Kendra Ruminer's Two Cents of Real Estate

Take A Peek At Los Alamos, New Mexico

Month: July 2020

Interest Rates & Buying Power

July 29, 2020 /

We all hear the talk. It’s impossible to miss. It might only be a snippet of conversation between some financial analyst and an economist discussing strategies employed by the feds to help boost the economy. But we hear an awful lot about interest rates. What do low interest rates really mean for home buyers and sellers? Let’s take a look.

Now. I’m not going to take you through all of the pieces of the financial puzzle that actually affect mortgage rates. Let’s keep it simple by saying that both banks and the federal government have an interest in how many people are purchasing a home. The bottom line is that in the beginning of 2020, we have seen record lows for interest rates on home mortgages. Yes. Coronavirus has had a negative impact on the economy, but even though interest rates have come up just a bit since the spring, they are STILL lower than they ever have been before.

What does this mean? It means your hard earned dollar can now get you a LOT more house for the money. And here in Los Alamos, this is great news! The basic laws of supply and demand mean our home prices tend to carry a higher than average median value than other areas of New Mexico. But when you have the increased buying power of a record low interest rate, this can go a long way toward bridging the gap.

If you were ever considering the purchase of a home, now is the time!

Remember that your actual mortgage payment includes more than one line item. You are likely paying $ toward your principal balance and another sum for taxes and insurance to an escrow account. You might pay mortgage insurance, and of course, you pay interest. By far the largest piece of your monthly payment is very likely the interest payment. That means, if you’ve set your heart on a house just above your initial budget, you might actually find that your budget is bigger than you thought because a very low interest rate will mean that interest portion each month is much less!

When we talk about interest rates for big ticket items like homes, a single percentage point can make a huge difference to your monthly payment. This is why pre-qualifying and getting a pre-approval from a reputable lender for your new home purchase is such a vital part of the process. Once you have started working with a lender, you will have a better picture of just how much buying power you have. Once you have this information in hand, it’s time to go shopping for that fantastic new home.

Nope. It’s almost never too late to take advantage of record low interest rates!

Don’t worry. If you bought a house in the last ten years or even the last five. Heck, even if you purchased one only a few years back, there are ways that you might be able to benefit from the current low interest rates.

“I love my house! But my interest rate wasn’t nearly as good as I could get now!”

If this is you, then maybe it’s time to refinance. There are several factors that should affect your decision to refinance, but if you love your home and plan to remain in it until you retire from the National Laboratory and head to Florida (or wherever you prefer) it might benefit you to refinance.

Remember that your home has likely appreciated this last year. Homeowners in Los Alamos County are enjoying more equity than ever. And while banks aren’t too keen to do cash out refinancing like they did a decade ago, you might still qualify for a better interest rate. You’ve been a homeowner for awhile now, right? That likely means your credit score has been improving. And now your initial down payment has been supplemented by the market value increase of your home! Equity means a bank might look even more favorably on a loan for your home. Imagine that! More buying power while buying something you already own. You might even look into a fifteen year mortgage and discover a way to pay off your big ticket investment even sooner than anticipated!

“We’ve only been in our house for a short while, but we need something else!”

Low interest rates are great news for you if you fall into this category. And don’t worry. That’s why so many homes fall into what real estate professionals sometimes call “starter homes”. They’re meant to be a start. A place to get your feet wet as a homeowner. Maybe that two bedroom quad was a snug hideaway for you and your spouse a few years ago. But now you have a toddler and another baby on the way and you’re busting at the seams.

Well, this is the perfect time to sell and move into something bigger. Remember, low interest rates mean other people looking for “starter homes” will have the buying power to do just that. Buy your home! Then you’ll be able to turn around and use your equity and that lower interest rate mortgage to purchase a home that better fits your changing needs.

So, don’t wait another minute if you’ve been thinking you can’t possibly afford the home you want. You will never know until you try. Give me a call today and let’s chat about ways to exercise YOUR buying power!

Surprise! You Bought A Home.

July 22, 2020 /

You’ve just purchased the home of your dreams in Los Alamos County. You’ve never been so excited about the prospect of moving. Break out the champagne and celebrate, right?

Welcome Home To Your New Space!

Now. Let me be the first to congratulate you. You’re absolutely right. Finding a home to purchase in our community is a whirlwind ride all on its own and that doesn’t begin to cover the step by step process of actually purchasing this new living space. So, yes. CONGRATULATIONS! But while we enjoy that champagne, let’s talk details shall we?

Let me be frank. There are a few hidden costs associated with purchasing a home. I know. I can hear you right now. “Kendra,” you say. “Believe me! I’ve already gone through multiple inspections. I’ve paid insurance premiums and set up an escrow account with my lender. I have this in the bag!”

Right. The details about closing costs were probably a surprise if you’re a first time homebuyer. I always try to walk my buyers through the entire process and keep them aware that these things are coming. But there are just a few more things to talk about. And honestly, they CAN be pretty fun. After all, who doesn’t like the part where you move in and make this new house your home?

Remember That First Walkthrough?

No. Not the walk through that happens just before closing. Although, if your new home was professionally staged when you first decided to purchase it, that last walkthrough might have been a bit of an eye opener if the place was bare boards and stark walls. That was the moment you got to actually picture your things inside the house. How did it look? Don’t worry. There are plenty of ways to make this new space feel like your home.

Now, go back to the very FIRST time you saw this home. For those of you who have already purchased or those considering selling and moving into another home, keep in mind that in this Covid-19 market, many of these walkthroughs are taking place virtually. There are so many home buyers who have NEVER physically been inside the new home they’re purchasing before they’ve got the keys in their hand and the mortgage payment coupon in their mailbox.

Stop for just a moment. The Los Alamos market is unlike anywhere else. The good news is that you’ve got your house! Love that! Give yourself permission to be thrilled with that! And remember that the rest is just cosmetic. Even if its quite possible that your new house hasn’t been updated since the seventies, who cares? This is your chance to make this house YOURS. Keep in mind that in other cities you might be peeling off the nineties, the eighties, and the seventies before putting your stamp on it. A few less layers can be a good thing!

Remember all of those improvements you knew needed to be made on this home before you became convinced that this was the ONE? There’s nothing wrong with some can do DIY attitude. But now that you’ve come through the home buying process, I don’t want some of the basic foundation stones for actually LIVING in your home to get lost in the shuffle.

Start Small

Yes. Small. As in, blinds or shades, or some kind of window coverings. You need to be able to cover your windows for privacy and also, in a bigger way, to maximize heating and cooling. So many homes in our area are lacking in modern double paned windows. I can think of a few homes that are missing screens on the windows, much less blinds. And we’re talking trading pretty for functional right now. Start with examining all of the blinds or shades in your new home. Count them, measure them, and then start looking for good deals on decent window coverings. You’ll be surprised how quickly the cost grows. But, you’ll also be thankful you handled this small task when that brutal summer sun starts creeping into your home and sending the temperature toward the roof. Good blinds can save plenty of pennies in cooling costs. And those are the pennies you’ll use to improve your new home in other exciting ways!

It may take a while for your new house to look like a real homey haven.

Now, The Kitchen

No. Don’t look at the cabinets. That’s a project you’ll be tackling soon enough. What I would suggest instead, is to look at the appliances. Check them for functionality. Does the refrigerator actually keep things cold? Does it freeze your produce solid? Does the dishwasher clean the dishes, or does it recycle your food leavings before flinging them back onto the plates and glasses? Does that snazzy built in microwave work? How about the oven? Did the house come with a washer and dryer? Do they get the job done or are you looking for a clothesline to finish your dry cycle outdoors?

Appliances are a vital part of our lives. Modern families are hard to manage without these work reducing beauties. But, as with everything else in a home, there is a decision that has to be made here. Is now the time to replace them or not? Do not let the avocado green or brilliant red or goldenrod yellow color of these make your decision for you. If an ancient refrigerator does its job and does not require you to call a repairman every day, then bump it down the priority list. If you’re dreading the purchase of the new fridge with its $3300 price tag, don’t let that keep you from replacing an older model that is costing you an extra $100 or $200 per month in electric and repairs. Think energy efficient and prioritize your list of renovations. Then assess each appliance with the decisiveness of a general making strategic battle plans. And by the way, take your time and enjoy making this space all yours!

Plumbing

Next, let’s take a look at the bathrooms and every faucet in your new home. Are the toilets making weird noises? Do the faucets drip? Does the shower head hit everything BUT your hair? Replace or repair these little things. The cost of doing them all at once may take more of your budget than you’d like. But making sure that you’re not increasing your water bill or driving yourself insane every time you take a shower is a must. And speaking of shower, you might want to replace the shower curtains or doors depending on how that door track looks. And what about the toilet seat? A new seat can refresh the toilets in your home in ways you probably never imagined possible.

Make sure the bathrooms in your new home are liveable.

This community is unlike anywhere else. We love living here. We love the fact that our homes are unique and sometimes dated. Okay. Maybe we don’t LOVE the dated part. But you’re going to do something amazing with that space. I know you will. Until then, remember that its about functionality, energy efficiency, and not draining your bank account penny by penny each month. Making sure your home is your refuge even while you’re rehabbing your heart out to make it the haven of your dreams will make the DIY rehab project that much more fulfilling.

Ready to Make a Move? Call or Email Kendra Today!

Using Zillow Responsibly…

July 15, 2020 /

Is there anyone left on this planet who has NOT heard of Zillow? Okay. Maybe planet is a pushing it. Is there anyone in the United States who has not clicked their way around Zillow taking a peek at the housing market in their area? Whether you’re an enthusiastic Zillow user or not, let me give you three tips for using Zillow responsibly in the Los Alamos County real estate market.

Tip # 1 – Pre-Foreclosure Homes Are Not Actually For Sale

That’s something I get a lot of in the real estate business. Especially here in Los Alamos where homes come on and go off the market with a record low number of days on market. I get calls from excited clients who just saw something perfect pop up on Zillow as “pre-foreclosure”. They want to hop in their car and go look at this fantastic property. They’re ready to make an offer! This is the home of their dreams.

Except… Pre-foreclosure is just a term that comes from a homeowner getting slightly behind on their mortgage payments. When this happens, the lender has a legal obligation to file a public notice. It’s an attempt – an early attempt – to collect on a debt. There are a whole lot of steps between public notice and actual foreclosure. In the meantime, the house is NOT on the market. You CANNOT go and take a peek at it. It’s still someone else’s home. No wonder it’s perfect for your family, right?

Tip # 2 – Just Because Zillow Suggests a Home Value, Doesn’t Make It So

This goes back to tip number one. Zillow is a database that gets information from public records. Even on their website they tell you this. Hence the public notice that results in a pre-foreclosure listing on Zillow. But this is where home valuation gets really tricky. New Mexico is a non-disclosure state. That means our home values are not made public record. 

Not that this actually slows Zillow down. The database is filled with what they refer to as “zestimates”. Basically, Zillow has algorithms that come up with what a computer estimates to be the best possible guess for a home’s value. But that isn’t necessarily based on recent sales prices.  A homeowner can go in and input the value of their home, but that’s up to the homeowner. As a realtor I would never make that information public.

Tip # 3 – Don’t Believe Everything Zillow Has to Say About Mortgages

This is not to say that the mortgage calculator on Zillow is wrong. It’s not. It’s actually a very useful tool. Zillow has multiple tools to help you figure out what it might cost to own the home of your dreams. Insurance, HOA fees, mortgage, mortgage insurance, they’ve got a little line item for everything. What I ask people to keep in mind is that this is all perfect world thinking. And no. I don’t believe that the word “perfect” applies to anyone trying to scrounge up a down payment for the home of their dreams. But what this doesn’t take into account is the actual funding process for purchasing a home. This is a complex process that has a lot of variables Zillow can’t anticipate for you.

This is why you call a Real Estate Agent!

Please. Give me a call. If you’ve got questions about your current home’s value or are looking to sell and get something bigger or downsize to something smaller, talk to an actual human being who will walk you through the realities of this process. Sure. Zillow is useful. I would never say that it isn’t. But please use a common sense approach when surfing the Internet for the home of your dreams. It makes the transition from dream into reality a whole lot smoother!

Call or Email Kendra

Title Insurance 101

July 9, 2020 /

If you’ve ever purchased a home, you’ve heard of title insurance. You’ve probably paid for it. You’ve probably also grumbled a bit about the added cost. But this is only a one time fee. Usually LESS THAN 1% of the purchase price of your home. Of course, that can still feel like a ton of cash to lay out at closing when it’s easy to feel pinched about the cost of purchasing a home.

What is a title anyway? Why do I need someone to guarantee it? The house isn’t going anywhere, right?

Let’s start by talking about what title insurance actually is.

According to The Street, a popular financial blog, “more of a risk prevention than a risk assumption (the model for most insurance policies) form of insurance, title insurance covers the history of the policy-holder’s home, examines the history for any trouble spots that could damage the value of the home, and highlights those potential issues before the buyer purchases the home”.

So what does that really mean? It means that you’re paying a company to research the title of the home you’re purchasing just in case there is something wonky in the history of that property.

Let’s bring that back around to our community of Los Alamos. Think about how many homes were either built, brought here, or somehow fabricated back when the Atomic Energy Commission was still in charge. Think about the chain of owners and banks and lenders and foreclosures and lien releases and… (I really think you get the idea). There are other homes that were damaged and then reconstructed after the Cerro Grande fire.

Now think about the way a mortgage works. Even if a lender only owns a pile of ash, they still want a piece of that pile. And this is before taking into account the homes that pass from one party to the next via a will or some kind of inheritance situation.

  • A home’s title includes:
  • The property abstract (sometimes called a chain of title)
  • A description of any easements or rights of way. (or maybe a note about national forest access)
  • Liens against the property

The title is a public record held in a clerk’s office and is technically available to anyone who is interested. Considering what the title is and how many different things affect it, you might imagine why having a knowledgable and licensed title expert to review the title before you purchase a property is not only a requirement, but a really good idea.

“Okay, so can I just pay for a title INSPECTION?”

Nope, the insurance part comes in when or if you’ve owned your home for five years and some undisclosed heir shows up and claims you’re squatting on his inheritance. Or (a far more common occurrence) when the county does a tax audit and you discover there was an escrow account error ten years ago and the previous homeowner’s lender neglected to pay the property taxes. Yep. Guess who becomes responsible for those back taxes?

That’s right. The current homeowner.

So, next time you’re buying a new home or you’re speaking with someone who is and there is a discussion about closing costs and title companies, and title insurance, feel free to chime in with all you now know about why title insurance is important. After all, nobody wants to be left holding the bag when it comes to an unexpected financial lien against your home. Your home is supposed to be your safe space. Title insurance can make sure that it is fully YOURS.

Could You Quarantine In This Space?

July 1, 2020 /
The Coronavirus Has Changed What Buyers Are Looking For In a House

I think we’ve all come to the honest realization that the world we once lived in is gone. Things have changed. Everything has changed. The way that we hang out with our friends. The way that we hang out with our family… Wait. The way that we ONLY hang out with our family.

All of that togetherness is changing the way people live their lives and the things they value in a home. Let’s look at a few things that are becoming far more important to Average Joe Buyer.

Kitchens

So many times in the past, I’ve seen busy families who purchase homes because of their proximity to a school district or because the bedrooms are big or the garage and driveway has extra slots for the extra cars belonging to a family full of teenagers. Kitchens were useful because they contained conveniences like the toaster over, the microwave, and that mega juicer you just had to have but rarely use.

Now? The lack of restaurant options, especially in small communities like Los Alamos, means that homeowners are using their kitchens in ways they’ve not had to in ages. Even if you’re getting takeout and bringing it home, the kitchen is seeing far more traffic (or the dishwasher is!) than ever before. Suddenly, kitchens matter. Buyers want big eat in kitchens with tons of space, pantries that can handle kids who are no longer eating at school, and up to date appliances. The kitchen has suddenly become important to everyone and not just to a few home gourmets.

Home Office

Telecommuting is the new normal. No doubt about it. And considering the direction things are moving, there’s no doubt that this isn’t likely to change anytime soon. That means the home office has become the most important thing that anyone thinks about. The availability of any space that could be turned into a home office in a pinch has just become your home’s biggest selling point. Have an atrium or a little breakfast nook? Boom! Extra office. Have a spare bedroom? Boom! Instant school room. Yeah. Don’t forget those kiddos. Homes are now doing triple duty. Schoolroom. Workplace. And my personal favorite. Daycare.

Multiple Living Areas

All of a Sudden One Family Room Just Isn’t Enough!

In newer homes in places like Albuquerque, Rio Rancho, and Las Cruces, and even some of the newer housing developments here in Los Alamos County, a second living area or a bonus room is a given. Most of the homes in our community were built long before this was a popular concept. Not that there haven’t been tons of renovations or rehab projects with just that idea in mind, but all of a sudden buyers are VERY interested in homes that boast a second living area. After all, families that live and work together eventually need a break! What a great thing to have a basement or an upstairs loft where you can send the kids to enjoy their screen time while you binge watch Outlander and try to relax from your long day of pretending that you were super productive while working at home in a job that was never designed for a telecommute.

Outdoor Living Spaces

The backyard or side yard in some cases, has become a viable new place to hang out when all of the living space inside becomes either full of kids, or just boring. Patios and decks are suddenly far more attractive to potential buyers than ever before. Want to wow them when they come to view your house? Arrange your outdoor furniture to invite a buyer to imagine lounging after work with a book. Add a barbeque grill and I bet you’ll hook them in a second.

At the end of the day, our lives will never go back to the way that they were. And that means the real estate market – even the one in Los Alamos – is going to have to change too.

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