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4 good things about rising interest rates — and 4 bad

by Lakeshore Realty

4 good things about rising interest rates — and 4 bad

By Stephen Cook of HSH.com

 

Mortgage rates have crept up in recent weeks. But are higher mortgage rates really so terrible? Is there a silver lining or two?

Here are four benefits and four concerns about rising mortgage rates.

 

 

Good thing No. 1: Rising rates are often a sign of an improving economy

Rising interest rates are, according to many experts, a sign of national economic recovery.

Increases in mortgage interest rates suggest that consumer confidence is rebounding and that consumers are better able to pay higher interest rates. Higher mortgage rates are also a sign that uncertainty is lifting among investors who perceive that the economy is getting better -- and that their money can get better returns with more risky assets. But before scaling back bond purchases and risking higher rates, Fed Chairman Ben Bernanke wants to see substantial improvement in the economy.

"Higher rates mean the economy is doing better, which is good for housing prices," says John Walsh, president and founder of Total Mortgage in Milford, Conn.

Good thing No. 2: The return of purchase mortgages

Higher mortgage rates have caused refinance activity to dry up, resulting in more competition for homebuyer business, improved service and even relaxed lending standards.

Two of the most important lending standards have already begun to ease, Walsh says.Loan-to-value ratios have already responded a bit, and debt-to-income ratios are a little more flexible now than they were.

"Efforts by lenders to get more mortgage business is positive, and there's even more interest in jumbo loans," Walsh says.

Good thing No. 3: Today's rates are still historically low

When all is said and done, today's current mortgage rates are still historically low, and the rate increases to date have not significantly hurt affordability.

"The real question is not what effect rising mortgage rates will have on the housing recovery," says Frank Nothaft, chief economist at Freddie Mac in Washington, D.C. "There's sure to be an impact, but will it be enough to stall the recovery? We don't think so. Demand is strong, supply is limited and, for most families in most markets, housing affordability is still strong."

Good thing No. 4: More sales

Higher rates coupled with rising prices will push buyers "off the fence," resulting in increased sales, says Bernice Ross, founder and CEO of RealEstateCoach.com in Austin, Texas.

An increase of 25 basis points on a 30-year, fixed-rate loan at today's prices could cost borrowers thousands over the life of the loan, Ross says. "Coupled with today's rising prices, [higher] rates will highly motivate buyers to jump on the bandwagon."

Bad thing No. 1: Increased costs

"Quite simply, higher rates make homeownership more expensive," says Will Stein, a real-estate broker at Bel Air Realty in Bel Air, Md. "Buyers pay more for less of a home, and higher rates price some buyers out of the market altogether."

According to HSH.com, 30-year conforming mortgage rates have risen from 3.49% in May to 4.63% in July. That increase adds about $66 a month to a $100,000 mortgage. Rate increases to date combined with the 12% rise in home prices in the past 12 months mean that mortgage payments have gone up by about 25% for a typical homebuyer.

Bad thing No. 2: Deterring homeownership

Low interest rates do more than low home prices to keep affordability in place for homebuyers. According to the State of the Nation's Housing 2013 report by Harvard University, home-price gains in 2012 did little to offset affordability thanks to consistently lower interest rates.

Bad thing No. 3: Higher rates could threaten the housing recovery

"The rate increases since April 1 are a tough pill to swallow for someone buying a home who has to settle for having $20,000 or $30,000 less to buy a home than he would have if he had bought before April," Walsh says. "Some people aren't going to be able to buy a home where they could have before. These are going to impact the housing recovery, which isn't as strong as many think."

Bad thing No. 4: Fewer refinances

With about 20 million homeowners still underwater and unable to refinance, rising mortgage rates will continue to diminish the pool of qualified borrowers who can refinance at an attractive rate.

Price Reduction: 952 Lakeshore View

by Lakeshore Realty

One of our listings at Lakeshore Realty had a major price drop:

952 Lakeshore View Court

Exclusive Gated Community!

One of a kind lodge style home.  This home is an architectural masterpiece, extensive use of logs, pine and stone.  All bedrooms are en suites.  Beautifully landscaped grounds.  This home overlooks Incline Beach with wonderful lake views. 4 fireplaces, separate dining area, large kitchen with top of the line appliances, granite counters, hardwood floors, breakfast nook, walk-in pantry and more! Master bedroom has a wonderful sitting area, office & 2 walk-in closets.

 

Bed: 5
Bath: .5
Sq. Ft.: 5,716

 

VirtualTour

OLD PRICE: 4,200,000

NEW PRICE: 3,950,000

 

To access all the Incline Village and Lakeshore Realty listings please click here. You can also contact us by email or call us at 775-831-7000 begin_of_the_skype_highlighting 775-831-7000 FREE end_of_the_skype_highlighting. If you are in Incline Village, please visit us at 954 Lakeshore Blvd. Incline Village, NV 89451.

4 mortgage-rate trends for 2014

by Lakeshore Realty

4 mortgage-rate trends for 2014

By Michele Lerner of HSH.com

A lot of attention has been paid to the fact that mortgage rates are expected to rise throughout 2014. As mortgage rates creep upward in this year, borrowers need remember that rates will still be historically low and nowhere near the interest rates consumers faced in the early 1980s.

Four unique trends will unfold in 2014 that will influence the direction of mortgage rates throughout the year.

 

No. 1: Conforming loan rates are rising

While no one can know for certain what will happen with mortgage rates in 2014, Cameron Findlay, chief economist at Discover Home Loans in Irvine, Calif., believes rates for 30-year fixed-rate mortgages will reach 5.25 percent by the end of 2014.

Bob Walters, chief economist for Quicken Loans in Detroit, Mich., says conforming rates are driven by market and institutional forces such as fees charged by Fannie Mae and Freddie Mac to lenders which are embedded in your interest rate.

"A planned increase in guarantee fees has temporarily been put on hold, but it would have increased mortgage rates by about one-eighth percent," says Walters. "In order for the market to push rates up significantly higher, the economy would have to be running on all cylinders with wage and employment growth. That's not happening yet, so I think rates will range from 4.5 to 5.5 percent this year."

Walters says current fees from Fannie Mae and Freddie Mac add as much as 0.5 to 0.75 percent to conforming rates and could be raised later this year. Walters suggests homeowners who want to refinance act early in 2014.

"If you want to buy a home, make sure you're ready and know where you want your family to live, but if you do, then you should act earlier rather than later, too," he says.

No. 2: ARMs are low and making a comeback

Qualified Mortgage (QM) rules have virtually eliminated interest-only loans and loans with 40-year terms, often used by borrowers to afford a costlier home. Some borrowers may look to ARMs, with their lower initial interest rates, to stretch their budget in 2014. Walters says borrowers mostly choose ARMs when the gap widens between adjustable and fixed rates.

"Right now the difference is almost a full percentage point, so we're seeing more interest," says Walters. "ARMs are right for more people than are using them right now, such as first-time buyers who are likely to sell their starter home in five years as their income and family size increase, or for people who are transferred often."

ARM borrowers have to qualify at the fully adjusted rate and within tight debt-to-income ratios, so even if you’re using this to stretch your budget you’re doing it within the construct of fully qualifying for the loan, he says.

No. 3: Fixed-rate jumbos priced lower than conforming loans

"Two factors are driving rates lower on jumbo loans," says Findlay. "First, these loans typically have a lower loan-to-value, often as low as 60 percent. Also, the Federal Reserve is paying banks to have excess reserves on hand, which creates excess liquidity. Lenders are concentrating on offering jumbo loans because these loans require very high credit scores and a lot of equity so they're considered very low risk."

Walters says that jumbo rates are also priced lower because they're private loans that don't carry the fees charged by Fannie Mae and Freddie Mac.

Lenders are more competitive with jumbos, too, because they can earn higher fees on larger loan balances and are therefore more likely to offer lower interest rates to entice customers, says Walters.

No. 4: The Fed's influence over mortgage rates will wane

"The Fed's likely to continue removing itself from the mortgage market even if the economy isn't as strong as we'd like, in part because [Quantitative Easing] isn't working as well as it did in the beginning," says Keith Gumbinger, vice president of HSH.com in Riverdale, N.J. "Mortgage rates didn't go back down to rock bottom rates even after the Fed initially delayed tapering their bond-buying activity. They'll still have influence over short-term interest rates, but direct manipulation of the mortgage market is likely to stop."

New Lakeshore Realty Homes for Sale in Lake Tahoe, Incline Village Nevada

by Lakeshore Realty
  • New Lakeshore Realty Homes for Sale in Lake Tahoe, Incline Village Nevada

These are some of the newest listings at Lakeshore Realty on the North Lake Tahoe's Incline Village Real Estate Market.

900 Ace Ct.

Bed: 3
Bath: 2
Year: 1988
Sq. Ft.: 1960

Price: $770,000

 

Listing Agent:
Diane Brown  

Light bright wonderfully maintained single level home with large 2 car garage and quick access to the golf course! Gourmet kitchen, new roof, water heater & furnace. Spa Tub & Shower in master bath with additional closet space. Separate fenced area for garden (with raised bed), or a dog run. Sit out on your covered deck or your open deck to enjoy the yard. Boat parking on side yard. **Contact listing Agent to arrange showing.

 

716 Birdie Way

Bed: 4
Bath: 3
Year: 1984
Sq. Ft.: 2504

Price: $750,000

 

Listing Agent:
Carole Madrid

Mountain retreat on cul-de-sac surrounded by forest service and creek.  Home is set back from street and driveway is south facing and has a turn-around.  Super neighborhood -4 bedrooms/3 bathrooms, beamed ceilings and remodeled kitchen w/french doors to sunny deck overlooking woods.  Master on main level.  Family room and bedrooms on lower level.  New roof in 2008.  Lovely Home!

 

180 Lake View Ave.

Bed: 4
Bath: 3.5
Year: 1979
Sq. Ft.: 3149

Price: $2,200,000

 

Listing Agent:
Pat Evans  

HUGE, Stunning Lake View with one level living! Privacy galore-other views are the forest, mountains, ski runs & landscaped yard! This is what buyers look for! Entry, Garage, Living rm, Dining, Kitchen, Master Suite, guest bath & deck all on main level! Floor to ceiling wall of windows in living rm w/rock FP. Granite kitchen counters & island. Guest bedrooms/office & Family rm w/FP on lower level, all w/Lake Views. 2 baths, laundry rm & several storage areas on this level too. Air cond. Must see!

 

207 Nadine

Bed: 4
Bath: 3.5
Year: 1979
Sq. Ft.: 2550

Price: $674,000

 

Listing Agent:
Peg Augustus

Beautiful garden greets you as you enter this lovely home on a quiet cul-de-sac just minutes from hiking trails. Kitchen features granite counters, gas cook-top, stone tile flr & breakfast room. Wood floors extend into the living room with vaulted ceilings & fireplace w/access to side deck. Separate dining room & add'l loft. Master on entry level with living area. Backyard has spacious stone patio & garden. Best buy under $700,000...don't miss it!

 

829 Carano Ct.

Bed: 3
Bath: 2
Year: 1965
Sq. Ft.: 1256

Price: $575,000

 

                                               Listing Agent:
Diane Brown 

Wonderful quiet neighborhood at low elevation and close to schools. This Lot has a 3/2 AS IS, Where Is, How Is, home located on a half acre lot. This could be the opportunity you have been waiting for to own a piece of Incline Village in a desirable neighborhood and build a new home.  An As Built Survey is awaiting you and your architects designs. TRPA total allowable coverage is 6,611'.  

 

203 Robin

Bed: 3
Bath: 3
Year: 1995
Sq. Ft.: 1866

Price: $549,000

 

                                               Listing Agent:
Chris & Patti Plastiras

Wonderful low elevation Townhome!  No HOA dues!  Open kitchen dining and living area.   Master bedroom on main living level with walk-in closet, large bathroom, double sinks, separate shower and jacuzzi tub. Original owner, property shows perfect!  Large 2 car garage.  Entry level has second master bedroom with private bath, walk-in closet and kitchenette/wet bar.  New Trex deck,  roof a few years old and fenced back and side yards.      

 

123 Juanita Dr.

Bed: 3
Bath: 2
Year: 1971
Sq. Ft.: 1253

Price: $439,000

 

Listing Agent:
Peg Augustus

Ideal location just 1/2 block from the lake.  Easy walk to center of town and Hyatt.  This sunny end unit has a great location in the complex close to the pool. The living room has vaulted ceilings, skylight and wood-burning fireplace.  The master is conveniently located on the first floor with the living room and there are just a few steps at the outside entry. Upgraded with gas furnace and dual-pane windows. Living room/dining room furniture included. 

 

391 Willow Ct.

Bed: 2
Bath: 2
Year: 1978
Sq. Ft.: 1544

Price: $305,000

 

                                               Listing Agent:
Jamie & Kristi

Nicely maintained end unit with updated appliances, a fenced yard and two master suites.  Surprisingly private once inside with open space views from the back deck.  Short sale terms apply

 

To access all the Incline Village and Lakeshore Realty listings please click here. You can also contact us by email or call us at 775-831-7000. If you are in Incline Village, please visit us at 954 Lakeshore Blvd. Incline Village, NV 89451.

North Lake Tahoe August 2014 Real Estate Sales Comparison

by Lakeshore Realty
  • North Lake Tahoe August 2014 Real Estate Sales Comparison

The charts bellow reflect Incline Village real estate sales for the month of August in the past 5 years. These reports we're created individually for Residential Home sales and Condominium Sales.

  • Residential Home Sales Report


Click here for larger image

- Please note that the report above was created using data extracted from the MLXChange System and reflects Residential Home sales.

  • Condominium Sales Report

Click here for larger image

- Please note that the report above was created using data extracted from the MLXChange System and reflects Condominium sales.

To access all the Incline Village and Lakeshore Realty listings please click here. You can also contact us by email or call us at 775-831-7000. If you are in Incline Village, please visit us at 954 Lakeshore Blvd. Incline Village, NV 89451.

August 2014 Incline Village Real Estate Office Rankings

by Lakeshore Realty

Lakeshore Realty is still the leader in Real Estate sales in the Incline Village and Crystal Bay real estate market. So far this year our office was involved in the sale of 106 properties around the North Shore of Lake Tahoe. Looking forward, our office is dedicated to ensure that all our clients real estate needs are fulfilled.

What you need to apply for a mortgage

by Lakeshore Realty

What you need to apply for a mortgage

By Dan Rafter of HSH.com

When it comes time to apply for a mortgage in 2014, you might be surprised at how much documentation you'll need.

J.D. Crowe, president of Southeast Mortgage in Lawrenceville, Ga., says most of the documentation should be familiar to you if you have applied for a mortgage loan in the last five years. If you're new to the mortgage market this year, he says, this is all new.

The new qualified-mortgage rules that took effect on Jan. 10 make this paperwork even more important. To meet the rules, lenders will be even more diligent in collecting the paperwork that proves that you can afford your monthly mortgage payments. David Reiss, professor of law at Brooklyn Law School in Brooklyn, N.Y., says that while the documentation requirements under the rules might come as a shock to those who haven't applied for a mortgage since 2008, they are common-sense requirements, for the most part.

"These are really common-sense rules," Reiss says. "The new rules say that mortgage lenders are no longer allowed to throw out the common-sense standards of lending money during boom times, when they might be tempted to overlook long-term financial goals for quick profits. If the rules help that happen, they'll be a good thing."

Here are the documents you'll need to supply today to satisfy mortgage lenders.

 

Full tax returns from the past two years

You'll have to provide all the pages from both sets of returns. Jordy Castillo, national sales director at GFI Mortgage Bankers in New York City, says that your lender requires two years of returns to verify that your household income was consistent. Lenders get nervous when your household income fluctuates by too much from year to year.

You can request a copy of your past returns by filling out Form 4506, "Request for Copy or Transcript of Tax Form," from the IRS.

Two most recent pay stubs from your employer

Make sure these are current, or your lender won't accept them. Your lender wants to approve you based on your current salary. If you haven't saved your pay stubs on your own, request them from your company's human-resources department.

Financial statements from the past two months

You can request these statements from your bank or print them yourself if you have access to online banking. Some lenders might also request copies of all your retirement accounts, investment accounts or both. The thinking is that you can access these funds in a financial emergency -- even if doing so generates a penalty -- if you need extra money to repay your mortgage loan, Castillo says.

Photo ID

Everyone whose name will be on the loan needs to provide a photo ID.

Signed sale contract

You will only have to provide this when you finally make an accepted offer on a residence, not if you're applying for a preapproval.

Proof of homeowners insurance

Lenders won't give you a mortgage loan if you don't first take out an insurance policy on your new home.

Written verification of your position and salary

Make sure this is dated and written on company letterhead. Your lender might also call your employer during the underwriting process to verify that you haven't lost your job since the time you applied for your mortgage, Castillo says.

Canceled rent or utility checks

Lenders might request canceled rent or utility checks from first-time buyers to prove you have a history of on-time payments, according to the Consumer Financial Protection Bureau.

Gift letters

If someone is giving you a financial contribution to help cover closing costs or a down payment, you'll need to provide a "gift letter" from the donor stating the amount, that the funds were a gift and do not need to be paid back.

1099 forms

If you are self-employed you will have to provide copies of your 1099 forms to your lender. These forms show how much money you were paid as an independent contractor from various clients during a year.

These forms, combined with your past two years of tax returns, will help prove that your self-employed income is steady. Customers who pay you $600 or more in a given year are required to send you a 1099 form.

Price Reduction: 405 Tracy Court

by Lakeshore Realty

One of our listings at Lakeshore Realty had a major price drop:

405 Tracy Court

“Clear Water Lodge”​

 
By far one of Tahoe’s most beautiful and exclusive great room floor plans! After crossing the distinctive waterfall entry, the lodge foyer says “You Have Arrived” as you step down hand-carved railing staircases to massive glass walls of windows on the main level.​ Hardwood floors throughout with flag stone in the entry, mud room and in the 150 Sq. Ft. wine room.  Spacious kitchen fit for a gourmet and gorgeous lake views from the adjacent dining room.  Large entertaining deck wraps around the entire living space, with access to the expansive lawns and hot tub.​

 

Bed: 5
Bath: 5 Full & 2 1/2
Sq. Ft.: 6,330
Remodeled: 2008

VirtualTour

OLD PRICE: 3,895,000

NEW PRICE: 3,495,000

 

To access all the Incline Village and Lakeshore Realty listings please click here. You can also contact us by email or call us at 775-831-7000 begin_of_the_skype_highlighting 775-831-7000 FREE end_of_the_skype_highlighting. If you are in Incline Village, please visit us at 954 Lakeshore Blvd. Incline Village, NV 89451.

From Quaint Cottage to Luxury Lake House: 3 Upgrade Ideas for Your Home

by Lakeshore Realty

Whether you’re headed to the lake for relaxation or recreation, where you lay your head at night is the place you call home. So why not make it more than just livable? Convenience and atmosphere are both major considerations, but beyond the indoor amenities lie multiple outdoor opportunities. It doesn’t matter if it’s a weekend getaway or year-round living location, use these tips to upgrade your lake house inside and out.

 

Wow Them With Windows

A small detail that can make a huge difference—wide open windows at a lake house are a must. If possible, knock out any walls that obstruct your lakeside views. Replace lake-facing doors with sprawling sliding glass or french doors, and use your decor to mesh the indoor and outdoor spaces. In addition to a few large windows, consider installing awning and hopper windows throughout the major sitting rooms. Great for adding natural light to small spaces, awning windows can offer great ventilation without letting in debris or any other unwanted elements. Plus, nothing beats the view of the water—no matter if you’re in the kitchen preparing a midday snack or in the living room after a long day on the lake, so give yourself plenty of outside-peeking options.

Do-It-Yourself Deck

If sunbathing is more your style, lounging on the deck with a drink in your hand may fit the bill. Especially great for homes that are close to but aren’t quite on the water, a deck can offer stunning views, more square footage and if they’re tall enough, added privacy. To get started, contact South Tahoe’s city planning, land use and zoning department to review any requirements or to obtain a permit. Once you get the go-ahead, evaluate what you’re working with. If you’re resurfacing or adding on to a current deck, consider renting a scissor lift and doing most of the work yourself. If you’re starting from scratch, determine if you’re up for the challenge. According to This Old House general contractor Tom Silva, a 10x16-foot pressure-treated deck will take 4-6 days to complete and could cost between $800-$1000. On the DIY home improvement site, he put the project’s difficulty rating at moderate to hard.

Clever Cookery

Everyone likes to enjoy the spring and summer months with barbecues, picnics and romantic sunset dinners. Create your very own culinary escape in your backyard with an outdoor kitchen. If you already have a deck or patio, or plan to build one, a kitchen addition can give your backyard that pop of flair that it needs.

Begin with your appliances and grilling station. Consider a gas grill equipped with a rotisserie rack and warming drawers. For the ultimate in outdoor entertaining, pair your gas grill with a high-powered charcoal grill, smoker and stainless-steel accessories including a refrigerator and sink. For the pizza lovers out there, consider a wood burning oven. Decorate your kitchen area with furnishings that compliment the natural area as well as your home style. For modern homes, consider sleek industrial looking furniture. Traditional homes can incorporate luxurious additions like Tuscan style dining tables, chairs, granite countertops and accessories. Suited for large scale entertaining, or intimate gatherings over a bottle of wine, the addition of an outdoor kitchen can provide entertainment throughout the spring and summer seasons. 

July 2014 Incline Village Real Estate Office Rankings

by Lakeshore Realty

Lakeshore Realty is still the leader in Real Estate sales in the Incline Village and Crystal Bay real estate market. So far this year our office was involved in the sale of 84 properties around the North Shore of Lake Tahoe. Looking forward, our office is dedicated to ensure that all our clients real estate needs are fulfilled.

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