Affordability in Massachusetts

Speaker A: Welcome to your home, your market, your move. And this is where real estate gets real with the Serratani team. So welcome. We have really special guests today. We have Ashley Cookson from Movement Mortgage. We have Jenna Goulart. She's a realtor and part of the Saratani team. And Tina lynch from Tina, uh, Lynch Designs. She does all our staging and works with a lot of clients doing interior design. So we have a great topic today. We're going to talk about one of the biggest issues. It's affordability in Massachusetts. And this is a really big topic because right now we're working with buyers and sellers, and sellers are still, uh, at a really good price point. It's still kind of a seller's market. Prices are stabilizing a little bit in terms of not that huge influx of multiple offer situations. Going $100,000 over asking price. Um, so we're kind of getting stable there, but we have buyers, um, that are really struggling with affordability. And so it's. The rates were volatile for a long time, um, but they've kind of stabilized. They go up a little bit, then they come back down, and then they go low, and then they come back up. But usually, like, Ashley can talk to us a little bit more about that. Um, so we're going to talk a little bit about how we can help buyers afford to buy a house in this market. So, Ashley, what do you think in terms of just a general, um, statement in terms of what you can do for buyers? What programs are you offering right now?

Speaker B: Um, I think what's important to you is to get ahead of it. So make sure, even if you think you're not going to buy for six months or a year, it's great to start the process now so we can get a baseline of where your finances, um, currently are and where you're most comfortable in your range, and we can kind of gear you up to buy. I think that helps make it not as scary.

Speaker A: Yeah.

Speaker B: Um, and then you're kind of not, you know, shocked by how things look. You've had some time to prepare and time to work on your budget as well during that period.

Speaker A: That can help you with your credit score, savings, and all of that stuff. So planning six months to 12 months is, is really going to be helpful for you.

Speaker B: I think it makes a huge difference. Oath per personally. Um, and then also on our side, it really does give us a chance to kind of coach up the buyer and get them in really the perfect position. There's a lot that we can do sometimes in even A short amount of time. So it's good to get ahead of it.

Speaker A: I agree. I agree. I always tell when people call me, um, usually it's people I know. I get referrals from people. And I'll say, I am not your first call. You really need to talk to your lender. Your lender's your first call. Um, I can give you an idea of what the steps are and the processes, but really knowing what your finances look like are going to tell you what you can look for in a home, what your price point is.

Speaker B: Definitely. And there are a lot of options too for first time home buyers. I think still there's that um, tendency to think that you need 20% down, making it feel extremely out of reach.

Speaker A: Yeah, that seems crazy if you're buying a home. Like I think our average starting home price right now in Massachusetts in Rhode island is 600,000. Rhode Island's a little bit lower. Like it's around 500. But in Massachusetts it's 600. I can't even imagine, like that's $120,000 you need to save if you need a 20% deposit. So tell us a little bit about what programs. Like is there 0% down or there are 3%, 5%. What are those programs?

Speaker B: Look like my hair. 0% down. But it doesn't really, really exist. USDA does let you finance 100, but that's really a last resort program. You have to not fit into any of the buckets to really be qualified for usda.

Speaker A: Okay.

Speaker B: Um, a veteran can finance a hundred percent. Um, they will still have closing costs, but they can finance 100 of their down payment, which is nice. Other than that you'd be looking at conventional financing which does a 3% down, which a lot of people don't realize.

Speaker A: Okay, so I didn't realize conventional. Well, I think I did know that for some programs I always think of fha.

Speaker B: Yeah, that's everyone's first go to really.

Speaker A: Right. That's three and a half percent. Right.

Speaker B: And a half. And that's not everyone thinks FHA is a first time homebuyer program. It's really just another product alongside of conventional. It's just which is the best fit. Uh, but as long as one buyer is a first time home buyer, you can go with conventional 3% down and then any buyer can do FHA. So even a move up buyer, as long as they don't currently have an FHA mortgage, they can utilize that three and a half percent down for their second home if they wanted to.

Speaker A: So another Piece too. So you have your, your money down. Right. That you need. That's important. And I know laws have changed with the gift piece too. So I remember during the COVID years when parents were really helping people to buy houses because it was just so competitive, um, that, and I don't know if it was during that time period that the gift law changed, but you can really just write a letter now, right?

Speaker B: Yeah. So I think a lot of people get concerned from a tax standpoint, like, what is going to be the tax, you know, implication. Yeah, my parents gift. So always like, we're not CPAs. Always talk to your CPA or accountant.

Speaker A: Right.

Speaker B: But there's a maximum, um, gift and there's an annual gift before you actually have to file. And then usually when you file, you're not necessarily going to have it impact your taxes. You're just taking away from that lifetime gift that you can gift over time. So I.

Speaker A: So let me just clarify. So when you say a lifetime gift, are you talking about filing as the receiver or as the giver of, uh, the gift?

Speaker B: That's usually what we find is the giver is very nervous to give the gift for tax reasons.

Speaker A: And it's 15,000 annually that you can give without taxes.

Speaker B: I think it's up to $17,500.

Speaker A: Okay. So it's gone even higher.

Speaker B: Federally, even if you did gift that amount, it's just coming off your lifetime amount.

Speaker A: Okay.

Speaker B: And I believe, and don't quote me on it, but I think as long as you're under, I don't even think you have to technically file. I think if you're giving a gift of 17. 5 or higher, then you need to fill out the tax paperwork and then that's where it comes off your lifetime gift. Okay, But I would still check that.

Speaker A: Yeah.

Speaker B: But from what we researched on this end, to have some information to give clients is that there really isn't a tax implication.

Speaker A: Okay.

Speaker B: And from the client side, um, unless it's program specific, um, depending, you know, what program they're going for, um, there isn't necessarily a capped either on how much they can be gifted. So a gift can be a great option to go towards both down payment and towards closing costs.

Speaker A: Okay. Um, now another thing in terms of down payment assistance, um, I know Massachusetts and Rhode island both had programs, um, over the last couple years. They kind of empty out pretty quickly, these programs where they'll give you down payment assistance. Are we seeing that in 2026?

Speaker B: So there is still down payment assistance. It's not free so Rhode island had a grant in the last few years, which was amazing. It was free money, but once it ran out, it ran out. So that was a great option for those clients that were able to capitalize during that period. But both Massachusetts and Rhode island do still have down payment assistance programs, but you're essentially paying for the extra assistance. So yes, need some help with your down payment. It's amazing. You're going to be able to get some funds to go with yours or depending on the property, um, but you're

Speaker A: going to pay for that help.

Speaker B: You are going to pay for that. You're either paying now monthly as a secondary mortgage payment or you're going to pay it basically at the end in the form of it's going to still have to be repaid. So great option, but it really does depend on each client situation what might be the best fit.

Speaker A: So would you say that that um, actually helps, like when you think about renting versus buying? Is it better to take on that extra debt to then own a home as opposed to paying rent monthly where you're not really gaining anything in the end?

Speaker B: In my opinion, real estate is always a solid investment. I feel like all the trends and analytics show that.

Speaker A: Mhm.

Speaker B: So I think as long as you're comfortable with what that total monthly payment looks like and you feel it's doable, then it's definitely going to be a solid investment. Because rent, like you mentioned, you're not really right.

Speaker C: Rent is the same as a mortgage

Speaker B: and you're, it's not going towards anything.

Speaker A: Right. And you're not right. So it's the same, sometimes it's the same amount, sometimes rent, and then you're gaining equity, you're building wealth. Right. Um, that, that's great. So right now in terms of 2026, what are you seeing for. Are there any special loan programs out there for first time home buyers?

Speaker B: I would say from what I've seen right now, there isn't anything, you know, special. It's really just kind of those standard programs that have been available. So it's just a matter of identifying what is the best fit for each borrower. I think it's really good if they just come in with an open mind. I think sometimes there's so much outside noise that they're almost already pigeonholing themselves towards a very specific program sometimes before they even talk to a lender. So again, if they just start early, we can see what the options are.

Speaker A: Okay. I know some clients will talk to me about, um, interest rates and how that affects your buying power, um, but also real estate taxes from town to town and how that affects their buying power. Um, can you talk a little bit about that?

Speaker B: Yeah, of course. So we'll always ask where they're thinking they're gonna buy just to get a rough idea of town. So that way when we're calculating that estimated monthly payment and ensuring they qualify, um, that we're using a reasonable tax rate. But that is a big conversation that we have to them, um, with them is that taxes from home to home are never going to be the same.

Speaker A: Right.

Speaker B: So you could be looking at two properties both for 500,000 and the monthly mortgage payment could be very different.

Speaker A: Interesting.

Speaker B: Property taxes.

Speaker A: Interesting.

Speaker B: So we're always going to check every single home that they're interested in before they move forward with an offer to A, make sure they still qualify and then B, make sure they're completely comfortable with what that monthly payment looks like.

Speaker D: Yeah.

Speaker B: And that goes the same for condo dues too, if they're condo shopping. Um, and you all know those dues really do vary from a condo association. Condo association, massive impact on um, you know, their favorable.

Speaker D: And I think working with Ashley too, and from previous, um, clients that we have is she's great that she goes above and beyond. And you really make sure that we talk to the client and say, okay, are you comfortable with this payment? Because some lenders won't do that for you. They'll just kind of like write it, they'll give you the pre approval, you're ready to go, they're qualified for it. And you know, we don't want that to be a shocker for a buyer if they're a first time home buyer or if they're not. Um, so that's something that Ashley and our team does. That's phenomenal that we do appreciate with our clients.

Speaker B: Thank you. That's really important that we're really transparent in what that payment looks like.

Speaker D: Absolutely.

Speaker B: They're the ones that are going to have to.

Speaker A: Well, it's a lot of information for someone to go through. I mean, buying a house is not as simple as buying a car. They're very different animals. And there's a lot to know because your decisions and who you work with will impact you for the next 30 years or until you refinance or you sell your home. But it can be a long time. So what would you say is the average closing costs for a buyer right now?

Speaker B: I would say, I mean it does depend, but maybe 7 to 12,000.

Speaker A: Okay.

Speaker B: Uh, and the reason there's such a range is it's not necessarily your standard fees like your credit report or your lender fee or your attorney fees. It's more like your title insurance is going to be based on what that purchase price and loan amount is. Property tax escrows and insurance are going to be a part of those closing, closing costs. And again, those are going to vary property to property. So it's things like that that can really kind of drive it up or drive.

Speaker A: Does your credit score impact your closing cost amount?

Speaker B: No, not necessarily.

Speaker A: Not at all. Okay, well, that's interesting. I wasn't sure about that. Um, so in terms of buyers, there's a lot of information to know, but it sounds like there's a lot of flexibility depending on if you're flexible as a buyer, where you're going to buy your home. Absolutely. I always thought condos were a great way to start. And as condo associations are starting to fall apart and not doing as well. We really see that a lot in Florida. Um, a lot of. I think the governor in Florida, I'm only. This is all hearsay. So it's not fact, just little bits of the news that I listen to in terms of outside of Massachusetts that they are like shutting down some associations in Florida because they're so bankrupt that they're not people are paying their dues. I have, I have not seen that in Massachusetts. I have seen a couple of associations that lenders will not give you a mortgage for because of the insurance component.

Speaker B: So you make a good point. People don't also realize if you're looking for a condo, there's going to be two sides to it. There's going to be your buyer financing and then there's going to be the stability of the condo. So we're also essentially underwriting and approving the condo. We do it up front once you go under contract to ensure in case there was anything that came up with budget issues or insurance issues that we can get ahead of it. And there are programs for those condos that don't fit the box. M. So that is always an option for first time homebuyers though maybe if you're in that range of a lower down payment or down payment assistance, you're going to need a strong, you know, condo and condo association. Those condos. Yeah. That are outside of the box unfortunately, are not going to fit more for those first time home buyer programs.

Speaker A: So it's. When you're looking at listings, condo listings, and Tina, you make a good point about the budget. That's you know, I want them to look at the condo association documents, but I really want them to look at that financial statement, look at that budget, look at their reserves. Because the amount of the reserves will tell you if something were to happen, like say we're having a horrible winter here in Massachusetts. Like say that they all of a sudden a lot of the buildings have ice dams and there's this massive repair that needs to happen. If they don't have reserves in that budget, guess what? You're going to be getting a special assessment. Right. So that special assessment can be very costly to the owners of the condo association. So one of the things when you're looking at listings, I always tell my buyers if they really want to be in a condo, because I have a lot of downsizers I work with, and I know you do too, that they don't want to deal with the yard anymore. They don't want to deal with the exterior. They want to live more simply. And condos are a great option for that. And there are a lot of very well managed condo associations. But look in the listing, if it says this condo association is not certified by Fannie Mae and Freddie Mac, that is a red flag that says that you're going to have a hard time getting a mortgage for this. And if you're paying cash because you're selling your, you know, your lifetime home and you can pay for cash, do you really want to buy that? Because that's telling you that those reserves or there's something wrong with that association.

Speaker B: Sometimes it can be other factors too. Like Fanny and Freddie will only take on so much risk.

Speaker A: Okay.

Speaker B: So sometimes too it can be like investor occupancy and things like that.

Speaker A: Okay.

Speaker B: So sometimes, again sometimes. But we do recommend it is very important that you read the listing. A lot of times clients will sometimes send it to us and we'll see those factors that it's like a cash only. We will dive into it more upfront too to help you with our condo team to identify the why. So that way, you know, if it is something that is a risky budget situation and really like, do you want to put yourself into that type of like unstable condo or is it more just like a guideline nuance, like there's too many investors, which can a lot of times happen in smaller condo associations.

Speaker A: You're so good, Ashley, to take that. I mean, you're saying they might be a cash buyer but you're willing to do that homework for your client? Yes, I, I mean, I think that that just speaks volumes to the customer service that you provide, that clients that come to you are not just a number, that they have a face and that you really want to help them. And I think that's wonderful that that happens for you. So thank you, um, for taking good care of our clients. It's a great, it's a great thing because condos can be tricky.

Speaker B: Very tricky.

Speaker A: Yeah. So you have to really. And to be honest with you, um, I do sell condos just like everybody else does. But there are a lot more work than selling like a $2 million single family home.

Speaker B: It's changed over a time and it has changed and it is a lot.

Speaker A: Yeah, there is a lot going on. So let's turn the table a little bit about, um, buyers today. Because I've seen a lot of changes, I think in the last 10 years, um, working with buyers and working with sellers. But for buyers in particular, their expectations are different. You know, when I was first buying my first home, I was fortunate enough that my dad was handy, my husband's dad was handy, and my husband was handy. And so when we were looking at homes, you know, we didn't need them to be perfect, they didn't need to be turnkey, um, because that's top dollar. Like if you're going to buy a resale home. And what I mean by resale is it's not new construction that they're not going to be perfect. Um, what are you seeing, Jenna? Because as a buyer agent, and you're also a listing agent, but as a buyer agent, what do you see when you're working with buyers today for their first home?

Speaker D: I think it's a shock culture. People come in and, um, what they're qualified for, where they want to be for their monthly payment. And then we kind of start looking at homes of what's going to be in that price range for them. And, and sometimes when they, you know, we send them listings and we're opening the door, we're going to do, you know, the first walkthrough of the home. It's a shock. Sometimes it can be like a real shock to them of like, this is what I can afford and this is what it's going to get me in this market. Um, so that's, you know, you just kind of have to really put your

Speaker B: thinking cap on of what are the

Speaker D: things in the home that you truly cannot live without. Is it hardwood floors? Is it a two family home? Is it a one story home? Like, what are you truly looking for? And I think that comes into play, you know, when we hire Tina to come in and she can really walk through the home of that client and say, you know, maybe down the road, this is what we can do to your kitchen. Or this is, you know, if it doesn't have a fireplace in it and your clients wanted that, like, how can we put a faux fireplace in there with, like a nice bookshelf?

Speaker A: M. What a great idea. And, you know, I think that you raise a really good point, because houses in the winter always sit a little bit longer, but if that home is not perfect, it's going to sit a little longer. And what sellers need to realize is that time is your enemy. Because it's so true that I have seen this happen over and over again, that I want X amount of money for my house and I have to have this amount. Okay, well, there's a strategy on how we can get there if it's realistic, first of all, because we want to always be transparent and honest. Uh, we know there are some realtors that will go in and say, oh, yeah, I can get you a million dollars for that house, no problem. But really it's around 8, 850. And they want to just buy the listing. Right. But it's important to be honest with our sellers about that. But when you're with a buyer and you go through that home and they're like, oh, my gosh, this is too much work, and you're looking at it like, this is just cosmetic, like, this is not a gut job. Have you brought Tina in, like, on a second showing to have them walk through the house and kind of give them ideas?

Speaker D: Yes, of course. Um, so, you know, that's where Tina comes into play. And it's really great to have her on our team.

Speaker A: And it makes them feel better.

Speaker D: Yeah, it does feel more reassured.

Speaker C: Oh, yeah.

Speaker A: What are some of the things that you've made suggestions to buyers?

Speaker C: Well, kitchens and bathrooms really is what sell the house. And sometimes when buyers go into these homes and the kitchen and bathrooms aren't up to snuff, I mean, and their budget usually is not that high. So what I can recommend, obviously, is clean. I'm sure, you know, a good cleaning and paint. Paint the cabinets. That saves oodles of money. Um, if the countertop in the kitchen is in really bad shape and it needs to be replaced, this less expensive alternatives like quartz, it's like the best.

Speaker A: That's less expensive.

Speaker C: Oh, yeah.

Speaker A: Less expensive than granite or quartzite. Okay.

Speaker C: Or natural stone. Because quartz is not a natural stone. It's a man made stone. And it's heat, scratch water and stain resistant and uh, maintenance free. So, you know, these little things like that rip out the countertop, put in a new quartz, paint the cabinets and that's, that goes a long way. And it's not that much money.

Speaker D: Absolutely. Maybe throwing some new hardware on that cabinet as well. And it looks like a brand new bathroom.

Speaker A: Brand new bathroom, yeah. Kitchen bathroom, yeah. And what about flooring? Because a lot of homes like that go into like, they'll have like the 80s like tile, like that medium square. And sometimes if it's a neutral color, it's fine. A lot of times it could be like terracotta, you know, or.

Speaker C: Which is on trend right now, by the way.

Speaker A: Oh, interesting.

Speaker C: Okay.

Speaker A: Terracotta's coming back.

Speaker C: Sure is. It's been back for a little while.

Speaker A: Oh.

Speaker C: Well, the terracotta 80s tile, that has to stay just say it's out, uh, of the buyer's budget to replace it. Well, there's ways to decorate around it, like we mentioned before. Just add more terracotta. I can advise the buyer on how to make that terracotta look warm and inviting so that they can enjoy their space until they're ready to commit to, you're placing it.

Speaker A: Right. And you know, Rome wasn't built in a day. Right. So for some reason, and I don't know why, but people feel like, and I know they both. A lot of times you have two people that are buying this house together. They're not necessarily married. They could be friends, they could be brothers. But there's usually two people buying a house. Um, because you almost need two incomes to afford a house today. Right. But they're working hard and they don't want to have to work on the weekends. They don't want to have to deal with that. But you can hire people to do the work for you, but you just have to save a little bit more money. Um, and there's cheaper ways to do it too. I have an amazing handyman. He is just. I can't believe it. I feel like I struck the lottery by meeting this guy. And he's so affordable.

Speaker D: Mhm.

Speaker A: And he's really good at what he did. So I, I got three quotes from my basement stairs. Our house was built in 1826 and we had the grossest rickety basement stairs. We lived in the house for 13 years and just avoided the basement stairs. And I got three quotes to have them done. The quotes were anywhere from 1,500 to $12,000 to do basement stairs. I was like blown away. Well, guess who the $1,500 was? It was my handyman. And, uh, I. They look. They look like they belong in a new house. Like, it's just unbelievable. I want to go down the basement more now because they're better than my front stairs. So pricing it out and having connections, I think good realtors, um, have a good book of business in terms of who they can refer to, and they're reliable.

Speaker D: And I think it's part of your home inspection, too. Right. So, like, doing a home inspection on a home, really, that can be a really good checklist for you of things. Things that necessarily for safety reasons, like this needs to be attended to now versus this could be the other two down the line. So that's a great tool to work with. Yes. Um, right. And I agree. So I think that's a great tool that a lot of people kind of just look it over and they're like, okay, yep, we're ready to keep going forward and move to that next step with it.

Speaker A: Is a great checklist to work from. Um, you know, it's like. But I remember when I was looking for my first home, though, I was like, oh, you have this checklist of things you don't see. And if you have to do electrical or plumbing, you're like, that costs a lot of money. And I don't want to do that because I want to put it into my fun stuff, like my new kitchen or my new bathroom or buying windows. Oh, my gosh, now that's a big cost. Windows are a big cost. And again, I mentioned my house was built in 1826. We just did one room at a time. You know, we bought three windows. We knew this brand was going to be around for a long time, so they'd all be the same eventually. And you budget it. You know, you have to budget for that stuff. So, um, I think safety. You made a good point between safety and cosmetic. When you're doing your home inspection. Right. Because that's. You can decide what you're going to walk away from if it's cosmetic. And you already saw it when you walked through, you just start to build a small budget for that.

Speaker D: I think talking about it, too. It's a preference versus a niche.

Speaker A: Yeah.

Speaker D: So like, flooring, like, you could walk in and, you know, the flooring's fine. It's just the color.

Speaker A: Right.

Speaker D: Might not. And yeah, uh, that's when you come into, uh, you know, maybe even painting that, like a certain tile. They do have paint out there now that you can paint a Tile, Same thing in a bathroom. Um, you m know you could do that for the first couple years you're there and then you can save that money.

Speaker C: And paint is amazing. You can paint any surfaces. Special paint for floors, especially paint for countertop if you don't want to replace or can't replace it.

Speaker A: And it can be a temporary fix and that you can live with right in the moment.

Speaker B: Also renovation moments too, which I think people don't realize that they're out there and they are available to first time home buyers.

Speaker A: Mhm.

Speaker B: And those down payments follow conventional and fha. So you can still take advantage of those really low down payments. So again with affordability. I feel like affordability has like two sides. One is like saving and having the funds for that down payment and the closing costs and then the other piece is monthly payment. Sometimes we have clients that have a little more wiggle room in that monthly payment, a little bit more comfortability so they can go higher to finance and renovation costs.

Speaker A: But is that a 203k loan or is it something different?

Speaker B: 203k would be the FHA version and hairstyle is the conventional version. Um, so you don't have to necessarily go FHA either. You can also go with a conventional option. But if you don't have that money for your down payment and you're closing costs at all these renovations that you want to do, you love the house, you have time to wait. You can always explore a renovation loan. And it works necessarily. Um, like it's pretty much the same way. Your pre approval process is going to be the same. We're still going to kind of give you your cap amount. And then when you're out there shopping, you know you're going to bring in your subject matter experts to start giving you some estimates. And then we just work through to make sure the property works. But it's another really great option if you do just want to buy the home, get in and have it done.

Speaker A: So are you only paying the monthly payment on the money that you take for the renovation as you have like you. So you do like it comes in segments. Correct.

Speaker B: It's almost like a construction loan. So you close one time. Financing is based on the total. So if it's like a $500,000 house and if it was like a really extreme renovation and say it's like a $300,000 renovation, you have to think of it as your new price or your purchase price is almost like 800,000 and your financing is basically going to be based off that number so down payment will be based off that number. Um, so there is some extra work that goes into calculating like the max you're allowed to finance and can they do the work themselves in some situations? Um, they can do the work themselves in other situations it would have to be by like a licensed contractor. So there's kind of two pieces. Once they go under contract and they have that solid estimate, we'll work with the contractor directly and we'll work with them directly on um, the side.

Speaker A: That's great. So that's great. So if you're buying your first home and it's your three bedroom, one and a half bath home and it needs a new kitchen and a new bathroom, that would sounds like it would be a good fit for that.

Speaker B: Yeah, it does help. Again as long as you're okay monthly payment wise it can help it be more affordable because when might they have that money? They've just taken on a new mortgage. How long is it going to take to save for that kitchen or that you know, bathroom? Um, or if there are just a lot of small things that kind of do add up. But the house has you know, great bones that can be times again a more affordable way than going into a higher price point even to get something that's in better condition again depending.

Speaker A: Right. That's great. That's great. I find that buyers today are looking for more of their forever home as opposed to their first time home. Um, do you find that happening more like they just, they feel like it has to be perfect, it has to be four bedrooms, two and a half, three bats like to fit forever?

Speaker D: I think it depends on the client but I, I do, I think in this day and age I feel like a lot of like the younger first time home buyer, they think that because of the pricing out there of what they can truly get for a home that it is going to be that turnkey ready and there's going to be no updates. And honestly that's not how it is here.

Speaker A: Yeah.

Speaker D: In this market Ms. Joseph. Unfortunately. Um, so it really again is to you know, kind of really have that conversation. You know we dive in with Ashley. Like we've even worked on a couple deals um, with clients of how do we write that offer a little bit more sweeter so that way they can get in that home and they can afford to do those updates.

Speaker A: Mhm.

Speaker D: So that's another great thing about working with you of like, you know this is what we want to do. In your price point of not going higher, they don't have to buy a $700,000 home, if they like that home in the area that they're looking for.

Speaker B: Because there are once in a while a property that might be sit. Not often, but sometimes if it is usually, that will be my first call be to the agent. So I'll ask Jenna, like, do we have any wiggle room on this? You know, if so, like what do you think? And we can maybe negotiate a seller credit instead of a reduction in price. A reduction in price is certainly going to get you a lower monthly payment, but interest rate is really what's hitting hard right now. So if we can get that interest rate down, you're going to see savings. So sometimes we can work a smaller seller credit which is more favorable to the seller than a large reduction. And to the buyer it's more favorable because it helps get their monthly payment down by using the seller's money to buy down that interest.

Speaker A: That's a great suggestion because I think in Massachusetts we don't see seller credits right now because it's still, it's teetering on not being a seller's market, but it still kind of is because our inventory is so low. But I have seen a lot more homes come on the market that need a lot of work. And I had a particular client recently where the house clearly needs $200,000 worth of work. And it's an estate sale. But people want their money from the estate. Right. So they're not willing to budge. They think it's worth like all this and a bag of chips. Right. But it really isn't. But mentioning the seller's credit instead of changing the price might actually help my buyer right off, like kind of maybe off that, uh, some of the closing costs it can offset.

Speaker B: Yeah, you can do it that way where it offsets their total like cash to close and helps offset the closing costs.

Speaker A: Okay.

Speaker B: Or the funds can be used to buy the rate essentially below the market rate. So the buyer is not paying for

Speaker A: that, but the seller, that's even another great idea. Okay, so pay. So let's say the house is on the market for 700,000, it needs $150,000 worth of work. So they're offering like 500, 550. But if they went to 600 and then they gave a $50,000 sell, is that too high? Is there a limit on it?

Speaker B: There are limits. So it's going to depend on loan program. So that's something we're always going to check. It's going to depend on, um, loan program and then in some cases Even what your down payment is. Okay. On how high that credit can be. So that's something too, that will always inform you all of. So that way, if it does come down to some back and forth negotiation, you know, how much, what the limits are. Oh, exactly.

Speaker A: And so do the, to the seller, credit limits depend on what they'll depend

Speaker B: on the financing type and then in some cases the financing type and down payment.

Speaker A: Okay. Okay, that's great to know.

Speaker B: But some, again, sometimes it's an option, not all the time, but we're still seeing it here or there.

Speaker A: Yeah.

Speaker B: Um, so it just can be a different strategy and way to go about it.

Speaker A: Well, as we see inventory climb, you know, which we will because just of the whole nature of the market and our baby boomers aging out. Right. We're going to see more homes come on the market over the next two years or so. And it will change. It will change. Um, but that's really good helpful information. Um, is there anything else that we haven't touched upon in terms of affordability before we close out the segment?

Speaker D: I think we pretty much nailed it. But just to. For clients that are tuning in and listening to us, I think it's a really, um, it's really important when you're hiring your agent versus you're going to the right lender and making sure that they have that relationship, that they're in tune with each other. Um, because like we, we were just talking about, like me and Ashley have done so many deals in the past, but we've really, there's a few that I can, you know, touch upon that. Um, we work together and we truly have worked together to make the strongest offer for our client. And they end up.

Speaker B: It really is, it really, it really truly.

Speaker A: It's not, it's not boilerplate. Like, um, every client with every property, the scenario is going to change. Right. So whether the client changes or the property changes, that package scenario will be very unique. Absolutely. And so it's really important to have seasoned professionals that really help you navigate every possibility.

Speaker D: Absolutely.

Speaker A: You know, it's funny. Um, I sold my brother's multifamily and um, the buyer that came to us with the best offer didn't have representation in a realtor. And he said, I can write my own offer. Like, okay. So he wrote his own offer and he sent it over to me and I'm like, nope, it's not compliant. You need to use the form that your attorney can then take and put into a purchase and sale. And none of your funding is in Here from your lender. M. So it was like all of these pieces and he's like, I'm just gonna waive the inspection. And I'm like, wow. We have a new law now in Massachusetts and I am representing my brother. I don't represent you, but I have to adhere to this new law of the inspections in Massachusetts. And then there's lead paint laws. So I just think that there's so many pieces that. And we're not attorneys, we are realtors, we are lenders. But we do know what we need to comply with.

Speaker B: We have the resources too. Right, Right. You know, there's a need to bring in an attorney for clarifying, you know, questions. We have the resources to do so. I think too, there's so much tech and I love tech myself and I love quick. I'm very impatient. I think it's so easy now. It's like I'm going to go online and I'm going to get something like so quick.

Speaker A: It.

Speaker B: You really just need to check it. You need to again, very fact check. And you do need to make sure that you're working with someone that whether it be, you know, realtor or lender that's going to pick up the phone.

Speaker A: Right. Well, it's interesting. I will run so much through ChatGPT.

Speaker B: Right.

Speaker A: Like that's become our new best friend. ChatGPT, we love it, but it's not always right. It's really interesting because I run a few things through ChatGPT just to like test it. And I'm like, I say, I'll say in Massachusetts, like, what are the. And it does not give me all the right information. Sometimes it gives me some right information, but not all of it. It's almost like the new Internet. Right. Like you can Google whatever, but you may not. You have to check the source. It's not always 100%.

Speaker B: The online applications are pre quals. M. Pre approval.

Speaker A: Yes.

Speaker B: And I don't think people realize the difference. And with a pre qual, it's not necessarily that you're lying about your information,

Speaker A: but you just haven't provided it. Yeah.

Speaker B: You haven't provided it or you're just saying, well, I do. I made a hundred thousand dollars last year. But we have to go to the guidelines and how was your income and how do we need to net? So it just helps by getting a full pre approval upfront again by someone that you can trust.

Speaker A: Yes.

Speaker B: Um, that you're going to have less surprises or hopefully no surprises during the process because everything's been vetted up front.

Speaker A: Well, it's interesting that you say that because, um, last summer I had a listing and I received this pre approval letter from a local bank in that person's town. And I had never heard of the bank. And so I did call and it said pre approval. It didn't say pre qual. And I called the lender and the lender was like, I asked all, uh, my questions that I always ask to vet the buyers. And she's like, no, I didn't do that. We do that later. We do that later. I'm like, did you check W2s? Did you check, you know, the income? Did you check the employment history, their credit score? No. They gave me all the information and I put together the pre approval based on what they told me. And I said, so I went back to the buyer agent because as a buyer agent, I always call my lenders to say, did you go through this process before I even write an offer? So you have to vet your buyers on your buyer side. You have to vet your buyers on your listing side. And they did nothing. And we had five other offers on

Speaker B: this property because it's a service to the buyers.

Speaker A: Right. And they lost out on that property.

Speaker B: It's not there to know that. It's not my job to know mortgage guidelines.

Speaker A: I felt so bad, uh, for this buyer and I, I felt bad for the buyer because they had a terrible buyer's agent and they had a terrible lender and. And they lost. They had the best offer and they could have very well been qualified. Qualified for that, that house. But they did not. They did not.

Speaker B: I know, doing the paperwork up front, not that it is a ton of paperwork, but I know it's, like, scary to do that anytime I get pushback. It's just. That is our process. That is my process.

Speaker C: Yeah.

Speaker B: Um, that is how we work. We wouldn't be doing our due diligence and doing right by our clients.

Speaker A: Right.

Speaker B: We shouldn't do that. 100 so I always tell them they can go get, you know, something faster and something instant and something online, but it's just not going to be as secure. 100 it's done in their best interest. It really is.

Speaker A: Right. And I have to say, I think there are certain, certain online lenders that are very frequently accessible and they don't follow timelines. They don't. And I, you know, I try to tell my clients that you have the right to use whatever lender you want.

Speaker B: Absolutely.

Speaker A: But I also want you to have the best representation. So I always try to get a second opinion when they, you know, especially when they come to someone that they don't have a relationship with. Um, well, I think this was a great segment, and thank you all so much. Um, join us again in our next episode.