Category Archives: Uncategorized

When deciding to sell your home there are two primary avenues you can chose from to complete the transaction. As a homeowner you can either list with a local real estate agent, market, and sell your home on the open market, or you can choose to sell to an all-cash home buyer. To help you decide which route to select, we have compiled a list of the top 4 recommended questions to ask your real estate agent before listing and have provided you answers to the same question according to how an all cash buyer closes on a home. Let’s take a closer look.

1. What Are Your Fees?

Agent fees are negotiable; however, a listing agent will generally request a 6% full service fee be included in the listing agreement. This includes 3% commission for the seller’s brokers and a 3% commission for the buyer’s broker. These fees are unavoidable when listing on the market since this is the main source of income for the real estate agents.

Gulf State Homebuyer’s charges no agent fees. Since we are working directly with the homeowner, we are able to forego additional fees, providing sellers the highest return on their homes. 

2. Can You Explain The Process of Selling To Me?

When listing a home with an agent, the process of selling can be long and exhausting. The first step is agreeing on the terms and conditions of the contract. Once the homeowner has hired an agent, the agent will then put together their marketing strategy for the home. This can include open houses and can take months to effectively attract a buyer. Once the agent finds a buyer, the property will enter into escrow. During this time, the buyer will complete their due diligence process and obtain funding. It is not until escrow closes that the transaction is finally complete.

The process of selling to Gulf State Homebuyer’s is much simpler. Once you contact us, we will complete a home evaluation. If you decide to accept the offer, we will complete all necessary paperwork, leaving you with the simple steps of signing on the dotted line and collecting your cash.

3. What’s the Best Price You Think My Home Can Sell For? Can You Guarantee That Price?

Using market comparables a real estate agent will outline the expected closing price for your home (the list price). They will take into consideration your homes amenities, location, and quality, and compare it with the homes that have recently closed and ones that are currently listed in the area. The agent will then market the home at the agreed upon price with the intention of closing at that value. Remember though, this is not a guarantee by the agent – the actual closing price will vary depending on your agents marketing strategy and the market demand. Don’t forget as well, there will be additional closing costs accrued at escrow. These fees will be deducted from your profit at the end of escrow.

Similar to that of a real estate agent, Gulf State Homebuyer’s will complete a valuation of the home using comparables. The primary difference when selling to an all cash buyer however – we will close on that estimated value. There is no need to market; instead, we provide an offer at the price we are willing to close.

4. How Long Do You Think It Will Take To Close On My Home?

Depending on the status of the market and the accuracy of the listing price, the length of time a home is listed can very. (Note: Most real estate agents will not openly admit that they overpriced a home to get a listing! However, this can have a negative effect on the sale). Currently in Baytown the average time on-market for a home is seventy days. This time only includes time listed and does not consider the time it took to prepare the listing and how long it takes to close escrow. Depending on the closing contingencies, the time to close escrow can very as well. A finance contingency will generally need at least sixty days. This means that you can expect it to take at least four to five months to close on your home.

Gulf State Homebuyer’s will close in five days. We provide quick valuations, and if a seller is interested in accepting the offer, the final closing date is determined by the needs of the seller. However, on our end at Gulf State Homebuyer’s, we can close quickly!

As you can see, there are quite a few benefits to selling to an all cash home buyer. If you are interested in learning more, please contact us. There is no commitment to sell – we will simply start with a conversation and if you are interested, move forward with an evaluation.

The predictions made for 2018 were not all accurate. In fact, contrary to many of last year’s estimates, the real estate market has remained strong for home sellers through to 2019. Let’s take a look at what is going on in the housing market this January, 2019.

• Despite previous reports that interest rates were going to continue to increase through 2019, they have actually experienced a decline in the past week. According to Freddie Mac, home buyers mortgage rates are averaging 3.87% for a five-year adjustable-rate home loan and 4.45% for a conventional 3-year loan at a fixed rate.

• On a negative note, the numbers are in for December 2018 and home sales plunged 6.4% according to the National Association of Realtors. This is drastic since, regardless the direction, home sales usually only shift in very low digits month to month. According to Lawrence Yun, chief economist for the Realtors, “The latest decline is harder to explain. Perhaps it is the decline in consumer confidence that’s been occurring in the latter half of 2018.” He continues, “The latest numbers do not reflect the lower, current mortgage rates comparted to the November figures, so it’s really harder to explain.”

• Real estate experts and economists are projecting that in 2019 the housing market will continue to slow down. Home developers have reduced their amount of construction planned for 2019 due to the high number of homes that are currently available on the market. In Baytown alone, there are over seven hundred homes listed for sale (as of January 2019). However, this should not be a deterrent to individuals interested in selling – they can sell to an all-cash homebuyer. The benefit of selling to an investor is that the competition does not necessarily impact the sale. For example, we here at Gulf State Homebuyers provide competitive offers despite the high number of homes available on the market.

• More on Baytown: Home prices in Baytown over the last thirty days have averaged $185,000, which is up 2.4% compared to January 2018. This is above the median home value in Baytown, which averages $147,400. In the last year home values have risen 5%, creating opportunity for potential sellers.

The Impact of the Government Shutdown 

According to the numbers, it is an optimal time for a homeowner to sell. Home selling prices are still competitive and interest rates are still lower compared to anticipated predictions. However, there is one major event that is negatively impacting the housing market – the government shutdown.

Due to the shutdown lenders are having to make a challenging decision related to providing clients with new loans. When an application is submitted to the lender, they generally verify income through the Internal Revenue Service (IRS) or Social Security Administration. However, both these agencies are experiencing delayed response times to lending inquiries. Due to lack of funding, the agencies are behind on work. Therefore, lenders are having to decide whether they want to provide loans without this critical informational. Unfortunately for home buyers and home sellers, this is causing lenders to withdraw certain loans that may seem too risky. Additionally, this does not include buyers who are seeking FHA or VA loans. These loans are underwritten by both of the identified agencies, so with limited assistance, approval time on these loans is longer than usual.

Moreover, home buyers with either the capital at hand or those that have been approved by a loan are somewhat hesitant to finalize purchases on new homes during the government shutdown. A recent study completed by the National Association of Realtors found that 25% of buyers are backing out due to their fear of government uncertainty.

The continuation of the government shutdown is making the real estate market (and the United States economy) unstable.  Depending on the length of the shutdown, interest rates could fluctuate, and, with all of the missing government assistance, many home buyers are limited in their ability to execute on a deal.

How to Take Advantage of the Market, But Avoid the Complications with the Shutdown

Remove the finance contingency on your home sale. Just because the government is shut down, it does not mean you need to hold off on selling your home. With an uncertain forecast for the real estate market, now is the best time to pull the trigger on your sale. Sidestep the finance contingency and sell to us – all-cash home buyers. We have the capital available to close on your home within five days.

If you are interested in taking advantage of the current market and selling your home, contact us today.

If you are not in the real estate industry, you are most likely unaware of how your home’s value is determined. Many individuals such as yourself believe that your home’s value is equivalent to the price you purchased the home with inflation. We hate to be the bearer of bad news but there are many other variables that must be considered when evaluating a home, and sometimes a home’s value can actually depreciate over time. To help you better understand what we consider when we value a home we have made a simple outline for you. So, if you are considering selling your home you can take a look around and see how your home compares.

The Real Estate Market and The United States Economy

The market is really what sets the price of your home. No matter the additions and upgrades you have installed, if we are in a bad market your home’s value may decline. But how can you tell how the real estate market is doing? A simple assessment of the United States economy can be your first indicator on how the real estate market is doing – generally, the economy is a direct reflection of the housing market. You do not need to be an expert in the field; instead, you can conduct a simple search on the internet and catch up on the national news headlines. This can be a great start to identifying how the economy and how the housing market is doing.

There is an exception to this assumption however. If you live in a highly sought out market, such as San Francisco, your home’s value may not be directly impacted by the market. But, if you live in an area such as Baytown, you can be sure that the local and national market will have an impact on your home’s value.

Market Comparables and Property Characteristics

Market comparables, or market comps, are essential when valuing a home, and if you can understand the data involved, you can even gain a better understanding of the economy via these comps. The first step is to understand, what are market comps? When your home is being evaluated, a professional will look at homes that have sold in your market or are available for sale in your market. This gives an understanding of price points for homes – more specifically, price per square foot. However, when completing this assessment there are many factors that need to be considered to determine if the comp is an appropriate one to utilize when evaluating your home. We at Gulf State Homebuyers consider a variety of aspects when evaluating a home, including: condition, year built, amenities and upgrades, number of bedrooms and bathrooms, square footage, and more. Every additional luxury can add value to a home. For instance, for 2019, homebuyers are seeking eco-friendly homes that provide adequate open spaces. Therefore, if your home matches what the buyers are looking for, your home could increase in value.

A unique home to value is one that has been damaged, say by a recent hurricane or a fire. These homes can be a bit trickier since they require much more upfront capital to improve. When evaluating a home that has severe damages we take into consideration the value of the home prior to the damages along with the estimated cost for renovations, including time and money. We differentiate ourselves from the insurance companies in a major way however, in respect to our motives. We are not looking to give you as little as possible; but instead provide a fair valuation of the homes fair market value.

Getting a Professional Opinion

To get a true understanding of the fair market value of your home it is recommended that you seek the assistance of a professional. Individuals in the field are continuously working with homeowners, reading market updates, and assessing home trends, which provides them with the understanding of how to value your home at a competitive price. One of the worst things an individual can do is evaluate their own home and set the expectation of that selling price. Due to an emotional connection, many homeowners value their homes above their true value.

If you are considering selling and would like a free market evaluation, we here at Gulf State Homebuyers are happy to help. We specialize in purchasing homes in the Baytown area and therefore spend our days living and breathing the local real estate economy. We purchase homes all cash and provide an easy solution for residents to close quickly. We purchase homes of all types, including those that are damaged by fire or rain, homes that are heading towards foreclosure, and even homes that have unwanted tenants living in them. To get started with your free home evaluation, contact us today.

Many reports label millennials lazy, suggesting that they are averse to working and lack the motivation to pursue the American Dream. Unbeknownst to many, over the last 50 years, the United States economy has undergone a major shift that is deeply impacting the ability of millennials to achieve the so-called American Dream, reducing their chances of owning a home.

A recent study completed in October by Bank of America found that 72% of millennials, which they identified as individuals born between 1978 and 1995, have listed being a homeowner as a “top-priority” in their lives. With such high number, why aren’t millennials purchasing more homes?

The Impact of Student Debt

Most millennials were pushed to enroll in college following high school, which generated enormous debt for student’s post-graduation; understandably, when you already have $50,000 or more of looming debt, taking on a mortgage is frightening.

The Belief that We Are Approaching Another Recession

Many analysts are forecasting that by 2020, the United States will be hit with another recession. Most argue that it will not be as severe as that of 2007; however, as millennials were witnesses to the economic impacts that the 2007 downfall had on the population, they are wary of purchasing a home at this time. The fear is that they will lose the home not long after the purchase. And although interest rates have been moderately low, few have acted.

Low Pay and High Cost of Living

If you take a closer look at many postings for job openings, you will see employers hiring people at $10 – $15 per hour and requiring a college education; many master level positions are paying below $20 as well. Compared to the cost of living in most major areas, including the Houston area, this pay rate does not enable someone to purchase a home. The average rent is 30% of the renter’s income – but those who earn near minimum wage end up paying nearly 50% of their income toward rent! This high cost of living makes it challenging for individuals to save the money for a down payment on a new home.

Lifestyle Changes

We can also gain some insight by shifting lenses and looking at the social aspects of millennials’ lives. There is a noticeable difference in their values and life trajectory compared to those of baby boomers. First off, they are marrying later in life. While twenty years ago, it was common for someone to marry in their early 20’s, it is now more common for couples to marry in their early 30’s. One major contributing factor is the transition from skilled jobs to professional careers, which demand years to develop rapport and professionalism. No longer are people satisfied at entry level positions; rather, there is a higher percentage of men and women committed to building their career prior to getting married.

Another lifestyle change that is impacting the pattern in which home buying occurs is that millennials are less interested in material items and more interested in spending their income on experiences. With this mindset, they are struggling to save the capital for a down payment.

Lastly, there is also the trend towards digital nomads. This professional decision to build a company online, or work as an online freelancer, is reducing the number of people dedicated to purchasing a home. Instead they are utilizing their income to fund a nomadic lifestyle built around working abroad. There are even companies devoted to organizing digital nomad groups, which meet for anywhere from one a week to one year, providing people with the essentials they need to comfortably work and live abroad.

High Home Prices

The real estate market has been a seller’s market for some time now. This means that homes are selling at higher prices, inventory is low, and competition is tough. Additionally, due to the increased price of homes, those who already own homes have been hesitant to sell. Although interest rates have seen a decline over the last few years, the increase in home values has made it challenging for millennials to transition to their own home.

Looking at The Future

There is no simple answer to the question of why millennials are not purchasing homes. There are both economic and social influences that have had a major impact on the shift in home buyers in the United States. If the economy can push through the expected recession and provide millennials with more confidence in their future with buying a home, we may anticipate an increase in home buyers.  If you are in the market to sell or buy a home, contact us today!