Tallahassee Real Estate Blog

I received an email from a large financial institution that is offering a home price checking service. Just sign-on the site and access their database of neighborhood sales data.

Being a Tallahassee real estate professional interested in all sorts of real estate data and sources of information, I did it. And it does have a lot of information that a homeowner would be interested in.

But home buyers and sellers should understand the limits to this information. First, all the sales were at least 3 months old – that’s an ETERNITY in today’s Tallahassee market. Market analyses for price comparisons should be comprised mainly of sales less than 3 months. Second, the home sales presented were similar in geographic location only. No information on quality of the homes, or condition of the homes was used.

Buyers and sellers: use these automated services for your general knowledge. But they are almost always wrong when it comes to details.  If you need precise home sales information to help you buy or sell a home, use a local Tallahassee real estate professional that will give you the best information available to achieve your goal!

I'd like to talk about another mortgage myth currently going around - that ARMs are bad for consumers, and the cause of the subprime mortgage problem.  Not true. 

ARMs can be GREAT loan products for the right situation.  For example, if a homebuyer only expects to own a particular home for about 5 years, a 5/1 ARM could offer significant interest rate savings with little risk.  A 5/1 ARM acts like a fixed rate loan for 5 years, then adjusts on 1 year periods.  Right now, 5/1 ARM rates are about 0.7% BELOW 30-year fixed rate mortgages.  That is a savings of about $75 every month on a typical Tallahassee area home. Over 5 years, that equates to $4,500 in interest savings!  How much gas could that buy you in Tallahassee??  Quite a lot!

What caused trouble for some subprime borrowers were ARMs that started with an artificially low "teaser rate", and drastically adjusted upward within a few months to payment amounts that the borrower could not make... bad advice and predatory practices from the lender, or bad judgment by the borrower. 

In considering any mortgage, it is important to discuss your situation with a trusted real estate professional and reputable mortgage lender.  True professionals will always make sure you hear sound and unbiased advice.  Call Terance Keenan and his Team if you are considering a Tallahassee home purchase - 850.445.2476           

At an Open House I was hosting the other day, a couple mentioned to me that they were waiting to buy a home because mortgage rates were sure to fall as the Federal Reserve cut interest rates. 

This highlights a common myth that mortgage rates mirror the Fed's rate actions.  Not true.  30 year mortgage rates are most closely tied to movements of 10 year Treasury Bonds.  Bonds and mortgages are impacted by a variety of factors, including the probability of future inflation.  In fact, there are times where a Fed rate cut will RAISE mortgage rates if investors feel the action will make inflation more likely.  Such could be the case now, where many mortgage analysts think rates will rise in the next 2 months as the economy does show some signs of future price inflation.  

But guessing the direction of future rates is risky business.  If you want to purchase a home, don't try to time the market.  Look for the home that fits your needs, and work with your Realtor to buy at a fair price. 

If you are more concerned about making money in real estate, that's another thing...  find a Realtor that does investment analysis, and buy some investment property - good values can be found!

Whether you are looking for a home or investment property in Tallahassee, call Terance Keenan and his Team - we can help!  850.445.2476!            

This maybe one of the best times to buy a Tallahassee home in your lifetime.  Mortgage rates are near historic lows... not just compared to the last 3 years, but compared to the last 37 YEARS!!!  Really - there have only been brief periods where rates have been lower since 1971.  See the chart! 

What do low rates mean?  They lower the cost of owning a home.  Coupled with the pause in appreciation rates, you may never see another time like this! Contact us to set up a pre-qualification appointment where you can find out how mortgage costs really are today - no obligation - no hassle!