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Beat the Summer Rush to Reap Huge Savings



Should I sell now or later?
Today I have a special guest with me. His name is David Lawver from Kal Financial and he is nationally recognized as a top-producing mortgage originator, and he has been in this business for 10 years. In addition to this, he's the host of Silicon Valley radio hour, which focuses on finances, real estate and other issues. This program airs on KLIV on Saturdays at 9:00 a.m.

Now, what we're going to focus on today is whether or not you should sell now or wait to list your property in the summer. David gets this question a lot as a mortgage professional, and he has put together some charts to show you where interest rates are headed and how this will affect you if you're thinking about selling your home in the near future.

What will it cost you to wait to sell in the summer?

This analysis covers a person selling & buying a home today, versus a person selling & buying a home in the summer. Home prices often rise 5-10% during the summer, so keep that in mind for now. This is taking a $750,000 starter home with a loan balance of $400,000 and selling it today. That money is then being parlayed into a $1.2 million dollar purchase price, leaving an $850,000 loan from the proceeds of this sale. In the summer scenario we're assuming the previous house of $750K rose in value to $825K, but that also the new purchase price rose proportionally in value to $1.31 million. This leaves a loan amount of $885K with the higher down payment.

After running the numbers, the monthly payment savings from buying today versus waiting until summer is $695 per month. When you buy today, the total interest over the lifetime of the loan is $700,455, and in the summer this amount would jump to $874,000. In total, your savings for purchasing a home today rather than in the summer would be just under $175,000.

Further, if that savings of $695 per month is reinvested at 5%, the person who buys today versus in the summer will have a bank account with $578,000 in it. This is on top of the $175,000 in interest savings.
What we can deduce from this is that if you buy today, you can save hundreds of thousands of dollars. However, if you can invest your savings you can actually gain on this transaction. Buying now can make a huge difference for the average buyer. The first few times that David ran this exercise he found it hard to believe how much you could save just by buying earlier rather than later. These numbers don't lie, though.

What you need to realize is that buying before the summer rush is a key long-term financial strategy. If you're thinking of buying or refinancing, be sure to contact David. He can be reached at (408) 834 4571 or email him at david@kalfinancial.com.

How to find a home when there's nothing on the market



How to Purchase When Inventory is Low

Today I'm going to to speak about a problem that a lot of buyers in Silicon Valley have been asking me about lately. Inventory is currently very low in this area, and clients have been asking me how to buy a home with so few properties available. I have three simple things you can do to increase your chances of finding a great home for yourself.
  1. Get Gateway Access to the MLS: A lot of people only look for homes on websites like Trulia or Zillow, and while these are good resources, they do not provide direct access to the MLS. For a property to show up on Trulia or Zillow, it can take anywhere from 24-72 hours to be uploaded, and in a fast-paced market such as the one here in Silicon Valley, it's just not fast enough. The MLS will give you the best chance to find up-to-date properties with accurate information on them.
  2. Get Access to Off-Market Properties: What I mean by this is that you should be looking at private sellers, builders, developers, or perhaps people that are flipping properties. Here at Bret Jennings Real Estate Experts, we've been cultivating a list of more than 100 properties that are not on the MLS. With only 750 properties available on the MLS, our list represents almost 15% of all available inventory in Silicon Valley. Feel free to click the link below to request a copy of our Off-Market List.
  3. Be Proactive in Your Search: Whoever you're working with in your search for real estate, whether it's yourself or another agent, you need to be proactive in your search. What I mean by this is that your realtor should be engaging in a telemarketing campaign, a direct mail campaign, or even a door knocking campaign. You want to contact any and all potential sellers in your neighborhood so that you can put an offer on a property before it hits the MLS. This way you can make an offer on their home and avoid a bidding war before it goes on the open market. Turn over every stone that you possibly can.
These are three great strategies for finding homes when inventory is low. Also, by finding properties not listed on the MLS you have a better chance of finding a good deal with less competition.

Of course, the best thing that you can do to find yourself a great home is to contact your real estate agent. If you need assistance finding real estate in Silicon Valley, allow me to be your resource. I can be reached at (408) 807-4541 or visit www.TheBrettJenningsTeam.com

Should I Sell Now...or in the Summer?


Should I Sell Now...or in the Summer?

This is probably a question that has been nagging at a lot of people's minds recently. There are three key considerations you should think about in making this decision.

  1. Inventory is at an all-time low right now: Real estate prices are driven by supply and demand, and supply is extremely, extremely low right now. Currently, there are less than 1,000 homes and condos available in Silicon Valley. I expect inventory to double once we approach June, so now is a great time to get your home listed and marketed if you want to avoid extra competition.
  2. Interest Rates Will Rise: What this means for you is that waiting will cost you money. The National Mortgage Bankers Association expects rates to rise from 4.5% to 5.4% or 5.3%. This increase could cost you if you wait to buy. For example, on a $700,000 loan, this 1% increase will cost you an extra $420 per month, or an extra $180,000 over the life of the loan! There is no reason not to take advantage of these low interest rates.
  3. Time Your Listing Well: What I mean by this is that you must put your home on the market when buyer activity is peaking. If you take a look at this map from Trulia, search activity for homes peaks in California during March and April, not during the summer as most people would believe. Missing this peak could prevent you from getting the best price on your property.
These three trends are all indicating that you should sell your home as soon as possible to get the best possible price for it. If you need any help in this process feel free to reach out to us and we will give you a complimentary Smart Home-Selling Strategy which includes a free home evaluation as well as tips & advice to increase your home's value before you put it on the market.

Feel free to contact me at (408) 807-4541 or visit www.TheBrettJenningsTeam.com

2014 Silicon Valley Real Estate Market Forecast




To know where the market is headed we first have to look at where we’ve been.  In the past two years we have seen a rise of more than 15% per year in home prices. Although this may seem like good news for homeowners, too much of a good thing can easily turn into a bad thing.

So when the Federal Government saw the real estate market getting red hot in the summer of 2013, they simply ANNOUNCED that they would soon scale back on buying mortgage bonds, and that sent mortgage rates shooting up from 3.5% to 4.5% . This put a lid on the rise in home prices and prices stabilized in Q4 2013.

What I expect in 2014: Inventory will be at historic lows. With only 25% of the supply we need to satisfy current buyer demand, there will be upward pressure on prices. I do expect inventory to rise as we reach the summer, but even so, this will only be half the inventory needed to match the demand. Mortgage rates will likely rise from our current 4.5% to 5.3% or 5.5% so the longer you wait to buy, the higher your monthly mortgage payment will be. The sooner you buy, the better.

As for the Silicon Valley economy, 2014 should provide good job growth and also increase demand for housing.

Low Supply + High Demand + Slight Rise in Rates = Steady appreciation of 3-6% in 2014


•    These conditions will create opportunities for both buyers and sellers in Silicon Valley but if you are considering buying, buying sooner will save you money.

Thanks again for reading, and I'll see you soon for another Silicon Valley Market Minute.

And of course, if you have any questions, call us at (408) 807-4541 or email brett@bjrex.com.