How Much Leverage Do Today’s House Sellers Have?

How Much Leverage Do Today's House Sellers Have? | MyKCM

The housing market has been scorching hot over the last twelve months. Buyers and their high demand have far outnumbered sellers and a short supply of houses. According to the latest Existing Home Sales Report from the National Association of Realtors (NAR), sales are up 23.7% from the same time last year while the inventory of homes available for sale is down 25.7%. There are 360,000 fewer single-family homes for sale today than there were at this time last year. This increase in demand coupled with such limited supply is leading to more bidding wars throughout the country.

Rose Quint, Assistant Vice President for Survey Research with the National Association of Home Builders (NAHB), recently reported:

“The number one reason long-time searchers haven’t made a home purchase is not because of their inability to find an affordably-priced home, but because they continue to get outbid by other offers.”

A survey in the NAHB report showed that 40% of buyers have been outbid for a home they wanted to purchase. This is more than twice the percentage in 2019, which was 19%.

What does this mean for sellers today?

It means sellers have tremendous leverage when negotiating with buyers.

In negotiations, leverage is the power that one side may have to influence the other side while moving closer to their negotiating position. A party’s leverage is based on its ability to award benefits or eliminate costs on the other side.

In today’s market, a buyer wants three things:

  1. To buy a home
  2. To buy now before prices continue to appreciate
  3. To buy now and take advantage of historically low mortgage rates while they last

These three buyer needs give the homeowner tremendous leverage when selling their house. Most realize this leverage enables the seller to sell at a good price. However, there may be another need the seller has that can be satisfied by using this leverage.

Here’s an example:

Odeta Kushi, Deputy Chief Economist at First American, recently identified a situation in which many sellers are finding themselves today:

“As mortgage rates are expected to remain near 3%, millennials continue to form households and more existing homeowners tap their equity for the purchase of a better home…Many homeowners may want to upgrade, but do not for fear that they will be unable to find a home to buy.”

She then offers a possible solution:

“While the fear of not being able to find something to buy will not disappear in a limited supply environment, new housing supply can incentivize existing homeowners to move.”

There’s no doubt many sellers would love to build a new home to perfectly fit their changing wants and needs. However, most builders require that they sell their house first. If the seller sells their home, where would they live while their new home is being constructed?

Going back to the concept of leverage:

As mentioned, buyers have compelling reasons to purchase a home now, and many homeowners have challenges to address if they want to sell. Perhaps they can make a deal to satisfy each party’s needs. But how?

The seller may decide to sell their home to the buyer at today’s price, which will enable the purchaser to take advantage of current mortgage rates. In return, the buyer might lease the house back to the seller for a pre-determined length of time while the seller’s new home is being built. A true win-win negotiation.

Not every buyer will agree to such a deal – but you only need one.

That’s just one example of how a seller might be able to overcome a challenge because of the leverage they have in today’s market. Maybe you feel a need to make certain repairs before selling. Perhaps you need time to get permits or approvals for certain upgrades you made to the house. Whatever the challenge, you may be able to work it out.

Bottom Line

If you’re considering selling your house now but worry a huge obstacle stands in your way, let’s connect. Maybe with the leverage you currently have, you can negotiate a deal that will allow you to make the move of your dreams.

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Meet Lisa Santana

Meet Lisa Santana! Lisa is the sole owner at BST Realty, LLC and Managing Principal Broker. She has almost 20 years of experience providing phenomenal service to her clients. Lisa is an expert negotiator and compassionate listener. Not only that, but she grew up in Oregon, so she has in-depth knowledge of it. One of the reasons she chose real estate was because she also just really loves looking at houses. She enjoys the excitement of showing a new home to a Buyer. Lisa also specializes in working with seniors, and she finds it rewarding to help families make a smooth transition. If you’re a Buyer or a Seller, Lisa is the person to call. She helps her clients at every point in the real estate journey, and she does so with quiet confidence and grace.

Meet Lisa Santana! She helps her clients at every point in the real estate process.

Growing Up and Choosing a Path of Real Estate

Lisa moved around a lot while growing up. This was also the start of her loving to see new homes. She remembers how it was fun to pick out new bedrooms. Later on, she helped her family find their home, and she thought this may be something she could do professionally. She had to ask herself the question, “What do I want to be when I grow up?” At the time she had been a stay-at-home mom for 17 years with three children who she home schooled for 11 years, and she decided that it was time to venture into real estate.

Since then, Lisa has been enjoying working with clients and building long-term relationships. She built a local business with Dixon Bledsoe, of which she is now the sole owner. At BST Realty LLC, there are many benefits to becoming an agent. The biggest reason is having a heartfelt and strong sense of community. Mentorship is also key to cultivating community and making sure that all agents feel supported and receiving the tools they need to be successful. Not only that but also connecting them with resources that will help them grow and learn even more.

Lisa and Dixon celebrating being recognized as Business of the Year in 2018 by the Silverton Chamber of Commerce. Photo Credit: Our Town Jim Kinghorn

BST Realty, LLC has offices in Silverton and Keizer, and also provides property management services. Uriel Santana, Lisa’s husband, and Jenna Robles have been doing a fabulous job with the property management division as well as being real estate brokers. Uriel and Jenna offer education to tenants and make sure that landlords are not only receiving rent on time but also that their properties stay in tip-top shape. There are also some plans in the mix to begin revamping the Silverton location. So, please make sure to keep a lookout for what changes are going to be made!

Lisa and her husband, Uriel, celebrating Lisa being honored as Realtor of the Year in 2017 by North Willamette Association of Realtors.

Family is Everything

When Lisa isn’t doing real estate, she also enjoys time with family. Lisa loves to knit, and her adorable dog, Remi. She also loves taking her annual rafting trip with her husband, Uriel. They’ve been taking this trip for many years, and she loves the feeling of just being out in nature. She especially loves being on the pontoon boat. And, she’ll even take her knitting out camping, too. Of course, Lisa loves spending time and babysitting her grandkids. She has 10 grandkids and counting, so let’s just say it’s a full house!

Enjoying time with family and all those grandkids!

Supporting Community

One thing that people may not be aware of with BST Realty LLC, is how we are involved with our community. This is because we truly value and cherish it. It’s community that gets us through the hard times, and it’s also community that helps us flourish. We are involved after-school programs, Silverton Area Community Aid (SACA), Silverton Sheltering, soccer teams, the Silverton Dodge Ball Fundraiser, supporting programming that combats military suicide called Active Heroes, supporting Homes for Heroes as an affiliate, and more. Lisa says, “We work really hard to give back to our schools and the heroes among us in our community.” And, some of the money BST Realty LLC receives is given back to our community.

In addition to this, Lisa serves on the Kiwanis Board, and is currently serving as Past President. She is on the Silverton Kiwanis Club’s Committee for the Dolly Parton Imagination Library, because she believes that books should be accessible to all children. And, the Kiwanis Club will be having a spelling bee in the near future, so please lookout for next year’s event in 2022. Service in the real estate community is also important. Lisa serves as the Treasurer for the Mid-Valley Association of Realtors and the Willamette Valley MLS Board as a Director. Supporting community is first and foremost a priority to Lisa.

Lisa is the person that you want on your team when it comes to real estate. She’s a community and business leader. Lisa has a proven track record of excellence. Whether you’re interested in buying or selling real estate, Lisa will be there at every point in the journey. Give her a call, so you can start making your dreams a reality.

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Helping Neighbors

Tough times bring people together. The last week has served up weather that has made people even more compassionate with one another. Community is such an important thing to us, and we support it in many ways. This time around, neighbors were helping neighbors to make it through the cold temperatures after a power outage that has been deemed historic in Oregon. Although this may have taken the wind out of our sails for a moment, our community quickly came together to make sure people in need were being helped. With the snow and ice hitting the Midwest, it reminds us also to be appreciative of what we have in the Willamette Valley.

Helping Others

For those who have loved ones in that part of the nation, we hope that they are safe and warm. We also are so thankful for our heroes that continue to astound us with their bravery and courage. Our firefighters and first responders that are out there continue to help people still in need during this time.

Some stories of compassion have been happening everywhere. From a neighbor knocking door to door to make sure everyone had a warm place to stay. To families offering other families a home to take shelter and have some solace. Also, there is the story of the man who parked his RV at Silverton Estates, so that way others could refrigerate their medications. Some people have even given others less fortunate a bit of money and a pair of socks in a hotel lobby. All of these things, whether seemingly big or small add up to making our community stronger. Because, we are stronger together.

At BST Realty LLC, we are here to help you navigate during tough times as well. We are problem-solvers and we care about our clients. It’s not short-term for us, it’s building long-term relationships that last. We are also an affiliate with the Homes for Heroes Program, which helps people like first responders get some money back when buying or selling a home. We truly appreciate how much our heroes have been there to support our community. Now, we know that some people are without power still. We will lead with compassion, especially during this time. And, we will all get through this together. With spring right around the corner, we can’t wait to see blossoms from this long winter.

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Meet Freddy Ruiz Jr.

Meet Freddy Ruiz Jr., one of our fantastic agents at BST Realty LLC. Freddy makes himself available at all times for his clients and uses his creativity to make them shine. We are so proud to have Freddy on the team! Freddy was born and raised in Salem, so he really knows the area and the Willamette Valley. He witnessed how Salem has changed over the years. Freddy remembers riding his bike down dirt paths with his friends around new developments popping up around his neighborhood. Now, he loves being a part of that change and helping his clients find the perfect home.

If you’re interested in buying or selling real estate…Freddy is ready support you in your journey!

Growing Up

From an early age, Freddy was exposed to the ins and outs of real estate. He grew up in a family that bought fixer-upper homes and sold them. While growing up he remembers loving to spend time at the Coffeehouse Café, Jimmy Guitar Planet, the YMCA which is now the Ike Box. And, he still frequents the Gov Cup that has undergone name changes throughout the years. He did photography for shows at places like the Doug Bar. He eventually started up the Space Concert Club (which is now the Infinity Room).

Then, eventually decided to pursue a career in real estate. Freddy loves everything Salem has to offer including being close to just about everything. Like the mountains, the ocean, wondrous hiking trails, and more. With Freddy’s expert knowledge of the Willamette Valley, he is well-equipped to help his clients find the home that’s right for them.

Cultivating Community

Freddy has a degree in Graphic Design from Chemeketa Community College. And, he likes to utilize these creative skills with his clients. He uses his tech-savviness to make sure everything’s fast and easy for his clients. Freddy aims to keep the process, “simple, affordable, and smooth.” Freddy also really enjoys working with people and developing long-lasting relationships. Just like the relationships he’s built over the years with the Salem community.

Freddy also loves the freedom and community that BST Realty LLC provides. Because it offers the flexibility to be creative, but also mentorship and support. At BST Realty LLC, our goal is for our agents to be their very best when it comes to real estate. This means supporting our agents for who they are, and their unique skills and talents.

When Freddy isn’t practicing real estate he’s spending time with family. He has an adventurous side and likes to do fire-spinning with his wife and go to festivals like the Oregon Country Fair or even Burning Man. Freddy continues upping his skills with doing some fire poi and juggling two batons, and he also enjoys spending time outdoors with his family and friends. If you’re looking for a real estate agent whose an expert in the field that will get the job done well, then Freddy is a must-call!

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Homeownership Today: 6 Foundational Benefits

6 Foundational Benefits of Homeownership Today | MyKCM

Over the past year, our homes have become an integral part of our lives more than ever. They’re much more than the houses we live in. They’re our workplaces, virtual schools, and safe havens that provide shelter, stability, and protection through the evolving health crisis. Thinking about homeownership today, 65.8% of Americans are fortunate enough to call their homes their own.

As we continue to think about the future, our goals for the year, and what we want to achieve well beyond 2021, it’s a great time to look at the benefits of owning a home. Below are some highlights and quotes on the benefits of homeownership shared by the National Association of Realtors (NAR). From feel-good motivations to economic and social impacts on the local community, these items may give you reason to believe homeownership stretches well beyond your financial investment.

Non-Financial Benefits

Owning a home brings a sense of happiness, satisfaction, and pride.

  • Pride of Ownership: It feels good to have a place that’s truly your own, especially since you can customize it to your liking. “The personal satisfaction and sense of accomplishment achieved through homeownership can enhance psychological health, happiness and well-being for homeowners and those around them.”
  • Civic Participation: Homeownership creates stability, a sense of community, and increases civic engagement. It’s a way to add to the strength of your local area and drive value into your neighborhood.

Financial Benefits

Buying a home is also an investment in your financial future.

  • Net Worth: Homeownership builds your net worth. Today, the median household net worth of all homeowners is $254,900, while the median net worth of renters is only $6,270.
  • Financial Security: Equity, appreciation, and more predictable monthly housing expenses are huge financial benefits of owning a home. Homeownership is truly the best way to improve your long-term financial position.

Economic Benefits

Homeownership today is even a local economic driver.

  • Housing-Related Spending: An economic force throughout our nation, housing-related expenses accounted for more than one-sixth of the country’s economic activity over the past three decades.
  • Entrepreneurship: Homeownership is also a form of forced savings that can provide entrepreneurial opportunities. “Owning a home enables new entrepreneurs to obtain access to credit to start or expand a business and generate new jobs by using their home as collateral for small business loans.”

Bottom Line

The benefits of homeownership go well beyond the basics. Homeownership is truly a way to build financial freedom, find greater satisfaction and happiness, and make a substantial impact in your community. If owning a home is part of your dream this year, let’s connect so you can begin the homebuying process today.

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Love Notes to Your COVID Heroes

You may notice that there’s something up in our front window in our downtown office in Silverton. If you’re in the area, you should stop on by and add to it. At BST Realty LLC, we believe in supporting community. That’s why during the whole month of February we are having a “Love notes to your COVID heroes.” What does that mean? Well, out front there is a special place for you to write down your appreciation and support for all the people who have been on the front lines.

Sending notes of appreciation to our COVID heroes!

Your Heroes

If there is a nurse you thought of just now, then our front window is a great place to express your admiration for that person. Perhaps it’s to someone who brings out your groceries. Someone who takes special care making sure everyone has ready access to nutritious food. It could also be for a teacher who has went above and beyond with teaching your kiddos. There are so many essential people out there making our lives better. And, we want to give people a chance to express it in a bigger way.

BST Realty LLC is also a proud affiliate with the Homes for Heroes program. This home program helps essential people in our community like firefighters, educators, and health care professionals. If you qualify, then it may help you save when purchasing your dream home. If you work with a real estate specialist, you may be able to save on the purchase price when buying a home, and when selling your home. This means, if you’re purchasing a home for say $300,000, then you could potentially receive a check for $2,100 in the mail after closing from Homes for Heroes.

We love supporting our community in any way we can. If you’re buying or selling real estate, let’s talk. If you’re walking in downtown Silverton, please add your own personal words. Share gratitude with our COVID heroes. They make our lives safer, and for that, we are very grateful.

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Want to Build Wealth? Buy a Home This Year.

Want to Build Wealth? Buy a Home This Year. | MyKCM

Want to build wealth? Every year, households across the country make the decision to rent for another year or take the leap into homeownership. They look at their earnings and savings and then decide what makes the most financial sense. That equation will most likely take into consideration monthly housing costs, tax advantages, and other incremental expenses. Using these measurements, recent studies show that it’s still more affordable to own than rent in most of the country.

There is, however, another financial advantage to owning a home that’s often forgotten in the analysis – the wealth built through equity when you own a home.

Odeta Kushi, Deputy Chief Economist for First American, discusses this point in a recent blog post. She explains:

“Once you include the equity benefit of price appreciation, owning made more financial sense than renting in 48 out of the 50 top markets, with the only exceptions being San Francisco and San Jose, Calif.”

What has this equity piece meant to homeowners in the past?

Want to Build Wealth? Buy a Home This Year. | MyKCM

ATTOM Data Solutions, the curator of one of the nation’s premier property databases, just analyzed the typical home-price gain owners nationwide enjoyed when they sold their homes. Here’s a breakdown of their findings:The typical gain in the sale of the home (equity) has increased significantly over the last five years.

CoreLogic, another property data curator, also weighed in on the subject. According to their latest Homeowner Equity Insights Report, the average homeowner gained $17,000 in equity in just the last year alone.

What does the future look like for homeowners when it comes to equity?

Want to Build Wealth? Buy a Home This Year. | MyKCM

Here are the seven major home price appreciation forecasts for 2021:The National Association of Realtors (NAR) just reported that today, the median-priced home in the country sells for $309,800. If homes appreciate by 5% this year (the average of the forecasts), the homeowner will increase their wealth by $15,490 in 2021 through increased equity.

Bottom Line

As you make your plans for the coming year, be sure to consider the equity benefits of home price appreciation as you weigh the financial advantages of buying over renting. When you do, you may find this is the perfect time to jump into homeownership.

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Write Home About Deer Friends

The Willamette Valley has so much to offer, especially some interesting neighbors. In Silverton, there’s a deer herd that likes to make its way around town. To the point that it makes for a natural stopping of traffic. Kids “ooooh,” and “ah,” while adults might be tapping their thumb on the steering wheel. And, still, other adults also have big smiles on their faces at capturing a beautiful moment when nature intersects into their daily routine. Perhaps it’s a little perk when you drive home and find some deer smack dab in the middle of your yard…looking up cautiously and wondering what the lights and fuss are about from your vehicle. You may want to write home about deer friends!

Write Home to Deer Friends
Sometimes the deer are just happily tasting the new grass in the front yard when you pull up. Photo by: Michael Kemry

Deer Sightings in Your Neighborhood?

Have you ever noticed a cute little furry creature munching on some of your lovely roses? Sometimes people think they are a nuisance, while others adore these creatures and find them a fun addition to the neighborhood. When has there been a time you’ve spotted a deer near your home? Or, out and about on errands? These little sights from nature are just one of the many things that add to the character of our gorgeous state. We’d love to see your photos of deer! Just @BSTRealtyLLC on Instagram for a chance to show your neighborhood deer off…perhaps they’ll become even more famous!

If you’re looking to deter deer from your home, then choosing plants they don’t think are very tasty is a good start. Or, possibly getting a fence that is higher than a deer can jump. There are also scented sprays that deer smell and don’t like too much. If you’re looking to attract deer, then putting out a few apples would most likely do the trick, however, who knows what your neighbors will think! There’s plenty of vegetation for deer to eat anyway in the lush Willamette Valley.

Whether you’re a fan or perhaps would like the deer to mosey on through elsewhere, your neighborhood is a special place to observe the wondrous wildlife of the Willamette Valley. If you’re looking for a neighborhood that’s more deer-friendly or one that may be a little less teaming with wildlife, give us a ring. Let’s figure out the perfect type of home for you and your family.

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What’s the Difference between an Appraisal and a Home Inspection?

What’s the Difference between an Appraisal and a Home Inspection? | MyKCM

If you’re planning to buy a home, an appraisal is an important step in the process. It’s a professional evaluation of the market value of the home you’d like to buy. In most cases, an appraisal is ordered by the lender to confirm or verify the value of the home prior to lending a buyer money for the purchase. It’s also a different step in the process from a home inspection, which assesses the condition of the home before you finalize the transaction. Here’s the breakdown of each one and why they’re both important when buying a home.

Home Appraisal

The National Association of Realtors (NAR) explains:

“A home purchase is typically the largest investment someone will make. Protect yourself by getting your investment appraised! An appraiser will observe the property, analyze the data, and report their findings to their client. For the typical home purchase transaction, the lender usually orders the appraisal to assist in the lender’s decision to provide funds for a mortgage.”

When you apply for a mortgage, an unbiased appraisal (which is required by the lender) is the best way to confirm the value of the home based on the sale price. Regardless of what you’re willing to pay for a house, if you’ll be using a mortgage to fund your purchase, the appraisal will help make sure the bank doesn’t loan you more than what the home is worth.

This is especially critical in today’s sellers’ market where low inventory is driving an increase in bidding wars, which can push home prices upward. When sellers are in a strong position like this, they tend to believe they can set whatever price they want for their house under the assumption that competing buyers will be willing to pay more.

However, the lender will only allow the buyer to borrow based on the value of the home. This is what helps keep home prices in check. If there’s ever any confusion or discrepancy between the appraisal and the sale price, your trusted real estate professional will help you navigate any additional negotiations in the buying process.

Home Inspection

Here’s the key difference between an appraisal and an inspection. MSN explains:

In simplest terms, a home appraisal determines the value of a home, while a home inspection determines the condition of a home.”

The home inspection is a way to determine the current state, safety, and condition of the home before you finalize the sale. If anything is questionable in the inspection process – like the age of the roof, the state of the HVAC system, or just about anything else – you as a buyer have the option to discuss and negotiate any potential issues or repairs with the seller before the transaction is final. Your real estate agent is a key expert to help you through this part of the process.

Bottom Line

The appraisal and the inspection are critical steps when buying a home, and you don’t need to manage them by yourself. Let’s connect today so you have the expert guidance you need to navigate through the entire homebuying process.

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Wondrous Views

If you’re a first time Home Buyer, the thought of buying a home may seem mind-boggling. It may feel like making the first step to climbing a mountain. At BST Realty LLC, we are here to help make your experience as smooth as possible. We get that our clients may need a bit of education when it comes to buying a home, especially your first home. We also understand that making the decision to buy a home is a big. It’s life-changing. And, we’re here to help you make the change you’ve been thinking about with your family. It doesn’t have to seem like trudging up a mountain, but my…you may have wondrous views once you reach your goal.

Crater Lake, one of the many great views that Oregon has to offer.

Taking the First Step

Perhaps you have been renting for a while, and you realize you’d rather put your money in a mortgage rather than toward rent every month. Maybe you and your partner have been saving up a bit, so that way you have enough to make a down payment. Whatever the reason is, we’re here to support you. Anything that’s your first time can feel a bit intimidating at first. It’s because things seem a bit more uncertain because you don’t know what to expect. We are here to make the steps to buying a home have more clarity. We are here to make sure you aware of each step.

From making an offer to closing on a home, each step can be exciting. There are many ways to make the offer the best of the bunch. And, right now, we are experiencing lots of times where multiple offers are being made on homes. Don’t let that get you down though. We are experienced at making offers that will put yours at the top, and also keep your needs and wants at the top, too. If you’re thinking of buying your first home, we’d love to talk. We are here to support you at every point in the journey and get to those wondrous views you have been waiting for. After all, it’s a once in a lifetime experience, and we are honored to be a part of it.

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