You want to ask the listing agent if they’ve heard about any paranormal activity on the property. But do they actually have to tell you?

That depends on where you’re house hunting. In most states, the seller doesn’t have to disclose anything. For example, according to Massachusetts state law, whether the home “has been the site of an alleged parapsychological or supernatural phenomenon” is not a material fact that has to be mentioned in a real estate transaction. However, the seller or agent are also not allowed to lie about it.

Minnesota has a similar code, which says that sellers don’t have a duty to disclose whether the home “was the site of a suicide, accidental death, natural death, or perceived paranormal activity.”

Still, a disturbing history like murder can affect the value of a home, said Ryan Dossey, co-founder of the house-buying service SoldFast in San Diego, in an online exchange. He points to search services like DiedInHouse as an example of how prospective borrowers can research a home’s past, uncovering details that a seller might have chosen not to divulge.

A gruesome case of buyer’s remorse

One such incident led to the 1983 court case Reed v. King. Dorris Reed purchased her California house from Robert King, who did not disclose that a woman and her four children were murdered in the home ten years prior. King had even requested that a neighbor not tell Reed about the killings. Reed’s attorneys claimed that while she had paid $76,000 for the home, it was really worth $65,000 because its history seriously damaged its value and desirability.

The courts ruled in Reed’s favor, finding that the home’s reputation affected its property value. Such homes are sometimes called “stigmatized properties.”

For some, a colorful history is a selling point

Not every buyer feels as Reed did. While an oversized skeleton decoration in the front yard is about as creepy as some home buyers are willing to get, others are drawn to the novelty and mystique of certain listings.

“A lot of buyers I’ve worked with love when there’s a deep or haunting history,” said Joe Luciano in an online exchange. Luciano is a Massachusetts Realtor who has shown historic homes in Salem.

For instance, one couple bought a house next to a funeral home. “They pretty much always wore all black, and the first thing they did when they moved in was paint the inside a deep purple color. This home was also right near the Salem Witch House, which, truthfully, was a selling point.”

So you bought a “haunted” house. Now what?

Let’s say you’re not afraid of things that go bump in the night and bought a stigmatized property. Even if you’re not worried about poltergeists, you still may have to contend with human reactions.

“Unbeknownst to me, I bought a ‘murder’ house back in 2021 as a flip that was the site of a homicide inside the property,” Ryan Dossey said.

“We encountered issues with the contractors,” he said, after neighbors mentioned the home’s history. From that point on, the contractors refused to be alone at the property. “It took considerable effort to persuade them to complete the renovation.”

Believer or skeptic, home buyer or seller, it’s important to know your rights when it comes to marketing a stigmatized home, as well as your legal responsibilities. Talk with your real estate agent, be honest with all parties involved, and check your state’s law if it’s relevant.

It’s perfectly reasonable to worry about the effect that such a history could have on your home’s value, but don’t be too discouraged. While some would never dream of buying a home that has a creepy past (real or imagined), you never know when Gomez Addams is prowling the market.

The post Surreal Estate: How Hauntings Affect Home Sales appeared first on Rough Draft Atlanta.

This week was a great example of how much mortgage interest rates can change in a short window of time. The 30-year fixed-rate mortgage rate spiked 21 basis points to an average of 6.4%. That’s a whopping 51 basis points more than in the week ending Sept. 19, immediately following the last Federal Reserve meeting. A basis point is one one-hundredth of a percentage point.

Rather than waiting for rates to hit their lowest, homeowners may be better off calculating what rate would give them a reasonable break-even point — the number of months or years it would take to recoup the refinancing costs — and make that their goal.

For instance, suppose a borrower got a $300,000 30-year conventional mortgage in early October 2023 at a rate of 7.5%, which was typical for that time. Refinancing to 6.12% — the average rate posted by Freddie Mac on Oct. 3, 2024 — would result in monthly savings of nearly $300 and savings of $80,155 over the entire life of the loan. Assuming the borrower pays $6,500 in closing costs, the break-even point would be 22 months, or just under two years.

Even small rate changes affect refi opportunities for millions

While Fed watchers are predicting further cuts to the federal funds rate through the rest of this year, mortgage rates don’t have to vary much to create sizable implications for the refi market. According to an October report from real estate tech firm ICE Mortgage Technology, rates falling from 6.4% in August to 6.1% in September grew the number of households who would benefit from refinancing by 1.3 million. An additional mortgage rate drop of 25 basis points (which is within a fair range of normal weekly or even daily changes) would add another 1.2 million to that pool of potential refi candidates.

On the flip side, an Oct. 9 Zillow analysis of homebuying data estimates that approximately 275,000 more households would benefit by refinancing at 6.1% than at 6.6%. According to Zillow, that 0.5-percentage-point rate increase represents a combined loss of over $6 billion in potential refinance savings over five years.

What to do if you’re thinking about refinancing

If you find that refinancing may soon be on the table after you’ve calculated your target rate, you can prepare by getting your financial profile in shape. Get a copy of your credit report, and contact the credit reporting bureaus if you note any mistakes. Pay down existing debts as much as possible, as lowering your debt-to-income ratio will make you a more attractive borrower and can get you a lower interest rate. You should also avoid making any large purchases on credit, like buying a new car or financing new furniture.

Additionally, if you’ve only recently purchased your home, review your closing contract to see if there’s a prepayment penalty for refinancing before a certain number of months have passed. If you’re stuck with that fee, you’ll want to factor that into your break-even calculations and see if that affects your goal rate.

The post Weekly mortgage rates rise as refi opportunities fluctuate appeared first on Rough Draft Atlanta.

The 30-year fixed-rate mortgage averaged 6.81% APR, up five basis points from the previous week’s average, according to rates provided to NerdWallet by Zillow. A basis point is one one-hundredth of a percentage point.

Pending home sales drop as home prices boom

The latest pending home sales report from the National Association of Realtors (NAR) shows that contract signings were down an average of 2.1% in May, with month-over-month declines in the Midwest and South regions but increases in the Northeast and West. Year-over-year, pending home sales were down in all four regions.

“The market is at an interesting point with rising inventory and lower demand,” said NAR Chief Economist Lawrence Yun, who suggested that sales will “inevitably” rise when mortgage rates come down.

Yun went on to note that fewer than expected homes sold in the first half of 2024, while prices exceeded initial forecasts. The NAR predicts that median existing home prices will reach a record high of $405,300 this year, up from $389,800 in 2023. While Yun’s tone is optimistic that lower mortgage rates are coming, buyers are feeling squeezed today.

What does ‘affordable’ mean, anyway?

Zillow underscored the strain that home buyers are under with the release of a new report on June 20, which analyzed the real estate markets in 50 major U.S. metropolitan areas. The report found that for median-income households, buyers need to put down a whopping $127,750 dollars — or 35.4% — in order to “comfortably afford” a mortgage on a typical home. This report defines affordability as a mortgage payment, including taxes and insurance, that represents no more than 30% of the area’s median income.

NerdWallet’s First-Time Home Buyer Affordability Report, which reviewed the state of the market in the first quarter of 2024, notes that ideas about what constitutes an “affordable” price tag are evolving. Buyers and lenders have been coached for decades that an affordable home costs no more than three times the buyer’s income, guidance that has become increasingly unrealistic for many home shoppers. In 2024, prospective buyers can consider the “three times income” figure as a starting point rather than a hard-and-fast rule.

When thinking about your own homebuying budget, consider all of the parts that would make up your payment — including your principal, interest, mortgage insurance, homeowners insurance, property taxes and any HOA fees — and see how much of your income would go toward these costs and your other existing debt payments. In addition to having enough left to live on, you’ll ideally have cash available to save for home maintenance and emergencies.

The post Weekly mortgage rates rise, falling sales show home buyer squeeze appeared first on Rough Draft Atlanta.

This question is even more loaded for LGBTQ+ buyers, who may face the added pressure of evaluating a new community for safety and comfort.

Social attitudes have dramatically shifted from the days where queer and transgender buyers were concentrated in just one or two neighborhoods, points out Barbara Stone, a Realtor in Dallas, Texas. Today, the community is made up of buyers with a diverse set of needs and preferences, including families with children, professionals who need to be close to business hubs, rural homeowners, and many more.

Regardless of what that dream home looks like, LGBTQ+ buyers can seek out the resources available to them, the most valuable of which may be hiring a buyer’s agent who is experienced in working with the community.

What comfort looks like in a listing

LGBTQ+ home buyers often have to get creative in defining and communicating intangible but necessary qualities. For Kathleen Myers, a Realtor with Re/Max Equity Group in Clackamas, Oregon, the word that clients frequently land on is “privacy.”

“This often means a very private backyard, not having neighbors right on top of you,” she says, making yard space a priority commodity. “Privacy really is about safety.”

This idea of safety goes beyond fears of physical violence or crime, Myers says. When she and her partner bought their home, they were encouraged by a sign in their new neighbors’ front yard that read “In our community, all people are welcome.”

“While it may seem really insignificant to some, that was actually really important to us when we decided to make an offer on the house,” she explains.

Stone says that questions of safety and acceptance are frequently among the first questions she’s asked by clients relocating to Texas. “It is a very valid concern to have.”

By describing the qualities that provide a sense of comfort and safety in whatever environment best suits them, buyers can get the most from their home search — and from their agent.

How LGBTQ-friendly real estate agents can be vital resources

As members of the local community, the wealth of knowledge that buyers’ agents can provide goes beyond setting up tours or negotiating contracts.

For example, same-sex parents or parents of LGBTQ+ children often have questions about schools, Stone says. When children are a factor in the home search process, she’s able to connect clients with local professionals who know which schools have established support programs for LGBTQ+ families. She also directs them toward news articles documenting schools where incidents of bullying have been cited.

View the latest home listings here.

LGBTQ+ buyers may also bring unique financial circumstances to the table. For example, Stone says, she has historically seen queer women looking at lower-priced homes and dealing with a level of scrutiny in their loan application that exceeded their male counterparts. A 2022 analysis from the Federal Reserve Bank of St. Louis shows that more self-identifying lesbian and bisexual women have household savings and investments below $250,000 than men of any sexual orientation. The analysis shows that this is also the case for adults who identify as transgender, nonbinary or other.

Real estate agents with a history of working with LGBTQ+ clients can be vital advisors. Knowing what has worked for clients in the past, Stone has guided buyers through the maze of social and financial considerations — and has even pointed them toward queer-friendly lenders.

Where to find a queer-friendly real estate agent

“I think it’s an absolute must that any LGBTQ+ couple or family with an LGBTQ+ member find an agent that has this experience and these resources,” Stone advises.

Buyers can find queer- and trans-friendly agents in their community through networks like gayrealestate.com and the National Association of Gay and Lesbian Real Estate Professionals. Some real estate firms also have agent groups that work specifically with the LGBTQ+ community, such as the Keller Williams Rainbow Network and the Corcoran Perry & Co. “Live Proud” team in Denver, Colorado.

For home shoppers who have existing ties to the city or region they’re buying into, personal recommendations can also be a great place to start.

Other resources for LGBTQ+ home buyers

Beyond working with an agent familiar with the area and the needs of LGBTQ+ homeowners, buyers of any gender identity or orientation can take advantage of financial and informational resources.

• Home buyer assistance programs. These are grants or favorable loans offered by local and state governments and nonprofit organizations, which can help offset down payment and closing costs.
• Low down payment mortgages. Loans insured by the Federal Housing Administration (called FHA loans) require just 3.5% down, while loans backed by the Department of Veterans Affairs (VA loans) and the Department of Agriculture (USDA loans) don’t require a down payment at all. And despite what you may have heard, some conventional mortgages only require 3% down.
• Home search platforms partnering with the Movement Advancement Project. Some websites like Trulia and Zillow have partnered with MAP, a nonprofit research and advocacy group, to include information about local laws and policies that impact LGBTQ+ buyers within property listings. 
• LGBTQ-supportive financial advisors. These professionals can help buyers meet their financial goals, manage debt and access tools and assistance, among other services.

The post How LGBTQ+ home buyers can find allies in the market appeared first on Rough Draft Atlanta.