The seemingly endless run of bad housing news is discouraging some potential home buyers from considering a purchase. But the truth is that the advantages of homeownership have very little to do with investment gains. The best things about owning a home have a lot more to do with personal comfort and satisfaction.
Here are five of them:
• Be your own landlord. The bank can only kick you out if you don’t pay; a landlord can be much less dependable – deciding to sell the property or choosing to live there themselves.
• Paying the principal is forced savings. Yes, it’s possible that home prices will fall further. It is also possible that your 401(k) will lose value. But over the long haul, both are likely to enjoy modest gains in value.
• Fixed-rate mortgages never rise – and eventually you pay them off. With mortgage rates at record lows, people who buy now are locking in real bargains.
• Good schools. Family-sized rentals are harder to come by in areas with excellent public schools.
• Spacious properties in pleasant neighborhoods. Sizable homes in attractive communities are almost always owned – not rented.
Source: The New York Times, Ron Lieber (08/27/2010) – Info from Realtormag.com
Monday, August 30, 2010
Friday, August 27, 2010
Is The American Home Shrinking?
The Census Bureau recently reported that median new home size fell to 2,135 sq. ft. in 2009 after peaking at more than 2,300 earlier in the decade.
"Home buyers are asking for less, cutting back on options and reducing square footage," said Steven Pace of the North Carolina-based Pace Development Group, which builds both custom and tract houses ranging in price from below $250,000 to more than $2 million. "They're saying, 'Maybe we don't need that 5,000 square footage;" he said. "'Maybe our bath doesn't need to be big enough for our whole family and all our neighbors to take a shower at the same time.'"
Kermit Baker, chief economist for the American Institute of Architects, pointed out that consumers aren’t asking for spaces devoted to single purposes, such as media rooms for watching videos and game rooms for shooting pool. Instead, the requests are for rooms with shared uses. "We continue to move away from the 'McMansion' chapter of residential design," he said.
Now, the typical U.S. owner-occupied home has six rooms total, with three of them being bedrooms, according to the Census Bureau's annual American Housing Survey. The most common number of baths is two or more.
More than 75% of all homeowners have a dishwasher, up from 65% a decade ago. And garbage disposals can be found in nearly half of owner-occupied homes, up from 46%.
On a broader scope, the survey revealed that, despite the recent excitement about the new urbanism and return to cities, most Americans still lead a "Leave it to Beaver" lifestyle.
Are YOU thinking of downsizing, or know someone who is? Give us a call! We have 133 agents ready and willing to help you find the (smaller) home of your dreams! You can reach us at 972-562-8883 or mckinney@kw.com!
Source: CNN Money - Les Christie
"Home buyers are asking for less, cutting back on options and reducing square footage," said Steven Pace of the North Carolina-based Pace Development Group, which builds both custom and tract houses ranging in price from below $250,000 to more than $2 million. "They're saying, 'Maybe we don't need that 5,000 square footage;" he said. "'Maybe our bath doesn't need to be big enough for our whole family and all our neighbors to take a shower at the same time.'"
Kermit Baker, chief economist for the American Institute of Architects, pointed out that consumers aren’t asking for spaces devoted to single purposes, such as media rooms for watching videos and game rooms for shooting pool. Instead, the requests are for rooms with shared uses. "We continue to move away from the 'McMansion' chapter of residential design," he said.
Now, the typical U.S. owner-occupied home has six rooms total, with three of them being bedrooms, according to the Census Bureau's annual American Housing Survey. The most common number of baths is two or more.
More than 75% of all homeowners have a dishwasher, up from 65% a decade ago. And garbage disposals can be found in nearly half of owner-occupied homes, up from 46%.
On a broader scope, the survey revealed that, despite the recent excitement about the new urbanism and return to cities, most Americans still lead a "Leave it to Beaver" lifestyle.
Are YOU thinking of downsizing, or know someone who is? Give us a call! We have 133 agents ready and willing to help you find the (smaller) home of your dreams! You can reach us at 972-562-8883 or mckinney@kw.com!
Source: CNN Money - Les Christie
Thursday, August 26, 2010
Home Owners Switching to Natural Plants
Home owners seeking to save money are landscaping their properties with plants that are native to the area.
These gardening design schemes generally require less water. The practice started in the West, where this kind of design is called "xeriscaping" — based on the Greek word for “dry.” But lately, it is spreading all over the country.
Water savings can be significant. According to the Water Research Foundation of Denver, landscape watering accounts for 40 percent to 70 percent of residential water use. Converting to this kind of landscaping can reduce annual household water use by 30 percent.
Source: The Wall Street Journal, Anne Marie Chaker (08/18/2010)
Information from Realtormag.com
These gardening design schemes generally require less water. The practice started in the West, where this kind of design is called "xeriscaping" — based on the Greek word for “dry.” But lately, it is spreading all over the country.
Water savings can be significant. According to the Water Research Foundation of Denver, landscape watering accounts for 40 percent to 70 percent of residential water use. Converting to this kind of landscaping can reduce annual household water use by 30 percent.
Source: The Wall Street Journal, Anne Marie Chaker (08/18/2010)
Information from Realtormag.com
Wednesday, August 25, 2010
Mortgage Applications Jump
Mortgage applications rose 4.9 percent last week as more borrowers refinanced at the lowest rates in decades.
The Mortgage Bankers Association said Wednesday the gain was fueled by a 5.7 percent increase in refinancing applications. The number of loans taken out to purchase homes edged up by less than 1 percent. The numbers are adjusted for seasonal factors.
Refinancing is at its highest level since May 2009 and makes up 82.4 percent of all new loan activity, its highest share since January 2009.
However, low mortgage rates have done little to boost home sales, which have been hurt by high unemployment, slow job growth, and strict credit standards. Purchase activity is 41.5 percent below its level at the end of April, when two federal tax credits for home buyers expired.
Rates have fallen since spring as investors sought the safety of Treasury bonds, lowering their yield. Mortgage rates tend to track those yields.
Interest rates declined for the week:
30-year fixed loan fell to 4.55 percent from 4.6 percent.
15-year fixed-rate loan fell to 3.91 percent from 3.99 percent.
1-year ARMs decreased to 6.84 percent from 6.90 percent.
The Mortgage Bankers Association's survey covers more than 50 percent of all applications nationwide.
Source: Associated Press, J.W. Elphinstone, 8/25/2010
Information from Realtormag.com
The Mortgage Bankers Association said Wednesday the gain was fueled by a 5.7 percent increase in refinancing applications. The number of loans taken out to purchase homes edged up by less than 1 percent. The numbers are adjusted for seasonal factors.
Refinancing is at its highest level since May 2009 and makes up 82.4 percent of all new loan activity, its highest share since January 2009.
However, low mortgage rates have done little to boost home sales, which have been hurt by high unemployment, slow job growth, and strict credit standards. Purchase activity is 41.5 percent below its level at the end of April, when two federal tax credits for home buyers expired.
Rates have fallen since spring as investors sought the safety of Treasury bonds, lowering their yield. Mortgage rates tend to track those yields.
Interest rates declined for the week:
30-year fixed loan fell to 4.55 percent from 4.6 percent.
15-year fixed-rate loan fell to 3.91 percent from 3.99 percent.
1-year ARMs decreased to 6.84 percent from 6.90 percent.
The Mortgage Bankers Association's survey covers more than 50 percent of all applications nationwide.
Source: Associated Press, J.W. Elphinstone, 8/25/2010
Information from Realtormag.com
Tuesday, August 24, 2010
Protest Rising Over Resale Charges
In some newly constructed housing developments home builders are including a clause in the contract demanding a 1 percent transfer fee to be paid to them every time the property is sold over the next 99 years.
The fee isn’t for improvements or maintenance. It is just a payment to the builder.
"It's of no benefit to consumers," says Kathleen Day of the Center for Responsible Lending. "It's another innovative way to price gouge. Every extra dollar they suck out of people's wallets takes away from other spending. It's not good for the economy."
Freehold Capital Partners, which has developed the program, says it has enlisted thousands of developers nationwide. It argues that this is good for the economy because it will provide builders with more capital.
Meanwhile U.S. Rep Brad Sherman, a California Democrat, is pushing for approval of legislation to make these fees illegal. Also, in the past month, the Federal Housing Finance Agency has proposed rules preventing Fannie Mae and Freddie Mac from buying mortgages that include home resale fees.
Source: CNNMoney.com, Les Christie (08/23/2010) - Information from Realtormag.com
The fee isn’t for improvements or maintenance. It is just a payment to the builder.
"It's of no benefit to consumers," says Kathleen Day of the Center for Responsible Lending. "It's another innovative way to price gouge. Every extra dollar they suck out of people's wallets takes away from other spending. It's not good for the economy."
Freehold Capital Partners, which has developed the program, says it has enlisted thousands of developers nationwide. It argues that this is good for the economy because it will provide builders with more capital.
Meanwhile U.S. Rep Brad Sherman, a California Democrat, is pushing for approval of legislation to make these fees illegal. Also, in the past month, the Federal Housing Finance Agency has proposed rules preventing Fannie Mae and Freddie Mac from buying mortgages that include home resale fees.
Source: CNNMoney.com, Les Christie (08/23/2010) - Information from Realtormag.com
Monday, August 23, 2010
Investors Turn to "Flipping" Foreclosed Homes for Quick Profits
Private equity firms and other groups of wealthy people are purchasing foreclosures at distressed prices, rehabbing them, and selling them for a quick profit.
This used to be a game for amateurs, but because of the lack of other investment opportunities, the money-management pros have stepped in.
The influx of new players is pushing up auction prices and making it harder to make a profit. The average discount at auctions — the difference between a home's sale price and its actual value — is 21.6 percent, down from 28 percent in January 2009, according to ForeclosureRadar.
"In crisis there's opportunity," says Rick Hudson, president of investment firm Prosperity Group Real Estate in Irvine, Calif. "Right now there's huge opportunity with flipping houses."
Source: Los Angeles Times, Walter Hamilton and Alejandro Lazo
This used to be a game for amateurs, but because of the lack of other investment opportunities, the money-management pros have stepped in.
The influx of new players is pushing up auction prices and making it harder to make a profit. The average discount at auctions — the difference between a home's sale price and its actual value — is 21.6 percent, down from 28 percent in January 2009, according to ForeclosureRadar.
"In crisis there's opportunity," says Rick Hudson, president of investment firm Prosperity Group Real Estate in Irvine, Calif. "Right now there's huge opportunity with flipping houses."
Source: Los Angeles Times, Walter Hamilton and Alejandro Lazo
Friday, August 20, 2010
Seller-Financing Licensing Exemption Reinstated!
Great news for sellers who finance in Texas: Texas Department of Savings & Mortgage Lending Commissioner Doug Foster has issued a notice that allows the continuation of the de minimis exemption until further action is taken by the Legislature. This exemption, which was briefly repealed by the federal SAFE Act, means that a seller can once again finance up to five properties in a 12-month period without being licensed as a residential mortgage loan originator. The Texas Association of REALTORS® worked closely with the agency in its efforts to continue to allow the exemption to apply in Texas.
The de minimis exemption has not yet been recodified, but the Texas Association of REALTORS® will continue to work during the next legislative session to see that it is reinstated in statute.
Source: TAR
The de minimis exemption has not yet been recodified, but the Texas Association of REALTORS® will continue to work during the next legislative session to see that it is reinstated in statute.
Source: TAR
Thursday, August 19, 2010
5 Real Estate Scams To Watch Out For!
Don't be duped by mortgage fraud. Here are a few common scams and the red flags you should look for in a transaction.
Mortgage fraud is pervasive: An estimated $4 billion to $6 billion in annual losses result from mortgage fraud, according to FBI reports. “An entire community can be damaged by mortgage fraud,” says Rachel Dollar, a lawyer from Santa Rosa, Calif., and editor of the Mortgage Fraud Blog. Mortgage fraud can lead to a spike in foreclosures, home values plummeting, and lenders raising their rates and fees to recover losses.
The crimes are often complex, involving several parties and occurring over multiple transactions. To protect you and your clients, educate yourself about mortgage fraud and be on guard for any warning signs in a transaction. You can start by reviewing these five scams, and then test your knowledge by taking our Mortgage Fraud Quiz.
1. The Foreclosure Rescue Scheme
The Scam: “Rescuers” promise cash-strapped home owners that they can save their home from foreclosure. The rescue, which involves paying upfront fees, can take multiple forms, such as the perpetrator obtaining a new loan on behalf of the owner or by having the owner sign over the home’s deed and then rent the home until they can repurchase it. Eventually, the home owner loses the home, either to foreclosure or the fictitious rescue company.
Red Flags: With foreclosure rescue programs, borrowers are often advised to sign over the title of their house to a third party, become renters of their home, not contact their lender, or send mortgage payments to a third party, according to Fannie Mae, which provides fact sheets on mortgage fraud.
2. Loan Documentation Fraud
The Scam: This fraud involves numerous schemes in which a borrower provides inaccurate financial information — such as about their income, assets, and liabilities — or employment status in order to qualify for a loan with lower rates and more favorable terms. Occupancy fraud is one growing area: Borrowers say they plan to live in the property when they actually intend to rent it.
Red Flags: Documentation may raise suspicion if the employer’s address is shown as a post office box, accumulation of assets compared to the person’s income appears too high or low, the new house is too small to accommodate occupants, the person has no credit history, or the application is unsigned or undated, according to Fannie Mae.
3. Appraisal Fraud
The Scam: A faulty appraisal — saying a property is worth more than what it really is — is connected to many types of mortgage fraud. It entails manipulating or overstating comparables, market values, or property characteristics in order to obtain a higher appraisal. The higher property appraisal, which generates false equity, is done by falsifying an appraisal document or using an appraiser accomplice to obtain the higher value.
Red Flags: Be skeptical of appraisals that are dated prior to the sales contract, list comparable sales that do not contain similarities to the property or are outside the neighborhood, the owner is not the seller listed on the contract or the title, or a third party participating in the transaction orders the appraisal, Freddie Mac warns.
4. Illegal Property Flipping
The Scam: This entails purchasing properties and reselling them at inflated prices. These scams usually involve faulty appraisals and inaccurate loan documents. The property is then refinanced or resold immediately after purchase for an inflated value. The home is purchased at a higher price, often by straw buyers working with the “flipper,” and eventually falls into foreclosure.
Red Flags: Some key things to look for are rapid refinancing of a property; the seller recently having acquired the title or acquiring the title concurrent with the transaction; an appraisal that comes in too high; a property that was recently in foreclosure being purchased at a much lower price than its sales price; or the owner listed on the appraisal and title not matching the seller on the sales contract, according to Fannie Mae.
5. Short Sales Schemes
The Scam: Borrowers owe more than the current value of their home so they fake financial hardship and no longer make their mortgage payments. An accomplice of the borrower then submits a low offer to purchase the property in a short sale agreement. The lender agrees to the short sale, unaware that it was premeditated. The property, after being purchased at the reduced price, is then often resold at the home’s actual value for profit.
Red Flags: The borrower suddenly defaults on the mortgage with no workout discussions with the lender, an immediate offer is made to a lender at a short sale price, the short sale offer is less than current market value, or a cash back is offered at closing to the delinquent borrower (disguised as “repairs” or other payouts, for example) and is not disclosed to the lender, according to Fannie Mae.
You can report instances of suspected mortgage fraud to Stopfraud.gov.
By Melissa Dittmann Tracey | August 2010
Source: Realtormag.com
Mortgage fraud is pervasive: An estimated $4 billion to $6 billion in annual losses result from mortgage fraud, according to FBI reports. “An entire community can be damaged by mortgage fraud,” says Rachel Dollar, a lawyer from Santa Rosa, Calif., and editor of the Mortgage Fraud Blog. Mortgage fraud can lead to a spike in foreclosures, home values plummeting, and lenders raising their rates and fees to recover losses.
The crimes are often complex, involving several parties and occurring over multiple transactions. To protect you and your clients, educate yourself about mortgage fraud and be on guard for any warning signs in a transaction. You can start by reviewing these five scams, and then test your knowledge by taking our Mortgage Fraud Quiz.
1. The Foreclosure Rescue Scheme
The Scam: “Rescuers” promise cash-strapped home owners that they can save their home from foreclosure. The rescue, which involves paying upfront fees, can take multiple forms, such as the perpetrator obtaining a new loan on behalf of the owner or by having the owner sign over the home’s deed and then rent the home until they can repurchase it. Eventually, the home owner loses the home, either to foreclosure or the fictitious rescue company.
Red Flags: With foreclosure rescue programs, borrowers are often advised to sign over the title of their house to a third party, become renters of their home, not contact their lender, or send mortgage payments to a third party, according to Fannie Mae, which provides fact sheets on mortgage fraud.
2. Loan Documentation Fraud
The Scam: This fraud involves numerous schemes in which a borrower provides inaccurate financial information — such as about their income, assets, and liabilities — or employment status in order to qualify for a loan with lower rates and more favorable terms. Occupancy fraud is one growing area: Borrowers say they plan to live in the property when they actually intend to rent it.
Red Flags: Documentation may raise suspicion if the employer’s address is shown as a post office box, accumulation of assets compared to the person’s income appears too high or low, the new house is too small to accommodate occupants, the person has no credit history, or the application is unsigned or undated, according to Fannie Mae.
3. Appraisal Fraud
The Scam: A faulty appraisal — saying a property is worth more than what it really is — is connected to many types of mortgage fraud. It entails manipulating or overstating comparables, market values, or property characteristics in order to obtain a higher appraisal. The higher property appraisal, which generates false equity, is done by falsifying an appraisal document or using an appraiser accomplice to obtain the higher value.
Red Flags: Be skeptical of appraisals that are dated prior to the sales contract, list comparable sales that do not contain similarities to the property or are outside the neighborhood, the owner is not the seller listed on the contract or the title, or a third party participating in the transaction orders the appraisal, Freddie Mac warns.
4. Illegal Property Flipping
The Scam: This entails purchasing properties and reselling them at inflated prices. These scams usually involve faulty appraisals and inaccurate loan documents. The property is then refinanced or resold immediately after purchase for an inflated value. The home is purchased at a higher price, often by straw buyers working with the “flipper,” and eventually falls into foreclosure.
Red Flags: Some key things to look for are rapid refinancing of a property; the seller recently having acquired the title or acquiring the title concurrent with the transaction; an appraisal that comes in too high; a property that was recently in foreclosure being purchased at a much lower price than its sales price; or the owner listed on the appraisal and title not matching the seller on the sales contract, according to Fannie Mae.
5. Short Sales Schemes
The Scam: Borrowers owe more than the current value of their home so they fake financial hardship and no longer make their mortgage payments. An accomplice of the borrower then submits a low offer to purchase the property in a short sale agreement. The lender agrees to the short sale, unaware that it was premeditated. The property, after being purchased at the reduced price, is then often resold at the home’s actual value for profit.
Red Flags: The borrower suddenly defaults on the mortgage with no workout discussions with the lender, an immediate offer is made to a lender at a short sale price, the short sale offer is less than current market value, or a cash back is offered at closing to the delinquent borrower (disguised as “repairs” or other payouts, for example) and is not disclosed to the lender, according to Fannie Mae.
You can report instances of suspected mortgage fraud to Stopfraud.gov.
By Melissa Dittmann Tracey | August 2010
Source: Realtormag.com
Wednesday, August 18, 2010
Fed: Give Borrowers Time to Change Their Minds
The Federal Reserve released a proposal Monday to give mortgage applicants three days to change their minds.
The proposal was part of a 930-page document that clarifies and finalizes the new financial reform law.
The Fed’s document says that for closed-end loans secured by real property or a dwelling, a creditor must:
• “Refund any appraisal or other fees paid by the consumer (other than a credit report fee), if the consumer decides not to proceed with a closed-end mortgage transaction within three business days of receiving the early disclosures (fees imposed after this three-day period would not be refundable); and
• “Disclose the right to a refund of fees to consumers before they apply for a closed-end mortgage loan.”
The Fed says this proposal will make it easier and cheaper for consumers to comparison shop. It also acknowledged that borrowers who want to close a transaction in a hurry would be handicapped because most lenders will delay sending out an appraiser for a few days.
Other proposals affecting home buyers included:
• A ban on yield-spread premiums, which encourage mortgage brokers to push buyers toward more profitable mortgages.
• A requirement for lenders to tell borrowers when their mortgage is sold or transferred.
• An explanation of the effects of balloon payments, adjustable loan payment fluctuations, and minimum payments on loan balances.
Source: Bankrate.com, Holden Lewis (08/17/2010)
The proposal was part of a 930-page document that clarifies and finalizes the new financial reform law.
The Fed’s document says that for closed-end loans secured by real property or a dwelling, a creditor must:
• “Refund any appraisal or other fees paid by the consumer (other than a credit report fee), if the consumer decides not to proceed with a closed-end mortgage transaction within three business days of receiving the early disclosures (fees imposed after this three-day period would not be refundable); and
• “Disclose the right to a refund of fees to consumers before they apply for a closed-end mortgage loan.”
The Fed says this proposal will make it easier and cheaper for consumers to comparison shop. It also acknowledged that borrowers who want to close a transaction in a hurry would be handicapped because most lenders will delay sending out an appraiser for a few days.
Other proposals affecting home buyers included:
• A ban on yield-spread premiums, which encourage mortgage brokers to push buyers toward more profitable mortgages.
• A requirement for lenders to tell borrowers when their mortgage is sold or transferred.
• An explanation of the effects of balloon payments, adjustable loan payment fluctuations, and minimum payments on loan balances.
Source: Bankrate.com, Holden Lewis (08/17/2010)
Tuesday, August 17, 2010
FHA Refis for Underwater Borrowers
FHA has launched a refinancing program to assist homeowners who owe more on their mortgages than their home is worth. Beginning September 7, the agency will offer qualified non-FHA borrowers the opportunity to refinance with an FHA-insured mortgage on their primary residence.
Borrowers must be current on their existing mortgage, qualify under FHA underwriting requirements, and have a credit score of at least 500. The first lien holder must agree to write off at least 10 percent of the remaining amount owed under the mortgage, bringing the combined loan-to-value ratio of all mortgages to no more than 115 percent.
The LTV for the new FHA mortgage may not exceed 97.75 percent. The Treasury Department will provide incentives to second lien holders who agree to forgive all or part of their liens.
Source: CCAR
Borrowers must be current on their existing mortgage, qualify under FHA underwriting requirements, and have a credit score of at least 500. The first lien holder must agree to write off at least 10 percent of the remaining amount owed under the mortgage, bringing the combined loan-to-value ratio of all mortgages to no more than 115 percent.
The LTV for the new FHA mortgage may not exceed 97.75 percent. The Treasury Department will provide incentives to second lien holders who agree to forgive all or part of their liens.
Source: CCAR
Monday, August 16, 2010
10 States with Pricey Closing Costs
Per: Realtormag.com
Closing costs have risen an average of 36.6 percent compared to 2009, according to Bankrate.com’s annual survey.
The big increased was caused by the U.S. government requiring lenders to provide accurate good faith estimates of closing costs. Previously, lenders weren’t penalized for a bad estimate.
On average, the origination and third party fees on a $200,000 purchase mortgage added up to $3,741.
Here are the 10 highest states:
1. New York, $5,623
2. Texas, $4,708
3. Utah, $4,605
4. California-San Francisco, $4,566; California-Los Angeles, $4,406
5. Alaska, $4,327
6. Oklahoma, $4,254
7. Pennsylvania, $4,236
8. New Jersey, $4,110
9. Idaho, $4,077
10. Massachusetts, $4,025
Source: Bankrate.com (08/16/2010)
Closing costs have risen an average of 36.6 percent compared to 2009, according to Bankrate.com’s annual survey.
The big increased was caused by the U.S. government requiring lenders to provide accurate good faith estimates of closing costs. Previously, lenders weren’t penalized for a bad estimate.
On average, the origination and third party fees on a $200,000 purchase mortgage added up to $3,741.
Here are the 10 highest states:
1. New York, $5,623
2. Texas, $4,708
3. Utah, $4,605
4. California-San Francisco, $4,566; California-Los Angeles, $4,406
5. Alaska, $4,327
6. Oklahoma, $4,254
7. Pennsylvania, $4,236
8. New Jersey, $4,110
9. Idaho, $4,077
10. Massachusetts, $4,025
Source: Bankrate.com (08/16/2010)
Friday, August 13, 2010
Refinancing on The Increase Due to Low Interest Rates!
Mortgage lenders have seen refinancing demand rise as the 30-year fixed rate tumbled to 4.4 percent — the lowest level in the nearly 40 years that Freddie Mac has tracked the statistic.
However, experts say borrowers who would benefit most from a refi likely will not qualify for new loans due to income cuts, unemployment, low credit scores, or insufficient equity. Borrowers who already refinanced in the last 18 months, along with borrowers whose adjustable-rate loans are ready to reset, will account for most of the refi activity; and many will move into shorter-term mortgages to more quickly repay their debt.
Source: Wall Street Journal, Nick Timiraos (08/13/10)
However, experts say borrowers who would benefit most from a refi likely will not qualify for new loans due to income cuts, unemployment, low credit scores, or insufficient equity. Borrowers who already refinanced in the last 18 months, along with borrowers whose adjustable-rate loans are ready to reset, will account for most of the refi activity; and many will move into shorter-term mortgages to more quickly repay their debt.
Source: Wall Street Journal, Nick Timiraos (08/13/10)
Thursday, August 12, 2010
National Assoc. of Realtors Reports Homeownership and Community Stability are Linked
Home owners are more active in their communities, benefit from improved education opportunities, and report higher levels of self-esteem and happiness when compared to renters, according to leading research. A new report from the NATIONAL ASSOCIATION OF REALTORS®, Social Benefits of Homeownership and Stable Housing, explores the impact of stable housing and the positive social outcomes resulting from homeownership.
“Homeownership is in investment in your future – home is where we make memories, build our lives and feel comfortable and secure,” said Vicki Cox Golder. “Owning a home has long-standing government support in this country because homeownership benefits individuals and families, strengthens our communities, and is integral to our nation’s economy.”
NAR’s study identifies research from government, industry, and academia that identified the relationship between homeownership and stable communities. Home owners move far less frequently than renters, and therefore are embedded into the same neighborhood and community for a longer amount of time. This allows for social cohesion, ultimately resulting in social benefits and stronger communities.
“REALTORS® care as much about keeping families in their homes as they do about helping them find the home of their dreams,” said Golder. “Social benefits do not arise solely from ownership, but also from greater housing stability and social ties associated with less frequent moves among home owners.”
Several research studies cited in the NAR report have found that homeownership has a significant impact on educational achievement. For instance, the decision by teenage students to stay in school is higher for those raised by parents who are homeowners compared to those whose parents are renters. Access to economic and educational opportunities are also more prevalent in neighborhoods with high rates of homeownership. Furthermore, studies have shown that changing schools frequently due to moving impacts negatively a child’s educational outcome.
Civic participation is another social benefit resulting from homeownership and stable housing. Home owners are proven to be more politically active and are more likely to vote in local elections compared to renters. In addition, homeowners have a higher membership in voluntary organizations.
Studies have shown that home owners are more likely to believe that they can do things as well as anyone else, and they self-report higher ratings on their physical health. “The research shows that home owners report higher self-esteem and happiness than renters, resulting in better overall health, both physically and psychologically,” said Golder.
When it comes to property, home owners have more invested both financially and emotionally. Property crimes affect home owners directly, but nonviolent property crimes can impact the property values of the entire neighborhood. Therefore, home owners are more motivated to deter crime by forming and implementing voluntary crime-prevention programs. In addition, it is easier for home owners to recognize perpetrators in stable neighborhoods because of extensive social ties. Unstable neighborhoods often display social disorganization which can lead to higher levels of crime.
Along with protecting their home and neighborhood from crime, home owners spend more time and money maintaining their home than renters. Neighbors also influence other home owners to improve their property, resulting in a better overall quality of the community.
“Homeownership certainly contributes to positive social outcomes, but those outcomes are truly a result of stable housing communities,” said Golder. “With strong social ties and a cohesive community, home owners can enjoy not only the long-term financial benefit of owning a home, but also a more satisfying life – which is what’s really at the heart of the American Dream.”
Source: NAR
“Homeownership is in investment in your future – home is where we make memories, build our lives and feel comfortable and secure,” said Vicki Cox Golder. “Owning a home has long-standing government support in this country because homeownership benefits individuals and families, strengthens our communities, and is integral to our nation’s economy.”
NAR’s study identifies research from government, industry, and academia that identified the relationship between homeownership and stable communities. Home owners move far less frequently than renters, and therefore are embedded into the same neighborhood and community for a longer amount of time. This allows for social cohesion, ultimately resulting in social benefits and stronger communities.
“REALTORS® care as much about keeping families in their homes as they do about helping them find the home of their dreams,” said Golder. “Social benefits do not arise solely from ownership, but also from greater housing stability and social ties associated with less frequent moves among home owners.”
Several research studies cited in the NAR report have found that homeownership has a significant impact on educational achievement. For instance, the decision by teenage students to stay in school is higher for those raised by parents who are homeowners compared to those whose parents are renters. Access to economic and educational opportunities are also more prevalent in neighborhoods with high rates of homeownership. Furthermore, studies have shown that changing schools frequently due to moving impacts negatively a child’s educational outcome.
Civic participation is another social benefit resulting from homeownership and stable housing. Home owners are proven to be more politically active and are more likely to vote in local elections compared to renters. In addition, homeowners have a higher membership in voluntary organizations.
Studies have shown that home owners are more likely to believe that they can do things as well as anyone else, and they self-report higher ratings on their physical health. “The research shows that home owners report higher self-esteem and happiness than renters, resulting in better overall health, both physically and psychologically,” said Golder.
When it comes to property, home owners have more invested both financially and emotionally. Property crimes affect home owners directly, but nonviolent property crimes can impact the property values of the entire neighborhood. Therefore, home owners are more motivated to deter crime by forming and implementing voluntary crime-prevention programs. In addition, it is easier for home owners to recognize perpetrators in stable neighborhoods because of extensive social ties. Unstable neighborhoods often display social disorganization which can lead to higher levels of crime.
Along with protecting their home and neighborhood from crime, home owners spend more time and money maintaining their home than renters. Neighbors also influence other home owners to improve their property, resulting in a better overall quality of the community.
“Homeownership certainly contributes to positive social outcomes, but those outcomes are truly a result of stable housing communities,” said Golder. “With strong social ties and a cohesive community, home owners can enjoy not only the long-term financial benefit of owning a home, but also a more satisfying life – which is what’s really at the heart of the American Dream.”
Source: NAR
Wednesday, August 11, 2010
Insurance For a Vacant Home
Clients whose homes sit vacant and on the market for many months should contact their insurance agents and arrange for a policy that will protect an unoccupied property.
Sticking with a standard home owners policy could leave them vulnerable to liability lawsuits. Some policies also exclude coverage for fire damage if the property has been unoccupied for a specified number of days.
Paying a higher premium, should be expected.
Source: USA Today
Sticking with a standard home owners policy could leave them vulnerable to liability lawsuits. Some policies also exclude coverage for fire damage if the property has been unoccupied for a specified number of days.
Paying a higher premium, should be expected.
Source: USA Today
Tuesday, August 10, 2010
Sales of Pre-owned Homes in Texas Rise 14% over 2nd qtr. 2009!
Texas Association of Realtors reported on August 9, that 2nd qtr. home sales in Texas rose for the third period in a row compared to year-earlier. Pre-owned, single-family home sales were up 14 percent from the 2nd qtr. of 2009.
Collin County sales rose by 11.01% and Denton County sales increased 18.45%.
TAR attributed the increase to the improving Texas economy and an increase in home-buying directly related to the federal tax credits, which expired in April.
”We’re encouraged to see continued strength in Texas’ real estate market as 2010 marches forward,” Texas Association of Realtors chairman Bill Jones said in the report.
Median home sales prices showed only a slight change at $149,200.
Collin County sales rose by 11.01% and Denton County sales increased 18.45%.
TAR attributed the increase to the improving Texas economy and an increase in home-buying directly related to the federal tax credits, which expired in April.
”We’re encouraged to see continued strength in Texas’ real estate market as 2010 marches forward,” Texas Association of Realtors chairman Bill Jones said in the report.
Median home sales prices showed only a slight change at $149,200.
Monday, August 9, 2010
Is Your Listing a Little "Stale"?
Real estate professionals share creative ways to make a home smell great to a buyer!
Source: Realtormag.com
"I recommend using lemon or citrus scented candles for showings and running a few lemon wedges through the garbage disposal." −Christine Spitale, Sunflower Staging, Highland Mills, N.Y.
"Covering up the smell is not the answer. Sometimes it takes a thorough cleaning of carpets, drapes, and upholstery. It also helps to open windows to get air flowing and to clean out the air ducts." −Barbara Linick, ERA Troy, REALTORS®, San Antonio
"I think that cinnamon and vanilla are the best smells when trying to sell a home. I love to walk into a home and breathe in the fresh scent of cinnamon sticks on the stove or smell a burning vanilla candle." −Fran Hughes, Keller Williams Realty Atlanta Perimeter, Atlanta
"I always use an electric ceramic crock that can hold small or large glass candles, like from Yankee Candle Co. There’s no risk of fire because there’s no flame; the ceramic crock warms the candle to melt the wax. I’ve used several of these in different places throughout the house, so as you walk through you get different fragrances." −Linda C. Hardt, Homelynx Home Loans, Fort Myers, Fla.
"I use an odor eliminator called PureAyre that smells like mint. The product can be 'injected' into furniture or carpets. It can also be sprayed into the air. When buyers come into a home, many are turned off by the smell of air fresheners or candles. Smart buyers know these are old tricks used to cover up smells, not eliminate them." −Carol Smith, Creative Home Stagers, Charlotte, N.C.
"Put a beer in the oven on low and it will smell like you’re baking fresh bread." −Elizabeth Lord, Carolina Farms & Estates, York, S.C.
"When you introduce any pleasant smelling items to a home, try to stick to basic scents such as vanilla, apple, cinnamon, and lemon. In small doses, these often appeal to the most buyers. A small reed diffuser in a bathroom can keep a clean smell, while not overwhelming the space." −Kellie Frooninckx, Virtual Enriching Homes, Phoenix
"Heat up some water and throw fresh cinnamon into it. Turn it off just before the buyers come. They’ll think that you baked cookies for them." −April M. Newland, Newland Real Estate, St. Thomas, U.S. Virgin Islands
Source: Realtormag.com
"I recommend using lemon or citrus scented candles for showings and running a few lemon wedges through the garbage disposal." −Christine Spitale, Sunflower Staging, Highland Mills, N.Y.
"Covering up the smell is not the answer. Sometimes it takes a thorough cleaning of carpets, drapes, and upholstery. It also helps to open windows to get air flowing and to clean out the air ducts." −Barbara Linick, ERA Troy, REALTORS®, San Antonio
"I think that cinnamon and vanilla are the best smells when trying to sell a home. I love to walk into a home and breathe in the fresh scent of cinnamon sticks on the stove or smell a burning vanilla candle." −Fran Hughes, Keller Williams Realty Atlanta Perimeter, Atlanta
"I always use an electric ceramic crock that can hold small or large glass candles, like from Yankee Candle Co. There’s no risk of fire because there’s no flame; the ceramic crock warms the candle to melt the wax. I’ve used several of these in different places throughout the house, so as you walk through you get different fragrances." −Linda C. Hardt, Homelynx Home Loans, Fort Myers, Fla.
"I use an odor eliminator called PureAyre that smells like mint. The product can be 'injected' into furniture or carpets. It can also be sprayed into the air. When buyers come into a home, many are turned off by the smell of air fresheners or candles. Smart buyers know these are old tricks used to cover up smells, not eliminate them." −Carol Smith, Creative Home Stagers, Charlotte, N.C.
"Put a beer in the oven on low and it will smell like you’re baking fresh bread." −Elizabeth Lord, Carolina Farms & Estates, York, S.C.
"When you introduce any pleasant smelling items to a home, try to stick to basic scents such as vanilla, apple, cinnamon, and lemon. In small doses, these often appeal to the most buyers. A small reed diffuser in a bathroom can keep a clean smell, while not overwhelming the space." −Kellie Frooninckx, Virtual Enriching Homes, Phoenix
"Heat up some water and throw fresh cinnamon into it. Turn it off just before the buyers come. They’ll think that you baked cookies for them." −April M. Newland, Newland Real Estate, St. Thomas, U.S. Virgin Islands
Friday, August 6, 2010
Federal Sales Tax on Home Purchases?
Source: Texas Association of Realtors
An Internet rumor continues to spread FALSE INFORMATION about a supposed tax on home sales. The erroneous e-mail claims that a provision of the healthcare reform bill passed earlier this year will place a tax on "all real estate transactions" in 2013. NOT TRUE.
The e-mail includes a guest editorial in a Spokane newspaper with the false claim. It doesn't, however, mention the corrected information sent to the newspaper the next day from the local association of REALTORS®.
To learn more about this myth, go to FactCheck.org.
An Internet rumor continues to spread FALSE INFORMATION about a supposed tax on home sales. The erroneous e-mail claims that a provision of the healthcare reform bill passed earlier this year will place a tax on "all real estate transactions" in 2013. NOT TRUE.
The e-mail includes a guest editorial in a Spokane newspaper with the false claim. It doesn't, however, mention the corrected information sent to the newspaper the next day from the local association of REALTORS®.
To learn more about this myth, go to FactCheck.org.
Thursday, August 5, 2010
20 Year Mortgages help Cut Interest Payments Significantly!
Source: CBS, Ray Martin
Buyers with the ability to stretch a little might consider a 20-year fixed-rate mortgage instead of the traditional 30-year, suggests CBS Money Matters’ financial adviser Ray Martin.
Martin points out that a $200,000 mortgage with a 30-year term and an interest rate of 4.75 would have a monthly payment of $1,043 and the total interest over the life of the loan would be $175,600.
The same mortgage with a 20-year term at 4.5 percent would have a monthly payment of $1,265 with total interest over the life of the mortgage of $103,670.
Young home buyers planning to have children will have their 20-year mortgage paid off by the time their kids enter college, a big financial advantage, Martin points out.
You can contact Mark Potter at Service First Mortgage for more info! His link is listed to the right!
Buyers with the ability to stretch a little might consider a 20-year fixed-rate mortgage instead of the traditional 30-year, suggests CBS Money Matters’ financial adviser Ray Martin.
Martin points out that a $200,000 mortgage with a 30-year term and an interest rate of 4.75 would have a monthly payment of $1,043 and the total interest over the life of the loan would be $175,600.
The same mortgage with a 20-year term at 4.5 percent would have a monthly payment of $1,265 with total interest over the life of the mortgage of $103,670.
Young home buyers planning to have children will have their 20-year mortgage paid off by the time their kids enter college, a big financial advantage, Martin points out.
You can contact Mark Potter at Service First Mortgage for more info! His link is listed to the right!
Wednesday, August 4, 2010
Applications to Purchase a Home on the RISE!
Applications to purchase homes rose 1.5 percent last week compared to the previous week on a seasonally adjusted basis, according to the Mortgage Bankers Association.
The unadjusted purchase index also rose 1.5 percent, and it was up 7.1 percent compared to four weeks ago. Compared to the same week a year ago, it was down 33.7 percent. For the third straight week, government-backed loans, especially Federal Housing Administration loans, drove the increase, with government loan volume rising 3.4 percent compared to last week.
Mortgage rates were still remarkably low!
30-year fixed-rate mortgages decreased to 4.60 percent from 4.69 percent.
15-year fixed-rate mortgages decreased to 4.03 percent from 4.12 percent.
1-year ARMs decreased to 7.10 percent from 7.15 percent.
Source: Mortgage Bankers Association
The unadjusted purchase index also rose 1.5 percent, and it was up 7.1 percent compared to four weeks ago. Compared to the same week a year ago, it was down 33.7 percent. For the third straight week, government-backed loans, especially Federal Housing Administration loans, drove the increase, with government loan volume rising 3.4 percent compared to last week.
Mortgage rates were still remarkably low!
30-year fixed-rate mortgages decreased to 4.60 percent from 4.69 percent.
15-year fixed-rate mortgages decreased to 4.03 percent from 4.12 percent.
1-year ARMs decreased to 7.10 percent from 7.15 percent.
Source: Mortgage Bankers Association
Tuesday, August 3, 2010
"Strategic Defaults" Can Damage Credit for Years
Home owners who choose to default on their mortgage even though they can afford the monthly payments can expect to take a significant hit to their creditworthiness, some credit rating firms say.
A record of the default — initially as much as 200 points — stays on a credit report for seven years. This will have an impact on the defaulter’s ability to get credit of all kinds and potentially his or her ability to buy insurance and even get a job.
The debt that foreclosure erases may be considered income, and Uncle Sam may want to collect taxes.
"It's by no means a move to be undertaken lightly," says Maxine Sweet, vice president of public education for Experian.
Source: ARA Content (07/30/2010)
A record of the default — initially as much as 200 points — stays on a credit report for seven years. This will have an impact on the defaulter’s ability to get credit of all kinds and potentially his or her ability to buy insurance and even get a job.
The debt that foreclosure erases may be considered income, and Uncle Sam may want to collect taxes.
"It's by no means a move to be undertaken lightly," says Maxine Sweet, vice president of public education for Experian.
Source: ARA Content (07/30/2010)
Monday, August 2, 2010
Keller Williams Realty Named Highest Ranked in Home Buyer Satisfaction by J.D. Power and Associates for Third Straight Year!
AUSTIN, TEXAS (July 30, 2010) —According to the J.D. Power and Associates 2010 Home Buyer/Seller StudySM, Keller Williams Realty, Inc., the third largest real estate company in the United States, has received the highest overall satisfaction ratings from home buyers among the largest full-service real estate firms for the third year in a row. The company also ranked second among home sellers in the study for the second year in a row.
“We are incredibly proud of our associates for earning this distinction and want to thank them for their commitment to their clients and communities," said Mark Willis, CEO of Keller Williams Realty. “We see this honor as demonstration of our company philosophy that it is the agent’s brand that matters most and no amount of money spent on advertising can replace the influence and reputations our agents have in their local communities. Our associates have earned this on their own, by building relationships in their communities."
The study was produced by J.D. Power and Associates to measure home buyers and sellers customer satisfaction. The results of the home-buying experience were determined by three factors including the buyer’s experience with their agent, the real estate office and a variety of additional services. Keller Williams Realty performed particularly well in the agent and office factors. And, overall satisfaction of buyers for the industry was up over last year.
Additionally, the study noted that the importance of real estate agents has increased substantially in the past year, with buyers and sellers relying on the negotiating skills of their chosen agent and help in navigating the market.
“It is thrilling to see our firm, once again, get public recognition for its incredible focus on customer satisfaction from such a prestigious group. Our associates continually demonstrate that it is possible to deliver the highest level of customer service in one of the toughest real estate markets on record," said Mary Tennant, president and COO of Keller Williams Realty. “We feel incredibly fortunate to be in business with them, and want to congratulate them on their hard work and dedication."
In the past year, Keller Williams Realty has continued to grow despite the well-publicized turmoil in the real estate industry. In addition to becoming the 3rd largest real estate company in the U.S., surpassing RE/MAX®, Keller Williams Realty was ranked as the No. 1 real estate franchise on the 31st Annual Franchise 500 list by Entrepreneur magazine and was voted the Most Recognizable Brand of Real Estate Franchises and the Trendsetter of the year for 2009 in an industry-wide survey for the Swanepoel TRENDS Report.
If you are thinking about purchasing a home and want to use the Highest Ranked real estate company in the nation in BUYER SATISFACTION - give us a call! We have over 130 agents ready to to help YOU find the home of your dreams! Call 972-562-8883 or email mckinney@kw.com!
If your plans include a career change - think REAL ESTATE with Keller Williams! Our PROFIT SHARE system is unique in the industry and our TRAINING can't be beat! Call Team Leader, Matt Hilton, for an appointment at 469-452-1112 or send him an email at matthilton@kw.com!
“We are incredibly proud of our associates for earning this distinction and want to thank them for their commitment to their clients and communities," said Mark Willis, CEO of Keller Williams Realty. “We see this honor as demonstration of our company philosophy that it is the agent’s brand that matters most and no amount of money spent on advertising can replace the influence and reputations our agents have in their local communities. Our associates have earned this on their own, by building relationships in their communities."
The study was produced by J.D. Power and Associates to measure home buyers and sellers customer satisfaction. The results of the home-buying experience were determined by three factors including the buyer’s experience with their agent, the real estate office and a variety of additional services. Keller Williams Realty performed particularly well in the agent and office factors. And, overall satisfaction of buyers for the industry was up over last year.
Additionally, the study noted that the importance of real estate agents has increased substantially in the past year, with buyers and sellers relying on the negotiating skills of their chosen agent and help in navigating the market.
“It is thrilling to see our firm, once again, get public recognition for its incredible focus on customer satisfaction from such a prestigious group. Our associates continually demonstrate that it is possible to deliver the highest level of customer service in one of the toughest real estate markets on record," said Mary Tennant, president and COO of Keller Williams Realty. “We feel incredibly fortunate to be in business with them, and want to congratulate them on their hard work and dedication."
In the past year, Keller Williams Realty has continued to grow despite the well-publicized turmoil in the real estate industry. In addition to becoming the 3rd largest real estate company in the U.S., surpassing RE/MAX®, Keller Williams Realty was ranked as the No. 1 real estate franchise on the 31st Annual Franchise 500 list by Entrepreneur magazine and was voted the Most Recognizable Brand of Real Estate Franchises and the Trendsetter of the year for 2009 in an industry-wide survey for the Swanepoel TRENDS Report.
If you are thinking about purchasing a home and want to use the Highest Ranked real estate company in the nation in BUYER SATISFACTION - give us a call! We have over 130 agents ready to to help YOU find the home of your dreams! Call 972-562-8883 or email mckinney@kw.com!
If your plans include a career change - think REAL ESTATE with Keller Williams! Our PROFIT SHARE system is unique in the industry and our TRAINING can't be beat! Call Team Leader, Matt Hilton, for an appointment at 469-452-1112 or send him an email at matthilton@kw.com!
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