What is a ‘granny flat’ and could it be a housing solution?

Montebello, California | mortgage rate news

What is a ‘granny flat’ and could it be a housing solution?

A ’granny flat’ is an ‘accessory dwelling unit’ or ADU. They are essentially prefab homes or flexible dwellings that can be added to an existing property or quickly built on an empty lot. These units can be made livable in a short period of time and allow residents a bit more space than a tiny home or trailerhome.

The units may be a solution to the lack of affordable housing that California has been trying to solve for decades.

Joe Gebbia, Airbnb’s co-founder, is one of the innovators experimenting with ADUs. Gebbia said, “In California, cities have mandates to add more housing over the next couple of years and neighborhoods love ADUs because rather than putting in a multifamily mid-rise in the middle of the neighborhood, they can actually have similar amounts of density without adversely affecting the visual character of the neighborhood, so it’s a win across the board.”

California has pushed through legislation to make it easier to adapt existing property into an ADU, but it remains to be seen if this is a long-term solution or merely a short-term band aid.

What will the housing market look like in summer 2023?

Yahoo! Finance sat down with Orphe Divounguy, a senior macroeconomist at Zillow, to discuss what the summer housing market should look like. When asked about what homebuyers have to look forward to, Divounguy stated, “There are positive signs in the housing market. Builder confidence has been up for the past five months. 1.6 to 1.7 million units under construction in April 2023,” so increased inventory could be on the horizon.

When asked about advice for potential homebuyers, Divounguy said, “Don’t try to time the mortgage rates,” was his initial advice. While mortgage rates at 7% may seem high, it is actually closer to the norm, with low mortgage rates being the exception, he explained.

How much home can I afford with a $100k income?

The team at Rate.com is often asked about income levels and home affordability. In a recent article, we took a look at how much house an individual with a $100,000 income could afford. The short answer is that it really depends on a lot of other factors including debt-to-income ratio, the home itself, and the type of mortgage you’re able to secure.

The first step is to review your finances and understand where you stand right now. Do you have a down payment? Do you have debt payments that exceed 50% of your income? Do you have an idea of the type of house you want and the location? Figuring these issues out ahead of time will put you ahead of the game when it’s time to apply for a mortgage.

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in under 10 minutes. Grab a few important documents to get started.
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  2. Copies of W-2s (or 1099s for independent contractors,
    freelancers and the self-employed)
  3. A payroll stub
  4. A bank statement
  5. Loan obligation info (student loans,
    auto loans and credit cards)

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