Thinking About Upgrading a Skylight?

Skylights can be a great way to add natural light to your home. This can be especially useful for rooms that lack windows or that are otherwise blocked from getting much natural light. Unfortunately, skylights sometimes fall victim to the ravages of time and climate. This may leave you wondering whether you should upgrade or replace those skylights that have been in place for years. In some cases, this can be a pretty big undertaking, so here are a few things to consider before jumping into a skylight upgrade.

Reasons to Upgrade a Skylight

There are a number of issues that can arise with skylights that might prompt an upgrade or replacement. The most obvious is some damage occurring to the skylight from severe weather or other natural events. Even without external damage, though, skylights can also start to leak around the edge seams over time. This is especially prevalent in older skylights that were made with materials that are not as resistant to UV rays and weather as modern materials.

Leaks and damage aren’t the only reasons one might want to upgrade or replace a skylight, however. Some skylight materials can yellow or otherwise become discolored over time, resulting in cloudiness or a gradual decrease in the amount of light that shines through. Fixed-frame skylights were common at one point, but newer skylights may offer the ability to open them or can feature self-venting options to help manage heat buildup within the house. Older skylight designs may also not be as aesthetically pleasing 

Skylight Upgrade Considerations

Regardless of the reason you might want to upgrade your skylight to something newer, there are a few things that you need to keep in mind when considering the type of replacement you want to get. The size of skylights can be deceiving given their angle and location, so proper measurements are vital to ensuring that you get the right size for your skylight replacement. Different skylight types may only be suitable for certain roof pitches as well, so this should be taken into consideration when picking one out to make sure that it won’t cause problems once installed. The materials used in modern skylights can also affect the strength, UV resistance, and overall look of the skylight, so this should be kept in mind when exploring skylight options.

Another important consideration is the timing of your skylight upgrade. Many homeowners who upgrade or replace older skylights often do so when planning other roof work such as a new shingle installation to allow all the work to be done at once. This also ensures that any warranties or guarantees for the skylight and the roof will be activated at the same time so that leaks or other problems can be taken care of regardless of which part of the roof or skylight they’re associated with.

Calling in the Pros

While it’s possible to replace or install a skylight yourself, it can be a real challenge if you don’t have previous experience with roofing or skylight installation. The work can be dangerous if you don’t know what to expect, and if installed incorrectly your new skylight can leak or suffer damage that can lead to even more costly repairs down the road. As a result, it’s often recommended that you hire a roofing contractor or skylight installation specialist to perform any upgrades or other installation work for your skylight.

Fortunately, HomeKeepr can help you find the pro that you need to complete your skylight upgrade. Not only can you connect with roofers and other skylight pros in your area, but creating an account with HomeKeepr is free. Sign up today to get your skylight rejuvenation underway.

Pre-Approval Makes All the Difference When Buying a Home

You may have been told that its important to get pre-approved at the beginning of the homebuying process, but what does that really mean, and why is it so important? Especially in todays market, with rising home prices and high buyer competition, its crucial to have a clear understanding of your budget so you stand out to sellers as a serious homebuyer.

Being intentional and competitive are musts when buying a home right now. Pre-approval from a lender is the only way to know your true price range and how much money you can borrow for your loan. Just as important, being able to present a pre-approval letter shows sellers you're a qualified buyer, something that can really help you land your dream home in an ultra-competitive market.

With limited housing inventory, there are many more buyers active in the market than there are sellers, and that's creating some serious competition. According to the National Association of Realtors (NAR), homes are receiving an average of 5.1 offers for sellers to consider. As a result, bidding wars are more and more common. Pre-approval gives you an advantage if you get into a multiple-offer scenario, and these days, its likely you will. When a seller knows you're qualified to buy the home, you're in a better position to potentially win the bidding war.

Freddie Mac explains:

By having a pre-approval letter from your lender, you’re telling the seller that you’re a serious buyer, and you’ve been pre-approved for a mortgage by your lender for a specific dollar amount. In a true bidding war, your offer will likely get dropped if you don’t already have one.

Every step you can take to gain an advantage as a buyer is crucial when todays market is constantly changing. Interest rates are low, prices are going up, and lending institutions are regularly updating their standards. You're going to need guidance to navigate these waters, so its important to have a team of professionals such as a loan officer and a trusted real estate agent making sure you take the right steps and can show your qualifications as a buyer when you find a home to purchase.

Bottom Line

In a competitive market with low inventory, a pre-approval letter is a game-changing piece of the homebuying process. Not only does being pre-approved bring clarity to your homebuying budget, but it shows sellers how serious you are about purchasing a home.

 

Demand for Vacation Homes Is Still Strong

The pandemic created a tremendous interest in vacation homes across the country. Throughout the last year, many people purchased second homes as a safe getaway from the challenges of the health crisis. With many professionals working from home and many students taking classes remotely, it made sense to see a migration away from cities and into counties with more vacation destinations.

The 2021 Vacation Home Counties Report from the National Association of Realtors (NAR) shows that this increase in vacation home sales continues in 2021. The report examines sales in counties where vacant seasonal, occasional, or recreational use housing account for at least 20% of the housing stock and compares that data to the overall residential market.

Their findings show:

• Vacation home sales rose by 16.4% to 310,600 in 2020, outpacing the 5.6% growth in total existing-home sales.
• Vacation home sales are up 57.2% year-over-year during January-April 2021 compared to the 20% year-over-year change in total existing-home sales.
• Home prices rose more in vacation home counties the median existing price rose by 14.2% in vacation home counties, compared to 10.1% in non-vacation home counties.

This coincides with data released by Zelman & Associates on the increase in sales of second homes throughout the country last year.

As the data above shows, there is still high demand for second getaway homes in 2021 even as the pandemic winds down. While we may see a rise in second-home sellers as life returns to normal, ongoing low supply and high demand will continue to provide those sellers with a good return on their investment.

Bottom Line

If you're one of the many people who purchased a vacation home during the pandemic, you're likely wondering what this means for you. If you're considering selling that home as life returns to normal, you have options. There are still plenty of buyers in the market. If, on the other hand, you want to keep your second home, enjoy it! Current market conditions show that its a good ongoing investment.

 

 

Small Changes Make Big Bathroom Impacts

Nobody likes a small bathroom. Unfortunately, a lot of houses have them. If you live in a home with a bathroom that makes you feel a bit claustrophobic, you might think that there isn’t much you can do without some major (and majorly costly) renovations. This may not be the case, though. There are actually a number of small changes that you can make to your bathroom to make it not only appear bigger, but possibly even give you some more space to work with.

Bear in mind that some of these options are a matter of personal taste. You’ll need to think about how these would work with your own personal style preferences. With that said, even if you only use one or two of these suggestions, you may be surprised at how big of a change they can make in your bathroom … all without having to tear down a wall or anything.

Change Up the Look

The first thing that you should do is stop and take a good look at your bathroom. Are the walls some dark, unappealing color that was last seen in the wilds of the 1970s? Does the lighting give everything kind of a dull yellow tint or cast some big shadows everywhere? Did some unfortunate soul decide that the bathroom really was the place for some deep-pile carpeting? The look of your bathroom can have a big effect on how open (or not) it appears, and in many cases can make the bathroom seem smaller or more unpleasant than it actually is.

Some options for fixing this include adding mirrors (which are always useful in the bathroom anyway), painting or adding wallpaper to cover up dark or grungy walls, and replacing light fixtures with something that will give you a bit more illumination everywhere. Try painting one wall a different complementary color as an accent. Choose wallpaper with repeating patterns but also with ample open space between repetitions. Paint your cabinets or add light-colored veneer to help lighten up the space. The lighter and more inviting the bathroom is, the larger it will seem.

Revamp Your Storage

Another thing that can make a bathroom feel small is clutter. If every available surface seems covered with soaps, styling products, makeup, or manscaping tools, it’s going to trigger that part of your brain that doesn’t like crowded spaces every time you enter the room. This is where good storage can come into play, since it will give you a place for all that clutter, so you don’t have to just shove everything into an unorganized mess in the cabinet.

Consider installing rotating storage or under-shelf racks in your cabinets to make organizing easier. Adding a high shelf with a towel rack under it can also help, letting you move towels out of your cabinet and position them closer to your bath or shower without taking up precious floor space. Hanging a multi-panel medicine cabinet is also a great idea, since it gives you more storage for small items and medicines while also adding additional mirrors to the bathroom. Once you deal with some of the clutter on your surfaces, you’ll be surprised at how much more open the bathroom seems.

Bringing the Bathroom to Life

If you aren’t exactly sure how to revitalize your bathroom, don’t be afraid to ask for help. Painters and interior designers may have suggestions on how to change the look and functionality of your bathroom without breaking the bank and can assist you in picking colors and other options to really open the place up. They may have additional suggestions based on the actual layout of your bathroom as well, helping you to feel more comfortable in the bathroom without all the cost of significant renovation.

HomeKeepr can help you to find the pros you need to make your bathroom revamp a reality. Sign up for a free account today to find local pros in your area that can get the job done. It’s quick, it’s easy, and it’s one more little thing that will make a big difference in your bathroom revitalization project.

Homeowner Wealth Increases Through Growing Equity This Year

Building financial wealth and stability remains one of the top reasons Americans choose to own a home, and as a homeowner, your wealth often grows without you even realizing it. In a recent paper published by the Urban Institute, Home Ownership is Affordable Housing, author Mike Loftin illustrates how homeowners increase their equity and their wealth simply by making monthly mortgage payments:

The principal portion that reduces the loan balance builds the homeowners equity. In doing so, the principal payments behave like an automatic savings account. The principal payment is not money going out; it is money staying in.

But home equity the difference between the value of your home and what you currently owe isn't just built through your monthly principal payments. Home price appreciation plays a vital role in growing your equity and, ultimately, your wealth.

As Freddie Mac explains:

Homeownership has cemented its role as part of the American Dream, providing families with a place that is their own and an avenue for building wealth over time. This wealth is built, in large part, through the creation of equity Building equity through your monthly principal payments and appreciation is a critical part of homeownership that can help you create financial stability.

Homeowners Continue To See Equity Increase

CoreLogic recently published their latest Homeowner Equity Insights Report, and it shows continued growth in equity amidst record home price appreciation. The report provides several key takeaways, all of which point to rising wealth for homeowners:

1. The average equity gain of mortgaged homes during the past year was 33,400
2. The current average equity of mortgaged homes is greater than 216,000
3. There was a 6% increase in total homeowner equity over the past year
4. Total U.S. homeowner equity has reached nearly 1.9 trillion

Here, you can see the equity gains by state:

Equity Provides Homeowners with Flexibility

In addition to being a critical tool in building wealth, a homeowners equity also provides significant flexibility. When you sell your house, the accumulated equity comes back to you in the sale. Recent increases in home equity coupled with record-low mortgage rates mean it could be the perfect time for homeowners looking to make a move.

Mark Fleming, Chief Economist at First American, notes:

Existing homeowners today are sitting on record amounts of equity. As homeowners gain equity in their homes, the temptation grows to list their current home for sale and use the equity to purchase a larger or more attractive home.

Increasing equity also helps families facing challenges brought on by the pandemic. Frank Martell, President and CEO of CoreLogic, explains in the recent Homeowner Equity Insights Report:

Homeowner equity has more than doubled over the past decade and become a crucial buffer for many weathering the challenges of the pandemic. These gains have become an important financial tool and boosted consumer confidence in the U.S. housing market, especially for older homeowners and baby boomers who’ve experienced years of price appreciation.

Bottom Line

Home equity has always been a powerful wealth-building tool, and homeowners continue to see their financial stability increase. Lets connect today so you can better understand how much equity you have in your current home or if youre ready to take the next step in building your savings as a homeowner.

 

 Homebuyers: Hang in There

 

Some Highlights

• Todays sellers market provides unique challenges and benefits for buyers.
• Current low interest rates wont last forever, and home prices are forecast to rise.
• If you're a homebuyer, hang in there. Homeownership improves your quality of life, and the long-term benefits outweigh the short-term challenges.

 

The Right Expert Will Guide You Through This Unprecedented Market

In a normal market, its good to have an experienced guide coaching you through the process of buying or selling a home. That person can advise you on important things like pricing your home correctly or the first steps to take when you're ready to buy. However, the market were in today is far from normal. As a result, an expert isn't just good to have by your side an expert is essential.

Todays housing market is full of extremes. Mortgage rates hovering near record-lows are driving high buyer demand. On the other hand, an absence of sellers is creating record-low housing inventory. This imbalance in supply and demand is leading to a skyrocketing rate of bidding wars and more houses selling over their asking price. This is driving home price appreciation and gains in home equity. These market conditions aren't just extreme they can be overwhelming. Having a trusted expert to coach you through the process of buying and selling a home gives you clarity, confidence, and success through each step.

Here are just a few of the ways a real estate expert is invaluable:

• Contracts We help with the disclosures and contracts necessary in todays heavily regulated environment.
• Experience Were well-versed in real estate and experienced with the entire sales process, including how its changed over the past year.
• Negotiations We act as a buffer in negotiations with all parties throughout the entire transaction while advocating for your best interests.
• Education We simply and effectively explain todays market conditions and decipher what they mean for your individual goals.
• Pricing We help you understand todays real estate values when setting the price of your home or making an offer to purchase one.

A real estate agent can be your essential guide through this unprecedented market, but truth be told, not all agents are created equal. A true expert can carefully walk you through the whole real estate process, look out for your unique needs, and advise you on the best ways to achieve success. Finding the right agent should be your top priority when you're ready to buy or sell a home.

So, how do you choose the right expert?

It starts with trust. You'll have to be able to trust the advice your agent is going to give you, so make sure you're connected to a true professional. An agent cant give you perfect advice because its impossible to know exactly what's going to happen at every turn especially in this unique market. A true professional expert can, however, give you the best possible advice based on the information and situation at hand, helping you make the necessary adjustments and best decisions along the way. The right agent the professional will help you plan the steps to take for success, advocate for you throughout the process, and coach you on the essential knowledge you need to make confident decisions toward your goals. That's exactly what you want and deserve.

Bottom Line

Its crucial right now to work with a real estate expert who understands how the market is changing and what that means for home buyers and sellers. If you're planning to make a move this year, lets connect so you have someone who can answer your questions, give you the best advice, and guide you along the way.

 

 

Clever Uses for Useless Spaces

There are a lot of areas around the home that may seem kind of useless or wasted. Partial dividing walls, areas below (or even above) a staircase, or little nooks or alcoves that were created by the house’s unique design are all common examples. You might not think much about these areas, but if you consider them for a moment, you might see how they could be some serious missed opportunities. With a little bit of creativity, though, you can change all of that for the better.

That blank wall around a doorway doesn’t have to stay empty, and the space under the stairs isn’t just for boy wizards anymore. There are a number of ways that you can revamp these empty and otherwise useless spaces and make your home more functional and fun in the process. Here are just a few ideas to get you started.

Surfaces and Seating

Look around your home at the various nooks and crannies that seem to just be empty space. With a little bit of work, it’s easy to add seating, tables, desks, and more to these areas and make them much more functional. Once you start thinking creatively, a whole wealth of options opens up.

Some of the open space in your foyer could have benches added for you and your family to sit and get your shoes on in the morning, possibly with bins that slide under the benches to keep those shoes in when they’re not being worn. A little alcove could be a great place to install a small desk or computer workstation for homework, bill paying, creative writing, or even grabbing a quick bite to eat. You could even stick a chaise lounge or part of a sectional couch in a largely unused corner to give people a private place to wind down or relax. And this is just the tip of the iceberg.

Storage and Organization

Some of these seemingly useless places can be a great place to add storage solutions to your home. Shelves and cabinets can instantly transform empty walls, giving you additional storage even in the small spaces around doorways or in closets. Drawers are also great additions, as are sliding cabinet racks that pull out and then slide fully back into the wall. There are even more options available if you really want to get creative.

If your kitchen has a small dividing wall separating it from other rooms, consider adding a built-in wine rack within it to hold a few of your favorite bottles. A pull-out vertical cabinet next to the sink or stove can also be a great area to add a spice rack or store cutting boards. Bookcases are relatively easy to install, and if you have a large unused area, it might even be an ideal place to add a built-in pantry. Not only do details like these really liven up your home, but they can also help reduce clutter in other areas and make everything a bit more organized in general.

A Use for Every Space

You might be surprised at just how much space there is in your home for these types of projects. The options can increase even more if you start looking at the outside of your home or in the garage, too. While some projects might require a bit of work, others are simple modifications that can really go a long way toward improving both the look and functionality of your home.

If you aren’t sure where to start, consider bringing in an interior designer or general contractor to discuss what you want and see what your options are. HomeKeepr can help you find the right pro for the job, too. Sign up for a free account today to get connected with professionals in your area that can help make your renovation dreams come true. They may even be able to offer up suggestions you haven’t even thought of yet.

Hope Is on the Horizon for Todays Housing Shortage

The major challenge in todays housing market is that there are more buyers looking to purchase than there are homes available to buy. Simply put, supply cant keep up with demand. A normal market has a 6-month supply of homes for sale. Anything over that indicates its a buyers market, but an inventory level below that threshold means were in a sellers market. Todays inventory level sits far below the norm.

According to the Existing Home Sales Report from the National Association of Realtors (NAR):

Total housing inventory at the end of April amounted to 1.16 million units, up 10.5% from March’s inventory and down 20.5% from one year ago (1.46 million). Unsold inventory sits at a 2.4-month supply at the current sales pace, slightly up from March’s 2.1-month supply and down from the 4.0-month supply recorded in April 2020. These numbers continue to represent near-record lows.

Basically, while we are seeing some improvement, were still at near-record lows for housing inventory (as shown in the graph below). Here's why. Since the pandemic began, sellers have been cautious when it comes to putting their homes on the market. At the same time that fewer people are listing their homes, more and more people are trying to buy them thanks to todays low mortgage rates. The influx of buyers aiming to capitalize on those rates are purchasing this limited supply of homes as quickly as they're coming to market. This inventory shortage doesn't just apply to existing homes that are already built. When it comes to new construction, builders are trying to do their part to bring more newly built homes into the market. However, due to challenges with things like lumber supply, they're also not able to keep up with demand. In their Monthly New Residential Sales report, the United States Census Bureau states:

The seasonally adjusted estimate of new houses for sale at the end of April was 316,000. This represents a supply of 4.4 months at the current sales rate.

Sam Khater, Chief Economist at Freddie Mac, elaborates:

In the span of five decades, entry level construction fell from 418,000 units per year in the late 1970s to 65,000 in 2020.

While in 2020 only 65,000 entry-level homes were completed, there were 2.38 million first-time homebuyers that purchased homes. Not all renters looking to purchase their first home were in the market for entry-level homes, however, the large disparity illustrates the significant and rapidly widening gap between entry-level supply and demand.

Despite todays low inventory, there is hope on the horizon.

Regarding existing home sales, Sabrina Speianu, Senior Economic Research Analyst at realtor.com, explains:

In May, newly listed homes grew by 5.4% on a year-over-year basis compared to the earlier days of the COVID-19 pandemic last year

In May, the share of newly listed homes compared to active daily inventory hit a historical high of 44.4%, 17.3 percentage points higher than last year and 15.1 percentage points above typical levels seen in 2017 to 2019. This is a reflection of quickly selling homes and, for buyers, it means that while they can expect fresh new listings every week, they will have to be prepared to move quickly on desirable homes.

As for newly built homes, builders are also confident about what's ahead for housing inventory. Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB), shares:

Builder confidence in the market remains strong due to a lack of resale inventory, low mortgage interest rates, and a growing demographic of prospective home buyers.

Things are starting to look up for residential real estate inventory. As the country continues to reopen, more houses are likely to be listed for sale. However, as long as buyer demand remains high, it will take time for the balance between supply and demand to truly neutralize.

Bottom Line

Although it may be challenging to find a house to buy in todays market, there is hope on the horizon. Lets connect to talk about your home search so we can find your dream home this summer.

 

Don't Wait To Sell Your House

Were in the ultimate sellers market right now. If you're a homeowner thinking about selling, you have a huge advantage in todays housing market. High buyer demand paired with very few houses for sale makes this the optimal time to sell for those who are ready to do so. Whatever the move you want to make looks like, here's an overview of what's creating the prime opportunity to sell this summer.

High Buyer Demand

Demand is strong, and buyers are actively searching for homes to purchase. In the Realtors Confidence Index Survey published monthly by the National Association of Realtors (NAR), buyer traffic is considered very strong in almost every state. Homebuyers aren't just great in number right now they're also determined to find their dream home. NAR shows the average home for sale today receives five offers from hopeful buyers. These increasingly frequent bidding wars can drive up the price of your house, which is why high demand from competitive homebuyers is such a win for this summers sellers.

Low Inventory of Houses for Sale

Purchaser demand is so high, the market is running out of available homes for sale. Danielle Hale, Chief Economist at realtor.com, explains:

For most sellers listing sooner rather than later could really pay off with less competition from other sellers and potentially a higher sales price… They'll also avoid some big unknowns lurking later in the year, namely another possible surge in COVID cases, rising interest rates and the potential for more sellers to enter the market.

NAR also reveals that unsold inventory sits at a 2.4-months supply at the current sales pace. This is far lower than the historical norm of a 6.0-months supply. Homes are essentially selling as fast as they're hitting the market. Below is a graph of the existing inventory of single-family homes for sale:At the same time, homebuilders are increasing construction this year, but they cant keep up with the growing demand. While reporting on the inventory of newly constructed homes, the U.S. Census Bureau notes:

The seasonally adjusted estimate of new houses for sale at the end of April was 316,000. This represents a supply of 4.4 months at the current sales rate.

What Does This Mean for You?

If you're thinking of putting your house on the market, don't wait. A seller will always negotiate the best deal when demand is high and supply is low. That's exactly what's happening in the real estate market today.

Bottom Line

As vaccine rollouts progress and we continue to see the economy recover, more houses will come to the market. Don't wait for the competition in your neighborhood to increase. If you're ready to make a move, now is the time to sell. Lets connect today to get your house listed at this optimal moment in time.

 

 

Is It Time to Replace Your Windows?

Your windows are one of the most important features of your home. They provide you with natural light and visibility while also giving you the option to let fresh air in when your home gets stuffy. As with everything else in your home, your windows will start to accumulate some wear and tear over time. Eventually they might even have to be replaced. How do you know when it’s really time to replace your windows, or when a little maintenance will keep them in operation for a while longer? While this varies a lot depending on the specific windows that are installed, how well they’re maintained, and what the average temperature and other environmental factors are like, here are a few things you can look out for to see if you need new windows.

Leaks and Drafts

Two big signs that your windows might be having problems are drafts and leaks around your window. Both of these problems can cost you money and make your home less comfortable overall. Drafts can drive up heating and cooling costs, while leaks can cause water damage that in some cases may need a significant amount of work to repair.
Sometimes these issues might not be readily apparent at first. A small leak may disguise itself by traveling along seams in wallpaper or similar wall features, so you may not even discover it until it has been there for a while. Drafts can also start small, requiring you to come toward the window from a certain direction before you feel the draft at all. These small issues can become much larger problems if left to fester over time.

Cracks and Condensation

Visible cracks are also a sign that there is some problem with your windows. These cracks can appear on the frame of the window itself or in the surrounding wall. In some cases, cracks in the window glass may be visible as well. Regardless of where the damage occurs, cracks in your window are bad news, since each crack is a potential entry point for drafts, water, and other problems that could become costly to repair down the line.

Some of these problems may not be immediately visible if you don’t know what you’re looking for. Condensation between the panes of double-pain glass is often seen as a big red flag, since the condensation means that water is getting in somewhere. That little bit of moisture can eventually lead to mold and mildew in your windows as well as other damage occurring within the walls.

Replacing Your Windows

If you do need to replace your windows, finding the right new windows for your home is important. You’ll want to make sure that the windows you choose are well insulated or have other features to help control the temperature in the summer and winter. If you want to add security alarms or other sensors, it’s important that you choose windows that are compatible with these devices as well.

Most people don’t see window installation as a DIY job, since depending on the window layout and materials involved it might be a significant undertaking without assistance. If you think that it’s a bit more than you can handle, don’t be afraid to consult a contractor or professional window installer. They can help with everything from the installation itself to selecting styles and materials that go best with your home.

Whether you aren’t sure of exactly what you need or want to find someone who can handle installation, HomeKeepr has you covered. We help you connect with professionals in your area in a variety of fields, ensuring that you find the exact people you need for your projects. Sign up for a free account today to connect to window installers and contractors in your area. It just takes a minute and you’ll be good to go.

Housing Wealth: The Missing Piece of the Affordability Equation

The real estate market is soaring today. Residential home values are rising, and that's a big win for homeowners. In 2020, there was a double-digit increase in home values a trend that's expected to head toward similar levels this year.

However, skyrocketing prices are causing some to start questioning affordability in the current housing market. Many are quick to emphasize the fact that homes today are less affordable than they were last year. Black Knight, a leading provider of data and analytics across the homeownership life cycle, just reported on the issue.

The findings show the historical averages of the national payment to income ratio, which they define as the share of the median income needed to make the monthly payments on the median-priced home. Their study reveals:

• The average over the last 25 years was 23.6%
• The average over the last 5 years was 20.1%
• The average today stands at 20.5%

Right now, housing payments are slightly less affordable than the five-year average but only by less than a percentage point. However, they're significantly more affordable than the 25-year average. Put another way, a buyer will likely make a slightly greater financial sacrifice to afford a home right now than if they purchased a home within the last five years. On the other hand, it also means the potential financial sacrifice is not nearly as great as it was over the last 25 years.

Does making a sacrifice to buy a home today make financial sense in the long term?

Last week, the Federal Reserve announced that, in the first three months of the year, household net worth increased by 968 billion based solely on the values of the real estate they owned. Another report from CoreLogic reveals the average annual gain in homeowner equity was 33,400 per borrower.

Homeownership continues to be the cornerstone to building personal wealth. For most Americans, their home is the largest asset they own. On top of that, the difference between the net worth of homeowners and renters is significant at every income level. Here's a table detailing that point using data from a study done by First American:Owning a home is an essential steppingstone to grow a households net worth. Despite the slightly greater sacrifice in the percentage of monthly income youll spend on housing today, for most homebuyers, the payoff of starting to build equity now will be worth it.

Bottom Line

Since prices have risen dramatically over the past 18 months, its slightly less affordable to buy a home today than it was a year ago. However, when you consider the equity gain and weigh the long-term benefits of building your net worth, you may question if you can afford not to buy now.