Karen's Real Estate Blog

Expert Housing Market Forecast For the 2nd Half of the Year


The housing market is at a turning point, and if you’re thinking of buying or selling a home, that may leave you wondering: is it still a good time to buy a home? Should I make a move this year? To help answer those questions, let’s turn to the experts for projections on what the second half of the year holds for residential real estate.

Where Mortgage Rates Will Go Depends on Inflation

While one of the big questions on all buyers’ minds is where will mortgage rates go in the months ahead, no one has a crystal ball to know exactly what’ll happen in the future. What housing market experts know for sure is that the record-low mortgage rates during the pandemic were an outlier, not the norm.

This year, rates have climbed over 2% due to the Federal Reserve’s response to rising inflation. If inflation continues to rise, it’s likely that mortgage rates will respond. Greg McBride, Chief Financial Analyst at Bankrate, explains it well:

“Until inflation peaks, mortgage rates won’t either. Without improvement on the inflation front, we don’t know where the interest rate ceiling will be.”

Whether you’re buying your first home or selling your current house to make a move, today’s mortgage rate is an important factor to consider. When rates rise, they impact affordability and your purchasing power. That’s why it’s crucial to work with a team of professionals, so you have expert advice to help you make an informed decision about your best move.

The Supply of Homes for Sale Projected To Continue Increasing

This year, particularly this spring, the number of homes for sale has grown. That’s partly due to more homeowners listing their houses, but also because higher mortgage rates have helped ease the intensity of buyer demand. Moderating buyer demand slows down the pace of home sales, which in turn helps inventory rise.

Experts say that growth will continue. Recently, realtor.com updated their 2022 inventory forecast. In the latest release, they increased their projections for inventory gains dramatically, going from a 0.3% increase at the beginning of the year to a 15.0% jump by the end of 2022 (see graph below):

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Having an Agent Is Essential


Stabilizing The Home Market


Home Price Deceleration Doesn’t Mean Home Price Depreciation
Huntsville, Al And The Surrounding Area Is Still One of The Best Places To Live and Buy

Home Price Deceleration Doesn’t Mean Home Price Depreciation | MyKCM

Experts in the real estate industry use a number of terms when they talk about what’s happening with home prices. And some of those words sound a bit similar but mean very different things. To help clarify what’s happening with home prices and where experts say they’re going, here’s a look at a few terms you may hear:

  • Appreciation is when home prices increase.
  • Depreciation is when home prices decrease.
  • Deceleration is when home prices continue to appreciate, but at a slower pace.

Where Home Prices Have Been in Recent Years

For starters, you’ve probably heard home prices have skyrocketed over the past two years, but homes were actually appreciating long before that. You might be surprised to learn that home prices have climbed for 122 consecutive months (see graph below):

Home Price Deceleration Doesn’t Mean Home Price Depreciation | MyKCM

As the graph shows, houses have gained value consistently over the past 10 consecutive years. But since 2020, the increase has been more dramatic as home price growth accelerated.

So why did home prices climb so much? It’s because there were more buyers than there were homes for sale. That imbalance put upward pressure on home prices because demand was high and supply was low.

Where Experts Say Home Prices Are Going

While this is helpful context, if you’re a buyer or seller in today’s market, you probably want to know what’s going to happen with home prices moving forward. Will they continue that same growth path or will home prices fall?

Experts are forecasting ongoing appreciation, just at a decelerated pace. In other words, prices will keep climbing, just not as fast as they have been. The graph below shows home price forecasts from seven industry leaders. None are calling for prices to fall (see graph below):

Home Price Deceleration Doesn’t Mean Home Price Depreciation | MyKCM

Mark Fleming, Chief Economist at First American, identifies a key reason why home prices won’t depreciate or drop:

In today’s housing market, demand for homes continues to outpace supply, which is keeping the pressure on house prices, so don’t expect house prices to decline.”

And although housing supply is starting to tick up, it’s not enough to make home prices decline because there’s still a gap between the number of homes available for sale and the volume of buyers looking to make a purchase.

Terry Loebs, Founder of the research firm Pulsenomics, notes that most real estate experts and economists anticipate home prices will continue rising. As he puts it:

“With home values at record-high levels and a vast majority of experts projecting additional price increases this year and beyond, home prices and expectations remain buoyant.”

Bottom Line

Experts forecast price deceleration, not depreciation. That means home prices will continue to rise, just at a slower pace. Let’s connect so you can get the full picture of what’s happening with home prices in our local market and to discuss your buying and selling goals.

Staging To Sell


Staging Your Home While Packing to Move – A Dilemma - Huntsville, Al

“Buyers only know what they see. Not the way it’s going to be.”

Packing your stuff before moving out is a daunting task itself, but doing it while you’re staging your home for potential buyers can be a nightmare. After all, you have to go through long-forgotten boxes and old belongings to complete your packing. Coincidently, you must keep your home in the perfect shape to ensure that it sells fast and for top dollar. Both these tasks seem contradictory, but we can help you plan out everything.

Here, we present you with some tips to stage your home while packing for a move at the same time. So, let’s get started.

Image Title: Keys to a new house

Image Alt Title: A model house with its keys

Image Description: A picture demonstrating a realtor giving the buyer their new house with its keys.

Image Source: Pixabay

Declutter as Much as You Can

Decluttering itself can be exhausting, both emotionally and physically. You might have to get rid of things that hold sentimental value for you, and it’s difficult to go through with it. So, how to go about it? Well, follow a simple rule. If you haven’t used or worn something for more than six months, you don’t need it. This process not only makes the house attractive, but it’s also the first step to kickstart your packing process. You can also make good use of the stuff by donating them to charity.

Focus on One Room at a Time

Instead of trying to pack up the whole house and making things worse, focus on one room at a time. This will ensure that the process is less overwhelming and will also keep your home looking organized and neat. Also, ensure that your packing supplies are put away or at least hidden so the visitors don’t find the place messy.

Packing Up Personal Items

Perhaps, the most important part of packing is taking care of your personal items. There’s a good chance that your house is filled with priceless memorabilia, family photos, and other knickknacks. However, they won’t be appealing to your potential buyers, and without those items, the house will seem like a blank canvas for them to decorate. If you want to stage your home in a better manner, you can keep your paintings on the wall. The artwork can be a great addition to your staging efforts.

Quick Tips to Pack Your Picture Frames

Now that you’ve staged your home perfectly for the visitors, it’s time to pack your personal belongings. Picture frames are generally quite delicate, so wrap them up properly and keep them in good condition until you arrive at your new place. Here are a few quick tips to help you go through the process.

  • Wrap each frame individually with a bubble wrap or a newspaper.
  • Place them vertically inside a box.
  • Fill the remaining space with something soft so it doesn’t harm your picture frames.
  • Mark the box with “fragile” so the movers know they have to be gentle with it.

Don’t Forget Your Closets, Drawers, and Cupboards

When you think about potential buyers going through your house, you may picture them looking at every corner of the space. However, buyers often also consider storage spaces when looking for a new home. So, before inviting buyers inside, ensure that closets, cupboards, and drawers are squeaky clean. In fact, we suggest that you start your efforts in these storage areas by removing all items to keep minimal staging in place.

Place Quick Staging Supplies

If you’re planning to stay in your home while you stage it, make sure you’re prepared. For instance, set aside some staging supplies like replacing dishcloths and bath towels with show towels, cleaning up small messes, and using scented candles to freshen up your home’s atmosphere. Mark your scheduled showings and ensure that your humble abode is set to perfection before buyers arrive.

You can even hire a professional staging and packing service provider. These service providers have the experience to not only help you pack to move but also improve your chances of finalizing a deal with a buyer as quickly as possible. For instance, if you have mismatched furniture, it wouldn’t make a good first impression on the viewers. So, these stagers can supply new furnishings to complement the décor.

Stager companies offer different kinds of services, ranging from a complete overhaul of your space to making it as appealing as possible to partial work in one or two rooms. So, this option is also viable if you wish to only focus on selling your home.Picture1.jpg

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Selling a Home In Today's Market


Getting Your House Ready to Sell

When selling your home, little things can make a huge difference.

Every house owner or investor wants their property to sell quickly, and that too with a huge profit, but it takes more than luck to make it happen. Apart from careful planning, it requires addressing the right pain points. Remember, you’re looking to convince your buyers to spend a hefty amount to buy your home. They won’t purchase if you fail to impress them. This does not require spending a fortune on renovation. Instead, work on the little things, and you can get top dollar.

To help you, we have prepared a guide to start the process.

Making the Move

You’ve reached this page because you’ve almost decided on moving. But letting go of your home can be difficult. You’ve lived there for years, perhaps your whole life, and it holds important memories. So, it would help if you gave time to disconnect from your home emotionally. It will make it easier to enlist the property. An easier way to disassociate yourself is to look at the future in a new home, where you create new fond memories and perhaps begin the packing and moving process.

Depersonalization Move

For someone who spent decades personalizing their homes, it can be a nightmare to change anything. But you want potential buyers to see your home from their perspective, allowing them to picture the space with their personal belongings is a must.

Depersonalizing your home can make a lot of difference for buyers, helping them visualize what the décor would look like with their belongings. Remove the mats or rugs you got from the outskirts of Bali to give it a more open feel. Regarding the furniture, ensure only to leave the understated pieces that don’t leave an impression on the look or feel of the house.

Also, ensure your house is squeaky clean before calling potential buyers for a showing. That doesn’t mean that only the garden should be tidied up. It also applies to the front door and the accessories surrounding your décor. For instance, mending a broken door or anything that may cause hassle to your potential buyer should be fixed.

Declutter and Downsize

Most people collect a bulk of items for their homes over the years. Reasons can range from an emotional attachment to memories of a memorable trip years ago or something to pass on to the next generation. But there’s a good chance you don’t need most of them, so why not get rid of them?

Instead of throwing them away, you can donate them to a nonprofit organization for goodwill purposes. Not only will those items be put to good use, but some of them can also be tax-deductible. Also, remove your kitchen utensils from the counters and books or knickknacks from your bookshelves. This way, you can kick start your packing process.

We’re not saying that you remove everything from your home; box your essentials and give away the items that aren’t useful to you.

Decide on a Price

You should have a price in your mind. But it would help if you did your research. These days, property costs vary significantly, so you can’t measure your property’s price based on the price of a property across town or one with a water view if yours does not also have a view. Also, don’t overprice your property because maybe you “aren’t in a hurry.  Overpricing a property can ultimately end up causing the property to sit on the market longer and cause buyers to make lower offers.  Remember, the most serious buyers are the first ones to view the property, they have already been looking, are ready to buy and just haven’t found the right home just yet. Instead, conduct extensive research on the pricing of your home and consult a realtor and/or appraiser for a professional opinion.

Final Piece of the Puzzle – Getting a Good Real Estate Agent

The last piece of the puzzle is to get a real estate agent who can work with you through the process. After you’ve spoken to several agents, you need to finalize one who understands your requirements and is compatible with your personality. Compare their sales success, services provided, and ask for references.

Karen Harrison is one of the finest real estate agents in the Huntsville, Alabama area. With over two decades of experience in selling homes, Karen knows the ins and outs of North Alabama. So, give Karen a call if you’re looking to sell your house in Huntsville, Alabama.  

Cost of Waiting To Buy a Home


Today's Home Loans


In today’s housing market, many are beginning to wonder if we’re returning to the riskier lending habits and borrowing options that led to the housing crash 15 years ago. Let’s ease those concerns.

Several times a year, the Mortgage Bankers Association (MBA) releases an index titled the Mortgage Credit Availability Index (MCAI). According to their website:

“The MCAI provides the only standardized quantitative index that is solely focused on mortgage credit. The MCAI is . . . a summary measure which indicates the availability of mortgage credit at a point in time.”

Basically, the index determines how easy it is to get a mortgage. The higher the index, the more available mortgage credit becomes. Here’s a graph of the MCAI dating back to 2004, when the data first became available:

Why Home Loans Today Aren’t What They Were in the Past | MyKCMAs the graph shows, the index stood at about 400 in 2004. Mortgage credit became more available as the housing market heated up, and then the index passed 850 in 2006. When the real estate market crashed, so did the MCAI as mortgage money became almost impossible to secure. Thankfully, lending standards have eased somewhat since then, but the index is still low. In April, the index was at 121, which is about one-seventh of what it was in 2006.

Why Did the Index Get out of Control During the Housing Bubble?

The main reason was the availability of loans with extremely weak lending standards. To keep up with demand in 2006, many mortgage lenders offered loans that put little emphasis on the eligibility of the borrower. Lenders were approving loans without always going through a verification process to confirm if the borrower would likely be able to repay the loan.

An example of the relaxed lending standards leading up to the housing crash is the FICO® credit score associated with a loan. What’s a FICO® score? The website myFICO explains:

“A credit score tells lenders about your creditworthiness (how likely you are to pay back a loan based on your credit history). It is calculated using the information in your credit reports. FICO® Scores are the standard for credit scores—used by 90% of top lenders.”

During the housing boom, many mortgages were written for borrowers with a FICO score under 620. While there are still some loan programs that allow for a 620 score, today’s lending standards are much tighter. Lending institutions overall are much more attentive about measuring risk when approving loans. According to the latest Household Debt and Credit Report from the New York Federal Reserve, the median credit score on all mortgage loans originated in the first quarter of 2022 was 776.

The graph below shows the billions of dollars in mortgage money given annually to borrowers with a credit score under 620.

Why Home Loans Today Aren’t What They Were in the Past | MyKCMIn 2006, buyers with a score under 620 received $376 billion dollars in loans. In 2021, that number was only $80 billion, and it’s only $20 billion in the first quarter of 2022.

Bottom Line

In 2006, lending standards were much more relaxed with little evaluation done to measure a borrower’s potential to repay their loan. Today, standards are tighter, and the risk is reduced for both lenders and borrowers. These are two very different housing markets, and today is nothing like the last time.

Luxury Homes Are In Demand

KCM Blog.jpg
Looking for a realtor that knows the Huntsville, Al Luxury Market?  Karen Harrison has 23 years of real estate sales experience and knows the luxury market.  She has many clients that can offer references upon your request. 

As people realize their needs are changing, some are turning to luxury housing to find their dream home. Investopedia helps define what pushes a home into this category. In a recent article, they point out that a luxury home isn’t only defined by its price. Location is also an important factor. It could be a condo at a desirable city address, a spacious home on the water, or one with access to luxury activities like arts and entertainment, high-end shopping and dining, and more. The home itself will also boast some of the finest features available.

According to the Luxury Market Report from the Institute for Luxury Home Marketing, there’s been a substantial increase in how many buyers are purchasing luxury homes over the past two years. It says:

“. . . North America recorded the fastest growth of demand during the first year of the pandemic. Also, demand has . . . consistently increased, and even in April 2022, we saw a higher volume of sales compared to 2021.

If you own a luxury home, it could be a great time to list your house today while demand is so high. But first, let’s understand where the demand is coming from.

What’s Driving the Heightened Buyer Demand for High-End Homes?

The same report says more people have reached a certain net-worth threshold, and that’s contributing to the increased interest in luxury housing:

“In 2020, we saw a 2.2% growth in the number of individuals with wealth of over $5 million in net value, but in 2021 that number grew by an outstanding 19.8%.

This total increase has resulted in the introduction of over 660,000 new individuals into the high net-worth bracket, which, combined with the existing affluent looking to both diversify and add new properties to their portfolio, provides a true insight into why the demand for luxury properties skyrocketed during 2021 and into 2022.”

So, if you’re looking to make changes to your real estate portfolio or are looking to sell your current house, it may be a great time to list and benefit from the high demand for luxury homes today.

Bottom Line

If you own a luxury home and want to know how strong demand is in your area, let’s connect so you can capitalize on current market conditions while buyer demand for upscale homes is so high.

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