What Happens When Tariffs Hit Home?
ldquo;Tariffs on goods traded between the U.S. and China have already increased in several stages since early 2018,rdquo; said CNBC. ldquo;Now, President Donald Trump has added a 25 tariff up from his original proposal of 10 on another 200 billion worth of Chinese imports, and China hit back with 5 to 10 percent duties on another 60 billion worth of U.S. goods.rdquo;
Experts say we could be seeing higher prices as a result of this escalation as early as this summer, and that has economists yelling, ldquo;Buy, buy, buy nowrdquo; in order to avoid what a report from Oxford Economics estimates will be an 800 hit to every U.S. household.
There is some question as to how the tariffs will play outmdash;after all, Trump said that China will suffer most of the economic impact. ldquo;Yet experts say the burden will land squa>
So what can you do? Ramp up future spending now, if possible.
ldquo;To get ahead of the next waves of tariffs, University of California, Davis, professor of economics and specialist in international trade Katheryn Russ recommends buying some items now, if possible mdash; such as backpacks and other back-to-school supplies mdash; rather than holding off until later in the year,rdquo; said CNBC. Ditto for things like iPhones; ldquo;The price for an iPhone XS would rise to 1,142, up from 1,000, if the White House implements a 25 tariff on the rest of China imports, J.P. Morgan said in a note to clients.rdquo; Expect a ldquo;similar impact on TVs and everyday purchases, ldquo;where consumers will be harder hit, such as frozen food and paper goods, including diapers and paper towels.rdquo;
Phil Crone, Executive Officer of the Dallas Builders Association, warns of the effect on the housing market. ldquo;From tile to countertops, laminates, lighting, and furnishing, about 450 products commonly found in new homes and remodeling projects are seeing tariffs rise from 10 percent to 25 percent,rdquo; he said. ldquo;According to the National Association of Home Builders NAHB, homeowners and homebuilders nationwide will be paying an additional 2.5 billion.rdquo;
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Dont Judge a House by its Photo
If you spend hours on the internet trying to find your dream home by searching through photos or video of properties, you may be overlooking important flaws in this superficial approach to evaluating real estate.
The big question is: What percentage of time are you incorrect in your decision to discard a property based on a photograph?
Judging a property by its photograph may prove expensive when you discard poor photos without knowing if they represent excellent real estate opportunity for you. Just ask yourself, how many selfies does it take to achieve a great and, therefore, accurate picture of you?
Even when you eventually find photogenic real estate to visit, how many better choices or better bargains did you miss out on because you did not approve their visuals?
bull; Have you studied photography and earned the advantage of knowing how to evaluate second-rate equipment or poor photographic technique that results in failure to present a homersquo;s good bones or reveal a hidden gem worth a closer look? Even a good photo may present poorly as an online image through bad decisions regarding lighting, resolution, cropping, coloration....
bull; What percentage of properties are discarded because the photo is unappealing? Listing photos are not intended as works of art. Was this a drive-by photo where the photographer did not get out the car because they had so many photos to take? Was it raining or snowing that day? Just like people, houses have a ldquo;good siderdquo; and a ldquo;bad side.rdquo; Which side is in the photo?
bull; Do you have a magazine or Instagram pic in mind that you are intent on matching? Houses that are beautiful from the curb earn high-value ratings >
bull; You canrsquo;t live in a photograph or even a video. Ideally, a photograph or short video of a property should reveal all the benefits of the buildings and the land. In reality, most photographic representations fall short of this goal. Some are more successful that others, but none are a substitute for experiencing ldquo;the big picturerdquo; first-hand: the feeling of being there, the volume of rooms, the acoustics of the building, the effects of daylight, the flow through the buildinghellip;the reality of inspecting the property yourself. In addition, street-face photos cannot reveal interiors that are in marked contrast to facades: a house with a renovated, ultra-modern interior may maintain its historic exterior.
bull; What percentage of the time are you attracted by a great photo of a house, which you later discover has ldquo;a lot of uglyrdquo; going on outside the photo i.e. beside the house is a high-rise building, auto body shop, shopping mall, night clubhellip;? Or, did you discard a property which, invisible to you, had wonderful green space around it? Since location is the most important value factor in real estate, how
can a photo of a property in isolation enable you to fully evaluate its location value without knowing context?
The above list of flawed reasons for discarding properties based on photographic representations explains how you may allow your lack of knowledge, on many levels, to limit your ultimate success identifying desirable real estate. Select only the ldquo;pretty picturesrdquo; and you may inadvertently eliminate properties that would be ideal and perhaps less expensive purchases for you and your family.
The Smart Approach
Wersquo;re not advising that you view every listed property. Instead, work with experienced real estate professionals whorsquo;ll process listings, visit properties using your criteria, and, therefore, save you time by selecting the best prospects for you to view.
Describe what yoursquo;ll want in a new home and the professional will converse with you to clarify that description for you and for them. Buyers are often surprised when these conversations reveal how much they had not realized about what they thought they wanted and needed.
Search out a professional who makes it their business to know area product from the outside in. Theyrsquo;ll share their insider view, so you wonrsquo;t miss out on what could be your dream home. This informed culling of properties will save you from having to view too many properties that are a poor fit for your needs and dreams.
ldquo;This house was a big surprise inside; from the outside, it looked much smaller,rdquo; is a common buyer observation. Most buyers, particularly first-timers or first-time-in-a-long-time buyers, are not experts at architecture or construction, nor have they inspected as many properties as experienced real estate professionals.
Your secret weapon is your real estate professional who makes it their business to keep up-to-date viewing area listings. They understand the advantages of knowing the whole property and its entire potential, not just its street face. They appreciate the difference between a real estate dream and a home thatrsquo;s a dream to live in.
Professionals are also aware of smart buying strategies based on poor photos or less inspiring facades. For instance, if yoursquo;d like to invest in the best location your budget will allow, there may be advantages to viewing properties in choice neighborhoods with less attractive street faces. When there is value in the location, interior, and backyard, over time the curb view can be improved on, increasing property value in the process.
Online buyers of clothing who >
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What to Expect When Applying for a Jumbo Loan
A jumbo loan is one where the loan amount exceeds current conforming loan limits. Conforming loans are those that conform to standards issued by Fannie Mae and Freddie Mac. One of the many requirements for a conforming loan is the loan limit which is currently 484,350 in most parts of the country. In higher cost areas where home values are much greater compared to the rest of the country, the conforming limit can be as high as 726,525. Beyond that is jumbo territory. When applying for financing to purchase a higher end home, jumbo approvals are issued in much the same manner as other types of loans, itrsquo;s just a bit more difficult to qualify for one.
Conforming loans can ask for a down payment for as little as 5.0 percent of the sales price. With a down payment of less than 20 percent however, private mortgage insurance, or PMI, will be needed. PMI insures the difference between 20 percent down and the actual amount of down payment. with a 5.0 percent down payment, the insurance would cover 15 percent. With jumbo loans however there is no PMI available. That means the loan amount for a jumbo loan should be no greater than 80 percent of the sales price. This equates to a 20 percent down payment, but slightly better terms are offered with a down payment of 25 percent or more. There are some niche portfolio products that ask for a lower down payment but in general this is what you can expect.
Credit score minimums are also higher for most jumbo loans. Conforming loan programs can go as low as 600 or so but jumbo loans need higher scores. Minimum scores can vary from one lender to the next but not by very much. Many jumbo loans ask for a minimum credit score of 700 while a few programs need a score of 680. Better rates and terms are typically available with a credit score of 740. If there are two borrowers on the same application, the lender will use the lower of the two qualifying scores.
Finally, jumbo loans typically require a bit more documentation both from the borrower as well as third parties. For example, a jumbo loan program might need two appraisals instead of just one. Again, if there are two appraisals, the lender will use the lower value for approval purposes. Jumbo loan applications are also fully documented. There are no ldquo;statedrdquo; type loans where income or employment is not verified via third parties. There are a couple of programs out there that review 12 months of bank statements in lieu of paycheck stubs or W2s, but the bank statements must show regular monthly deposits from a verified source.
On these statements, there needs to be sufficient cash to close for the down payment, closing costs and cash reserves. Lenders can separately mail a Verification of Deposit to the financial institution asking the bank to verify how much cash is in the bank as well as an average of recent balances.
Jumbo lenders can set their own guidelines because theyrsquo;re not bound to conforming rules which means qualifying at one lender may be easier or more difficult compared to another. Your loan officer will tell you what types of documentation yoursquo;ll need to provide, but once submitted, your jumbo loan application will be processed just like any other.
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