Real Estate Buyers 93551 | Palmdale | FAQ’sHow much home can I afford?
This is one question I am asked all of the time by friends and clients who are in the market for Palmdale or Lancaster, CA area real estate. “How expensive a home can I afford?” The problem with answering this question, at least when my personal friends ask it, is that they are not honest with me about their income or they just plain don’t want to share their financial life with someone so close to them. I understand that and I refer them to several mortgage brokers in Palmdale which keeps it impersonal. Just about everyone I know wants to own their own home, and most of them want to own the biggest and most expensive home they can. We should not be a slave to our home mortgages, life is too short, and you need to budget appropriately in order to have a good quality of life with some disposable income over and above your monthly mortgage payment amount. There is a general rule of thumb for how much home you can afford, but I shouldn’t even get into it. Better that I defer this question to the real experts on the topic of residential real estate or mortgage finance. I have mortgage calculator widgets on this website for your general reference only. Please do not rely only on such a simple tool as this for one of the most important financial investments that you will make in your life. A Palmdale, CA area mortgage broker will be able to get you thinking realistically about how much home you can really afford.
An important consideration when pondering the question “how much house can I afford” is how much down payment you are able to put down. A down payment is not necessary at all with some of todays mortgage assistance programs and first time home buyer incentives. Having ten to twenty percent down is nice but not necessary.
What is Equity?
This is a great question, and one I love talking about. Home equity is the reason that there have been more millionaires created through real estate investing than any other form of investment. So, “what is equity?” Equity is the money or value that you have in an asset, and in our case this is your home. Not all of your monthly mortgage payment is equity. There is a lot of interest paid in the early stages of a mortgage (check out an amortization table for a more in depth analysis). The interest you pay on your Palmdale real estate is not building equity, but it can benefit you in the way of being an income tax deduction. Equity is built in your home only from the portion of your mortgage payment that goes toward the “principle.” Principle is the original sum or outstanding balance of the loan. As you build equity in your Palmdale real estate, you can use that equity as leverage to finance or buy other things outright. You can use the equity in your home to do just about anything. You can use the equity as collateral for the purchase of another property, to buy a car, start your own business, send your kids to college or anything else you can imagine. Equity is yours to do with as you please. Instead of throwing your money away on rent and building equity for your landlord, you can accumulate wealth yourself. This is the American dream. At the end of your mortgage term you have a valuable asset that is probably worth two times what it was when you originally financed the home. Real estate is an incredible hedge against inflation. As Realtors in Palmdale, CA my team at Keller Williams and I can feel really good about helping home buyers grow their wealth by building equity in their Palmdale real estate. The beauty of buying a home is that your equity is protected against inflation. Palmdale real estate is a tangible asset. When real estate is traded, it is traded for real-time value. When you buy a home you are making the safest most stable investment I am aware of. The best part about an investment in Palmdale real estate is that, unlike other forms of investment, you can live in the home while gaining and protecting your equity. You can’t live in, and raise a family in a stock or bond.
Do I get a tax break for buying a home?
Yes you do get a tax break for buying a home. Everyone’s financial situation is unique but almost everyone gets tax benefits when buying Palmdale real estate. I am a Realtor and not a real estate tax attorney or accountant but I understand the basics. The interest you pay on your mortgage can be deducted (at least in part) from your taxable income. As well as your mortgage interest, you can deduct your property taxes. The financial aspects of buying a home are quite complicated but the simple answer is yes you do get a tax break for buying a home. When you do the math and compare the bottom dollar costs or renting a home to buying a home, it is clear that the smart money is buying real estate. I went to a “Rich Dad Poor Dad” seminar about a year ago and one of the main suggestions was to buy real estate if you possibly could. Tax advantages are just one of the many benefits of home ownership. Palmdale real estate is appreciating at or above the national average. You save money on your federal and state income taxes, build equity and wind up owning an asset (your Palmdale real estate). Contact your accountant or real estate tax attorney for a detailed analysis of the benefits to you specifically. Everyone’s financial situation is different, because of different income tax brackets, their income, their investment goals, and other circumstances. When you rent real estate you get no tax break or tax advantages so consider buying a home if you can.
Whats the difference between pre-qualification and pre-approval?
I’m often asked by by Palmdale real estate buyer clients “what’s the difference between pre-qualification and pre-approval?” The short answer is that home loan pre-qualification is a very rough estimate of how much home you can afford. With pre-qualification you will still need to go through a lot of paperwork and a real approval process before you can actually buy a house. Now pre-approval is a definite amount of money that you can spend on a house. The mortgage company, bank or credit union, has given absolute approval of a certain dollar amount that they will lend you for your Palmdale real estate purchase.
The difference between pre-qualification and pre-approval might sound insignificant but it’s not. Consider this example. You find a house in Palmdale or Lancaster that you fall in love with. This is the perfect piece of real estate for you and your family’s needs. You want to be near the Rancho Vista Golf Course, a good Palmdale area school for your kids, and your work is just a mile away. This home checks all the boxes including the price and absolutely everything. This house has been on the market for only a few days, and there are several other families who are thinking exactly what you are thinking. This is the perfect piece of Palmdale real estate for their family also. Offers start flooding in to the seller of the home. One family has a pre-approval and can close on the property several weeks faster than another family with only a pre-qualification. The seller of the home can choose between buyers, and this does happen often with the really desirable properties. Which one of the offers or buyers do you think the seller will choose to take? Of course the seller chooses to accept the offer from the buyer with a pre-approval. It will be heart breaking for the family with the pre-qualification. When you go shopping for a home, be prepared and cover your bases. When the perfect home for your needs comes to your attention, you want to be poised and able to buy. Buying real estate is competitive at times and a pre-approval could give you the edge over the competition.
How do I make an offer on real estate?
It sounds simple enough to make an offer on real estate, but it’s more complicated than you might think. In most real estate transactions there are conditions that must be met in order to even submit an offer that will be seriously looked at and given consideration. First of all a Palmdale home seller, or their real estate agent wants to know that you are qualified (or pre-approved) to buy a home before they will even give you a showing of the home. No one likes having their time wasted. Home sellers are wary of people who might be casing their property. Some screening is necessary to protect the safety of the people looking to sell their Palmdale real estate.
Making an offer on real estate should be very carefully done. As a home buyer, you want to make your offer contingent on the home or property passing the proper inspections. In addition, you might want other contingencies such as a certain move in date, acceptance of certain financing, or other terms you want to set forth. You make an offer on real estate through a real estate agent or Realtor such as myself so that the paperwork is done right and the offer will be legally binding on the home seller if it is accepted.
What are real estate contingencies?
Real estate contingencies are the if, then type of conditions. For example, your offer might basically state that you will buy the Palmdale real estate, if the house doesn’t have termites. Or you are willing to buy the home, if the well and septic system check out in good working order. Or you might need to sell your current home on the east side of Palmdale before you can buy this one on the west side that you’re making an offer on. Contingencies certainly have their place in real estate offers. Be aware that in situations where there are multiple offers made on the same property, the seller of the home will likely choose to accept the best overall offer. Contingencies are a factor in determining which offer a seller will accept. For example, a home seller might choose to accept an offer for less money because it is a cash offer, and is not contingent on a buyer obtaining financing. Or a seller might choose to accept one offer over another, because of fewer inspections being required, or a faster closing. Be aware that the inclusion of contingencies in your real estate purchase offer can weaken your offer in comparison to other competing offers.
What is earnest money?
When you’re buying real estate and have made an offer that is accepted by the home or property seller, the next step is to transfer some earnest money. As the name implies “earnest” money shows that you are earnest (ready, able, and willing) and want to purchase the real estate. This money is usually a percentage of the purchase price of the home and is not refundable if you default on your end of the purchase contract. Earnest money really shows the property seller you are serious. You should be ready to transfer earnest money quickly for the purchase of your Palmdale real estate. Know this is a required step of the real estate purchase process. Be prepared with money in your checking account or a location you can transfer it quickly from.
What is a short sale?
A short sale is real estate situation in which the seller of a property and the lending institution have agreed to sell the home for less than what is owed on the mortgage. You might be able to buy some real estate in Palmdale or Lancaster, CA for a bargain. A short sale helps a home owner who is under water on their mortgage, avoid foreclosure. This is a win for all parties involved and good for the whole Palmdale real estate market. A short sale is good for the seller of the home because they avoid foreclosure and the financial ruin that comes along with it. It’s still not great for the sellers credit report, but better than a ruinous foreclosure on their record. Short sales are good for the lender or mortgage company because the foreclosure process is long and expensive. A lender would logically only approve a short sale in the case that they would net more money than they would after going through the foreclosure process and selling the property afterward. The mortgage lender might not like the idea of a short sale but it might be the best financial option for them at times. A short sale can be a win for your the Palmdale real estate buyer because you get a home for a bargain price. The Palmdale real estate market benefits from a short sale also. Foreclosure properties are generally not well kept. For this reason they stay on the market for a long time. Not many home buyers have the time and money to make extensive repairs to a home before they move in. The excess housing inventory floods the market and drives overall home prices down. Short sales aren’t something the Palmdale real estate community desires, but they are a necessary evil. We will still feel the effects of the real estate market crash for some time to come.
What is the condition of the Palmdale real estate market?
This is a great question. As Realtors in the Palmdale, CA area we talk about this a lot at Keller Williams. I am asked by my buyer and seller clients often “is it a buyer’s market?” or “is it a seller’s market?” The condition of the real estate market in Palmdale and Lancaster, CA is constantly fluctuating so it’s hard to give a straight answer on this but it needs to be addressed. If I had to sum up my opinion of the condition of the Palmdale real estate market, it would be that I’m very optimistic. I think that 2015 will see price appreciation, historically low interest rates, which will create more demand for housing than there is supply. In tough economic times such as this areas such as Palmdale and Lancaster, CA that offer cheap or affordable housing are going to see an influx of new residents. People can’t afford to live as close in to the cities will move out our way and our real estate market will benefit from this phenomenon. In Palmdale, we are in the path of sprawl and growth, which is a good thing. This is a time of recalibration for the real estate market in Southern California. As a professional Realtor I am educated on market conditions and looking at historic trends, I think that the Palmdale real estate market will become better while other areas such as the San Fernando Valley will stay the same or get worse.
Who is the best Realtor in Palmdale, CA?
This is a great question. I like to think that I’m the best real estate agent in Palmdale, CA. If you ask ten people this question you will get ten different answers. On what criteria will the Realtors be measured? My friends and family often ask me “who is the best real estate agent in Palmdale?” and my answer is always the same. Wes Darby “Mr. Palmcaster” Realtor at Keller Williams in Palmdale at the Antelope Valley mall. The best real estate agent in Palmdale for you might be someone you relate to or is a family member. Then again if your brother or bum of a relative is a real estate agent here, and you don’t want them to know your business, then they might not be the best Realtor in Palmdale, CA for you. Some might say that the best real estate broker in Palmdale might be the one who had the most in gross volume sales. Others might say the best real estate agent was a member of the multi-million-dollar-club or some other distinguished title. In my opinion the best Realtor in Palmdale, CA is one who will listen carefully to your needs and pay attention to you. A Realtor who really keeps your best interests and needs in mind at all times. Some of the top producing Palmdale real estate agents might be considered the best by some standards, but they’re too busy to give you the personal attention that you deserve. I think my team at Keller Williams and I are the best Realtors in Palmdale, CA hands down. I specialize in the 93551 zip code in Palmdale and can help you with your real estate needs whatever they may be. You will believe after doing business with me that I am the best real estate agent in Palmdale, CA I have no doubt.
Do I have to pay a real estate agent?
As a Palmdale real estate buyer you do not have to pay a real estate agent to help you find a home. Real estate commissions are paid by the seller of the home or property and as a buyer you might as well employ the services of a Realtor because this is spent money whether you find the house yourself or not. If you find a Palmdale home or property yourself, eventually you go to buy the real estate and you need professional help. If you aren’t represented by a Realtor already then the real estate agent who has the property listed for sale will likely become your agent as well. This is known as a dual agency. The selling real estate agent can collect commission on both sides of the transaction. When you are buying real estate in Palmdale you want a Realtor who is representing you and only you. A Realtor who is playing both sides of the fence doesn’t have your best interests in mind. Utilize the resources available to you as a home buyer and get help from a professional Palmdale Realtor such as myself to help you negotiate the best deal on your real estate transaction.
How do I find the best real estate agent in Palmdale?
I would suggest that if you want to find the best real estate agent in Palmdale you pick up the phone and call me directly at (661) 236-3420. You can always e-mail or find us on our website at palmdalerealestate.net and submit your contact information into the form provided. You can find (me) the best Realtor in Palmdale by simply coming into my office which is located on Rancho Vista Blvd. My office is on the outside of the Antelope Valley Mall 93551 (where all the restaurants are) and across from the new Dick’s Sporting Goods location.
Who is the best Realtor in Lancaster, CA?
I like to think that I’m the best Realtor in Lancaster, CA. I am not a top producer with lots of fancy titles but I know the area well and give great customer service. I can help you buy or sell a home quickly and I deal with raw land and commercial property often. Interview me personally and you will see why I get such high marks from my past Lancaster, CA real estate clients. There are over three hundred and fifty real estate agents in my office at Keller Williams in Palmdale, and if you don’t think we mesh well or anything, I can refer you to one of the other agents in the office.
Is it a buyer’s market or a seller’s market?
This is a tough question to answer because by the time I’ve written this and by the time you’re reading this the market has probably changed. Palmdale and Lancaster real estate is a moving target. Inventory of homes listed for sale is always changing. To understand the basics of whether it is currently a buyers market or a sellers market, you must understand real estate inventory fluctuation. If there are more houses for sale at a given time than there are buyers of those houses, then that situation is called a “buyers market.” The balancing of supply and demand will drive prices down and a buyer can essentially afford to buy more house. In the inverse situation there are more buyers of homes than there are homes for sale, then that creates a “seller’s market” and the balancing of supply and demand for those homes drive prices up. A seller gets more money for the same house in this situation hence the term “seller’s market.”
Palmdale, CA Real Estate Listings from “Mr. Palmcaster” Realtor Wes Darby and MLS[idx-listings city=”Palmdale” statuses=”1,2″ propertytypes=”1380″ orderby=”DateAdded” orderdir=”DESC” count=”100″ showlargerphotos=”true”]
Quartz Hill, CA Real Estate Listings from “Mr. Palmcaster” Realtor in Quartz Hill[idx-listings city=”Quartz Hill” statuses=”1,2″ propertytypes=”1380″ orderby=”DateAdded” orderdir=”DESC” count=”100″ showlargerphotos=”true”]
Lancaster, CA Real Estate Listings from “Mr. Palmcaster” Realtor in Lancaster, CA[idx-listings city=”Lancaster” statuses=”1,2″ propertytypes=”1380″ orderby=”DateAdded” orderdir=”DESC” count=”100″ showlargerphotos=”true”]
Leona Valley Real Estate Listings from “Mr. Palmcaster” Realtor in Leona Valley 93551[idx-listings city=”Leona Valley” propertytypes=”1380″ orderby=”DateAdded” orderdir=”DESC” count=”100″ showlargerphotos=”true”]
1 thought on “Palmdale Real Estate Buyers 93551 FAQ”
Thanks for the good info.