up in sales.

“It (recovery) will continue. What I am counting on to bolster demand in the second half of the this year is continuing economic expansion,” commented David Crowe, who is the chief economist at the National Association of Home Builders in Washington. “Sales will be driven by pent up demand along with low house prices and a return to positive employment growth.”

Many economists predict that the labor market will start to enjoy some growth as early as March after hitting a 26-year high at 10.1% in October. Although interest rates are expected to go up, economists believe home loans will continue to remain affordable.

“Home prices are now down almost 30 percent from when they peaked in 2006, so even a 50 or 100 basis points move in the mortgage rates is not going to do substantial damage to the housing recovery,” said Tortson Slok, who is an economist at Deutsche Bank in New York.

According to analysts at Freddie Mac, home mortgage interest rates will need to rise to 6% before the rates will discourage potential buyers. Further, some analysts believe the Feds will take action once again if the rates start to get too high.

“They can’t allow the housing market to falter from here,” said Josh Levin, who is a homebuilder analyst at Citigroup in New York. “If you are under 6.0 percent, affordability is still your friend. Sales won’t be affected.”

Despite the fact that the economy is moving in the right direction in many ways, foreclosures may remain a problem.

“There are currently about 5.5 million mortgages either seriously delinquent or in some stage of foreclosure,” said Michele Meyer, who is an economist at Barclays Capital in New York.

Regardless, many economists believe that pent up demand and an improving job market will outweigh the additional inventory.

Austin W Hotel & Residences

For those who adore style and elegance, news that The W Hotel has broken ground in both Boston and Austin is certainly exciting. Since the opening of its first hotel in New York in 1998, the W Hotel has represented the epitome of style and personality. As a result, it has become the upscale hotel of choice for the harried business traveler or vacationer, and as the popularity of the “condo-hotel” grows, you can now call the W Hotel home.

Despite the fact that Austin and Boston are on near opposite ends of the country, it should come as no surprise that the W Hotel has decided to break ground in both cities. The chain is known for selecting the most vibrant destinations around the world for construction of new facilities. Both Boston and Austin are iconic cities with a long and important history as well as a bright and promising future.

Below are renderings of the to-be W Hotel and condo developments in Austin and Boston respectively.

Austin W Hotel & Residences Boston W Hotel & Residences

As would be expected of a W Hotel, both facilities will offer guests comfort combined with sophisticated design and numerous opportunities to experience cultural attractions and to dine at some of the area’s signature restaurants. The W Boston, for example, is located within the storied Theatre District. As such, guests of the hotel are treated to the nearby ambiance of the South End, while being only moments from the Public Garden, Boston Common, and the big city feel.

The planned 35-story Austin W Hotel structure will be similar to the Boston development in that hotel rooms will be on the lower floors, and condos on the upper – 200 residential condominiums on the upper floors in AUstin compared to Boston’s 123. The first four floors of the Austin W Hotel and Residences will contain lobby areas for the hotel and residences, retail space with street frontage, a spa, swimming pool and pool terrace. Condominium owners will enjoy unprecedented access to five-star W Hotel amenities such as concierge services, valet parking, room and housekeeping services, and in-home spa services.

Located in the vibrant 2nd Street District, the W Austin offers all the excitement of the big city while still being located only one block from several of the many hiking and biking trails that Austinites love so much. Regardless of which of the more than 20 W Hotels you visit, you will be treated to a plethora of amenities. Business travelers, for example, can have up to two phones as well as high-speed laptop connectivity in their rooms. The lobbies of most W Hotels offer wireless service and travelers can take advantage of the wired full-service business center as well. Guests may also take advantage of the state-of-the-art SWEAT fitness facilities on site, and the exclusive Bliss spas. So, whether you are there for business or pleasure – or perhaps a bit of both – the W Hotel is sure to deliver.