Facing an underwater mortgage (owing more than your home's worth) can be scary, but a short sale offers an alternative to foreclosure. In a short sale, you sell for less than owed and the lender forgives the difference. There are drawbacks like potential tax implications and credit score hit, but it allows you to avoid a foreclosure and potentially recover your ability to buy a home sooner. Explore all options with a HUD counselor before proceeding.
The rising cost of houses and high mortgage rates are making homeownership harder to achieve. However, the lack of homes to buy is balancing out these increases. The Federal Reserve will try to lower interest rates, which may help buyers. Additionally, the "build-to-rent" market is becoming increasingly popular. This involves constructing homes that will only be rented out, which provides a more affordable option for many people.
An upcoming book, "Financially Lit!", discusses financial success and its challenges. The author realized the pressure to buy a home isn't always suitable and highlights the importance of understanding your own values and lifestyle before making such decisions. The American dream may be redefining as younger generations face financial hurdles, making it less accessible than in the past.
Mortgage rates have slightly increased to 7.34%, but their future direction depends on the labor market. Rising homeownership costs also include increasing insurance and taxes, especially in areas prone to natural disasters. While the housing inventory is improving, concerns have been raised about a change in commission arrangements for real estate agents, which may affect home sales.
Due to a lawsuit, the National Association of Realtors is changing its commission rules. Home sellers will now pay less, while buyers may pay more for agent services. The lawsuit and settlement challenge NAR's traditional commission structure, paving the way for new models like flat fees. This could disrupt the industry, leading to new competitors and potential changes in how real estate agents are compensated.
Homeowners in 2023 are benefiting from a surprising shift in tax laws. Single homeowners can shield up to $250,000 and married couples can protect up to $500,000 of their profits from capital gains taxes when selling their primary residence, provided they meet specific IRS criteria. This exemption encourages homeownership and can save homeowners a significant amount in taxes.
