Our Blog: Central Maryland Real Estate News, Tips & Local Insights

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There is hope! Reconsider your options. Have you heard the phrase "Don't put all your eggs in one basket"? So, the financial advisors who make their income by having you invest in their firm will surely explain that is the perfect reason to invest in mutual funds. Although that might be sound logic, it's by no means the entire picture. You might want to seriously consider investing in Real Estate. Real Estate when purchased correctly, remember the phrase "Location, Location, Location", can be a vital tool for any retirement vessel. Did you know that many mortgages on properties in most Maryland counties are currently lower than their corresponding rents? Do you realize that the tenant pays your mortgage while putting extra money in your pocket. That is the passive income that everyone is looking to achieve or required for retirement. As your tenant pays down your mortgage, the rents continue to rise. By the time you own the house outright, you have a significant amount income per month with only one rental. While there are tax implications, so you should also consult your accountant, the investment could be an attractive alternative. Let's look at the figures.
In a hypothetical case, but one that I could duplicate today, an investor can purchase a townhouse in a neighborhood with no HOA. Let's say you purchase it for $300,000. Most lenders will require a 25% down payment (there are other options to this) So, your down payment would be $75,000. Let's say including closing costs, your total investment is $87,000. At the same time, a 30-year mortgage on this property including taxes would be about $1600.00/mo. A townhouse that fits this scenario would probably rent for $2100.00/mo or $500.00 extra in your pocket a month, $6000.00/yr. That is roughly 7% per year. As rents increase, that number will grow. Once your mortgage is paid off, not only would you have $2100/mo to spend as you wish, you will also have an investment property that with moderate appreciation would be worth approximately $600,000! The return on your initial investment is phenomenal. Don't have that much to invest? That is okay too. Let's have a conversation. There might be other ways to make it work for you. Real Estate could be a gold mine, hop on board, we will show you how to 'dig in'! Call us today! 443.386.1306

May the luck of the Irish be with you today! We are bracing for a busy spring market, low rates, high employment, low inventory. It is time for you to get in the market now! Call us to get started!

With all the talk about the Coronavirus Pandemic, I have some concerns. Information currently being disseminated from the federal government seems to be telling us that the majority of Americans affected will recover without any adverse effects. Things will be similar to typical seasonal illnesses. Also, our children do not seem to be affected. According to the experts, the highest risks posed by Covid 19 are among the elderly in our population as well as those with other underlying health issues. So, if there is a very high chance we will survive even if we get infected and understanding the proverbial "an ounce of prevention is with a pound of cure", why the necessity of government to shut down schools, cancelling sports, concerts, all types of events, even travel out of your own state for some people? Make no mistake I also understand the absolute need to slow the spread down and realize that it is a balancing act to achieve that desired result. Is it plausible or even very likely that the government knows something which they don't want to share with the public. The general public is already in a panic about this and by giving the "real dope" on the situation, could really end in mass hysteria. If what they are telling us is true, how about other potential endeavors like closing all Senior Citizen centers, prohibiting all visits for 2 weeks? How about they close the doors of all the old age homes to keep everyone safe? I would be happy to not visit my elderly parent in a nursing home if that meant life or death to them, wouldn't you? So why are they doing what they are doing? I would really like to know that answer, but that may never be acceptably explained. So stay safe everyone!
They tell you to wash your hands and wash your hands while singing "Happy Birthday", in addition to that, make sure you cup your hands as you are washing so that you are cleaning underneath your fingernails, make sure you rub in between your fingers to clean those areas. Just rubbing the outside of your hands for 30 minutes will not clean as well as 20 seconds of correct cleaning. With the hand sanitizer seemingly sprouting wings and flying off the shelf, know that it is easy to make a satisfactory sanitizer yourself. All you need is 2/3 cups of Rubbing Alcohol (91% or higher) and 1/3 cup of Aloe Vera gel. Remember to do the elbow bump and keep you distance as best you can. Also, drink as much as you can and keep hydrated as one of your first defenses are the moist folicles in your nose. Keep yourself, clean and healthy and we will have a happy Coronavirus-free Summer!
- As for me, I will just stay hydrated with lots of Corona!

Watch this video, did you see it?

Oh, yeah, you can turn us right side up please!
Don't forget to turn your clocks ahead night!
Spring Forward to Your New Home with Us!

So, I receive so many inquiries from old and new clients looking to purchase a foreclosure because they want a good deal and they feel with all the foreclosures right now available, that is the best possible deal to be had. Well, I am here to tell you that while that aspect is one part of the market, it is not the whole marketplace. Let me take a moment of your time to speak about these things generically.

Take this example from a logical perspective, you are living in a house that for one reason or another you can no longer afford. Maybe you have tried to work with your bank to keep your house and make partial payments or modified lowered payments, and the bank isn't willing to work with you, the homeowner. These people are not happy campers! What does that mean? Well, I have seen the entire spectrum. They pack up and move out and leave the house in good shape. If that is the case, the bank, like every other seller, will still want market value for the house, so the buyer will still find it difficult to get "that great deal". If the owner goes the opposite direction, performing/allowing damages to the house such as: they can cut out the plumbing, pull out the electric wires, spray paint walls, rip out the HVAC, or simply just turn on the water, let it run and walk out the door, yeah, it is possible you can get a good deal on those types of houses. It certainly entails lots of planning (which I am well capable of consulting with you) however, that planning could include the following: lots of mold work, lots of plumbing, electric, and of course cosmetic work. You might get lucky to find that "diamond in the rough".

However, now think outside the box. You can get a great deal on houses that are distressed or owned by people that don't want to own them. Let's review some options:

1. Short Sales: This is when you have an owner who cannot afford to pay their mortgage, but doesn't want to ruin their credit. They will chose a short sale option. It might take a little longer for you to physically own the property, but can certainly be worth the wait. You might still have some work to do to the house, but it usually is only cosmetic and minor repairs due to the fact that it is typical that the owners are still living in the property.

2. Estate Sales: The personal representative working to sell a house belonging to a deceased relative usually wants to get it done quickly. They usually don't want to try to fix up the house or get top dollar. Most of the time, this is dumped on a lap of someone with an already busy schedule and this becomes more of a hassle. These homes usually need updates, but again, you usually will be dealing with a home with heat and plumbing and mold-free. Older individuals usually take care of the important and expensive items of a house, so usually the roof will be in good condition, maybe newer windows or furnace.

3. Relocation Homes: Most people are not aware of these homes, have no idea what they are and therefore sometimes steer clear due to ignorance. I think these can be the absolute best way to purchase a home for less than market value. These homes are probably a little higher in the price range, so may not work for the first time buyer, but can be phenomenal immediate equity in your pocket. Let me explain. A seller gets offered a promotion but has to move to another state. To entice the seller further, their company hires a relocation company which agrees to purchase the seller's house and pay for the move. The relo company will do at least two appraisals before hand to establish value and the price they would be willing to pay. The seller then tries to sell his house before selling to relo, because the relo company will pay a bonus to the seller for selling it themselves. If the seller doesn't find a buyer and sells to the relocation company, then the relo company has inventory they really don't want. In those cases, you can typically get a really good deal on the home. Usually these homes will need little to no work, just instant equity.

There are many different ways to get a good deal in real estate. Experience matters so consult with a Realtor which has experience and don't fall into traps or Money Pits!

How much money will go into your pocket after your home is sold?
by Debbi Rivero

It’s not what you make, it’s what you keep that matters. This holds especially true when it comes to the sale of your home.

The sales price you see at the top of the closing paperwork is rarely, if ever, the amount of money that ends up in your pocket as the seller.

There are often a variety of costs and fees associated with getting a home sold, so it’s important that you understand exactly what you’re going to walk away with before you put a sign in your front lawn to let the world know it’s for sale.

The smart thing to do is to consult with a great local agent and have them go over what industry experts call a net sheet.

A net sheet is a financial worksheet that takes the sales price of a listing and then subtracts what the costs and fees are to get a home sold, giving you the net proceeds from the sale of the home.

The math is simple and when done correctly, it will give you an extremely clear picture of what you’ll walk away with when you sell your home.

Here’s a sample net sheet that a real estate agent would use with you prior to listing your home to make sure you knew what selling your home meant to you financially.

Let’s take closer look at how much money will go into your pocket after your home is sold.

House price: This one speaks for itself. It’s not the price a which your home is first listed, it’s the price at which the home actually sells when all is said and done.

First loan balance: This amount usually represents the original mortgage you took out on your home when you first bought your house. Ideally, it’s the main lien holder on your house.
Second loan balance: If you took out a second mortgage or home equity loan, this would qualify as a second loan balance.

Other loans: If you took out a third loan on your home or pledged it as collateral, it would show up here. Or, if there’s another loan you’d like to pay off with the mortgage, you would list it here.

Property taxes yearly paid/Annual property taxes: This one is a bit misleading. The reason is that your property tax allocation is going to be prorated based upon when you actually close your home. You’ll get credit for whatever you already paid or charged for the time you’ve lived in the home that you haven’t paid for yet. The company that closes the loan will do the research and reflect whatever the amount is that needs to go here.

Estimated closing month: You put that month here because you want to determine how prorations for taxes, insurance and utilities would look based upon the month in which you would close on the sale of your home.

Mortgage prepayment penalty: If you got a loan that required you to stay in your home for a period of time before you sold it and subsequently charges a payment if you do, then you would enter that penalty amount here.

Sales commission: This is the line where you would enter the commission that your agent would earn from helping you sell your home.

Other: In this category, you would put any repairs you needed to make to get the home sold, any points you’re paying for the buyer or any closing costs you’re covering for the buyer at closing.

Now, let’s put this into some real numbers for you:

House Price: $250,000

First Loan Balance: $125,000

Second Loan Balance: $18,000

Other Loans: $3,000

Annual Property Taxes: $2,500

Estimated Closing Month September

Mortgage Prepayment Penalty: $0

Sales Commission: $15,000

Other: $0____________

Net Proceeds: $86,500

In this instance, the seller would walk away with roughly $86,500. Again, prorations for taxes, insurance, utilities, etc. will alter that amount. The good news is that the seller would find out exactly what these numbers look like before they sign on the dotted line to transfer the home.

If you’re looking to sell, be sure you consult with a good real estate agent who can first price your home properly and second, identify all the fees and costs associated with getting your home sold so you’ll know what you’ll walk away with at closing.

Click here if you’d like to get the value for what your home will sell in today’s market and then a net proceeds calculation of the amount of money you’ll pocket after your home is sold.

This is my forecast for the year 2020 - Watch it Grow!

As I gaze into my crystal ball, I see a great year for Real Estate!  Interest rates are still at an all-time low and it is anticipated that it will remain that way throughout 2020.  I do not see the interest rates climbing higher than 4.5%  That being said, I also believe that we may even get to 3.0% or even dip into the 2% range!  Currently, the inventory is low and has been decreasing over the last few months.  That is certainly typical this time of year.  The job market is very strong, and people are feeling good about the economy of the nation.  All these factors will come together similar to what happened in 2002.  I don't believe that we will experience the same super increase in prices for the next 5 years or so, but I do predict that the sales price might grow as much as 10% this year.  So, what does that mean to you?  If you are looking to purchase a first home or you are looking to move-up to a larger home, you really should consider doing that right now.  Spring will be a seller's market, and buyers will be paying more than list price and fighting to get their dream homes.  If you are retiring or downsizing, I would suggest you wait til late spring or as late as early fall, I believe the market will still be strong at the prices will be maxing at that time.  Time the market correctly!  Hire me to give you the advise to make the most of your investment.