Today we're touching on two topics—the effects of the president rolling back FHA mortgage insurance premium cost reductions, and whether you should wait until spring to sell your house.
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Today I wanted to touch on two big topics affecting real estate. The first is about the president's recent rollback in HUD mortgage insurance premiums. Then, we'll discuss whether you should wait for spring to sell your home.
First things first—on Inauguration Day, President Trump rolled back a planned cut for the mortgage insurance premium in the FHA, which are HUD-loaned, government-backed insured mortgages. Within an hour of this cutback, I had a local TV reporter call me for comments on the impact!
A little background: if you have as low as 3.5% down, buyers will go with an FHA mortgage, which is insured by the federal government. If that loan defaults, the government will bail the bank out. The buyer pays a mortgage insurance premium on that mortgage, and that premium was going to be reduced, but will now instead stay the same. The overall impact is that it would have saved the average home buyer $400 to $500 a year in total, so the sky is not falling and buyers are not going to stop buying because of this. The status quo will stay the same, so we won't see any impact. This won't affect the market one way or another.
So, to our second point—should you wait for spring to sell your home? Absolutely not! If you're thinking about selling your home, know that inventory is the absolute lowest of the year in the dead of winter and buyers are out. We're seeing multiple offers on homes, making it a great time to sell. If you wait until the spring to sell, you risk two things. The first is rising interest rates, which hurts someone's ability to buy your home, and the second is that inventory increases dramatically. There will probably be five more homes just on your street for you to compete with.
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Don't wait to sell in spring when inventory is higher and buying power is lower.
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Our first quarter has always been our best, and it's always because we're a contrarian firm and we list homes in the dead of winter. We often sell them very quickly because the home buyers out at this time are very serious and inventory is very low.
If you ever have a real estate question I can help you with, give me a call directly. Have an absolutely awesome day!
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