What to Buy April 2016

      
We’re a few days early, but here’s all the things to buy and to avoid in April. And we found freebies for this month.

What’s Free?

Some fast-food outlets and nationwide chains will be offering free items on April 15 aka Tax Day. If it’s anything like last year, then you should be on the lookout for opportunities to get a free cup of coffee, free breakfast foods, or free side orders or desserts with the purchase of an entr?e.

What’s A Great Deal?

If you’ve been wanting to buy an Apple Watch, do not buy from Apple. While they may have slashed the price by $50, you can find better prices from Target and Best Buy. You will have to regularly monitor the ads. Look for prices around $249. And DealNews is predicting it could drop to $199 at Target since they consistently offer $100 off the cost of the Apple Watch.

Generally the rule of thumb is to wait about two months after a new season of apparel hits retail stores before you’ll see sizable discounts. So retailers begain debuting Spring clothing in February. April is that two month sweet spot. Look for 15-30% off on Spring apparel and clearance discounts on Winter wear.

Planning ahead for Mother’s Day? There are some good deals out on jewelry right now, and the prices should stay reasonable throughout April. Expect the prices to increase in May the closer you get to Mother’s Day.

If you have the time, now is a great time for a Canadian vacation. The US dollar is rallying and the Canadian loonie’s valued at a 12-year low. Even airfares have dropped 15% in the last two years. If you’re traveling domestically, American and Southwest are both offering some bargains. Spend some time poking around and book that flight.

For TV sets, the best deals are still on name-brand 55″ HDTVs. The price has dropped below $500. Even 4K TVs have some really good deals from $700. Look at the price of last year’s models as they will be discounted to clear room for the new 2016 models.

What to Avoid?

Wait two more months for deals on the new iPad Pro. They’re normally introduced in October right before Black Friday. Then Apple offers modest deals on the iPad about two months after the release of the product. So, DealNews is anticipating seeing the 9.7″ iPad Pro for about $527 by the end of May. If you can wait another two more months, you can expect to see the tablet starting at around $467.

Hold off on laptops until the Back to School deals start this summer.

Spring cleaning fever hitting hard? Hold off on a new vacuum. The prices are better in November. Black Friday seems to have the best prices for vacuums for the entire year.

Ready to replace your mattress? Wait until the big Memorial Day sales.

What’s In Season?

Cooking with the seasons means choosing fruits and vegetables that are at the peak of freshness and flavor. Buying locally grown produce is the best: local produce is less likely to be damaged, uses less energy to transport, ripens more naturally and you support your local economy.

Some of the fruits and vegetables that are in season for April include:

• Artichokes
• Arugula (Rocket)
• Asparagus
• Beans
• Beets
• Chicory
• Chives
• Dandelion greens
• Fava Beans
• Fiddlehead Fern
• Horseradish
• Leeks (end of season)
• Lettuce (leaf and head)
• Limes
• Morel Mushrooms
• Oranges
• Papayas
• Peas
• Ramps
• Rhubarb
• Shallots
• Strawberries
• Sweet Onions
• Turnips
• Watercress

Market Commentary for the Week of March 21st

     
This week brings us the release of only four pieces of relevant economic data for the markets to digest. However, there are only three and a half trading days for it to be posted due to the Good Friday holiday. Most of the reports can influence mortgage rates if they show surprises, but none of them are considered extremely important or key data.

The first will come later this morning when February’s Existing Home Sales report is posted by the National Association of Realtors. It will give us a measurement of housing sector strength and mortgage credit demand. It is expected to reveal a decline in home resales, meaning the housing sector softened last month. Ideally, bond traders would prefer to see a large decline in sales, pointing towards a rapidly weakening housing sector. Bad news would be a sizable increase in sales, indicating that the housing sector is gaining momentum. That could be troublesome for the bond market and mortgage rates because housing strength makes broader economic growth more likely.

Tomorrow has nothing of importance scheduled to be posted. Wednesday's sole report is February’s New Home Sales figures. The Commerce Department is expected to announce an increase in sales of newly constructed homes. This report tracks a much smaller percentage of home sales than Monday’s Existing Home Sales report covered, so it should have a much weaker influence on the markets and mortgage pricing. A large increase in sales would be negative for the bond market and mortgage pricing because it would point towards economic strength.

February’s Durable Goods Orders will be released Thursday at 8:30 AM ET. This Commerce Department report gives us a measurement of manufacturing sector strength by tracking new orders for big-ticket items, or products that are expected to last three or more years such as electronics, appliances and airplanes. This data is known to be volatile from month to month but is still considered to be of fairly high importance to the markets. Analysts are expecting it to show a decline in new orders of approximately 2.9%. An increase in orders would be considered negative for bonds as it would indicate economic strength and could lead to higher mortgage rates Thursday morning. Since these orders are volatile, it will take a wider variance from forecasts for it to move mortgage rates than other data requires.

Friday has the last piece of data this week. The final revision to the 4th Quarter GDP will at 8:30 AM ET. This is the second and final revision to January’s preliminary reading of the U.S. Gross Domestic Product, or the sum of all goods and services produced in the U.S. The GDP is the benchmark measurement of economic activity. It is expected to show that the economy grew at an annual pace of 1.0% last quarter, unchanged from the previous estimate that was released last month. Analysts are now more concerned with next month’s preliminary reading of the 1st quarter than data from three to six months ago. Because the markets are closed Friday, we won't see a reaction to this report until they reopen next Monday.

The bond market is expected to close early Thursday ahead of the Good Friday holiday. The stock and bond markets will be closed all day Friday and will reopen for regular trading Monday. It is common to see some pressure in bonds as investors make moves to protect themselves over the long holiday, so don't be surprised if bonds weaken slightly early Thursday afternoon before closing. The data itself isn't of much concern but the benchmark 10-year Treasury Note yield closed at 1.87% Friday. Anything above 1.90% is a big concern, in my opinion, as it makes a move about 2.00% likely. Since it slipped below 1.90%, a move downward is more of a possibility than it was the past two weeks. There is potential gains by floating a rate currently. Unfortunately, there is also an elevated risk of a quick upward move in yields and mortgage rates. Therefore, if still floating, please maintain contact with your mortgage professional.

4 Main Ways Your Location Can Affect Your Home Value

      
Have you heard of “the Starbucks effect?” It was coined a few years ago to describe the higher real estate values associated with living close to the coffee house. But being within easy striking distance of a Grande Skinny Vanilla Latte isn’t the only thing that can help boost your home value. Then again, not every location can help build equity. Chose incorrectly, and you could see your value drop – even if your house is great.

1. Being close to schools

The good: Families seek out neighborhoods with good schools for obvious reasons. Living close to a quality elementary school is especially desirable for parents who envision walking with their young children in the morning.

From a value standpoint, a location close to well-performing schools can be a smart decision for buyers regardless of their family status. “Living near a high-scoring school can increase your home’s value by over $200,000, according to the Brookings Institution,” said AOL.

The not so good: But, being too close to a school – no matter how good it might be – may be a deterrent for some buyers, which could end up hurting your bottom line. If you’re in the path of the school pickup and drop-off, which creates considerable traffic, or directly across the street from a playground, which means there is noise throughout the day, you could have trouble when it comes time to sell. A location that is close enough to be easily accessible but out of range of the daily inconveniences is often the best option.

2. Being close to conveniences

The good: “The Starbucks effect” is tangible: Data has shown that, “Between 1997 and 2013, homes closer to the coffee shop increased in value by 96%, compared to 65% for all U.S. homes,” said CNN Money.

Now Starbucks has company, with a new report that shows that proximity to a high-end grocery store – namely Trader Joe’s or Whole Foods – can also raise home values considerably.

“Between 1997 and 2014, homes near the two grocery chains were consistently worth more than the median U.S. home,” said Business Insider. “By the end of 2014, homes within a mile of either store were worth more than twice as much as the median home in the rest of the country. The analysis found that 2 years after a new Trader Joe’s opened, home values within one mile went up by 10 percentage points more than homes in the rest of the city.

The not so good: But, that doesn’t mean all area amenities boost home value. Adult entertainment spots, industrial businesses, a nearby airport that puts the home in the path of flights, and small businesses like tattoo parlors, check cashing, cash advance, or pawn shops that can be indicators of a lower-income or high-crime area can drive people away.

3. Being convenient to freeways

The good: A location close to major thoroughfares can be a selling point since it helps homeowners cut down on the dreaded daily commute. Many suburbs require an additional 10 to 20 minutes in the car after exiting the highway. Promoting the convenience of a home closer in can help it stand apart.

The not so good: Having a car fly off the freeway onto your roof is not ideal. Neither is having to endure the daily noise, congestion, and pollution of living right next to the freeway. If it bothers you, it’s going to bother buyers when you sell. Being close – but not TOO close – is key.

4. Quiet location

The good: A home that’s in a peaceful area surrounded by nature may be a benefit to buyers seeking a serene setting. A house that backs up to nature or is close to hiking trails can sell for more than a house in the same neighborhood that’s only surrounded by other houses.

The not so good There is such a thing as too quiet…

Written by Jaymi Naciri

Market Commentary for the Week of March 14th

      
This week brings us the release of seven monthly reports for the bond market to digest in addition to a Fed-filled day in the middle part of the week. The most important reports and Fed events take place the middle days, so we may see the most movement in mortgage rates those days.

Today starts the week's activities with the release of February’s Retail Sales data and Producer Price Index. The sales report will come from the Commerce Department at 8:30 AM ET Tuesday morning. This data is extremely important to the financial markets because it measures consumer spending strength. Since consumer spending makes up over two-thirds of the U.S. economy, data that is related usually has a big impact on the markets. This month’s report is expected to show a decline in sales of approximately 0.1%. If it reveals an unexpected increase, the bond market will likely fall and mortgage rates will move higher as it would indicate a stronger level of economic growth than many had thought. If it reveals a much weaker level of spending, I expect to see bond prices rise and mortgage rates improve Tuesday morning.

The Labor Department will post February’s Producer Price Index (PPI), also this morning. This important index measures inflationary pressures at the producer level of the economy. There are two portions of the index- the overall reading and the core data. The core data is more important and watched more closely because it excludes more volatile food and energy (such as gasoline) prices. If the index shows a large increase, inflation concerns will rise, making long-term investments such as mortgage-related bonds less attractive to investors. This could possibly lead to higher mortgage rates this morning. Current forecasts are calling for a 0.2% drop in the overall reading and a 0.1% increase in the core data. The weaker the core reading, the better the news it is for mortgage rates.

Tomorrow morning has three reports being released. The most important of the batch is February’s Consumer Price Index (CPI) at 8:30 AM ET. It is the sister release to Tuesday's PPI but measures inflationary pressures at the very important consumer level of the economy. The CPI is expected to show a 0.2% increase in the overall index and a 0.1% rise in the more important core data. As with the PPI, weaker than expected readings would be good news for bonds and mortgage rates.

Also early tomorrow morning, February’s Housing Starts data will be released. This report tracks construction starts of new housing. It doesn’t usually cause much movement in mortgage rates and is considered one of the less important reports we see each month. It is expected to show an increase in housing starts, indicating growth in the housing sector. Good news for the bond market and mortgage rates would be a sizable decline in new starts, but unless we see a large variance from forecasts the data likely will not lead to a noticeable move in mortgage pricing.

The third and final morning release of the day will be February’s Industrial Production report at 9:15 AM ET. This report measures manufacturing sector strength by tracking output at U.S. factories, mines and utilities. It is expected to show a 0.3% decline from January’s level. A larger decline would be considered favorable news for bonds and mortgage rates because it would indicate manufacturing sector weakness and broader economic growth would be more difficult if manufacturing activity is slipping.

Wednesday also has several Fed events scheduled. They start with the 2:00 PM ET adjournment of the two-day FOMC meeting that began Tuesday. The general consensus is that Fed Chairman Yellen and company will not raise key short-term interest rates at this meeting, although some market participants feel it is possible. Even if no move is made, we will be closely watching the post-meeting statement for changes in verbiage that could indicate when their next move is likely to take place. Any surprises could heavily influence the markets and mortgage rates Wednesday afternoon.

The FOMC meeting is ending a little earlier than the traditional 2:15 PM because it is one of the meetings that will be followed by a press conference with Chairman Yellen (her first as Chairman). The meeting will adjourn at 2:00 PM, which is also when the Fed will update their economic projections. They will be followed by a press conference at 2:30 PM. These events will probably lead to afternoon volatility in the markets and mortgage rates Wednesday.

The Conference Board will post its Leading Economic Indicators (LEI) for February late Thursday morning also. This index attempts to measure economic activity over the next three to six months. It is considered to be moderately important, but likely will not have a significant impact on mortgage rates. Current forecasts are calling for a 0.2% increase, meaning it is predicting that economic activity will likely expand modestly in the coming months. A smaller than forecasted rise, or better yet a decline would be considered good news for the bond market and mortgage rates.

Friday closes the week's calendar with the University of Michigan’s Index of Consumer Sentiment for March just before 10:00 AM ET. This index gives us a measurement of consumer willingness to spend. If consumers are more confident in their own financial and employment situations, then they are more apt to make large purchases in the near future. This helps fuel consumer spending levels and economic growth. A drop in confidence will probably hurt the stock markets and boost bond prices, leading to lower mortgage rates. Bad news for bonds and mortgage rates would be rapidly rising confidence. It is expected to show a reading of 92.2 which would be an increase from February’s final reading 91.7.

Overall, I am considering Wednesday as the key day of the week with the Fed events scheduled but Tuesday's data can also cause volatility in the markets. The least important day will probably be Monday or Friday. The benchmark 10-year Treasury Note yield closed Friday at 1.98%. This is dangerously close to 2.00%, which I believe if broken will cause another noticeable move higher. Because mortgage rates tend to track bond yields, this would be bad news for mortgage shoppers. Therefore, I am holding the conservative stance towards locking or floating an interest rate at this time. If closing in the near future, it may be prudent to consider locking or at least maintain contact with your mortgage professional if still floating an interest rate. At least until it is clear whether yields will move lower or higher from this level.

Improve Your Chances of Obtaining a Home Mortgage

  Securing financing to purchase a new home is one of the most important, exciting, and nerve-wracking financial steps most people will ever take.

During the housing boom, mortgage requirements were relaxed to unsustainable levels, and it seemed just about anyone could approach a lender and walk away with financing. But in an effort to recover from a record increase in foreclosures and loan defaults, lenders have become more stringent; loan applicants must now meet more demanding requirements to obtain a mortgage.

Does this mean that you won’t be able to get the financing you need? In a word, no. Here are a few tips to follow for a smoother path to home ownership.

Shore up your credit!

If there is one thing you can do to increase your chance of obtaining a mortgage loan, it is to take careful stock of your credit situation and address any issues that are lowering your credit score. The first thing to do is to order a copy of your credit record from all three major credit reporting agencies: TransUnion, Equifax, and Experian. Look over this information carefully to make sure that all three agencies are aligned in their rating of your credit. If you see any errors, dispute them with the company in question. If your credit is too low to obtain an attractive interest rate on a mortgage (680 or higher is considered good; 720 will put your in very good position to secure financing), take a few months to increase it. One way to do this is to take out a credit card, use it to make regular purchases, and pay off the balance monthly.

Reduce your debt.

By paying down your debt, you will not only show a lender that you are a good risk for making regular payments, you will end up with fewer outstanding payments or accounts to factor into your debt-to-income ratio. Simply put, the fewer static payments you have on your financial record, the better. While it might not be feasible for you to pay off your car or student loans quickly, you should be sure that credit card and store balances are low or nonexistent.

Don’t splurge.

If you can put off making any large purchases until after your home sale has closed, do so. This isn’t the time to run out and buy a luxury car or take a lavish vacation. The rule of the day is to be conservative with your spending – meaning more cash in hand for that down payment and reserve cash in the bank to fall back on once you need to start making your monthly mortgage payments.

Save. Save more. And then save more.

The amount of money you have in the bank is going to be important when you need to prove to a lender that you can offer up a healthy down payment. While 20% down is the conventional rule of thumb, there are mortgages available that require less cash up front. Your loan officer can point you in the right direction to take advantage of any low- or no-cost down payment programs for which you might qualify. But wherever possible, add to your savings – more money in the bank can only help you qualify for a loan.

Stability is key.

Maintaining steady employment or income is an absolute must when you apply for a mortgage. This isn’t the time to try a new career path on a lark or risk taking a new position without a lot of job security. Lenders are going to want to see that you have a proven, stable source of income, that you make regular payments on your rent or existing mortgage, and that you seem like a good risk for financing.

Obtaining a mortgage loan may seem like a challenge, but with a little diligence, a little financial restraint, and the aid of an experienced loan officer, you’ll have all the tools you need to secure the financing you need. If you can prove your commitment to the cause, you’ll be on the path to home ownership in no time.

Written by Chip Poli

What To Buy In March

 

March came in like a lamb up here and hopefully that will change since rain is forecast for the next ten days. We hope you’re staying warm and dry where you live. Today we’re going to look at the best and worst things to buy in March as well as what produce is in season.

First the freebies.

Freebies

March 8th is National Pancake Day. iHop will once again be offering a free short stack of buttermilk pancakes from 7AM until 7PM your local time. In return, iHop asks that the guest consider leaving a donation for the Children’s Miracle Network Hospitals or other designated local charities.

Best Bargains

March is National Frozen Food Month. And while it’s largely a marketing ploy to draw attention to the frozen foods industry, be on the lookout for supermarkets offering special coupons in their circulars for different frozen food brands. And if you come across a particularly hot deal, you can easily stock up on the long-lasting foodstuffs. Now would be the time to load up that extra freezer if you have one.

Look for leftover Valentine’s Day candy in the bargain bins. It should be available for pennies on the dollar. And if you prefer higher end chocolate, places like Godiva have been known to offer their Valentine’s boxes at 50% off. Our spies were in a Ghirardelli chocolate store the other day and saw big heart shaped boxes of candy for less then $5.

After-holiday bargains go beyond candy. Look in the gift sections of department stores for leftover Valentine’s Day themed presents that you can get on sale. Just like with Christmas gift baskets, you can take them apart and re-use the items in different ways.

You won’t see good bargains on lingerie, though. For the best prices of the year, wait until June and July.

Smartphones prices drop when the new models got announced at the Mobile World Congress in February.  So if you had wanted a model, and it was last year’s new super phone, now is the time to buy.  Also, talk with service providers about freebie phone deals (warning: you will probably have to sign a 2-year contract). Now, if you really want one of the new phones, wait a few months. Often, providers discount the new phones after it has been released for a short time.

March is typically a slow month for TV deals. But that’s good for you because sellers will want to negotiate as well as offer great sales. If you’re in the market for a mega-TV, expect the sales from February to continue into March. The 55″ sets are again providing the best value and most discounts.

Intel’s current-generation Skylake processors are going in some surprisingly affordable laptops. If you need good value, it’s still better to go with the older-generation Broadwell or even Haswell processors. Last month, we saw 16″ Broadwell laptops for around $400, though one was as little as $330. (The cheapest we saw on Black Friday was $315.) For those who want Skylake, your best bet is a 14″ for around $500.

Luggage deals are starting to increase. We’re not in the holiday season and we’re not in the summer season, so they need to get people buying luggage.

You may want to invest in Amazon Prime. Amazon announced last month that they would be raising the the minimum order for free shipping from $35 to $49 for non-members of Prime, a 40% increase. (Eligible book orders of at least $25 will still ship free.)

You can continue shopping on the site without a membership; it still might be the most affordable option, especially if you make infrequent purchases that are usually over $49. Otherwise, it’s time to either pay for a $99 a year Prime membership, or seek alternatives to Amazon.

Garden seeds are a bargain right now as seed companies try to get people thinking about planting. (and we’ve been trying to get you to think about planting as well).

Winter apparel should be on the clearance racks. It may be well picked over, but there’s always a great find. But don’t expect to find good deals on Spring apparel just yet. Your favorite retailers may have coupons, but there’s usually a catch. If you’re aware of that, you can plan your purchases.

And on March 18th, look for clearance prices on St. Patrick’s Day items.

The Five Biggest Turn-offs For Homebuyers

 

A lot of sellers don’t listen to their real estate agents, so we’ll tell you what your agent wants to say, but can’t say to you and this is it – your agent can’t get you the price you want unless your home is in pristine move-in condition.

That means no sticking drawers in the kitchen. No leaning fences. No rust-stained plumbing fixtures. We could go on, but maybe we need to make it clear. If you have even one of following “turn-offs,” your home won’t sell.

Buyers can get instantly turned off. Here are their five biggest turn-offs:

1. Overpriced for the market
2. Smells
3. Clutter
4. Deferred maintenance
5. Dark, dated décor

Overpricing your home

Overpricing your home is like trying to crash the country club without a membership. You’ll be found out and escorted out.

If you ignored your agent’s advice and listed at a higher price than recommended, you’re going to get some negative feedback from buyers. The worst feedback, of course, is silence. That could include no showings and no offers.

The problem with overpricing your home is that the buyers who are qualified to buy your home won’t see it because they’re shopping in a lower price range. The buyers who do it will quickly realize that there are other homes in the same price range that offer more value.

Smells

Smells can come from a number of sources – pets, lack of cleanliness, stale air, water damage, and much more. You may not even notice it, but your real estate agent may have hinted to you that something needs to be done.

There’s not a buyer in the world that will buy a home that smells unless they’re investors looking for a bargain. Even so, they’ll get a forensic inspection to find out the source of the smells. If they find anything like undisclosed water damage, or pet urine under the “new” carpet, then they will either severely discount their offer or walk away.

Clutter

If your tables are full to the edges with photos, figurines, mail, and drinking glasses, buyers’ attention is going to more focused on running the gauntlet of your living room without breaking any Hummels than in considering your home for purchase.

Too much furniture confuses the eye – it makes it really difficult for buyers to see the proportions of rooms. If they can’t see what they need to know, they move on to the next home.

Deferred maintenance

Deferred maintenance is a polite euphemism for letting your home fall apart. Just like people age due to the effects of the sun, wind and gravity, so do structures like your home. Things wear out, break and weather, and it’s your job as a homeowner to keep your home repaired.

Your buyers really want a home that’s been well-maintained. They don’t want to wonder what needs to fixed next or how much it will cost.

Dated décor

The reason people are looking at your home instead of buying brand new is because of cost and location. They want your neighborhood, but that doesn’t mean they want a dated-looking home. Just like they want a home in good repair, they want a home that looks updated, even if it’s from a different era.

Harvest gold and avocado green from the seventies; soft blues and mauves from the eighties, jewel tones from the nineties, and onyx and pewter from the oughts are all colorways that can date your home. Textures like popcorn ceilings, shag or berber carpet, and flocked wallpaper can also date your home.

When you’re behind the times, buyers don’t want to join you. They want to be perceived as savvy and cool.

In conclusion, the market is a brutal mirror. If you’re guilty of not putting money into your home because you believe it’s an investment that others should pay you to profit, you’re in for a rude awakening. You’ll be stuck with an asset that isn’t selling.

Written by Blanche Evans