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Newsletter, 4/9/21

The source of home price movement: buyer purchasing power

The BPPI is calculated by First Tuesday using the 30-year FRM rate and the average income in the state of California. The BPPI is significant because it displays the change in purchasing power from year to year. Thus, a homebuyer is able to qualify for more principal than one year earlier when the index moves upward.

The BPPI is determined by the:

  • average income, which changes very slowly over time; and
  • mortgage interest rate, which varies constantly.

The BPPI varies from month to month as the average 30-year  FRM interest rate fluctuates. The 12-month moving average in the chart shows a more significant trend than the monthly change. As soon as the BPPI trends upward or downward, watch for similar movement in home pricing several months forward. READ MORE


Ralene Nelson, REALTOR®

Delta Diamond Farm Estate & Event Center, 15175 Hwy 160, Isleton, 25.1 ac


Asking $3,250,000- Delta Diamond Farms is a very unique property, built in the late 1880s, fully renovated by currents owners in 2005. 4 story, 3850 sqft Victorian home, the potential for 5 beds, 3.5 baths, located on 25.1 acres, currently operating as a wedding event compound & family/corp. events, & is permitted. Expansive lawn area & beautifully landscaped courtyard with 3 self-contained cottages. Barn (8000 sqft) & metal workshop constructed in late 1880’s, renovated with concrete perimeter foundation/slab floor, & full loft. 50’s Replica Gas Station remodeled as operational restrooms. New 2300 sqft 6 carriage house w/half bath. 4200 sqft metal building set up for catering, (refrigerators, freezer, ice machine, table/chair/linen storage w/industrial washer/dryer. 3200 sqft metal newer building, equipped with workshop, office, bedroom & full bathroom w/shower. Property has 2 wells (domestic/agricultural) w/riparian rights from Sacramento River. River access with 60 ft custom dock & waterfront observation deck. READ MORE


Real Estate News

How much house can I afford?

How much mortgage payment can I afford?

To calculate how much house you can afford, we take into account a few primary items, such as your household income, monthly debts (for example, car loan and student loan payments), and the amount of available savings for a down payment. As a home buyer, you’ll want to have a certain level of comfort in understanding your monthly mortgage payments.

While your household income and regular monthly debts may be relatively stable, unexpected expenses and unplanned spending can impact your savings.

READ MORE


4 Numbers That Determine Your Home Buying Power

If you’re serious about buying a home, understanding your finances is a crucial first step.
When deciding to purchase a home, the list of things to consider can be daunting. While you might be comparing square footage, finishes, and neighborhoods, mortgage lenders are looking at specific numbers that make up your financial picture with the same discerning eye.You might be eager to look at homes online, or even swing by a few open houses, but without getting your finances in check, your offer could be the last to the table. Sitting down with a lender and getting pre-approved for a loan puts you in a strong position and will make your offer stand out on that home for sale in Denver, CO.

READ MORE


How To Research a Neighborhood Before You Move There

You know what they say about buying or renting a home: location, location, location. Your neighborhood matters a lot when it comes to how satisfied you are in your house or apartment, and it can be a real dealbreaker (or deal-maker) when you’re on the search. And while it’s hard to really know a place until you live there, taking the time to research a neighborhood before you move can help ensure that you don’t accidentally end up with a big case of buyer’s or renter’s remorse later on.

Digging into the details of a neighborhood before committing to living there can save you a lot of headaches later on. With that in mind, here are six ways to research a neighborhood so you know what you’re getting into before you take the leap.

  1. Check Out the Walkability Score

    Use a tool like Walk Score to see how a neighborhood measures up in terms of walkability and convenience. Low walkability scores mean you’ll probably be dependent on a car to get anywhere that you want to go, while a high walkability score means that you can get around just fine on your own two feet.

    Walkability scores are based on how easily walkable your neighborhood would be from a particular address, and factors in things like whether you could walk to the grocery store if you wanted to or whether stores and houses are spread out and not well connected through things like sidewalks and bike paths. You can also take away some key insights about residential density, access to public transportation, and what a neighborhood’s general physical environment is like.

  2. Go Walk It Yourself

    The best way to get a feel for a neighborhood is often just to go experience it for yourself. A simple walk will show you a lot about an area, such as whether the sidewalks and parks are crowded with families or whether people are generally friendly when they pass by. It’s also a great way to take in the sights and check out your options for restaurants, stores, and recreation.

    Walks can point out the not-so-good, too. Is there lots of trash lying around? Are the streets busy with cars and difficult to cross safely? Looking at pictures of a neighborhood or talking to a local real estate agent won’t necessarily give you the full story of what you can expect. A walk, on the other hand, will allow you to immerse yourself in a neighborhood and get a more nuanced idea of what you might be in for if you moved in.

  3. Talk to People Who Live There

    Sometimes the best way to research a neighborhood is just to ask the people who know best. If you have friends or family members who live in the area, ask them what they like and dislike about living in the area and whether they would recommend it. And if you don’t know anybody who lives in the neighborhood, consider reaching out to some residents through an app like Nextdoor or a public Facebook group.

    Keep in mind that people tend to have very different ideas of what constitutes a great place to live. Try to be specific in the questions that you ask to get answers to the things that matter most to you—for example, if you prefer quiet in your home, ask about general noise levels; if you’re interested in networking and business, ask about the local business community and what kinds of opportunities there might be to get involved. There’s lot of valuable information that you can pick up from current and former residents, and a lot of it might be things that are difficult to learn any other way.

  4. Give Your Commute a Test Run

    Your daily commute can have a big impact on your quality of life. And while a Google Maps search might tell you what your route would look like and how long it could take, a much better option is just to test drive your commute yourself, whether it’s by car, by bike, on foot, or on public transit. And better yet, do your test run during the time when you’d either be traveling to or traveling from work.

    In addition to seeing whether it’s a commute that you’d be okay doing throughout the week, also pay attention to things like amenities along the way and whether you’ll have to pass through areas that could slow you down, such as school zones or stretches of streets that are packed with traffic lights. If you’re used to grabbing a coffee or a quick breakfast on your way to the office every day, see if that will be an option. And if you’ll be taking public transit, try to get a feel for how crowded it is at the times of day you’ll be traveling, and whether you’ll be able to comfortably sit down with a book or your phone during your commute or whether you’ll be packed like a sardine trying to find a handrail.

  5. Look At Property Value Trends

    This probably isn’t super crucial to do if you’re renting, but if you’re planning to buy then taking property value trends into consideration is important. These will tell you whether home prices in the neighborhood are going up, remaining consistent, or trending downwards—all of which is necessary to know for making a smart investment.

    There’s more value to knowing these trends than meets the eye. You can learn a lot about the history—and the potential—of a neighborhood from examining how its housing prices have risen or fallen over time. You can also make some assumptions based on property tax rates in the area, such as whether a neighborhood’s schools and parks are likely to be well-funded.

    Of course, property values are never going to tell you the full story, and low property values don’t mean that somewhere isn’t a great place to live. But they’re worth looking into as you research a neighborhood—especially if you’re investing for the long term.

  6. View Crime Rates

    It’s normal to worry about crime rates when you’re moving into a new neighborhood. Under the Fair Housing Act however, real estate agents aren’t allowed to disclose these to their clients, so it’s up to you to do the research.

    There are a few places to look when you’re trying to dig up crime statistics. You can start with a tool like CityProtectAreaVibes, or Neighborhood Scout, all of which aggregate crime data for certain localities. Meanwhile a site like Family Watchdog will allow you to see if there are any registered sex offenders in the area. Do some general Google research on your own, too.

    Keep in mind that you’re unlikely to find a neighborhood where crime simply doesn’t exist. It’s important to contextualize the reports, especially in comparison to population density. More people usually means more crime, though it doesn’t mean you’re necessarily going to be at a high risk yourself.

Putting It All Together

All of the steps above will help you research a neighborhood effectively, but only you know what’s most important to you. Do your research with your most pressing concerns and preferences in mind, and remember as you go that every neighborhood is likely to have both benefits and drawbacks. With a good foundation of information though, you should be able to put together a pretty clear picture of whether you’d be happy taking up residency or not.

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