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During the 2008 housing market crash, homeowners owed more on their mortgages than their home was worth. During this time, we saw areas across the United States with high poverty rates, in addition to high appreciation in years prior, struggle the most. Homeowners in these places saw a 44% decline in home prices when the housing market crashed, whereas homeowners in areas with low poverty rates, and low appreciation, saw a 10% decline in the average home price. Now, home prices are at all-time high and 67% of Americans view now as the worst time to buy a home. As the housing bubble gets set to burst, real estate experts are expecting to see the same decline in home value in high poverty areas that they saw back in 2008. Areas with a high poverty rate are victims of investor interest for fix and flip. Homes in these areas are cheaper, and investors will come in during the housing bubble to buy. More interest in the area pushes prices up, causing home value appreciation to increase. When the crash begins and the home is updated or repaired, investors list their homes, pushing prices back down. The more appreciation we see in a specific area in the years leading up to a housing crash, the more that area will suffer in the aftermath. The national poverty rate sits at an average of 14%, and the state of Alabama has an average of 15.5%. To be considered a high poverty area, the average poverty rate will be above 20%, and low poverty areas will see an average poverty rate below 10%. According to data from 2019, Bessemer (35020) and Midfield (35228) have some of the highest poverty rates, sitting at 25.9% and 22.1% respectively. With a higher poverty rate, comes cheaper home prices, and cheaper home prices are an interest to investors from all over. High home value appreciation has been seen across all areas of metro Birmingham in the past year, but the higher percentages are found in those high poverty areas. For an area to be considered to have high appreciation, there needs to be at least a 10% increase in home value in the past year. Using the same areas from above, Bessemer has seen a 35% increase in appreciation value in the past year; Midfield saw a 29% increase. Areas with low poverty rates, such as Mountain Brook (35223) with a poverty rate of 2.5%, saw only a 17% increase in appreciation this past year. The average rate of appreciation for zip codes in the metro Birmingham area is 14%. With less Americans wanting to buy, prices will begin to drop, and it will add to speculation of an impending housing market crash. The poverty level and amount of appreciation contribute to how much a specific area will suffer, and if you live in an area with high poverty rates and high appreciation, you are at higher risk of losing home value than any other area. If you are looking to buy a home, checking out the increase in appreciation of homes in the area in the prior years would benefit your investment in the event of a housing market crash. You can check out the poverty rate for your zip code, as well as other important information, here. You can check out the appreciation rate compared to poverty rate, ranked with numerous metro Birmingham zip codes through our excel sheet.
With the recent COVID-19 pandemic, we have seen many changes to the housing market, including the need for more space for those who work from home. We are also seeing many younger people, such as millennials and Gen Z, choose to move back in with their families and stay for longer periods of time. Millennials make up the largest portion of first-time home buyers right now, but they aren’t buying homes at the same age and rate previous generations have. With more options available to them, affordability issues, and starting families later in life, millennial home buyers and older Gen Z have been slower to buy homes than the generations before them. Millennials and older Gen Z are prolonging the home buying process by having more access to options and information than previous generations have had. Technology plays a big part in everyday life, and it is no different with the home buying process. You can find homes online through websites like Zillow or Redfin and have access to almost all the information you need to know, such as pictures, number of bedrooms, what kind of flooring; you don’t even have to enter the home. The number of options that are at their fingertips gives them more homes to sift through, more options to think about, and more areas to cover. Mortgages can also be shopped around for online. With easier access, home buyers now receive more mortgage quotes than previous generation home buyers; millennials have seen to get an average of 6 mortgage quotes, compared to the 3 that their parents may have gotten. One of the biggest issues that has exiled younger adults from the housing market is affordability. Across the United States, new home buyers are being left out in the cold due to a housing shortage of nearly 4 million homes, propelling the average home prices to an all-time high. Homes today are 39% more expensive than they were 40 years ago. While wages have risen since then, they have not kept up with the increasing costs such as climbing rent prices, home prices, or tuition costs. Saving up money for long term goals, such as buying a new home, is hard to do when you have student loan payments and high living expenses. Being able to afford to buy your own home has risen to top priority amongst millennials and older Gen Z, knocking down the idea of settling down and starting a family. With home prices already being at an all time high, younger couples can no longer afford the challenges that come with having kids, such as higher insurance, childcare, and parental leave. This higher cost of living contributes to the lack of stay-at-home mothers; families can no longer survive off one income. Many women also want to build a career and be financially secure before settling down to start a family, and women 50 years ago weren’t given this kind of opportunity. With so many couples waiting until later in life to settle down, it also pushes back the idea of buying a home. Buying a home is a large investment, and it is a decision that many millennials are taking their time on. Whether it be due to too many decisions, affordability issues, or even the need to feel financially secure before making a long term decision, younger generations are ultimately prolonging their home buying experience.

A recent study found that Jefferson county ranked 8 in Alabama for rising home values. Jefferson county continues to be one of Alabama’s most desirable counties to live in. Jefferson county continues to be one of the most dense counties at 674,000 people. Mobile county is a close second at 414k people.

The study by SmartAsset ranked Clarke county, in south Alabama, as the number 1 fastest-rising home value county. Followed by Baldwin county and Mashall county. SmartAsset’s most recent study was to determine which counties get the most value when you consider home value growth, Schools and property tax rate.

Jefferson county continues to rank well across important criteria for the majority of homeowners. Jefferson county has also seen a large influx of commercial and out of state investors flocking to the county. Commercial development is highly correlated with getting the most value from residential home sales.

For the last 5 years Jefferson County has seen price appreciation of 37.66%, which is about 7.5% each year. Shelby county is close behind at 32.8%, about 6.56% each year. These strong numbers are a great sign for future property values in Magic City.

A link to the article mentioned: https://smartasset.com/taxes/alabama-property-tax-calculator#alabama/homeValueGrowth-1

Life moves fast as you look back on all the things you’ve done. Before you know it, you look next to you and your loved ones have grown older. Tasks take a bit more effort for them, and maybe their memory isn’t what it used to be. As much as we hate to think about the future regarding our loved ones, there comes a point where you have to plan for will happen for when their health declines. There are many signs that your elderly loved one may need some extra help with everyday tasks. Reduced mobility, vision, and memory are all common signs of aging, but that doesn’t mean that they need help. You’ve got to look deeper behind those signs and ask yourself the hard questions. Is the home safe if those worsen? Are you, family members, or friends close enough to help out on a daily basis? Complex medical schedules, signs of depression, sudden weight loss, recent injury, or a noticeable lack of self-care suggests that they need some assistance. If you’ve come to the conclusion that you need to seek help from outside your circle of family and friends, there are different senior care options based on what each individual needs. Home Care – Home care is typically a temporary situation due to illness or surgery recovery, and it put in place by a doctor. The individual will receive professional care while they remain in the comfort of their own home. Home health aides can also relieve primary caregiver stress and come to the home when it is convenient to the family to help with everyday tasks. Adult Day Care – Adult day care is a great option for those of you that are the primary caretaker of your senior loved ones and can’t afford residential care for them. This option can provide structure to the individuals everyday lives, and help alleviate feelings of isolation, anxiety, and depression. Many adult day care programs provide a midday meal, as well as a variety of social activities, outings, and healthcare. Assisted Living – If your loved one needs assistance with daily living tasks, such as laundry, dressing, or transportation, an assisted living facility would be a great option. It is a long-term residential option, and it allows seniors to remain their independence while still living in a safe environment with around the clock security and care. Assisted living facilities offer a range of social activities and events for residents to participate in, and it comes with a more communal vibe to make individuals feel more welcome and at home. Nursing Home – Nursing homes are residential care options for individuals that need around the clock medical care. Stays can be long-term or short-term for anyone requiring preventive, therapeutic, or rehabilitative care. You want to find a facility that best meets your loved one’s needs, and you want them to be happy and comfortable. When the time comes to begin the search, be sure to include your loved one in on the process. If you’ve decided to go with a residential facility, this will become their new home; allowing them to help make decisions will play a huge roll in how they cope with the change. The best way to find the right facility is to visit them. When you’re there in person, you’ll be able to tell how clean it really, is, how welcoming the common areas are, how the staff interacts with residents, and ask any questions. You might what to clarify what you’re paying for, or maybe you want to know specific questions about what your loved one will be able to bring with them. Take notes, compare facilities, and choose one that feels right. The cost of senior care varies depending on where you live, as well as how much care is needed for your loved one. Nursing homes provide the most care, making them the most expensive option; however, the cost of placing a loved one in a nursing home in Alabama is well below the national average. Alabama also has the lowest average cost for skilled nursing when compared to its neighboring states. If you need more information on the cost of senior care in Alabama, you can visit caring.com for more!
If you have been thinking about selling your home, you have probably thought about things you could do to add value to your home before putting it on the market. The truth is, while there are things that will increase the value, it pays off more in pride while you are still living there than it does anything else. However, some minor upgrades and changes aren’t such a bad idea when trying to appeal to home buyers. First things first, home maintenance. Your home is a big investment, and you should take care of it as you would anything else that you want to have for a while. Home maintenance items, such as lawn maintenance, replacing outdated or broken appliances, or servicing your HVAC, won’t add value to your home. If anything, you’ll have a lower chance of getting a bad home inspection report back. Home maintenance should take place as issues arise to keep your home in good condition while you’re still there. The better care you take of the home, the more it’ll be worth later. Small upgrades are a good way to spruce up your home and add a little bit of value back into it. The best way to do that is to paint. When you’re selling your home, you want your home to appeal to a wide variety of buyers, and to do that, painting over your lime green bedroom walls might be a good start. You could also think about sanding down and repainting kitchen or bathroom cabinets. Other small upgrades you might want to think about are removing your popcorn ceiling, replacing hardware on cabinets and drawers, and switching out old lightbulbs with LED’s. These are small and inexpensive changes, but they will make a difference in the eyes of a buyer! If you want to do something a bit more than small upgrades, think energy efficient. Bringing energy efficiency into your home is going to add value because you will ultimately be saving money on things like heating and cooling costs. Smart or programmable thermostats are a great way to save on energy costs; you’ll be able to set climate control for when nobody is home or when it’s time for bed. Other things you might want to think about in terms of energy efficiency include installing double paned windows, adding ceiling fans into bedrooms, or adding a bit more insulation to your attic. If you’re wanting to remodel or renovate, specifically to sell, remember to keep in mind that anything you do will need to appeal to a large variety of people. While a lot of people appreciate a good kitchen or bathroom remodel, any renovation that adds mores space is the best route to take. A lot of people are looking for more space to work from home ever since COVID has created a remote work force. You can finish out your basement, if you have one, or open up the floor plan by knocking out a wall. Making eye candy changes to your home to make it more appealing doesn’t have to be expensive. Add a fresh coat of paint, and keep in mind you are trying to please a variety of different potential buyers with whatever changes you decide to make. Whether you decide to make some minor changes or add a half bath, you’ll find that you added just enough value for the right buyer.
With the threat of COVID-19 across the world, many people had to make the transition from working in a centralized office space to working from the comfort of their own home. As the pandemic progressed, companies began to give their employees the option to continue to work from home instead of returning to the office; they even offered a hybrid option of coming into the office some days and remotely working other days. While those of us who work from home don’t make up a large portion of the work force, it is still enough to create a shift in commercial and residential real estate. With more people spending majority of their time back at home, their needs have changes regarding their living spaces. In the past, location played a big part in where people chose to live; they were willing to sacrifice floor space in order to be in the location they desired. Not to mention, better location meant higher prices in most cities. Now, people are looking for more space, and location isn’t necessarily a determining factor. There is a need for more space in order to have a dedicated area to working from home, and by working remotely, they don’t need to be as close to the office. This new necessity among working Americans has caused apartment floor plans to be modified. Renter’s desire a home office space, so architects have changed existing floorplans, enabling people to work from home without paying for a whole extra room. A combination of being able to work from home and the need for more space has remote workers migrating from city centers to more suburban and rural communities. These communities are often more affordable, and they provide more floor space for what you end up paying. Cities such as New York City and San Francisco are seeing massive loss of residents during this shift to remote work. Residents will sell their home and condos within the city and take the money they’ve made to the suburbs and rural areas nearby, consequently causing a rise in home and rental prices in that area. This rise in home and rental prices can affect locals, squeezing them out of the area. As more people are given the option to work from home, the more we will see a change in the real estate industry. With companies and workers finding more pros than cons from working from home, commercial real estate could see centralized office spaces phased out entirely. Within the residential real estate industry, there could be a severe change in floorplans for new homes being built. COVID-19 not only changed the average working day for Americans, but it created a shift what people want in the real estate market as well.

The home buying process is an extremely rewarding process, and we want to help you feel like you did it right.

  • Find a real estate agent. Finding a real estate agent is going to be the most helpful thing to do when it comes to finding your dream home. Don’t be afraid to talk to and interview several agents to find one that you think has your best interests in mind.
  • Figure out what kind of monthly payment your budget allows. Before you start your home search, it’s a really good idea to take the time to sit down to see what your monthly budget looks like now, and what it will look like once you buy a home. You don’t want your monthly housing payments to exceed 25% of your take home pay. Be sure to include property taxes, homeowners’ insurance, etc.
  • Buy in a good school district. Homes in a good school district are more likely to go up in property value, as well as sell faster. Even if you don’t have kids, and you never plan on having kids, check out homes in good school districts.
  • Know what you are not willing to negotiate on. Buying a home comes with a lot of compromise, but what are those things that you’re not willing to compromise? Maybe you want a walk-in closet, or you want a big open kitchen. Find those things that are important to you and make a list. This process is about you and your future home, so if you know you’ll be devastated if your new home doesn’t come with a formal dining room, don’t settle.
  • Don’t rush and be nosey. When you’re looking at homes, don’t be afraid to really look. Obviously if the home is occupied, respect their privacy and their belongings. However, turn on the water, check out the water pressure. Open cabinets and closets, see how much space is in there. Are the yards in the neighborhood kept up with? Purchasing a home is a big decision, and you want to make sure you know what you’re getting.
  • Bring in an outsider. Sometimes you don’t realize you’re wearing rose colored glasses, and you think you’ve found the perfect home. Bringing along a friend or family member, who knows what you’re looking for in a home, might help you see the not-so-perfect aspects about the home. It’s easier to stay grounded when you have someone you trust around to help decide if it’s what you’ve been searching for.
  • You might get a better deal in the colder months. When school begins for kids, most people have settled into their new homes. By September, the number of homes on the market is still fairly high, and as it gets colder, the market cools down as well. You may not have a full view of available homes, but the prices will be lower!

We want your home buying process to be as smooth as possible, and we want you to get the most out of it. Find your budget and take your time.

Maybe they stopped paying rent and were facing eviction. Maybe you have not seen them in while. There is plenty of reasons why someone would leave their home in the middle of a lease, but now what do you do?

The first step is to determine if they really did abandon the property. Tenants may be out of their home for business trips, vacations, hospitalizations, or even something a bit more sinister, like a kidnapping. The first thing you will want to check is to see if they are behind on rent; someone planning on coming back will most likely continue paying rent. Some more questions to ask yourself include:

  • Is any personal property or valuable items left behind? Typically, if someone does not have plans to return to the residence, you will not see many valuable or personal items, such jewelry, clothes, and pictures. If you see a lot of trash or rotten food, it is more than likely that they will not be returning.
  • Do the neighbors know anything? Everyone has nosey neighbors that love to peak through their blinds. Ask around, see if they saw anyone leaving or moving out in the middle of the night; they may know more than you think.
  • Are utilities shut off? If the tenant has truly abandoned, they would have turned off electricity and water. A quick call to the company who handles that for your area should answer that question.
  • Has a change of address happened? Tenants who have abandoned may have changed their address. Your local post office should be able to help you determine if they changed it.
  • Have you contacted their emergency contact? If you believe the tenant has abandoned, or may be in trouble, calling their emergency contacts is beneficial. They may know where they are or be able to tell you if something happened.

Once you have determined that the tenant has abandoned, the next thing to do is to notify them that you believe they have abandoned the property. Even if they have not responded to your inquiries about their whereabouts, you will still need to give them an official notice with a set amount of time to come reconcile any fees, gather personal items, or prove they did not abandon. The best way to give the official notice is to go through certified mail, so that way, you can prove that it was sent and delivered.

As far as personal property is concerned, create a list and take photos of everything left behind in the apartment. As a landlord, most states require you to store a tenant’s property that was left behind for a specific amount of time, so they have time to come retrieve it. You can pack it all up, place it in a storage unit, and then go ahead and change the locks on the property. Once the deadline has passed for the tenant to come pick up their things, check with your local or state laws to what you, as a landlord, can do to dispose of or get rid of the property that was never claimed.

Document everything during this process! Take photos of why you believe the property has been abandoned, such as overgrown yards or mail that is piling up in the mailbox. Document their rent record; know when they last paid, how much they owe, and how many times you reached out regarding their unpaid bill. Record conversations with their emergency contacts. Anything that might be helpful in proving why you feel they abandoned would be beneficial.

Across the country, home buyers and real estate investors have found it increasingly difficult to purchase or invest in real estate over the course of the past year. There has been a lack of inventory, therefore skyrocketing the prices. Buyers will run into the issue of not having a lot of options, having to compete with numerous offers, and having to place an offer well over the asking price. The United States has found itself in a housing bubble, and that bubble is set to pop very soon. From 2017 through 2019, there was an average of 5.3 million active listings on the market at any given time. At the end of 2019, those listings began to plummet, and the United States reached 4.45 million active listings in 2020. In March of 2021, the COVID-19 pandemic was in full effect. Nonessential businesses, like restaurants, movie theaters, and clothing stores, were closed, people were working from home, and you had to wear a mask if you left the house. This economical shut down contributed to the decline of active listings; people took their already active listings off the market, and those who had plans to list, delayed. Now, a year after peak hysteria from the COVID-19 pandemic, people are still delaying due to the frothy market. As of March 2021, there are 500,000 active listings on the market at any given time, and the price of each listing has averaged out to $375,000. All those people who removed their house from the market or waited to post their listing, due to COVID-19, are still out there. Due to the lack of active listings, the incentive for people to list and sell their homes only gets greater as prices continue to rise. When that incentive gets to the right point, that backlog of people wanting to sell their homes are going to begin listing. There were 1.1 million fewer listings in 2021 than 2020 due to the pandemic, and 900,000 resale listings to get to the pre-COVID baseline of active listings; that’s 2 million active listings. Another source of active listings on the market are home building permits. Home builders are reaching the number of new housings permits that reflect the number of permits they hit in 2006/2007, right before the housing crash in 2008. In total, there will be about 2.5 million listings entering the market. The market will be flooded with sellers, and the euphoria from the past 9 months will turn to hysteria, causing a crash.