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Maximize Your Tax Refund: Invest in Your Future Through Real Estate
Maximize Your Tax Refund: Invest in Your Future Through Real Estate
Tax season often brings a pleasant surprise – a refund. As of February 7, 2025, the IRS reported an average refund amount of $2,065. That is an 18.6% increase from the previous year. Check out the details here.
If you’re contemplating how to make the most of this windfall, consider channeling it into real estate. Continue reading to discover several ways you can maximize your tax refund by investing in real estate.
Building Wealth Through Homeownership
Homeownership is a proven strategy for building wealth. Consider this, median sales price for all the Northwest MLS Housing Market (Washington State), rose to $640,000 in 2024. This is up 6.7% from the year prior. This positive increase reflects steady appreciation over the years.
By investing in property, you not only secure a place to call home but also position yourself to benefit from potential market gains.
Smart Ways to Utilize Your Tax Refund in Real Estate
Boost Your Down Payment
Saving for a down payment is often a significant hurdle for prospective homeowners. While the traditional 20% down payment offers benefits like avoiding private mortgage insurance, it’s not a strict requirement. If 20% seems unattainable you’re not alone. NerdWallet exposed that in 2023, first-time buyers typically put down 8% of the home’s purchase price.
Whether your goal is 20 or 8% your tax refund can bring you closer to this goal. The closer you are to your goal makes homeownership more attainable.
Cover Closing Costs
Closing costs encompass various fees, including loan origination, appraisal, and title insurance, typically ranging from 2% to 5% of the loan amount. For example, you would pay between $10,000 to $25,000 in closing costs in addition to the down payment on a $500,000 home loan.
Allocating your tax refund toward these expenses can ease the financial load at closing, allowing you to preserve other savings.
Purchase Mortgage Points
If current interest rates are a concern, consider using your refund to buy mortgage points. Each point, costing 1% of your loan amount, can reduce your interest rate, leading to substantial savings over time.
This upfront investment can lower your monthly payments and decrease the total interest paid over the life of the loan.
Make Extra Principal Payments
Applying additional funds directly to your mortgage principal can shorten your loan term and reduce the total interest paid. Even small extra payments can have a significant impact over time. Always consult with your lender to ensure there are no prepayment penalties.
Hot tip: Consider making an extra payment every year (perhaps your tax refund) and you could save thousands in interest over the course of the loan. For example, if your monthly mortgage payment is $3,000 and you making one extra payment a year it has the potential to save you $100,000 in interest and could cut 6 years off your mortgage.
Just imagine your future self, lounging in your dream home, sipping a cup of coffee, and thinking, “I’m glad I invested that tax refund wisely!” By making strategic decisions today, you can pave the way for a comfortable and secure tomorrow.
Partner with a Real Estate Professional
Embarking on the real estate journey can be complex. You don’t have to navigate it alone. A knowledgeable real estate agent can provide personalized advice, helping you make informed decisions that align with your financial goals. If you’re ready to explore your options, connect with me today. Let’s turn your tax refund into a steppingstone toward your dream home.
What You Need To Know About Homeowner’s Insurance
Homeowner’s insurance is a must-have to protect what’s probably your biggest investment – your home. And while you never want to think about worst-case scenarios, the right coverage is basically your safety net if something goes wrong. Here’s how it helps you.
- Covers Repairs and Rebuilding Costs: If your home is damaged by fire, storms, or other covered events, your policy helps pay for repairs or even a full rebuild.
- Protects Your Belongings: Many policies can also cover personal items like furniture, electronics, and clothing if they’re stolen or damaged.
- Provides Liability Coverage: If someone gets injured on your property, homeowner’s insurance can help cover medical bills or legal expenses.
In the simplest sense, it gives you peace of mind. Knowing you have protection against unexpected events helps you worry less. And with such a big purchase, having that reassurance is a big deal.
And while your first insurance payment will be wrapped into your closing costs, you’ll want this to be a part of your budget beyond closing day too. That’s because it’s a recurring expense you’ll have once you get the keys to your home.
Here’s what you need to know to help you budget for this important part of homeownership today.
Costs and Claims Are Rising
In recent years, insurance costs have been climbing. According to Insurance.com, there are four big reasons behind the jump in premiums:
- More severe weather events and wildfires are leading to higher claims.
- Insurance companies are pulling out of high-risk areas, reducing options for homeowners in some states.
- Past rate increases haven’t kept up with the rise in claims.
- The cost to rebuild or repair homes has gone up due to higher material and labor costs.
Basically, disasters are happening more often, repairs cost more, and insurers have to adjust their rates to keep up. Data from ICE Mortgage Technology helps paint the picture of how the average yearly premium has climbed over the last decade (see graph below):
What You Can Do About It
Homeowner’s insurance is a must to protect your home and your investment. But with costs rising, you’ll want to do your homework to balance the best coverage you can get at the best price possible.
Homeowner’s insurance rates vary widely based on location, provider, and coverage. Shop around and compare quotes before settling on a policy. And don’t forget to ask about discounts. Things like security systems or bundling with auto insurance could help lower your insurance costs.
Bottom Line
When you’re planning to buy a home, it’s important to look beyond just your mortgage payment. You’ll also want to budget for your homeowner’s insurance policy. It gives you a lot of protection against the unexpected. And while it’s true those costs are rising, there are things you can do to try to get the best price possible.
Helping my clients connect with trusted insurance providers—if they don’t already have one—is just one of the many full-service benefits I offer.
Washington State Home Inspection Rules—Did You Know?
Washington State Home Inspection Rules—Did You Know?
Home inspections can be nerve-wracking for both buyers and sellers, but Washington State’s laws might surprise you!
🔹 Buyers usually want to share what they found in an inspection—whether to justify a request or out of a sense of fairness. But here’s the catch: they can’t!
🔹 Why? If a seller receives an inspection report, they are legally required to disclose that information to future buyers. To avoid this, Washington’s contracts require written permission from the seller before any details can be shared. Otherwise, the buyer waives their contingency with no explanation.
🔹 This is why many buyers simply ask for a closing credit without specifying why—it’s not a trick, just how the law works! For sellers, this can be frustrating, but a skilled agent can help navigate these negotiations so everyone feels confident in the process.
🔹 The exception? If a buyer requests a specific repair, they can name the item, but they can’t provide photos or inspection details unless the seller gives permission.
One of my fellow Windermere colleagues, Heather Maddox, shared this in a recent post, and the topic sparked so much interest that I wanted to keep the conversation going!
What are your thoughts? Drop them below!
Happy International Women’s Day!
Happy International Women’s Day!
Women have an illustrious history in the real estate industry — but it’s not a very long history. In fact, in the U.S., female aspiring homeowners weren’t even allowed to finance purchases on their own until the 1970s. Thankfully, women have achieved high levels of real estate–related success since then, both as homeowners and as industry professionals. 👏
I’m passionate about helping women achieve homeownership, whether it’s buying their first home, investing in real estate, or finding a place that truly fits their next chapter. Homeownership is a powerful tool for financial independence and stability, and I love guiding women through the process with knowledge, confidence, and support. My goal is to ensure every woman I work with feels informed, secure, and excited about building wealth and stability through real estate.
#celebratingstrongwomen #internationalwomensday #womeninrealestate #realestateagent #skagitvalleyrealestate #lovewhatyoudo #realtor #allinforyou #windermererealestate
Headed Back Into the Office? You May Decide To Move
It’s no secret that remote work has surged over the last few years. And that flexibility gave a lot of people the freedom to move — and work — from wherever they wanted.
But now, a growing number of companies are requiring employees to return to the office. And that’s leading some people to make decisions about where they live and if they need to move.
How Return-to-Work Policies Are Impacting Housing
During the rise of remote work, a lot of employees took the opportunity to move away from expensive or crowded city centers. Some opted for suburban neighborhoods and larger homes with yards, while others relocated to more rural areas. But lately, more people are returning to the city.
And according to data from Bright MLS, more than half of workers surveyed would have to rethink where they live or deal with long drive times if their job enforced a return-to-office policy (see chart below):
And maybe you’re one of them. If you moved farther out of the city during the work-from-home era, you may be facing a longer commute that you never expected to make daily. Once you’ve done it a few times, you might find it’s something you can get used to and isn’t as bad as you may have thought.
But sometimes, it’s just too hard to make it work — no matter how much you try. A drive or train ride that seemed fine once or twice a week can feel like too much of a grind five days in a row. It may also cost too much to commute so often, take too long, or cut too far into your free time. As Lisa Sturtevant, Chief Economist at Bright MLS, notes:
“During the pandemic, when remote work became the norm, homebuyers were able to move farther out . . . But workers do not have the same flexibility that they used to, and some are going to have to make a tough choice if and when their employer calls them back into the office full-time.”
If you’re thinking you may want to move, don’t stress. Talking to an agent can help you weigh your options. Whether it’s finding a home closer to work, balancing commute time with affordability, or even selling a home in one area to buy in another, having a pro on your side makes the process easier.
If having to be back in-office has you considering a move, let’s connect.
2024 Year in Review
Are You Asking Yourself These Questions About Selling Your House?
Some homeowners hesitate to sell because they’ve got unanswered questions that hold them back. But a lot of times their concerns are based on misconceptions, not facts. And if they’d just talk to an agent about it, they’d see these doubts aren’t necessarily a hurdle at all.
If uncertainty is keeping you from making a move, it’s time to get the real answers. The ones you deserve. And to take the pressure off, you don’t have to ask the questions, because here’s the data that answers them.
1. Is It Even a Good Idea To Move Right Now?
If you own a home already, you may be tempted to wait because you don’t want to sell and take on a higher mortgage rate on your next house. But your move may be a lot more feasible than you think, and that’s because of how much your house has likely grown in value.
Think about it. Do you know anyone in your neighborhood who’s sold their house recently? If so, did you hear what it sold for? With how much home values have gone up in recent years, the number may surprise you. According to Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), the typical homeowner has gained $147,000 in housing wealth in the last five years alone.
That’s significant – and when you sell, that can give you what you need to fund your next move.
2. Will I Be Able To Find a Home I Like?
If this is on your mind, it’s probably because you remember just how hard it was to find a home over the past few years. But in today’s market, it isn’t as challenging.
Data from Realtor.com shows how much inventory has increased – it’s up nearly 25% compared to this time last year (see graph below):
Even though inventory is still below more normal pre-pandemic levels, it’s improved a lot in the past year. And the best part is, experts say it’ll grow another 10 to 15% this year. That means you have more options for your move – and the best chance in years to find a home you love.
3. Are Buyers Still Buying?
And last, if you’re worried no one’s buying with rates and prices where they are right now, here’s some perspective that can help. While there weren’t as many home sales last year as there’d be in a normal market, roughly 4.24 million homes still sold (not including new construction), according to the National Association of Realtors (NAR). And the expectation is that number will rise in 2025. But even if we only match how many homes sold last year, here’s what that looks like.
- 4.24 million homes ÷ 365 days in a year = 11,616 homes sell each day
- 11,616 homes ÷ 24 hours in a day = 484 homes sell per hour
- 484 homes ÷ 60 minutes = 8 homes sell every minute
Think about that. Just in the time it took you to read this, 8 homes sold. Let this reassure you – the market isn’t at a standstill. Every day, thousands of people buy, and they’re looking for homes like yours!
A Record Percent of Buyers Are Planning To Move in 2025 – Are You?
This could be the year to sell your house – and here’s why. According to a recent NerdWallet survey, 15% of people are planning to buy a home this year. That’s actually a record high for this survey (see graph below):
Here’s why this is such a big deal. The percentage has been hovering between 9-11% since 2020. This recent increase shows buyer demand hasn’t disappeared – if anything, it indicates there’s pent-up demand ready to come back to the market.
That doesn’t mean the floodgates are opening and that there’s going to be a huge wave of buyers like we saw a few years ago. But this does signal there’ll be more activity this year than last.
At least some of the buyers who put their plans on hold over the past few years will jump back in. Whether they’re feeling more confident about moving, they’ve finally saved up enough to buy, or they simply can’t wait any longer – this is the year they’re aiming to take the plunge.
And, according to that same NerdWallet survey, more than half (54%) of those potential buyers have already started looking at homes online.
That’s a good indicator that a number of these buyers will be looking during the peak homebuying season this spring. So, if you find the right agent to make sure your house is prepped, priced, and marketed well, you can get your house in front of them.
More people are going to move this year, and with the right strategy, you can make sure your house is one of the first they look at.
What do you think these buyers will love most about your house?
Let’s talk it over and make sure it’s front and center in your listing.
3 Reasons To Buy a Home Before Spring
3 Reasons To Buy a Home Before Spring
Let’s face it — buying a home can feel like a challenge with today’s mortgage rates. You might even be thinking, “Should I just wait until spring when more homes hit the market and rates might be lower?”
But here’s the thing, no one knows for sure where mortgage rates will go from here, and waiting could mean facing more competition, higher prices, and a lot more stress.
What if buying now — before the spring rush — might actually give you the upper hand? Here are three reasons why that just might be the case.
1. Less Competition from Other Buyers
The winter months tend to be quieter in the real estate market. Fewer people are actively looking for homes, which means you’ll likely face less competition when you make an offer. This makes the process feel less rushed and less stressful.
According to the National Association of Realtors (NAR), homes sit on the market longer in winter compared to spring and summer (see graph below):
Fewer buyers in the market means you’ll likely have more time to make thoughtful decisions. It also means you may have more negotiating power. According to the Alabama Association of Realtors:
“A significant benefit of buying a home in winter is the reduced competition. Because of the perceived benefits of spring, many buyers delay the start of their house hunt. As a result, you will find fewer people competing for the same properties during winter. Less demand can translate into more negotiating power as sellers may be more willing to entertain offers or agree to concessions to get a deal closed quickly.”
2. More Negotiating Power
With homes staying on the market longer, sellers may be more willing to negotiate. This can lead to better deals for you as a buyer, whether that means a lower price or added incentives, like sellers covering closing costs or making repairs. As Chen Zhao, an Economist at Redfin, points out:
“. . . buying during the off season means less competition from other buyers. That means potentially negotiating a better deal.”
Plus, when demand is lower, sellers often feel more pressure to work with serious buyers. This could give you an edge to negotiate terms that work best for your situation.
3. Lock in Today’s Prices Before They Rise
Historically, home prices tend to be at their lowest point in the winter months, too. According to data from NAR, home prices last year were at their lowest in January, February, and March — right before the spring buying season kicked in (see graph below):
This trend isn’t new — Bright MLS shows between 2010 and 2024, home prices in January and February were, on average, 15% lower than during the month of peak home prices (typically June). Buying in the off-season means you’re more likely to avoid paying the premium prices that come with the high demand of spring.
On top of that, home prices generally appreciate over time, meaning they tend to go up year after year. That means if you’re ready to buy and you can make it happen, you’re not only taking advantage of what might be the lowest prices of the year, but you’re also locking in today’s price before it increases in the future.
Bottom Line
While spring may seem like the obvious time to buy, moving before the peak season can give you significant advantages, like less competition, more negotiation power, and lower prices.
If you’re ready to explore your options, let’s connect.
Time in the Market Beats Timing the Market
Trying to decide whether it makes more sense to buy a home now or wait? There’s a lot to consider, from what’s happening in the market to your changing needs. But generally speaking, aiming to time the market isn’t a good strategy – there are too many factors at play for that to even be possible.
That’s why experts usually say time in the market is better than timing the market.
In other words, if you want to buy a home and you’re able to make the numbers work, doing it sooner rather than later is usually worth it. Bankrate explains why:
“No matter which way the real estate market is leaning, though, buying now means you can start building equity immediately.”
Here’s some data to break this down so you can really see the benefit of buying now versus later – if you’re able to. Each quarter, Fannie Mae releases the Home Price Expectations Survey. It asks over one hundred economists, real estate experts, and investment and market strategists what they forecast for home prices over the next five years. In the latest release, experts are projecting home prices will continue to rise through at least 2029 – just at a slower, more normal pace than they did over the past few years (see the graph below):
But what does that really mean for you? To give these numbers context, the graph below uses a typical home value to show how it could appreciate over the next few years using those HPES projections (see graph below). This is what you could start to earn in equity if you buy a home in early 2025.
In this example, let’s say you go ahead and buy a $400,000 home this January. Based on the expert forecasts from the HPES, you could gain more than $83,000 in household wealth over the next five years. That’s not a small number. If you keep on renting, you’re losing out on this equity gain.
And while today’s market has its fair share of challenges, this is why buying is going to be worth it in the long run. If you want to buy a home, don’t give up. There are creative ways we can make your purchase possible. From looking at more affordable areas, to considering condos or townhomes, or even checking out down payment assistance programs, there are options to help you make it happen.
So sure, you could wait. But if you’re just waiting it out to perfectly time the market, this is what you’re missing out on. And that decision is up to you.
If you’re torn between buying now or waiting, don’t forget that it’s time in the market, not timing the market that truly matters. Let’s connect if you want to talk about what you need to do to get the process started today.
