How much money do you really need for a down payment on a home? I’ll go over a few different options today.Selling a home? Get a free home value reportBuying a home? Search all homes for saleIf you want to buy a home, how much money do you need for your down payment?Most lenders would love to see you put the standard 20% down for a conventional loan. Why? First of all, you won’t have to pay mortgage insurance. Secondly, you will be less of a risk. You are more likely to make your mortgage payments because you have equity in your home. Finally, putting 20% down helps you qualify for a bigger purchase.That said, there are a few things to consider.Recently, the National Association of Realtors revealed statistics from April to June of 2017 that found that 73% of all first-time homebuyers put less than 20% down; 61% of those buyers put less than 6% down.Here in Southern California, which includes Orange County, L.A., and the Coachella Valley, prices are appreciating and interest rates are low overall. The market is really taking off, although the desert is slowing down a little bit. Home prices have appreciated quite a bit over the past eight and a half years since the bottom of the market.Buyers are tired of renting. They know that long-term investments mean long-term gains. Real estate is a great way to build your portfolio and start building your wealth. In fact, 95% of all people who become millionaires got there through homeownership.“There are a few benefits to putting 20% down on a conventional home loan. ”A lot of people may say that renting is the way to go. Renting is fine if you are moving around a lot or have a transient job that requires you to go from location to location. If you have established a family or have a great career in the area, then why are you renting? Why are you spending $2,000 to $4,000 and not gaining anything from it?You may have a great place to live, but the reality is you are not benefiting from any of the mortgage interest deductions or appreciation that homeowners do. If the landlord decides to sell your home because the market is improving, then you have to move again, which costs you time and money.So, what are the loan limits? FHA loans allow you to put 3.5% down. If you are looking to buy a $500,000 home in Orange County, you would need $17,500 down. If you were looking at the same home but needed to put 20% down for a conventional loan, you would need $100,000 for your down payment.You can also get a conventional loan with a 5%, 10%, or 15% down payment. If you qualify for a VA loan, you can purchase a home with no money down.If you would like to talk more in depth about which options are available to you, give us a call or send us an email. You can also get pre-approved by our preferred lender on our website.So, if you have any questions, give us a call or send us an email. We would be happy to help you!

Orange County, CA Real Estate Podcast with Torey Severino

How Much down Payment Do You Need to Purchase a Home?

It’s time for this year’s third quarter market update. How have things changed from this time last year, and what do these changes mean for you? Selling a home? Get a free home value reportBuying a home? Search all homes for saleNow that it’s time for this year’s third quarter market update, where do we stand in 2017 compared to where we were this time last year?Let’s start by looking at the active listings in the Orange County market. Last year we had about 9,600 active listings. But, this year, that number is down to 7,500. As you can see, this is a pretty big drop.The number of days on market has dropped, as well. Last year the average was 64 days versus this year’s 35.We’ve also seen a shift in how many new listings are hitting the market on a monthly basis. At this time last year in Orange County, we had roughly 3,700 active listings. But now, we’re seeing 150 more new listings per month than last year—about 3,850 in total per month.Next, we’ll look at sales—which is a very important factor in the market. Compared to last year’s 3,100 active listings, we’re now seeing just a little bit over 3,300 active listings. Rounding up, there have been about 250 more homes sold than there were last year.Inventory has changed, too. Last year, we were seeing roughly three months of standing inventory. Now, though, we’re floating at about two months.Let’s compare these changes to what we’ve seen in Coachella Valley.There, we had about 5,500 active listings this time last year; however, this year we have about 5,200—accounting for a drop of about 300 active listings between 2016 and 2017.In terms of days on market, last year we saw an average of about 114 versus this year’s average of 92 days on market.Sales have undergone a big change in this area. Last year, we saw about 800 homes sold compared to the 1,100 that have sold this year. Also, standing inventory has gone down from seven months to about five.“Right now, both sides are ultimately seeing benefits. ”But what do all these statistics mean? How will they impact you as a buyer or seller?As buyers, we know that the market is cyclical. Interest rates, which were supposed to bump, are still low right now. It’s inevitable that this bump will happen eventually, though.Now is the time to buy. Take advantage of the market, as well as the mortgage deductions on your taxes, and become a homeowner.It’s a different story for sellers. While it is a somewhat difficult market for sellers right now, there are some positives. There has been a huge improvement in value since the bottom of the market eight or nine years ago. In Orange County, we are seeing record appreciation. So, if you are thinking of cashing out—this could be a good time.Right now, both sides are ultimately seeing benefits. If I can help you with any of your real estate needs, you have any other questions, or you would like more information, feel free to give me a call or send me an email. I look forward to hearing from you.

How Does Today's Market Compare to This Time Last Year?

How can you be sure you’ve hired the right real estate agent? I’ll go over some ways to put your mind at ease today.Selling a home? Get a free home value reportBuying a home? Search all homes for saleNot all real estate agents are created equal, and there are a few things you should ask when choosing one.First, are they a seasoned professional? Is this their full-time job or do they do this part time? Have they been in the business long enough to experience the ups and downs of the real estate market? Do they know a hot market from a slow market? Do they know what’s going on with foreclosures? Have they experienced all types of transitions? Have they represented buyers and sellers? The average real estate agent only sells one to four homes per year, so you need to make sure they know how to negotiate for you.“If you get the home you want or the price you want, that’s what really matters, not the personal interests of the agent. ”Second, do they have a great marketing plan? What is your agent going to do specifically to sell your home or find you a great deal? Are they putting their marketing budget toward new and exciting ways to get your property seen? Are they on the right websites? Are they using great photography? What are they doing to market your home to the public to get as much exposure as possible?Finally, will they negotiate in your best interests? Most real estate agents who don’t do a lot of business are focused on themselves and what is going to benefit them the most. It’s not about us though. If you get the home you want or the price you want, that’s what really matters. There are several stages of negotiation, so they need to be able to get you to the end with your needs in mind instead of shoving a contract down your throat to get their commission more quickly.If you have any questions about this topic, or if you have any other real estate needs, please feel free to give us a call or send us an email. We’re always happy to help!

How to Hire the Right Agent

Should you try to save yourself from having to pay real estate commission by selling your home on your own? There are a few reasons I recommend you don’t.Selling a home? Get a free home value reportBuying a home? Search all homes for saleWhy selling For Sale By Owner might actually cost you to lose money on the sale of your home! Are you aware the average For Sale By Owner home sells for between 87% and 90% of asking price? On Fizber, 94% of all homes originally listed as for sale by owner wind up listing with a broker within 63 days.The reality is that selling on your own puts you at a huge disadvantage here in California.Here in California, there are more than 55 pages of disclosures and contracts just to list a property. Agents like us have all the protection we need, but if you sell on your own and fail to disclose issues with a property, you put yourself at a huge risk.Secondly, you need to consider the types of buyers looking at properties listed For Sale By Owner. First, it’s investors who know you’re not paying a real estate commission and want to absolutely steal the property from you. The second type would be buyers who can’t get traditional financing.“Buyers looking to For Sale By Owner homes think they can get a steal of a deal. ”Thirdly, you might be working with a lease-to-buy tenant purchase, which generally doesn’t work out for the seller. If the market changes and your home goes up in value, you’ve locked yourself into a contract. If the market goes down and the buyer walks away, you’ve wasted all that time when you could have found a qualified buyer.Also remember that if you’re thinking about selling your home online, if it was that simple and easy, I wouldn’t have a job! It takes an agent to showcase a home’s features and benefits to the market. Sites like Zillow and Trulia can be helpful, but it takes an experienced and composed salesperson to be able to negotiate for you.Finally, remember that buyers looking at For Sale By Owner listings are looking for a steal of a deal. The owner of Forsalebyowner.com even had to use a real estate agent to sell his property in Manhattan, the hottest market in the country.If you have any other questions about this topic or you’re thinking about selling your home, give me a call or send me an email. I’d love to help you get the most out of your home sale.

Should You Try to Sell Your Home by Yourself?

There are three common mistakes that home sellers make over and over again in hopes of selling their home quickly for the most money possible.Selling a home? Get a free home value reportBuying a home? Search all homes for saleThere are three common mistakes that people make over and over again when selling their house:Incorrectly pricing the property: Everyone wants to get the highest price for their house, but the truth is that the more accurately you price your house, the faster it will sell for and for more money by creating more urgency. If you come out of the gates priced accurately to sell in the Southern California market, you’ll create immediate interest, potentially generating multiple offers and bidding up the price. Most sellers want to price high to leave room to negotiate, but we’ve found over the last 40 years that overpriced homes will take longer to sell and net you less money in the long run. Not making the home accessible and easy to show: I know it’s hard to accommodate showings when you have a family living in the house, but you want to make the house as accessible and have as much exposure as possible. We have a lot of relocation buyers in our market who might only be able to fly in for a week or a weekend, so notice is short for showings. The more accessible the home, the more exposure it will get. Wanting to be a secret seller: These sellers don’t want a for sale sign and they want to be hush-hush about the sale. Statistics show that this hurts your ability to sell for the most money possible. We want the most exposure possible. If your neighbors know, they’ll probably want another great neighbor to move in and they can help you find a buyer.I hope you or someone you know finds this information helpful and valuable. If you have any questions or you’re thinking of selling a home here in the southern California market, give us a call or send us an email. We’d be happy to help!

Don't Fall for These 3 Common Selling Mistakes

What is a home warranty and should you get one at close of escrow? I’ll cover everything you need to know today.Selling a home? Get a free home value reportBuying a home? Search all homes for saleWhat is a home warranty? Should you get one at the close of escrow?First of all, keep in mind that a home warranty is not the same thing as home insurance. A home warranty is a one-year policy that covers many of the mechanical items on the property, such as pool equipment, the water heater, the furnace, A/C, or other appliances.As a buyer, you should absolutely get a home warranty. After the close of escrow, you can move into the property knowing that if anything goes wrong, all you have to do is call the home warranty company. The company will then send out a technician to repair or replace the appliance.“Should you get a home warranty? ”As a seller, the home warranty is a great way to offer buyers reassurance.Who pays for the home warranty and what does it cost?Depending on the market, either the buyer or the seller will pay for the home warranty. In a more competitive market with lower inventory that favors sellers, it is more likely that the buyer will have to pay for the home warranty. In a buyer’s market, where there is more inventory and buyers have the advantage, then the seller will foot the bill for the home warranty.Home warranties tend to cost between $350 and $700, depending on the home and the number of items that the warranty covers.Still, a home warranty is worth the investment. If you have any other questions about home warranties, give me a call or send me an email. I would be happy to help you!

Do You Really Need a Home Warranty?

Rising interest rates constitutes both good news and bad news for both buyers and sellers in our market. Here’s why. Selling a home? Get a free home value reportBuying a home? Search all homes for saleHow are interest rates going to affect your ability to buy or sell?Let’s start with the buy side. Interest rates have gone up about a half a percentage point since the election, and we’re anticipating that they will continue to rise. By summer, we may see them increase a full percentage point or more, depending on what the Fed does and how the economy acts.How does that affect your ability to buy? A lender is going to look at your debt-to-income ratio and what percentage of that can go toward your mortgage. If rates go up anywhere from a half a percentage point to a full percentage point, that could raise your home payment on a $500,000 mortgage anywhere from $200 to $400 per month. When rates go up, your ability to purchase goes down. For sellers, this anticipated rise means you may face less competition. We’re in a unique situation here in Southern California in that both interest rates and inventory are historically low. You probably won’t get as many multiple offers, but you may get stronger offers.“Their true impact is something we can’t know until later on. ”Shifting back to the buyer’s standpoint, rising rates may also give you more negotiating power. Does that mean you can try a lowball offer? No—our inventory is still too low for that. Here in Orange County, our absorption rate is still around 60 days. In our desert market, the absorption rate is roughly a little over 100 days.The market is still moving at a relatively good pace, but the true impact of these rising interest rates is something we really can’t know until a few months down the road. As we are in the seasonal month here in the desert, inventory is up, but so is buyer demand. In Orange County, listings are always down in the winter months, and buyer demand is sometimes relatively equal to that. In summation, I don’t think interest rates will have an immediate effect on your ability to buy or sell. We’re still in a very strong market and consumer confidence is up. The only real question is whether the time is right for you.If we can help you answer that question, please feel free to give us a call. We look forward to the opportunity to serve you.

How Are Interest Rates Impacting Our Market?

How is the real estate market doing during the fourth quarter? I’ll go over the latest numbers for you today. Selling a home? Get a free home value reportBuying a home? Search all homes for saleWe are approaching the end of 2016. How is our real estate market doing during the fourth quarter?Let’s start with the desert. We are heading into the selling season, when a lot of snowbirds come back to purchase property. As a result, inventory is rising. Right now, there are 4,825 active listings in the Coachella valley.The concern is that last month alone, we listed 1,548 properties but only sold 687 properties. In other words, we sold less than half of what was listed. The overall number of listings has increased as a result. If you are selling your home, that means how you price your property is absolutely critical.“Now is an excellent time to sell your home. ”In the desert, it takes an average of 110 days to sell a home, even when your home is priced well. Some sellers are pricing slightly below the market to create additional competition among buyers and get their homes sold.In Orange County, the market is still very hot right now. There are about 3,800 listings on average. Last month, we sold 1,273 homes but only listed 1,155, so we’re selling out all the inventory and then some. As a result, our inventory is dropping a little bit, which is normal as we head into those off-season months of December, January, and February.Whether you are in the desert or Orange County, now is an excellent time to be a seller. If you’re thinking of selling, there is no better time than right now. Inventory is historically low and so are interest rates. We may see a bump in rates in the near future. Rates already jumped up a bit after the election, and we expect more of that in the first quarter of 2017.Not only is now a great time to sell at peak prices, it’s also a great time for buyers to lock in a low interest rate.If you have any other questions about our current market, just give me a call or send me an email. I would be happy to help you!

The Latest Numbers From the SoCal Real Estate Market

Have you ever considered investing in multi-family housing or apartments? Many investors are entering this market thanks to the stable returns it offers compared to the stock market.Selling a home? Get a free home value reportBuying a home? Search all homes for saleShould you consider investing in multi-family housing or apartment buildings?We're starting to see a lot of our investors that own residential investment property consider selling condos and single-family homes to leverage their equity into multi-family or apartment buildings. A multi-family unit has one to four units, whereas anything with five or more units is considered commercial.So why would these investors do this if they've created such great equity already?Well, the market is changing, and demographics are changing, too. People are renting longer these days, so we're starting to see an opportunity for a good stream of income from a multi-unit rental.“These investments don't have the volatility of the stock market. ”If a single-family or condo rental home goes vacant, you still have expenses coming out of your pocket. With a multi-family rental property, you have multiple streams of income, which is a great way to build passive wealth and build retirement income.You'll also build your net worth over time.These properties are very desirable, but they can be tricky to find. If you can't buy in California in the area you want or the price you want, I can absolutely refer you to an agent in my network of top agents across the country in areas where there are great investment opportunities.Secondly, there are a lot of tax and financial advantages. I'm no CPA or Financial Planner, but I've seen clients build phenomenal wealth over their career through property investments and apartments. With a lot of volatility in the stock market, many investors are leaning toward the real estate investment market. They know they can get a cap rate between 4% and 12% (the money you'll make after all the expenses) and realize that this is a lot better than they could do in the stock market or a bank.We don't see the volatility because it's a long-term scenario.If you're interested in learning more about investing in multi-family properties or apartments, give me a call or send me an email. Let's get the conversation started soon.

Why Multi-Unit Property Investing Is Heating Up

With Thanksgiving right around the corner, I have many people to thank for making 2016 the year it’s been so far. Selling a home? Get a free home value reportBuying a home? Search all homes for saleToday, I just wanted to take the opportunity to say thank you. For all that 2016 has given me, I have a lot of people to thank and be grateful for. First and foremost, I want to thank my family, especially my beautiful wife and daughter, for all their hard work, support, and dedication to our family.Next, I want to thank all of our great past clients—each and every one that we’ve had the pleasure of working with these past 16 years. Your referrals, your kind words, and your continued loyalty are invaluable to us and our family.“Thank you for all of your support.”I also want to thank the new clients that I’ve had the pleasure of working with and taking on this year who are really excited about continuing our relationship. We plan on being there for all of your needs and all your referrals.Lastly, I want to thank all the military veterans and active duty personnel who continue to protect this great county we live in. Without you guys, we would not be able to do what we love to do: help people.From my family to your family, I hope you have a happy Thanksgiving. I look forward to talking with you soon!

Wishing All of You a Happy Thanksgiving

When purchasing a new home, I’ve found that most buyers tend to focus most of their attention on the initial down payment.Selling a home? Get a free home value reportBuying a home? Search all homes for saleOver the last 16 years, I’ve learned that most home buyers are so focused on the initial down payment that they fail to take less-apparent costs into consideration. No matter what percentage you’re putting down for your down payment, it’s important to understand that you should have extra money set aside for the additional costs.These costs include: Escrow fees, lender fees, appraisal fees, title fees, and prepayment on property or HOA taxes.All of these costs could potentially add up to about 1% to 2% of your total purchase price. Depending on the market, we may be able to negotiate for you and get the seller to offer some form of credit. When the market’s a little less competitive, sellers may be a bit more flexible and more willing to negotiate, but when the market is hot and there are multiple offers on properties, we see this less often.After escrow, your next costs are going to come from the home inspection. Plan to set aside $350 to $700 for the general home inspection. This cost is based on square footage and the number of bedrooms and bathrooms in your home. After we find out what needs to be repaired, additional inspections—like a termite inspection or a roofing inspection—may require you to hire inspectors to come out and look at the property, which can cost anywhere from $500 to $1,500. “Be sure you’re not pinching pennies upon closing. ”The third cost to consider is moving costs. You’ll probably have to hire a moving company to come help you pack your things up and make sure they get to the next property safely. This can range anywhere from $800 to $2,500, or even up to $5,000 if you have the company come pack everything up as well.Finally, be sure to have some money set aside to personalize your home. You may want to paint, make some upgrades, or buy some new furniture, so you’ll want to make sure you’re not pinching pennies when it comes time to close on your property.If you have any questions about moving or about real estate in general, please give me a call or send me an email. I look forward to talking with you soon!

What To Expect When Buying A Home

There are many options to consider if you want to pay off your mortgage early. The first is by making one extra payment per quarter. You can also apply things to your mortgage like a refund check or any additional money that came from a tax refund.Selling a home? Get a free home value reportBuying a home? Search all homes for saleHow do you pay off your mortgage early? There are a few different ways to consider. For this scenario, let’s use the average $220,000, 30-year mortgage at a 4% interest rate.If you were to make one extra payment per quarter, you would shave 11 years off your mortgage and save $65,000. If you’re in California and don’t have such a small mortgage and can’t afford to do that, but you have a property that you would like to pay off early, you can divide your average mortgage payment by 12. You can also make a 13th additional payment, or make two additional biweekly payments per month. Any of these options can save $24,000 and shave four years off your mortgage.If you have additional money that comes in from a tax refund, you’re getting a refund check, or you get a raise or some other type of bonus, you can apply any of these toward your mortgage. You can also take any additional monies you have and round up your mortgage payment on a monthly basis.Any of these methods will pay off your debt faster and save you both time and money. Make sure you contact your lender directly to see how you can apply that additional money toward the principal. You don’t want it to be applied toward the interest of the loan or the next month’s payment. You also want to make sure your lender doesn’t charge you any prepayment penalties in doing so.You can also consider refinancing, or just pretending that you did. If you’ve already taken advantage of the great low interest rates that we have right now, you can pretend that you’re refinancing again by saving the closing costs, the appraisal, the title of the escrow, and any points you may pay the lender, and just pay the longer-term loan off.“You can make extra payments, refinance, or downsize. ”Your last choice is downsizing to a smaller home. We’re seeing a lot of sellers sell their larger home, pay off their mortgage, and then either pay for their next home in cash or buy a home with a smaller mortgage and take the additional monies. With that, they can buy an income-producing property, such as a rental unit, where the tenants are paying their mortgage by paying rent.In sharing the endorsement of Dave Ramsey—America’s trusted voice on money—I can assure you that choosing any of these options will work for you. If you have any questions, please give me a call or send me an email you so I can help in any way I can. Take care and have a great day.

Paying Off Your Mortgage Fast in Southern California

We’ve been busy the last few months on an important project, and we have just officially launched it. It’s our new website, www.ToreySeverino.com. We’re very excited to bring this website to you because it’s going to be a tremendous tool for you whether you are buying, selling, or just want information about the market.Our MLS search will allow you to freely search multiple counties for listings, where you can get real live market data and listings updated to the minute. This is where you will find the most accurate information out there.If you’re a seller and want to know what your home is worth, you can just click a button on the page, which will give you a direct link to my information. You can then send me the property you’re inquiring about, and we’ll give you a free market analysis of that property.“Our MLS search will allow you to freely search multiple counties. ”There are plenty more features on our site to explore, including a link to our lender so you can get pre-approved. If you have any questions for us, feel free to give us a call or send us an email. We look forward to hearing from you soon and hope you enjoy the new site!

Our Website Has Some Great New Features

Selling a home? Get a free home value reportBuying a home? Search all homes for saleIf you’re selling your home, I’m sure you’ve worked very hard on the inside. I bet you’ve cleared your countertops, cleaned your closets, and even cleaned your blinds. However, you cannot forget about the exterior of your home. The outside of your home draws buyers inside, so you need to devote just as much time and energy outside as you have inside. There are a few different things you could do to achieve this.“The outside of your home is what will draw buyers inside.”Add mulch and seasonal flowers to bring color. You want your yard to pop, so get as much color in there as possible. Add trees if necessary. Trees provide a lot of value because they create a great natural barrier. Out-of-town buyers love citrus trees, so consider adding those.Keep your lawn green and well-maintained despite the drought that we are facing. Be careful not to over-water.Prune the hedges to give off the feel of uniformity and organization in your yard. Add drought-resistant plants and drip systems.Enhance your plants with lighting. This makes your plants look fabulous, and there is also a little security feature involved with this. Do a general cleanup of your lawn. Take out any roots or stumps out or anything else that might be lingering and damaging the perception of your property. Buyers decide whether they like a property or not in less than 10 seconds, so your yard has to look good. Otherwise, those buyers won’t even want to step inside your home. For more real estate advice, please don’t hesitate to contact me! I’m available by phone and email.

7 Ways to Attract Buyers to Your Home

 There are many great Orange County and Coachella Valley area homes for sale. Click here to perform full home search, or if you're thinking of selling your home, click here for a FREE Home Price Evaluation so you know what buyers will pay for your home in today's market. You may also call me at (949) 441-0701 for a FREE home buying or selling consultation to answer any of your real estate questions.If you’re a buyer, you need to consider the outcomes of any home improvement projects. Do they actually add value to your home and is there really a good ROI opportunity? Today’s topic includes three remodeling efforts that might not be worthwhile in Southern California.Adding a pool: Although it’s great to have a pool in a warm, desert-like area, there are lots of community pools available. In the Orange County market, not everyone wants a pool. The cost of a pool might not be financially worthwhile unless you plan to live in your home for a long time.Personalized kitchens: Your idea of a kitchen might not be appealing or enticing to a buyer. My recommendations are to stay neutral with colors and trends, in hopes it will appeal to the masses.Adding an extension: Adding space can benefit your family, but it not might translate in value. Most buyers look to check off boxes in the process, such as two bedrooms or two bathrooms in a particular neighborhood.Ultimately, your biggest ROI opportunities are in kitchens, bathrooms, and flooring. Make sure your home smells and looks visually-appealing for buyers coming through.“Your biggest ROI opportunities are in kitchens, bathrooms, and flooring.”If you’re thinking about buying or selling in the surrounding area, give me a call or send me an email at your earliest convenience. I’d be happy to answer any of your real estate questions!

Reconsider These 3 Remodeling Projects

A Video Blog about the Orange County Real Estate Market for buyers and sellers By Orange County's premiere Realtor Torey Severino.

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Orange County, CA Real Estate Podcast with Torey Severino

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