Upcoming Real Estate Trends For 2020

2020 looks like a year that will start to see a bit of a shift in the real estate markets with a few new trends starting up. Inflation has certainly made itself felt in the market with the average price for a single-family home now being around $284,000. And with different consumer habits coming from younger millennial homebuyers, things may be a little different for future home sales. But what exactly will this look like?

The Growth Of Retirement Communities

With life expectancy becoming longer, an aging baby boomer generation and the usual preference of downsizing homes for them, the senior living communities are likely to see their demand rise. Some may simply want to sell off their current homes and downsize to a small housing unit, but many prefer to live in very active communities around like-minded people. The challenge they may have is selling their current homes to new buyers with housing market costs rising across the nation, although mortgage rates are also expected to decrease in 2020.

The Emergence Of The “Hipsturbia” Trend

There are new preferences millennials have when it comes to the kinds of housing they’re looking for, and what their neighborhood will look like. Disrupters in the rental housing market such as Airbnb rentals and co-living spaces have already begun to make their way into some of America’s major cities, but another neighborhood trend known as “hipsturbia” has also come about. This kind of neighborhood is a little like the traditional suburb, but housing tends to be much closer to retail stores, public transportation hubs and has a lot more sidewalks and walkways. The preference for millennials has been to save money on gas costs and long driving distance and live in communities that bring downtown housing into these suburban settings.

Smart Home And New Real Estate Innovations Are Emerging

Those who want to sell their homes without having to go through the long tedious process of listing and taking prospective buyers through the home have now started to use iBuyers. These are essentially third party buying companies that buy the home directly from the seller, and then later resell it for a profit. But even more importantly, smart home technology is also growing in demand and can greatly affect a home’s value.

This article was originally published on JasonCohenPittsburgh.org

What Is A Cap Rate In Real Estate?

A good way to analyze rental property is called a cap rate. The capital rate is a great tool to use to help you profit more from your rental property. The formula for a cap rate is the net operating income divided by the purchase price. This purchase price also includes any expenses that are for upfront repairs. This rate can be used when analyzing one specific property, but it can also be used on an overall grouping of properties as well. Net Operating Income includes Gross Rental Income minus property insurance and property taxes as well as common utilities, Vacancy/Credit Loss return, maintenance repairs, and other expenses. The focus of this type of formula is to look at the property alone and not how it was financed. This formula lets you look at the positives about a property without taking any of the debt into account. Because a cap rate measures risk, the higher the rate, then the higher the risk. The lower the rate means the lower the level of risk.

There are three different factors that actually affect the cap rate. Demographics and Macro-level economics have an effect on the cap rate. Places that have a higher population and less construction show there might be a bigger demand for rental properties. Therefore they would have a lower cap rate. Those areas that are more rural and probably do not have as big a rental demand, would have a higher cap rate.

Micro-Level markets can also affect the cap rate. Buildings in real estate are classified into four different groups, A, B, C and D. A property with a Class A rating would be the newest and most desirable building in the best location. Then the properties get classified into progressively less sought after characteristic, with Class D being the least desirable. Obviously, Class A properties would hold the least amount of risk, where Class D would have the highest.

The type of property that you have can also affect the cap rate. Commercial real estate would hold greater risk than residential property. This is because, during a recession, people still need to live somewhere. They may not be able to finance a business during that time, which would mean the commercial property would have a greater risk.

When investing in real estate, a cap rate will allow you to decide if you want to sell an already existing property. It can help pick a market or type of property to invest in and it can also allow you to set goals to determine how your acquisitions are going to perform.

This article was originally published on JasonCohenPittsburgh.org

Check Out These TED Talks If You Need Some Real Estate Inspiration

As in any business, there are a few key rules to success that only life or a seasoned mentor can show you.

Failure leads to Confidence

At this point, it’s no secret that failure is a part of success. Every wealthy entrepreneur in the last century has shared similar insight. Yet, what is it about failure that pushes people to succeed?

For Tami Pardee, the more you fail, the less insecure you feel about it because you learn to keep moving forward. The weight of insecurity lessens as you shift your focus away from the failure and onto the lessons learned. It’s easier to know the next step you should take after some perspective. Similarly, Barbara Corcoran has noticed that incredibly successful real estate agents are those who take minimal to no time feeling bad for themselves after a failure.

Power Posing

Some people fake it ‘til they make it, but Amy Cuddy suggests faking it ‘til you become it. Blame it on gender, personality, or upbringing but some people naturally stand out while others instinctively cower and hate to be seen. To make it as an agent, however, you have to place yourself in a powerful position.

Clients read body language on a subconscious level and will make instantaneous decisions based on that. No one will trust you with their money if you don’t look confident in yourself. The nonverbal cues you emit play a major factor in whether your business will succeed or not.

Social Media for Business

Unfortunately, not everyone that masters the power pose of business or accepts failures as natural motivators succeed in real estate. People have to know who you are to do business with you. And so, here comes the power of social media.

Gary Vaynerchuk has made a profitable living using both social media and his marketing skills. According to Vaynerchuk, you have to be the chief information officer of your business. Giving people an inside look at how you operate your business creates trust, transparency, but above all, content. And content is king in these social media days.

The bottom line is to not let others or fear of failure control you. According to Corcoran, as long as you keep moving forward, you’ll always reach the finish line.

This article was originally published on JasonCohenPittsburgh.net

Things You Might Be Doing To Your Home That Would Make Your Real Estate Agent Cringe

When it comes time to sell a house, some homeowners make mistakes that can cost them valuable time and money. Here are just a few things sellers should avoid doing if they want to sell their homes without fuss.

Homeowners should start with curb appeal. After all, it’s the first thing that buyers see before they enter a home. Poor curb appeal can hurt even the nicest of homes. No one wants to

A home that’s overly customized may drive away potential buyers for several reasons. First, they may struggle to imagine what your home would look like without that vibrant wallpaper. Secondly, they may not want to pay the cost, both in time and money, that it would take to undo those customizations and create a space that reflects them. This is why some people choose to repaint or make other modifications with neutral colors. Removing decor that points to political or religious affiliations is also a good idea.

Anyone who’s ever watched a homebuying show knows that the clutter has got to go. While it’s easy to focus on things that are obvious such as tables and counters, don’t forget about inside cabinets and closets. Clean up those spots and, if necessary, consider storing the contents offsite. This also protects your valuables when potential buyers tour your home.

While the way a home looks can be a dealbreaker, so can the way it smells. Smokers or pet owners are accustomed to the way that their home smells, but this can be abrasive to people who are not used to those smells. Removing smells may simply mean an extra deep cleaning, or it could require washing and painting walls as well as cleaning ducts, fixtures, and carpets. There are even companies that perform ozone treatments to remove those especially sticky smells.

A few home “improvements” can actually make a house harder to sell. This includes installing a urinal in the bathroom and building a sunroom.

Finally, beware of pricing. A house that needs a bit of work but is priced competitively compared to other homes in the neighborhood can sell faster.

Keeping these things in mind can make the process of selling a home less stressful and quicker, too.

This article was originally published on JasonCohenPittsburgh.net