Get ALL of the info on our newest listings, plus more info on the Boise Parade of Homes! Jon Hastings from Tresidio Homes is here to chat about the upcoming Spring Parade of Homes.
Wondering what PMI (Private Mortgage Insurance) is and why some of us are paying for it? Ron Wieczorek from Eagle Home Mortgage is here with those answers.
Dave Burnett: This is the Idaho Real Estate Buzz with Thom Dallman of CORE Group Realty, COREGroupRealty.com. Give a call today, (208)933-7777. Find out why they say, "You always get more with CORE." He is Thom Dallman, the co-owner, designated broker of CORE Group Realty. COREGroupRealty.com is the website, and that is CORE with a C. Or you can call (208)933-7777. We're headed into the springtime. Of course, you have the Parade of Homes coming up on the 28th. We'll be talking to some folks about the Parade of Homes a little bit later in the show today.
Thom Dallman: Yeah. We're gonna talk about it a lot, because that's one of my favorite times of the year. I love the Parade of Homes.
Dave Burnett: Well, it's a chance for people to get out and see what is new and what's happening with brand new homes, and they got those requirements they have to do, some new, innovative stuff.
Thom Dallman: Yup. Yup. Heather'll be on in a week or two to talk about innovative, new things.
Dave Burnett: Well, you know, it is a fascinating time. I think people like it in part because we have cabin fever. We're been locked up all winter. Spring has been so wishy-washy this year.
Thom Dallman: Right? Exactly.
Dave Burnett: I guess it's gonna be one of those situations where it's gonna be kind of like this, and then we'll have three nice days, and then it'll be 110.
Thom Dallman: Exactly. You know it well.
Dave Burnett: You know, it's springtime in Idaho. It's the way it works with cabin fever, but it's the chance to get out with that Parade of Homes. Three weekends. It'll go all the way from the 28th through Mother's Day, and a chance to see what is new and happening when it comes to homes.
Thom Dallman: Yeah. There's some really great, new technology that you're gonna see in a lot of new homes. There's gonna be some great, new floor plans obviously, because all builders have to have unique floor plans, and just all kinds of different stuff. It's just a great time to just go out, even if you just have an inkling of trying to think of remodeling stuff or because you're just fascinated by it, like me.
Dave Burnett: Yeah. It is. I like it just to get out and drive, see areas of town ... That's the strange thing. Speaking of homes that are out there, COREGroupRealty.com, that is a website to go to. We like to kind of highlight some of the homes. You've got a lot of homes listed there. When we talk about that tight marketplace with not a lot, there actually are homes that are out there, so don't be discouraged about looking for homes.
Thom Dallman: Yeah. Don't be discouraged. It's a little bit trickier right now to get into a home. You're facing a lot of multiple offers and stuff like that, but there's still homes available. There's still people out there looking to sell-
Dave Burnett: Especially this time of year.
Thom Dallman: ... whether they're relocating, whether they're downsizing. Yeah. Especially going into to spring, the market's picking up. We're getting more listings each week and stuff, so it's definitely still a good time to buy, because interest rates are still low. We've talked in the past about how it used to be up in the 18% interest rate back in the 80s.
Dave Burnett: Yes. He said 18%.
Thom Dallman: I know, right?
Dave Burnett: Unbelievable.
Thom Dallman: It's only been within the last, what is it, five or six years that the interest rates have dropped below the 4%?
Dave Burnett: Yeah. They're still right in that vicinity.
Thom Dallman: Yeah. They're still in that vicinity, so still a great time to buy.
Dave Burnett: Let's talk a little bit about what's on the website at COREGroupRealty.com, a new listing you have this week.
Thom Dallman: Yeah. Yeah. If you go to COREGroupRealty.com and click on our featured listings page, that's where all of our current listings that we have actively on the market are at. We have one at 1322 West Melrose Street in Boise. This is over there by the Broadway and Federal Way kind of area, so great location as far as easy access to downtown.
Dave Burnett: Micron.
Thom Dallman: BSU.
Dave Burnett: BSU.
Thom Dallman: Or Micron.
Dave Burnett: Yeah. Everything is on that side of town.
Thom Dallman: Anything like that. If you have kids that are gonna go to BSU, here's that perfect house to purchase and get your kids in there to be able to get down to school pretty quickly.
Dave Burnett: Not Melrose Place, which is the old TV show.
Thom Dallman: Melrose Street. Yes.
Dave Burnett: Melrose Street.
Thom Dallman: Oh, my gosh. That's a flashback.
Dave Burnett: So, what have we got?
Thom Dallman: 1322 West Melrose Street is a three bedroom, one bath with a one car garage. It's 1,064 square feet on a single level. It's been recently renovated with granite and granite tile countertops. RV parking. Once again, we like to talk about that RV parking. It's got, like I said, the granite countertops, back splashes, stainless steel appliances. It's got new paint through the interior and exterior, just really kind of a great property, you know, right there in downtown. Once again, the RV parking for being able to park your toys and your RV, especially in a downtown area is huge. We just don't see that much anymore.
Dave Burnett: There's not many rental storage places downtown, so if you've got an RV or trailer, you're gonna be parking it out a ways. This way it's right there on your property and saves you monthly another 70 bucks a month.
Thom Dallman: Yeah. Exactly. To find a spot like that downtown is super rare, so definitely worth checking out if you're in the market for something down there. It's listed at 228,900, which is, once again, finding things under $300,000 in Downtown Boise is getting harder and harder these days.
Dave Burnett: It is. With the location there, it would be a great home if you've got somebody headed to BSU or if you're looking for an investment property and you want to rent-
Thom Dallman: Great rental property.
Dave Burnett: ... to somebody down at BSU, it'd be a great way to go that way as well.
Thom Dallman: Yeah. If you work downtown, I mean, how nice would that be to be able to get downtown to your job, you know, easy commute for that, down Broadway.
Dave Burnett: One of the things I like in that, I was watching on of the home flipper shows the other day with those kitchens and those granite counter tops. If you get an older home, a lot of times you don't get that. You still have formica, or you still have that-
Thom Dallman: Yup.
Dave Burnett: To have that granite in there, it is so nice. Stainless steel appliances. It gives a modern feel to that kitchen, so that's a good thing.
Thom Dallman: It's definitely worth checking out. Yeah. Just check it out.
Dave Burnett: Let me ask you this question. You were talking about that you take your agents on an annual tour just to get comfortable. CORE Group Realty we've talked about in the past. Maybe you're new to this show. We've talked about how important it is to talk and to interview your agents, and you encourage people to just come in and just chat.
Thom Dallman: Yeah. I mean, not every person meshes with other people I guess. I don't know how else to say that. It's so important, especially when you're doing one of your biggest investments, to find someone that you know, that you can trust, that will be there for you, that has your back, that's well educated in the marketplace. As this market continues to be a hot market, more and more people are just kind of hearing, "Hot market. Hot real estate market. Let's go get my license and see if I can make it work."
Dave Burnett: That's a nice idea. It doesn't always work out.
Thom Dallman: Yeah. A lot of people kind of get into it with this mentality of, "I'm just gonna do this part-time, kind of one-off while I still have my full time to pay the bills and stuff like that." It's just not that type of market. You know? It's really tough to be a part-time real estate agent, because things are moving so fast.
Dave Burnett: You have to be paying attention full time.
Thom Dallman: We always encourage if you are an agent that's wanting to work full time, make sure that you have a partner that can be available to go show a property and stuff like that. Yeah. That's what we focus a lot of here with our agents. We are a boutique brokerage, so we have roughly about 30 agents right now, and it's a close knit group, because we're such a small brokerage. Everybody gets along. Everybody knows each other, and they can reach out to each other to help each other out. You know?
It's not uncommon each week to see a post on our internal Facebook page, communication page, for someone to say, "Hey. I've got clients that need to see this property, but I'm already showing property. Can someone help cover for me?", and stuff like that. I think that's one of the unique opportunities working with CORE Group is that we're a team. The whole company's a team, and we work together to make sure that everybody's getting the best service that they can.
Dave Burnett: But you are looking for more agents?
Thom Dallman: Yeah. Yeah. I'm looking to grow another 10 agents. We're pretty picky, like I said, because we're such a small knit group. We're kind of picky about who we bring in. They have to fit the culture here. They have to fit kind of our structure, as far as kind of the way that we do things, but they also have to have that passion for real estate. I just want agents that are passionate about it and want to get immersed in it and be there for their clients. That's why our motto is the client oriented real estate. That's what CORE stands for. I need agents that are dedicated to their clients and willing to go above and beyond for their clients. Yeah.
Dave Burnett: You're looking for somebody to establish a relationship that over the years, five, ten years from now, when I'm looking to buy a house again, I'll come back to CORE, because I was taken care of.
Thom Dallman: Yeah. We're not about just the sales, just sell it and move on. We're about the long term relationship. You know, you move into your house, and you find yourself with a water leak, heaven forbid. You need some advice on who to go turn to. That's why we have a preferred vendors list is because we know that just kind of the everyday living in your home you're gonna run into those situations where you want those recommendations. You want people that you know you can trust, and those referrals. That's why to us it's more important to have the long lasting relationship, and to still stay in contact with each other, and to be able to help not just with selling and buying homes, but maintenance of homes as well.
Dave Burnett: If you're an agent who's out there currently, or maybe you're thinking about getting into the business, or maybe you're looking for a new home, give ... I guess would Shawna be the one to give a call to?
Thom Dallman: No. It's still me.
Dave Burnett: It's still you?
Thom Dallman: Yup.
Dave Burnett: Look at that.
Thom Dallman: I'm the first person to talk to about coming over here.
Dave Burnett: Well, start at the top. That's the way to go. You can give Tom a call at (208)933-7777. You can also find his email online at COREGroupRealty.com. Tell him, "You know what? I'm an agent, and I'd like to just sit down and have a cup of coffee with you and find out if it's the right fit."
Thom Dallman: Please do. Yeah. Please do. I'd love to talk to you.
Dave Burnett: It is the Idaho Real Estate Buzz. We do this every week at this time. It's just to kind of help inform you and to keep you up to date on what is happening. We'll continue on the other side. It's all being brought to you by CORE Group Realty. COREGroupRealty.com. Find out why they say, "You get more with CORE."
Dave Burnett: This is the Idaho Real Estate Buzz. He is Thom Dallman, the co-owner, designated broker of Core Group Realty. CoreGroupRealty.com the website, or you can always call. It's the old-fashioned way.
Thom Dallman: Yup.
Dave Burnett: 208-933-7777, somebody will answer your questions, whether it's about the website or different topics we're talking about here.
Thom Dallman: Exactly.
Dave Burnett: You can have likely the answers.
Thom Dallman: Yeah, especially for fun stuff like the Parade of Homes coming up.
Dave Burnett: It is, boy. I tell you what, it is a sure sign of Spring when the Parade of Homes takes place and we're at that point again.
Thom Dallman: And the Parade of Home itself is such an exciting event because it's the showcase of all the new stuff that's happening.
Dave Burnett: It really is a way of really seeing what's going on now.
Thom Dallman: It really truly is, and we actually have a guest in the studio today, Jon Hastings from Tresidio is here to talk a little bit about the Parade of Homes.
Jon Hastings: Yeah, thanks so much for having me.
Dave Burnett: Well Jon, let's see, the 28th of April, so coming up not far off is the start of the Parade of Homes. Tell us a little bit about what your involvement is and how you got involved in Parade of Homes.
Jon Hastings: A great opportunity for builders to showcase our product, you know, we have a product that we can't show on a shelf in a store or anything like that and so the Parade of Homes is really a fun opportunity for us to be able to show new innovations and new floor plans to the consumers and home buyers. So there are forty homes in the Parade of Homes and I've been on the Parade of Homes committee at the Building Contractor's Association for quite a few years now and the committee works hard to put together a great show for our community and also for the Building Contractor's Association, and on a personal level, being able to put a home into the Parade of Homes, it's really a great marketing opportunity and just a fun time to see past clients, to show our home to hopefully future clients and generate a lot of buzz.
So one of the cool things about the Parade of Homes is that all of the floor plans that you'll see in the Parade of Homes are new, and that's something that's unique about our show, and that's one of the requirements to put a home in the Parade is that it can't be a floor plan that you've built before, and it keeps pushing us.
Dave Burnett: As a builder, does that really challenge you? I mean I guess there's so many things. If you have a three bedroom home, there's so many ways to configure that, a four bedroom. Does it really kind of tax you to think okay, how can we do this different than anything we've done before because you've built hundreds of homes, and to try and do something different, that seems to be a challenge.
Jon Hastings: Yeah, it is, but it forces you to not just do the same things you've always done and that's the great thing about the parade, and it really pushes you to innovate and try to come up with things that forces you to think about things in a different way and to say what are our home buyers really looking for that we haven't given them previously? And it's a fun opportunity.
Thom Dallman: I bet you it's fun but it still can be quite taxing sometimes like trying to come up with something new and innovative.
Jon Hastings: Sure.
Dave Burnett: Well let's put it this way. Since you got involved with The Parade of Homes to today, what is it that you as a builder have done differently to put a different spin on it?
Jon Hastings: Yeah, good question. You know, certainly communities change, lot types change, even housing styles change a little bit. I think our first home that we put in The Parade of Homes was eight years ago and we've done it every year since and you start planning it way back in the fall. You think about what community do I want to be in? What lot do I want to put the home on? And then what configuration of home do we not have today that we feel like our home buyers are looking for?
So some years we're doing a smaller patio sized home, and some years the home gets a little larger and a little bit more complex, and we're really just trying to kind of look at what our home buyers are asking for and tailor something that is more suited to them today than it was five years ago, ten years ago.
Dave Burnett: See, one of the things I have seen in homes, and that is, we've talked about this Thom, outdoor patios, outdoor living space to where kitchens are set up or you have grills and refrigerators and you have undercover areas. Are you finding that that is still a trend at this point to do that? Or is ...
Jon Hastings: Yeah, absolutely. I think we're living outdoors more than we ever have before, and if you look at the numbers over the years, really the square footage of our homes on average is shrinking, but the amount of outdoor space is growing, and people are really seeing that as an extension of their indoor living space. How much square footage am I getting outside? Our parade home this year has a front porch that's kind of a small front porch area that you could have a couple chairs on, but then a really large back patio.
Dave Burnett: Nice.
Jon Hastings: So I think that's certainly true, and I think will continue to be the case.
Dave Burnett: When you think about it, if you want to increase the living space of a home, putting it outdoors should be cost effective for you as a builder and for the home owner to suddenly add a thousand square feet to a home just because you've done the backyard differently, that's huge.
Jon Hastings: Yeah, absolutely. It's an opportunity to have some fairly cost effective space both for the builder and for the home buyer that you really can have an extension of that living space there. All kinds of different doors and things like that that you can put in that can really help to open up the space from the indoor to the outdoor and you're seeing more and more things put on the patio that would be the kinds of things that we would see inside. Ceiling fans, you mentioned kitchens. You know, even ceiling treatments on patios and things of that nature that have typically been reserved for the indoors, we're dressing up the outdoors now because it is a space that people want to spend time in, and it's a space that is fairly cost effective.
Thom Dallman: Yeah, that's awesome. It's awesome. Tell us a little bit about the location of your home in the parade. Magazines don't come out for a couple, I think another week or so, but yeah, just kind of give people a highlight of where your home is going to be at.
Jon Hastings: Yeah. So our home this year is in the Hillsdale Creek community, and that's a brand new neighborhood in South Meridian. It's off of Eagle and Amity. It's kind of tucked in behind the Century Farms community, which is a hot community right now. This Hillsdale Creek community, you know, one thing that people don't realize about South Meridian is there's a little bit of contour, some kind of undulation down there. So you have some communities that really have some unique character, and Hillsdale Creek is one of those. It has some elevation change to the community, there is kind of a nice seasonal creek running through it that they've done a good job of landscaping and making it look really nice, and so Hillsdale Creek is a great community. It's tucked in right next to the new YMCA and elementary school there off of Eagle and Amity, and then of courses Hillsdale Park that the city is going to put in right there in that corner as well.
It's really turning into a vibrant part of South Meridian.
Thom Dallman: That's awesome.
Dave Burnett: When you think of Meridian and in particular Tammy de Weerd, the mayor there, and the growth that has taken place in Meridian, it's pretty astounding when you think about it. Look at those subdivisions.
Jon Hastings: Yeah, it is amazing. You know, for a few years, a lot of the growth was in North Meridian, and really South Meridian over the last two to three to four years has just exploded.
It's getting some beautiful communities there in South Meridian, like reflection ridge, cabin ridge, this Hillsdale Creek, I mean just beautiful communities.
Dave Burnett: Yeah, I was trying to think just now, the last time I went out to South Meridian, it's been a couple years. It'll probably be one of those areas I go into and go whoa, what happened here?
Jon Hastings: Right, that's right.
Dave Burnett: It's like East Boise, you go over there in the hidden valley area and it's just like what has happened over here?
Jon Hastings: Exactly.
Dave Burnett: Absolutely amazing. Well tell us, you've got 40 homes in The Parade of Homes, and kind of what areas are we covering this year? They're not all right in Boise proper. They're kind of spread out through out Ada County.
Jon Hastings: Yeah they are. You know, that's the nice thing about the parade is that no matter where you live in the valley, there are going to be some homes that are convenient to ya and the nice thing about the parade is it's free, so you can see two houses or forty houses. And so that's really a great advantage, but the homes are spread out. There's a handful of homes in Star. There's a handful of homes out in East Boise, and then everywhere in between. Homes in South Meridian, South Boise, homes in North Meridian and Eagle. And so really kind of spread throughout the valley you're going to have a great opportunity to see homes wherever you are.
Thom Dallman: And the nice thing is it covers three different weekends, so each weekend you could take like a little section of town and kind of go see all the parade homes there and then next weekend go cover the other ones, so yeah.
Dave Burnett: It really does take a little bit of planning.
Thom Dallman: Yup.
Dave Burnett: To think about if you want to hit them all. So be watching for the publication to come out, or check out the website as well, and of course Tom you'll have some of those magazine here.
Thom Dallman: We'll have the magazines here at the office, at Core Group right off of Emerald, as well as we'll post a link once the maps get updated on the websites and stuff, we'll have links on our webpage.
Dave Burnett: You want to share with us what your top secret new thing is?
Jon Hastings: We've done something a little unique with our kitchen this year. You know, open kitchens and open great room layouts are so popular right now. We've kind of turned our kitchen and great room into kind of a little bit of a unique configuration, so we'd love for everybody to come and see it and give us their feedback and see how it lives.
Thom Dallman: Jon Hastings from Tresidio.
Dave Burnett: What is your address again for that home for Tresidio?
Jon Hastings: Yeah, our address is 12823 West Acland Street, and that's in South Meridian, and if you head down Eagle Road into the Century Farms community and follow the parade signs, you'll make it there.
Thom Dallman: Run right into it.
Dave Burnett: Parade of Homes starting April 28th, make your plans now. This is the Idaho Real Estate Buzz, we'll continue on the other side. It's all being brought to you by Core Group Realty. CoreGroupRealty.com is the website. Find out why they say you get more with Core.
Dave Burnett: This is the Idaho Real Estate Buzz. He is Thom Dallman, the co-owner, the designated broker at Core Group Realty. CoreGroupRealty.com, that is the website to go to. 208-933-7777, that is the phone number to call. And Tom, I know we talk about this every week, how important financing is, pre-approval is when it comes to buying that home.
Thom Dallman: Yeah, yeah. We've actually had this week someone attempt to put in an offer without a pre-qualification letter, and was immediately rejected because they had three other offers that had pre-qualification letters on it. That's just not the type of market.
Dave Burnett: Which has nothing to do with their qualification.
Thom Dallman: Yeah, exactly.
Dave Burnett: It's just if you go three people in the chute ready to go-
Thom Dallman: Exactly.
Dave Burnett: If I'm selling my home, I'll tell you who I'm gonna go with.
Thom Dallman: You're gonna pick the people who you know that have that pre-qualification letter and are ready to go.
Dave Burnett: Exactly. Ron Wieczorek with Eagle Home Mortgage joins us again. And Ron, there's so much that's involved. It's not just here's the bag of money, buy the home. But there's all these insurances, these forms, these alphabet things. When I say that, we were talking during the break about PMI. Now, for you, you deal with that every day. For me, what in the world is PMI?
Ron Wieczorek: PMI is private mortgage insurance. It kinda get a bad reputation 'cause a lot of people think of it just being an additional fee that they have to pay, and there is no use to pay it. And in some fashions down the road they might be right. But to get into a home, and to get into a home when you're putting less than 20% down the industry is going to have you pay an additional fee, which is called private mortgage insurance.
What I see a lot of times, is I'll have clients that use a mortgage calculator online. And they'll look at what their payment would be, and then they forget a few things. They say, "Well this payment should be about $800, $900 a month." And then we introduce taxes to the equation-
Dave Burnett: Insurance.
Ron Wieczorek: The homeowner's insurance. And if they're gonna put less than 20% down we have to talk about the PMI. And that can range depending on your loan program, and we'll get into a little bit of that a little bit later. But that can range based off, credit comes in heavy in the lending process. And it comes in two-fold; the interest rate that you're gonna pay, and a private mortgage insurance is heavily weighed based off your credit score depending on the loan program.
What does it do? Who does it protect? Who am I protecting with this insurance? I'm buying insurance, so of course it protects me, right?
Thom Dallman: That's the biggest question that we always get.
Ron Wieczorek: Is it?
Thom Dallman: Really.
Ron Wieczorek: And I have to answer that question on numerous occasions, and it's almost embarrassing giving the answer, it doesn't protect you at all. It protects the lender in case you're to either get behind on your mortgage payments, or if you foreclose then all that money that other people are putting into that pot of private mortgage insurance is gonna go to pay the lender side. It still doesn't get the client off the hook. They still have to pay the mortgage, and they might face foreclosure, but it pays that investor that's gonna take over that loan, or the lender that has that loan in case those troubled times come along.
So who does it protect? It protects the lender. Who pays for it? The client. The client will pay for it.
Dave Burnett: That would be me.
Ron Wieczorek: That would be you. So if you put less than 20% down, you're required to pay the PMI. I mentioned different loan programs, and what specifically, and that's where your loan officer or myself will come in. And key is to pick the right loan product. 'Cause there's a lot of information out there, it's not just as easy as it's a 30 year fixed, they should all be the same, right? It's not. If you're doing an FHA, and that's usually the most popular loan program that a first time home buyer will get into, 'cause it allows you to put 3.5% down. They're going to be a lot less stringent on the amount of PMI.
Why I say that, is because they have a fixed rate. It's a fixed amount of PMI, and it's a percentage of your loan amount, it's .85. And they don't care if your credit is on the lower end or on the higher end, everybody is paying the same .85. And that's great if you're on the lower end. That's not great if you're on the higher end of the scale as far as credit scores. And that's where a conventional mortgage comes into play. 'Cause you look at the rates, and you look at a lot of different things that go in, like you said, to that process when you're weighing what mortgage is gonna be best for you. And you look at a conventional versus FHA just on the surface, when you compare the two loans, the FHA is usually gonna have a little more favorable interest rate. Now, if you have a higher credit score your PMI on a conventional could be as little as a third, or a quarter of that amount of an FHA, because you're getting rewarded for that higher credit score.
So now you're looking at it, and you really want to take a long hard look at the conventional, even though some of us have been trained, well I'm not putting a lot down. Conventional still has lower down payment options, and even with a rate that might be, let's say it's a quarter higher. But as opposed to paying $250 you're paying $60, $70 in mortgage insurance. That's gonna more than make up for that difference in the rate. Another thing that I'll give another positive for a conventional with PMI is on a conventional mortgage once you get 20% equity, you can shake off that mortgage insurance.
Dave Burnett: So once I get that, I can get that taken off?
Ron Wieczorek: Exactly.
Dave Burnett: Does it happen automatically, or do I ... What do I do?
Ron Wieczorek: It doesn't happen automatically. By law, once you have 20% equity in your home, and there's a couple ways to get that. You can either, you get your [inaudible 00:05:51] schedule at closing. It's five, six pages, and it just shows as you make your mortgage payment, what my balance is gonna be after payment one, payment two, payment three, payment 350. And it shows you what your new balance is gonna be. Well once you get to that point where you have 20% equity on a conventional, and you can circle that, you can petition your lender or your mortgage servicer to drop the PMI.
If you're in good standing with them, and you've made your mortgage payments over the last 24 months without having a 30 day late, they're not gonna say no. They reserve the right to say no, but I've never seen it happen.
Dave Burnett: How often is it that people just keep paying their loan payment because that's what we do every month, and they're not paying attention, and they've gone past that. Are they continuing to pay that insurance?
Ron Wieczorek: Until they get to 78%, that's where the law comes into effect and says the servicer now has to tell you.
Dave Burnett: 78%.
Ron Wieczorek: And then the law says they have to go in and say you're eligible to drop this. Let's say what we're seeing in the Valley right now with prices and homes. Let's say you're only a year into your mortgage insurance, or even two years into your mortgage insurance, and you know you haven't paid it down enough to have 20% equity, but you know you have 20% equity. Your neighbor sold his home, Core Group sold his home for 20% more than you bought your house for, and now you have 20% equity in that house. You can petition your lender again and say, "I think my value where I have 20% equity in the house." And they'll give you rules. They'll say, "Are you in good standing?" And they'll ask you to get an appraisal, or they'll order an appraisal on your house. And if you have that 20% equity, that's where you can drop it as well.
A lot of people miss the boat on that, right? It's not something we're all thinking about. I'm in the business, I think about it, but not everybody thinks about it on a daily basis.
Dave Burnett: Let's be honest, for me, the consumer, I don't even know what PMI is, right? I don't even know what it is.
Ron Wieczorek: Well you do now.
Dave Burnett: I do now. But to get rid of it, I'm not aware of that. If it was a $300,000 home, about how much money are we talking about?
Ron Wieczorek: Right.
Dave Burnett: About how much money are we talking about?
Ron Wieczorek: 300 times 20% is 60,000, so that would be 240,000 for a loan balance at that point. So if you're at 240 or under, and you know your house is worth 300 and you have a conventional mortgage you can drop it. And I keep saying conventional mortgage, because if you get an FHA loan you cannot drop that PMI.
Dave Burnett: Okay.
Ron Wieczorek: And they've changed that. That's been kind of a moving target over the past 15 years. You used to be able to drop it, now you can't on a 30 year fixed, so you're stuck with it. It does go down as your mortgage balance goes down. So every six months it's re-evaluated. You know, we're not talking it goes down $50, it goes down a buck and a half.
Thom Dallman: Right?
Ron Wieczorek: But it does relieve some of that pressure.
Dave Burnett: But that might explain why suddenly your payments go down by a buck and a half and you're going, "Why is my payment a little bit less now than it was?"
Ron Wieczorek: You know, I've never got a call saying, "Why is my payment less than it was before?"
Thom Dallman: You probably only get the ones that are like, "Hey, why did they increase my payment?"
Ron Wieczorek: Yeah, those are the calls I'm used to.
Thom Dallman: Yes.
Ron Wieczorek: And I wanna just throw in a VA. With the VA they have their own version of PMI, it's called the VA funding fee. It's a one time fee, and it's rolled into the mortgage. And based off, there's a lot of veterans that are exempt from it just because if they have a disability, you'd know if you were exempt. But that's one of the great, you can put 0% down, and just pay that one time fee and be done with it. You don't have the monthly, like FHA and conventional. So that's a great, just an incredible product for our service member.
Dave Burnett: Ron, as we close out this segment, I do wanna ask, if somebody perhaps wants you to review their mortgage, where they're at, what they have, you have no problem with doing that?
Ron Wieczorek: I welcome it, that's part of what I do every day, and if I do see it in a scenario, or someone mentions they're paying PMI, especially in this market. If I know they've been in the house for just even a little while, that's something that we look at constantly. In fact, most of the refinances that I see that come across my desk now are a product of I had an FHA loan, I'm paying $200 a month I don't have to. Even with the rates being up a little bit from where they were, it still makes sense to refinance them out of it. And with an FHA that's the only way to get out of it, would be to refinance.
Dave Burnett: How does somebody get ahold of you, Ron?
Ron Wieczorek: My cell, it's always near me, its rang a few times while we've been here. It's 208-869-9154.
Dave Burnett: Ron Wieczorek with Eagle Home Mortgage, and check them out if you don't remember that number just go to Core Group Realty's website, they're listed right there.
Thom Dallman: Yep, they're listed on our service providers page there. All of our preferred vendors that we just adore, and have great relationships with.
Dave Burnett: PMI, it's one of those alphabet soups in there that you may not understand. But you know what, it may be something that can save you money, or it may be something that is important when you're getting that loan. Ron thank you so much. This is the Idaho Real Estate Buzz being brought to you by Core Group Realty. CoreGroupRealty.com. Call 208-933-7777. Find out why they say you get more with Core.
Dave Burnett: This is the Idaho Real Estate Buzz. He's Thom Dallman, the co-owner, designated broker of Core Group Realty. Coregrouprealty.com is the website to go to. You can call 208-933-7777. Thom, the Boise Treasure Valley area keeps getting put on lists.
Thom Dallman: Oh, yes.
Dave Burnett: Fastest growing-
Thom Dallman: We're on all kinds of different lists.
Dave Burnett: It's this. It's that.
Thom Dallman: What is it, livability, affordability, fastest growing? I think Forbes put us on the top of one of the best places to retire.
Dave Burnett: To retire, yep. Recent Forbes Magazine put us in, I think, top five. I don't have the information at my fingertips, but it was right up there as people are retiring here, which my first question is, "It snows here in the winter. It snows."
Thom Dallman: But it doesn't snow as much as other places, let's just put it that way.
Dave Burnett: No. Yeah, I guess so, but-
Thom Dallman: Especially the Midwest, being a Midwest boy that grew up in Iowa, let me tell you. Our snow here is nothing like that.
Dave Burnett: The snow and the wind. There's nothing to stop the wind in Iowa. It just keeps blowing. But one of the reasons is affordability.
Thom Dallman: The number one reason.
Dave Burnett: Now, when you look at homes, it shows if you're in Southern California, you're going to sell that 2,000 square foot home. You're going to sell that for half a million dollars. Then you come back here and buy something cash bigger and better than that.
Thom Dallman: You can buy something, take that money and invest it in something bigger and better here, or even take half that money and buy something that's the same size or a little bit smaller, especially if you're retiring and stuff like that. For retirement people that are coming in, they don't need as much space, typically.
Dave Burnett: No.
Thom Dallman: And stuff.
Dave Burnett: In fact, I was peeking at your notes while you were out of the room during the break. You have a list of things to look for if you're buying a retirement home.
Thom Dallman: Yeah. I've got some things to think about when you are looking at that because it's important to be conscious of the long-term longevity of the house that you're moving into. A lot of people who are retiring are buying these homes as kind of their last place to live for long-term. There's things like affordability, making sure that it's something that not only is affordable now, but will be affordable in the long-term, down the road.
Dave Burnett: When you're talking affordable, are you talking house payments or are you talking heating and cooling? What are you talking?
Thom Dallman: All of the above. Let's talk about all of the above. A, if you are in that realm where you are needing lending, you want to make sure that as you kind of get into social security and pensions and stuff like that, that you have the money to be able to continue making your house payments. If you are lucky enough to be able to pay it off, then yeah, it does come to that maintenance, to the HOA fees, to the taxes on the property and stuff. You want to make sure that for the long-term, it'll be affordable to you. Unfortunately, we don't have crystal balls to know what taxes'll do and stuff like that, but kind of keeping those things in mind when you're going to buy that property as a retirement home.
Dave Burnett: I guess some of the things to look at, how old is the hot water heater, the air conditioning, the heater, that kind of stuff?
Thom Dallman: Yeah, the longevity of ... How recently were they replaced? Are they new? Are they old? Are they going to need to be replaced in the next couple years? Looking at the longevity of the roof. Roofs-
Dave Burnett: They're expensive.
Thom Dallman: Are expensive. They tend to last about 15 to 20 years depending on the style and everything. If you're moving into a house that was 10 years old and another five years, you might be buying a new roof, five to 10 years.
Dave Burnett: And that could be a $10,000 bill or more.
Thom Dallman: Exactly. Who knows what it's going to cost in another five to 10 years? Things like that are things to keep in mind as well. You want some longevity in your house and looking for things like that.
Dave Burnett: One of the things that I know for my wife and I ... because we were trying to decide, "Do we sell our home, buy something new? Do we keep the home?" As we approach toward retirement age, one of the things, with a friend, they sold their home to get out of this, a home with stairs. Stairs, if you're retiring, right now may not be a big a deal to run up and down those stairs, but if you're 65 and you've got knee or hip or those kind of problems, that's a huge thing.
Thom Dallman: I have that at the top of my list. Mobility is one of those factors that you have to think about I don't know how to say this except to just come out and say it that we've recently run into where, it's not one of my agents, fortunately, but an agent has been encouraging a elderly person to buy a two-story house and just-
Dave Burnett: Not good.
Thom Dallman: Yeah, it was one of our listings that they were ... We're perplexed by, "Why would an elderly person want to buy where they have to climb the stairs every day and stuff like that," or not even climb the stairs? It does have the bedroom on the main level, but they won't be able to access the space upstairs. Once again, it goes back to that mobility thing and thinking long-term down the roads, being able to access all areas of your house and be able to enjoy all of the areas of your house and stuff like that are super important as well as, God forbid you ever have to have a walker or wheelchair or something like that, making sure that you're not getting into places with small doorways and stuff like that. That might make mobility-
Dave Burnett: Something to think of if you're buying a retirement home, level, single floor. That is just huge.
Thom Dallman: Exactly.
Dave Burnett: Other things?
Thom Dallman: Let's talk a little bit about the security and safety. You want to look at places where you have easy access to medical facilities, maybe, or neighbors that can help you out and keep an eye out for you and stuff like that. Once again, that security and that safety of having people around you checking in on you every once in a while and stuff like that.
Dave Burnett: But I think that's part of why Boise does well when it comes to retirement is that it is still a friendly community.
Thom Dallman: It's a friendly community. It's a safe community. You want to know that your neighbors are kind of watching out for you and watching out for any suspicious activity in that neighborhood and stuff like that.
Dave Burnett: We have Ed Fritz in on a regular basis with the Crime Stoppers and he talks about that, how important it is that you know your neighbors, that your neighbors know you. Not to be Gladys Kravitz, I'm going back a ways into the Bewitched show, but not somebody looking out the window curtains to look at what you're doing, but-
Thom Dallman: Exactly.
Dave Burnett: So that they know what's going on in your life so that way, if you're gone, they can keep an eye out for that suspicious vehicle.
Thom Dallman: Exactly.
Dave Burnett: That is important.
Thom Dallman: Super important to have that security and safety and the security of the home itself, too, making sure that, like you mentioned, Ed Fritz kind of talks about the bushes. You don't have bushes that are kind of blocking windows. You don't have trees that are blocking windows or that can block people hiding in your yard and stuff. You want to make sure that you're buying a house that has landscaping that's clear and easy to maintain as you get on in years and stuff like that. Getting out and maintaining that stuff can kind of get difficult, so that's going to be an added expense possibly down the road, just finding someone to do that. That kind of goes back to the affordability and cost and stuff.
Dave Burnett: Well, let's talk about that a little bit because when it comes to maintenance of your home, size of lawn, mowing that lawn, if you've got to do it yourself, that could be a problem.
Thom Dallman: Yeah, it can be, especially if you're kind of on that fixed income, not being able to really kind of afford someone to come and do it for you and you're out there trying to do that yourself. You may not want that big yard. There's great options as far as patio homes go where you still have that privacy, but your still kind of smaller yards maintained by an HOA, sometimes. Things like that, so there's some options out there.
Dave Burnett: Something to think of.
Thom Dallman: Something to think of.
Dave Burnett: Again, when it comes to that home, just the size of a home. You may not need a 3,500 square foot home.
Thom Dallman: Exactly. Exactly.
Dave Burnett: You might be better with something smaller. It's something to talk to one of your agents about as far as really talking about what your needs are.
Thom Dallman: Yeah, let's talk about how you plan on living in the house and if it's just going to be the two of you with the occasional visit from the grandkids, maybe you don't need that much space. You just maybe need that second or third room so that the grandkids can crash out there and stuff like that. That's what I love about what we do here and our relationship-building with our clients is just sitting down and figuring out their needs, making sure that they're getting something that fits them, just trying to sell 'em something to get into.
Dave Burnett: I guess as we conclude this topic, something to think about, and it may not be something that the retirees are thinking of, but maybe it's your parents. You might want to sit down and have an honest conversation with them. If they're thinking about selling their home or buying a new home, sit down with them and talk to them as their kids.
Thom Dallman: Exactly.
Dave Burnett: "What are the needs that you guys expect to have?" Help set some realistic needs in there for them.
Thom Dallman: Exactly.
Dave Burnett: What you going to do? RV parking? It's important, but maybe they might be getting up in the years and parking that RV on the side of the house may not be a good idea.
Thom Dallman: Exactly. It's interesting that you should say that because it seems like recently, there's been this trend for sitcoms to portray these kids who are going to their parents' house and trying to convince the parents that they need to move and stuff like that. It seems like a prevalent story lately.
Dave Burnett: Maybe with things happening the way it is. I mean, if you're retiring and you've got a 4,000 square foot home or a 3,000, you don't need it. You may want to go ahead and sell that thing.
Thom Dallman: Exactly.
Dave Burnett: It keeps the kids from moving back in with you.
Thom Dallman: There you go.
Dave Burnett: But that's a whole 'nother topic.
Thom Dallman: That's a whole 'nother topic.
Dave Burnett: If you're thinking about it, if you're thinking about retiring or your needs and you don't really have anyone to talk to, you can talk to one of the agents here at Core Group Realty. They'd be happy to talk to you about what you might need or not need when it comes to retirement. Treasure Valley, one of the top places in the country to retire. You might want to take advantage of that. Give them a call, 208-933-7777. Core Group Realty, they are the sponsor of the Idaho Real Estate Buzz, which we do each and every week at this time. Find out why you get more with Core.