Home Prices in 20 U.S. Cities Increase by Most Since 2006

The article, Home Prices in 20 U.S. Cities Increase by Most Since 2006, from www.bloomberg.com, reports that home prices in 20 U.S. cities rose in the 12 months to December by the most in more than six years, a sign the housing-market recovery is strengthening. The S&P/Case-Shiller index of property values increased 6.8 percent from December 2011, the biggest year-to-year gain since July 2006. “The key here is it’s not as if we’re getting all the juice from one area, it’s broadly based across the country,” said Brian Jones, a senior U.S. economist at Societe Generale in New York, who correctly projected the year-over-year increase. “Rates are low, prices are attractive, so affordability is high, and the labor market is gradually healing as well. If you were in the market to buy a home, right now it’s a good time." Home prices adjusted for seasonal variations in the 20-city index climbed 0.9 percent in December from the prior month, compared with a 0.7 gain in November. The month-over-month gain was led by Las Vegas and Los Angeles. All 20 cities showed increases. Phoenix led the group of 19 cities that showed year-over- year increases, with a 23 percent jump in the 12 months to December. San Francisco was second with a 14.4 percent gain.

Here is the link to the entire article: http://www.bloomberg.com/news/2013-02-26/home-prices-in-20-u-s-cities-increase-by-most-since-2006.html

LATEST PHOENIX REAL ESTATE STATISTICS

STAT is the ARMLS^® newsletter that gives Subscribers the most current market statistics.

In this issue read about an increase in the median sales price, further decline in foreclosures pending, a rise in total inventory, plus a new graph which looks at the UCB (formerly AWC) makeup within Active inventory.

Click to access the December issue of STAT and the ARMLS PPI™.

Back issues of STAT and ARMLS PPI™ are always available on the ARMLS website at: http://www.armls.com/statistics/stat-library

WHAT OBAMA ELECTION MEANS FOR HOUSING

From Trulia on 11/14/2012

http://trends.truliablog.com/2012/11/what-obamas-re-election-means-for-housing/

Phoenix, AZ Statiscal Data

Please take the time to visit my Webpage at www.denismarque.com .

I have added extensive statistical data on Sales, Listings, Days on Market, Foreclosures and many other items at "Market Statistics" on the webpage. You will find it to be encouraging if you are buying or selling in the Phoenix Metro marketplace.

As an aside, if you are concerned about keeping your current home, we do have several plans available to assist you including HAFA, HAMP, and HARP. Give us a call at 480-899-8844.

Denis

When will it end

Taken from responses to the question "When will it end?" by other Realtors.

1) As long as the banks are involved in real estate transactions which they know nothing about, it probably won't end for years to come. These banks are unbelievable. They just sent us a short sale package back saying that the word "Phoenix" was abbreviated "Phx" and it need to be spelling out on the listing contract. Once it was corrected, it took them two weeks to come back and demand that all parties sign the listing contract. Say what? Since when does a buyer get to look at listing contracts between the seller and broker?

Problems like this one are occurring every day. Yes, I wonder too, when will it end?

2) It will end when the large prevelent foreclosures and short sales end. I agree with (above), each bank/company has their own rules for these properties. It is not a matter of understanding how to deal with the foreclosure, because it is almost impossible to learn all the different rules.

3) Good question! I definitely agree with both (of the above), but would add that until unemployment abates and jobs open up or are created, we will continue to have issues.

4) There is also the perception by consumers that the market is in complete disarray and they are waiting for it to return to "normal." There are almost no buyers in the market because they think prices will continue to drop. Potential sellers know they are going to take a beating if they try to sell. They all think that, at some point, the market will return to where it was. Until consumers realize that this, in many ways, is the new normal, buyers and sellers will continue to sit on the sidelines.

Then there is the issue of financing. But I'll leave that for another commenter.

ED Comment: These are the views of four Realtors that offer reflection of where the market is and when will we see some stability return. "Normal" is not a return to our past, it is where we are today and for the foreseeable future. If you are sitting on the fence, waiting will not provide a better time to act for several years to come.

Denis

10 Tips For New Buyers

November 17, 2010

10 Tips For New Buyers by Carla Hill


It is a great time to buy for many would-be homeowners. The market offers historically low interest rates, as well as affordable home prices.

Here are 10 steps that buyers can take to make home dreams a reality!

1. Savings. You may already know how much monthly payment you can support (experts recommend no more than 1/3 your monthly income), but the buying process will also include upfront costs, such as a downpayment and closing costs.

2. Downpayment options. Do you qualify for downpayment assistance programs? Will you be able to get an FHA loan and pay 3.5 percent down? Do you have a relative that would like to make a downpayment gift? Many financial experts recommend a downpayment of 20 percent, so be sure to explore your options!

3. Check Credit Report. Your credit report says a lot about you. Lenders use it to evaluate your risk potential and to inform themselves on how responsible of a borrower you are. They use this report and subsequent score to figure your interest rate. The more stellar your report, the better your score and thus lower your rate. Be sure to check your report for accuracy, and report any errors to the credit reporting agencies.

4. Get Preapproved. It's time to talk to a lender! Pre-approval will give you a ballpark figure of how much the bank would be willing to lend you. Are you looking for a $100,000 house or a $300,000?

5. Get Prequalified. This is the official letter from the lender that says they will be willing to lend you money. Many sellers look for buyers who are prequalified.

6. Affordability. The bank may tell you that you can afford a home worth $300,000. This does not mean you want to borrow to your max. A more modest home may fit better in your financial plans.

7. Housing Criteria. You have a budget, now develop a list of what you need and want. This can include anything from "must have 3 bedrooms" to "hardwoods" or "granite".

8. Neighborhood choice. Location strongly affects prices. A 3,000 square foot home in rural Kansas costs a fraction of one in New York City. Decide what neighborhoods and areas are the best fit for you. This will help narrow your home search.

9. Hire an agent. An agent can help you navigate the entire process from searching, putting in offers, to where to hire an inspector or general contractors.

10. Start the search! The MLS is a wonderful place to begin your search. Eighty-four percent of buyers now start their search online, so you'll be in good company.

Copyright © 2010 Realty Times. All Rights Reserved.

Improve Your Credit Score Before Searching for a Home

From RISMEDIA via Lowes -
Improve Your Credit Score Before Searching for a Home
By Paige Tepping

RISMEDIA, September 8, 2010--Many prospective homeowners find out the hard way the importance of a good credit score when they apply for a home mortgage, especially after the subprime loan crisis. If you are considering buying a home in the near future, it is a good idea to give your credit score a check-up and then take positive steps to improve your credit score if you find problems. Ideally, it is best to begin working on improving your credit score at least six months before you plan to start shopping for a home.

According to the experts at Buy-and-Sell-House-Fast.com, the following tips will help you improve your credit and should be taken before you begin your home search.

The first critical step in taking care of your credit is to check your credit report. Unfortunately, many people fail to take this all important first step. Instead, they wait until they have applied for a mortgage loan to find out from the lender that there are problems with their credit scores.

By checking your credit score before you apply for a mortgage loan, you gain the opportunity to find out if there are problems which you can correct and discrepancies that need to be removed. When you check your credit report, make sure you check all three of the national credit reporting agencies: Experian, Trans-Union and EquiFax.

Review your credit report carefully for items that may be erroneous. If you believe that an item on your credit report is reported in error, you have the right to contest it. To do so, you will need to contact the credit reporting agency and explain why you believe the item is inaccurate. Supporting documentation such as receipts and cancelled checks can help your claim. Alternatively, you can engage a credit report repair services firm to fix your credit report.

If there are derogatory items on your credit report that are accurate but which could cause problems in your loan application, you cannot have them removed; however, you can take positive steps to counteract them. In the event that you have missed payments in the past, take steps now to get your bills current. Even if it means tapping into money that you might be planning to use for a down payment, it is essential that you get your accounts current and keep them that way. Begin by immediately making your payments on time. There is nothing which can lower your credit score more quickly than late payments. Ideally, make an attempt to begin sending in your payments a few days ahead of time to make sure they arrive on time and you do not have any more late payments on your record. If necessary, begin taking advantage of electronic payments in order to make sure your payments are made on time. Over time, this can make significant difference.

Keep in mind that eradicating all of your credit balances is really not the solution. In fact, credit can be your friend when you are looking to make a big purchase such as a home. The key is to make sure your credit is positive, not negative. Toward that end, avoid actually closing out your accounts. Instead, make an effort to pay down your balances and keep them paid down well below the minimum or completely paid off, but do not close the account. When your lender runs your credit to make a decision on your mortgage application, he or she will want to see that you have had a long credit management history.

After reviewing your credit history, if you see that most, if not all of your credit cards are maxed out or nearly maxed out, it is time to sit down and plan an aggressive strategy for paying some of them down. One of the critical factors that often determine your ability to be approved for a mortgage loan is your debt to income ratio. In addition, high credit card balances can drag down your credit score. Therefore, it is important to look at paying off some of your balances.

It is generally better to begin with your highest-rate balances first. Many consumers are tempted to move around balances when they receive an offer from another bank that is good; however, before you do this, remember that the worst thing you can do when you are trying to make a major purchase is to open new accounts.

By following these guidelines, you can improve your credit score and improve your chances of being approved for your home mortgage loan.

Lowe's Customer Care(CON8) 1065 Curtis Bridge Rd. Wilkesboro, NC 28698.

© 2010 by Lowe's®. All rights reserved.

Five Smart Reasons to Buy a Home Now

Five Smart Reasons to Buy a Home Now

RISMEDIA, July 30, 2010--The economy is stabilizing. Home prices are holding. It's not just as good a time as ever to buy a house. It's one of the best times ever.

ForSaleByOwner.com presents five overlooked reasons why now is a great time to buy a house.

1. Low mortgage rates serve as an equity shock absorber. When buyers borrow at today's record-low rates, they start building equity as soon as they close. That means they have a little give to absorb a few ups and downs as the still-recovering housing market gains traction.

2. Houses are in move-in condition. Homeowners have continued to spend on maintenance and repair, according to the Harvard Joint Center on Housing. Homeowners who have been holding back kept their houses in good shape while they waited. As those houses enter the market, they are in marked contrast to tattered foreclosures.

3. Terrific houses are coming on the market. Foreclosures are finally starting to clear the system – and this is just the opportunity that owners of many desirable properties have been waiting for.

4. Appraisal regulations are finally aligned with market realities. Fannie Mae has adjusted its appraisal guidelines...again. Now that appraisers have more flexibility to set values that reflect the current market, today's deals will make it over the finish line.

5. Plenty of programs. Homes are more affordable than they have been for years, but communities have stuck by "workforce housing" programs that encourage middle-class families to buy houses. Buyers who qualify can get a big boost by combining one of these programs with today's low mortgage rates.


RISMedia, Inc.

© 2010 by Lowe's®. All rights reserved

Choosing the Best Home

From Realty Times of June 24, 2010

Choosing the Best Home by Carla Hill

After weeks of searching for your next home, you now have it narrowed down to two great options. One offers a shorter commute, but the other offers more square footage for your growing family. How can you make the best choice?

There are several strategies you can employ in your decision making process. Above all, be confident in your decision making abilities. "The fear of making serious decisions is a new kind of fear, called decidophobia," proclaimed by Walter Kaufmann at Princeton University in 1973. Worry and procrastination do nothing to aid the process, so buyers, be confident that you will make a sound choice.

Pro/Con list: In this case, you are deciding between two houses as your prospective home. For each house, divide a sheet of paper into two columns: pro and con. Be realistic about what the positive and negative factors would be for each purchase. Considerations could include: price, location, schools, repairs, square footage, floorplans, street noise, neighborhood value, comparables, and gut intuition.

Brainstorm scenarios: Chances are, whatever house you decided upon will be your residence for many years to come. Try and think ahead to situations that may arise in the future, and how each residence would affect those situations. Do you have aging parents that could move in? If so, then which house provides the best floorplan for this? Planning on having children? Check out ratings on local schools.

Do the math: Business executives might call this the "cost/benefit analysis." Buying a home is a huge financial decision, and while personal preferences (e.g. location, schools, square footage) all come into play in homebuying, many purchases are based on what makes the best financial sense. Discuss numbers and neighborhood comparables with your real estate agent. One home may be a smaller dollar amount, but the other may be a better deal in the long run. Some neighborhoods are up and coming, while others have come and gone. Are either homes overpriced or underpriced for their neighborhoods? Do either homes need repairs or updates?

Priorities list: Yes, you know you want the pool, landscaping, granite counters, close proximity to work, extra bath, and the list goes on. But when push comes to shove, and it might, what items are your priority, really? For some, driving a longer commute is worth having a larger house or a cheaper price. For other buyers, the exact opposite can be true.

Change perspectives: Sometimes you simply must step out of your own shoes to see a situation clearly. There are many different ways to approach this decision. You can look at it from an emotional point of view (which home do you love), an intuitive view (what does your gut tell you), and even a devil's advocate view (what if). Experts consider this the "Six Thinking Hats," introduced by Edward de Bono in a book of the same title, where you put on six different hats during a decision making process. Try and see the buying process from the perspective of your spouse, your children, friends, and even your worst enemy.

Finally, be realistic in your own abilities. While the final decision rests on your capable shoulders, you should rely on the professionals that are by your side. This includes your agent, lender, attorney, and even your family. And while you are the final say, remember that you have a team to help give you information to fuel that sound decision.

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Copyright © 2010 Realty Times. All Rights Reserved.

Rent or Buy A Home?

In 2010: Rent or Buy A Home?

RISMEDIA, June 14, 2010--First time home buyers have a lot to consider this summer when making the decision to rent or buy a home: interest rates are at all-time lows, there's still plenty of housing stock and prices are at or near their lowest in years.

Still, deciding whether to buy a home or rent an apartment can be a complicated decision. How do you know what's right for you? Potential buyers should ask themselves several key questions before making this important decision.

1. What will monthly costs be, and can I afford the payments?
Keeping mortgage payments under 30 percent of your monthly income is a good rule of thumb. If you can't keep mortgage payments below that, you may be better off renting for awhile.

2. What other debt do I have?
Total rent or mortgage payments plus credit obligations should not exceed 35 to 40 percent of monthly income.

3. What is my credit score? Can I qualify for a good interest rate?
A high credit score indicates strong creditworthiness, and that qualifies you for better interest rates on a mortgage. Maxing out on your credit lines and paying bills late will lower your credit score. The impact of a credit score on interest rates can be significant. For instance, a borrower with a score of 760 could pay nearly two percentage points less in interest on a mortgage than someone with a score of 620. Lower interest rates also mean lower monthly payments. If your credit score is low, you may want to delay buying a home until you can improve your score.

4. How much will taxes, monthly maintenance, or other fees cost?
Owning a home means you'll have to pay real estate taxes and other costs like insurance and maintenance. On the other hand, owning a home brings big tax savings at the end of the year. As a renter, the owner pays those costs for you.

5. How many years will I stay here? Generally, the longer you plan to live someplace, the more it makes sense to buy. You'll build equity in your house and its value is likely to increase over the years.

© 2010 by Lowe's®. All rights reserved. Lowe's and the gable design are registered trades marks of LF, LLC.

Real Estate Outlook: Positive Trends

Realty Times of June 7, 2010

Real Estate Outlook: Positive Trends by Kenneth R. Harney


Positive news on housing and real estate keep rolling in -- thanks in large part to federal home purchase tax credits and continuing near-record low mortgage rates.

Last week's pending home sales report from the National Association of Realtors illustrates the trend: Pending contracts jumped for the third straight month -- up by six percent in April -- and now stand 22 percent higher than the year before.

Every region but one -- the South -- racked up sizable gains in transactions heading for settlement. Contracts in the Northeast were up by nearly 30 percent for the month. In the West, they rose nearly eight percent, and in the Midwest the gain was about four percent.

The South's pending sales were less than one percent off from the previous month, but are still an impressive 31 percent above where they were 12 months before.

Home prices also appear to be moving on an upward curve, according to the latest Clear Capital Home Data Index -- which tracks price movements in thousands of local markets and Zip codes.

Clear Capital's national report for the month of May found prices up by 6.8 percent year over year.

Consumer confidence is definitely powering some of these sales and price numbers, economists say. The Conference Board's index for consumer confidence in May rose by five points -- a good sign for consumers' willingness to spend money.

Lynn Franco, who directs the Conference Board's survey research center, noted that the "expectations" component of the index was particularly strong -- and is now at its highest point in nearly three years.

According to Franco, consumers' previous fears about the job market, incomes and the overall economy have been on the decline for a couple of months now.

Meanwhile, mortgage giant Fannie Mae released its latest economic projections for the rest of the year. Chief economist Doug Duncan says he sees a "self-sustaining economic recovery" gradually taking shape -- again good news for housing.

Of course, not all the latest numbers on real estate are upbeat. They never are. Now a closely watched index tied to likely new home purchase offers two to three months down the road has gone negative. The Mortgage Bankers Association's index of new loan applications declined again for the third straight week, and now is at its lowest point in 14 years.

What's going on here? Most likely its the tax credits. The April 30 deadline for signed contracts for the two tax credit programs -- and the phaseout of the entire credit program June 30 -- are definitely pushing loan applications down.

As we said last week, the credits -- which are part of the federal stimulus efforts -- pushed many purchasers to move up their transactions to the first half of the year. Lawrence Yun, chief economist for the National Association of Realtors, says the underlying strength of the economic recovery should allow sales and loan applications to recover in the second half, without any need for additional federal help.

Copyright © 2010 Realty Times. All Rights Reserved.

Home Buying Secrets for the 'Average Joe'

Realty Times of May 13, 2010

Home Buying Secrets for the 'Average Joe' by Broderick Perkins

New York City attorney Edward A. Mermelstein is, well, a big shot in the Big Apple -- but he hasn't forgotten the little guy.

Co-founder of the international, multilingual (11 languages) real estate law firm Edward A. Mermelstein & Associates, he's also got an office in Moscow and offers legal services to financial and real estate institutions, including representation for international transactions, business litigation, dispute resolution and insurance matters.

Clients include international conglomerates, start-up ventures and entrepreneurs, multi-national corporations, land charitable organizations, government officials and others, but he also offers insight for the 'Average Joe' -- home buyers who need all the help they can get right now.

Mermelstein's "Home Buying Secrets for the Average Joe" are a timely example of his insight for buyers.

• Study - Do your homework before you buy. Review the prices of comparable homes in the neighborhood, which can be found on websites such as Zillow.com, PropertyShark.com, StreetEasy.com, HouseValues.com, Trulia.com and others. Keep in mind these numbers sometimes trail the market by several months. A real estate agent can provide the latest sales data.

• Cure your credit - Today's best mortgage rates require a credit score of more than 700. Learn how to boost your credit score before you apply for a mortgage. Not only will a low credit score cost you more in terms of the interest rate on your mortgage, it could also prevent you from obtaining a mortgage.

Go to AnnualCreditReport.com, the only federal government-sanctioned service for obtaining a truly free credit report from one or all three of the major credit bureaus. On AnnualCreditReport.com, select your state and hit the red "Request Report" button and follow the instructions. The report is free, but you will have to pay a nominal fee to get your credit score.

• Bid low - In many of today's buyers' markets you can offer 10 to 15 percent below the list price because prices are based on contracts signed three to four months ago. List prices don't necessarily reflect the most current values, especially in markets still on the decline, according to Mermelstein.

• Consider a 'Lucky 7' loan - Take advantage of the lower interest rates available with a 7/1 adjustable rate mortgage (ARM), when compared to a fixed-rate 30 year mortgage. The interest rate on a 7/1 ARM is fixed for seven years. In the eighth year the loan resets as an ARM. Just be sure you know what the margin, life cap and periodic caps will be beginning in the eighth year to avoid surprises. Use those seven years to reduce debit and increase your income in preparation for what is likely to be a much higher rate than your starting rate.

Mermelstein also says to consider 30/15 year mortgages which are fixed for 15 years, amortized over 30 years and due in full in 15 years.

These and other mortgage options come with lower starting rates as a hedge against interest rates rising in the near future.

• Get pre-approved - Go beyond prequalifying for a mortgage, which only tells you what you can likely borrow. Get a pre-approved mortgage and you'll know your home price shopping parameters. You'll also present yourself to the seller as a serious buyer. Financing in hand will also help level the playing field with all-cash buyers and investors and it will help you negotiate a better purchase price.

• Consider a newly built home - The new home sector has been harder hit than resales. Concessions and reduced prices are the norm. The latest U.S. Census Bureau data reveal that sales of new homes fell for the fourth consecutive month in February, to a seasonally adjusted annual level of 308,000 sales - a year-over-year decline of 13 percent and the lowest level ever. Just be sure to check out the reputation of the builder.

• Inspect everything - Get a home inspection for a new home, a resale home, a nearly new home or a very old home. Always. Just because it's new doesn't mean it's defect free. Hidden problems can torpedo the value of your home.

• Read the title report - Make sure that any new additions or construction to an existing home are fully permitted and recorded with the local municipality. • Check the appraisal - Likewise check the appraisal report for any oversights, missed features or other errors that could cause the property to be undervalued.

• Negotiate - Don't be afraid to dicker. It's a buyers' market. Concessions are available from both new home builders and existing home sellers. Ask for help with the closing costs, repairs, even furnishings and other perks. Motivated sellers have much to offer.

• Don't skimp on the help - If you look for the least expensive attorney, real estate agent, inspector, etc., you will get what you pay for. Ask family, friends, co-workers, realty professionals and others you trust for referrals and then carefully vet them.
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Copyright © 2010 Realty Times. All Rights Reserved.

Real Estate Outlook: Faster Recovery?

April 19, 2010 in Realty Times

Real Estate Outlook: Faster Recovery?
by Kenneth R. Harney


It's been a long time since we've seen the Wall Street Journal run a front-page article suggesting that the national economy appears to be rebounding faster than most analysts forecast. But that happened last week.

And over the past couple of years, we haven't seen retail sales -- a key barometer of consumer confidence -- jump by almost two percent in a single month. But we saw that last week as well.

And then there's real estate: The latest Federal Reserve "beige book" on economic conditions nationwide, issued last week, said something we haven't heard in a long, long time. Housing activity is up in 11 of the 12 bank districts.

All of this, of course, sounds like promising news for home sales in the coming months. In fact, Freddie Mac's economists see total sales this year at least 10 percent higher than last year, even with the possibility of higher mortgage interest rates.

But there are complications in the mix: The Fed's "beige book" report essentially said, yes, housing is on an upward path at the moment, but what happens to sales after the home purchase tax credits expire mid-year?

Will expansion elsewhere in the economy be able to sustain sales and prices?

Lawrence Yun, chief economist for the National Association of Realtors, has similar concerns. In his latest commentary, Yun says steadily rising employment will be essential to keeping housing positive once the credits disappear.

The employment report for March was encouraging: 162,000 net new jobs, Yun noted, even in hard hit sectors like manufacturing. Yun's forecast model projects one million additional new jobs this year, plus another two million next year.

But even that sort of rebound in employment won't be enough to replace the 8.2 million jobs lost in the recession years. So the unemployment challenge is likely to be with us for a few years -- at best.

Meanwhile, though foreclosures remain troublingly high, the rate of delinquencies on existing mortgages may have actually peaked and could be headed downward. Equifax and Moody's Economy.com report that the percentage of home loans thirty days late dropped in the first quarter - the first decline in four years.

And in major housing markets that took hard hits during the bust, signs of recovery continue to multiply. For example, in the six counties of Southern California, home sales were up 33 percent in March over February, and were up five percent over 2009 levels, according to MDA Data Quick.

Even median prices were on the rise -- by 14 percent over year-earlier levels.


Copyright © 2010 Realty Times. All Rights Reserved.

Housing Affected by Demographic Trends

From Realty Times of February 5, 2010

Housing Affected by Demographic Trends by Phoebe Chongchua

The Urban Land Institute predicts there will be two major changes beginning in this new decade in our country that will affect the housing market.

The first is that home appreciation will slow. The report predicts annual appreciation of 1 percent to 2 percent. The second change is that the record-high U.S. homeownership rate will decline from 69 percent to 62 percent.

Four other demographic trends are likely to have an impact as well. Aging baby boomers, those 55 to 64 years old, will keep working, and, some may stay put in their current suburban homes until the values recover. And, just as I wrote about last week, those in this group who do move will look for comfortable, easy homes (first-floor master bedroom), but the report indicates they’ll look for mixed-age living environments that cater to active lifestyles.

The second major demographic trend could impact the second-home market. Those between the ages of 46 to 54 years old, according to the report, are in their prime earning years; however, they lack home equity and may not be able to afford second homes (unlike the older baby boomers).

There are approximately 68-million people that make up Generation Y. This group is even larger than the baby boomers. But the report indicates this group is less interested in homeownership. The author of the report, John K. McIlwain, wrote, “They will be renters by necessity or choice for years ahead.” Not surprisingly, this tech-savvy group places high value on communities—real and virtual—where information and ideas can be shared.

This generation likes walkable, close-in communities. They’re not seeking to escape to the outer edges of town, unless they can’t afford anything nearby. Another big draw—“net zero” homes—green and powered exclusively by alternative energy.

The fourth major demographic trend involves immigrants. This group is often attracted to multi-generational housing in areas that have a strong sense of community. So, larger homes are preferred, if affordable.

Overall, the lasting stability of the U.S. housing market, according to McIlwain, will depend most on the structure and revitalization of the private home mortgage finance system.

"Re-establishing a robust private mortgage market will require both strong market fundamentals and a reformed mortgage securitization structure that eliminates past abuses," McIlwain said. Bye-bye suburbia, study says. Well, not completely. But the study does indicate that several factors are escalating the popularity of urbanization: two-person household growth (including those households without children), fewer baby boomers moving to the suburbs, Gen Y opting/forced to rent rather than own, and public policies that encourage compact development.

However, the author of the study says that urban infill development can’t accommodate all the housing demand from the demographic groups. McIlwain cautions that suburban development "must adapt or it will be obsolete.” A new era is blossoming, “The suburban century is over. This is the urban century."


Copyright © 2010 Realty Times. All Rights Reserved.

Real Estate Resolutions 2010

Realty Times of December 24, 2009

Real Estate Resolutions 2010 by Broderick Perkins


Sure you can lose weight, get in shape, launch a business or find a new job.

But haven't you also procrastinated long enough about buying a home?

How long has it been since you upgraded your home with a new roof, spiffed up landscaping or pulled some other home improvement?

And that post-World War II ranch home of yours could certainly use a few energy efficient do-overs.

Look to low mortgage interest rates, bargain home prices and other favorable market conditions to give you the resolve to consider home sweet home in your list of must-dos next year.

• Join the nearly 18 percent of Americans who say they've resolved to become a first-time homebuyer in 2010, according to a new Move.com survey. That's both a smart move and a timely one. Mortgage rates are at record lows, prices are down and the $8,000 first-time home buyer tax credit has been extended until April 30, 2010. It's also been expanded to include a $6,500 tax credit to move-up buyers.

• More than 15 percent of those who responded to the survey said saving money to purchase a new home is their top real estate resolution for the New Year. Resolve with them to learn the best way to budget, plan ahead and save money.

• Nearly 40 percent say No. 1 on their list of resolutions is starting a home improvement. Cheap home equity money should help them not only start, but also complete the job. Calabasas, CA-based Informa Research Services found home equity lines of credit (HELOCs) for $50,000, with an 80 percent loan-to-value note, were available in early December at an average variable rate of 4.98 percent. Some rates were as low as 2.74 percent.

• The Move.com survey also found 9.1 percent most wanted to fix their credit so they can buy a home next year. To get started all you need to do is take a look at your next credit card statement for a toll free number directing you to counseling help. That's part of the new, but little-known mandated disclosure provisions in the Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act).

• Nearly 16 percent are wisely considering buying an investment property as their top resolution. The couldn't have picked a better time in the last half decade. Another Move.com survey recently found more than 12 percent of homebuyers today plan to purchase a home as an investment, compared to less than half, only 5.6 percent, just seven months ago, thanks to more attractive investment conditions.

"If you anticipate inflationary conditions in the future, investment property could be a good bet to hedge against it," said Nancy Osborne, chief operating officer of Erate.com, a Santa Clara, CA-based financial information publisher and interest rate tracker.

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Copyright © 2009 Realty Times. All Rights Reserved.

Rates Still Below 5 Percent

Realty Times of October 16, 2009

30-Year Fixed Rate Still Below 5 Percent for Third Consecutive Week

McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 4.92 percent with an average 0.7 point for the week ending October 15, 2009, up from last week when it averaged 4.87 percent. Last year at this time, the 30-year FRM averaged 6.46 percent.

The 15-year FRM this week averaged 4.37 percent with an average 0.7 point, up from last week when it averaged 4.33 percent. A year ago at this time, the 15-year FRM averaged 6.14 percent.

The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.38 percent this week, with an average 0.6 point, up from last week when it averaged 4.35 percent. A year ago, the 5-year ARM averaged 6.14 percent.

The one-year Treasury-indexed ARM averaged 4.60 percent this week with an average 0.5 point, up from last week when it averaged 4.53 percent. At this time last year, the 1-year ARM averaged 5.16 percent.

"Mortgage rates rose slightly over the week, but rates on 30-year fixed mortgages remained below 5 percent for the third consecutive week," said Frank Nothaft, Freddie Mac vice president and chief economist. "Homeowners are taking advantage of these low rates to refinance their current balances. Over the past five weeks ending October 9, more than three out of five mortgage applications were for refinancing, according the Mortgage Bankers Association."

"The outlook on economic growth in the second half of this year has improved over the past few months. At it's September 22-23 monetary policy meetings, the Federal Reserve increased its forecast for real GDP growth from the last meeting in mid-August. They noted that data from the housing sector indicated that a gradual recovery in activity was under way. The modest strengthening came about, in part, to improvements in housing affordability stemming from low interest rates for conforming loans and a lower level of house prices."

Copyright © 2009 Realty Times. All Rights Reserved.

Mortgage Rates Remain under 5 Percent

From Realty Times of April 10, 2009

Application for Purchase and for Refinancing up Nicely as Mortgage Rates Remain under 5 Percent

McLEAN, VA -- Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 4.87 percent with an average 0.7 point for the week ending April 9, 2009, up from last week when it averaged 4.78 percent. Last year at this time, the 30-year FRM averaged 5.88 percent.

The 15-year FRM this week averaged 4.54 percent with an average 0.7 point, up from last week when it averaged 4.52 percent. A year ago at this time, the 15-year FRM averaged 5.42 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.93 percent this week, with an average 0.7 point, up from last week when it averaged 4.92 percent. A year ago, the 5-year ARM averaged 5.56 percent. .

One-year Treasury-indexed ARMs averaged 4.83 percent this week with an average 0.5 point, up from last week when it averaged 4.75 percent. At this time last year, the 1-year ARM averaged 5.18 percent. The 1-year ARM has not been lower since the week ending September 29, 2005, when it averaged 4.68 percent.

"Mortgage rates rose slightly this week but still remained historically low," said Frank Nothaft, Freddie Mac vice president and chief economist. "Interest rates for 30-year fixed-rate mortgages have averaged below 5.0 percent for the last four weeks, which should keep homeowner affordability at record levels.

"Given these low rates, housing demand has strengthened. Conventional mortgage applications both for refinancing and for home purchases have increased over the past five consecutive weeks ending April 3. Since the end of February, applications for home purchases were up about 22 percent and nearly 129 percent for refinancing, according to the Mortgage Bankers Association."
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Copyright © 2009 Realty Times. All Rights Reserved.

First-time Buyers - Rescue Housing Market

From Realty Times March 3, 2009


First-time Buyers Must Rescue Housing Market
by Jim Adair


First-time buyers drove Canada's decade-long housing boom and they will lead the market out of the current downturn, says Phil Soper, president and CEO of Brookfield Real Estate Services. Brookfield owns the Royal LePage and La Capitale brands in Canada, and it recently acquired GMAC Real Estate, which has almost 17,000 sales reps in Canada and the United States.

Speaking at a recent Scotiabank forum, Soper said first-time buyers represented almost 70 per cent of the market when it peaked in 2007. Now they account for about 40 per cent of all transactions.

"Like stalled credit, the cycle of buyers and sellers grinds to a halt when first-time buyers disengage," said Soper. "It's like sand in the gears of the real estate market." He said young new buyers allow entry-level homeowners to move up to larger homes as children arrive, and in turn that helps mid-price owners aspire to more luxurious homes. "But without mover-uppers, they are stuck," said Soper.

He said it's going to take lower home prices and "transactional risk mitigation" to make first-timers start buying again. That is already being helped by dropping prices and historically low mortgage interest rates. Government incentives such as those announced in the recent federal budget will also help, he said.

The risk mitigation is helped by the return of conditional offers. During the boom, potential buyers often found themselves in bidding wars for desirable properties, and had to submit "clean" offers without any strings attached. With the softer market, now offers are being accepted with conditions on such things as successfully obtaining financing and home inspections.

Soper says the real estate industry is also seeing a shift away from the traditional "listing side" of the transaction and more to a focus on buyers. Buyer agency is growing, and brokerages are holding events such as first-time buyer seminars to help educate those entering the market. He says seller-driven contractual offers are also increasing to try and seal a deal.

Noting that housing markets have traditionally rebounded well after a recession, Soper predicted the current downturn would last about seven quarters, the same as the market correction in 1989/90. That would mean the market would flatten in the third quarter of this year and start its recovery in the fourth quarter.

Soper's forecast is more optimistic than that of his Scotiabank hosts.

Addressing the overall economy, chief economist Warren Jestin said, "The worst of the bad news will be in the first six months of this year, and next year the good news will outweigh the bad news." But he said it will be a long recovery that "may linger beyond 2010."

Senior economist Adrienne Warren said, "Another 15 to 20 per cent decline in the volume of resales is likely this year, with a further 10 per cent drop in average prices. Centres with the largest supply-demand imbalance, including Vancouver, Sudbury (Ont.) and Calgary, have relatively greater downside risk."

But she repeated what most observers have been saying about the Canadian housing market all along – that as bad as it gets in Canada, the situation is better here than in the U.S. There were far fewer subprime mortgages issued in Canada than the U.S., and the number of mortgage defaults in Canada still lingers near a record low, at about one-third of one per cent. Canadians also have more equity in their homes than their U.S. counterparts – almost 70 per cent, compared to about 45 per cent in the U.S. – reducing the risk of foreclosure.

Despite the introduction of a tax credit in the federal budget to promote renovation activity, Warren says the outlook for the renovation industry is "somewhat mixed." Spending on home improvements and alterations in Canada was close to $40 billion last year, about the same as was spent on new construction.

"The main factors behind the boom in renovations in recent years – record existing home sales, rising home prices and equity, high new home prices, record homeownership rates, an aged housing stock, and strong job and income growth – are no longer supportive," says Warren. "Renovation expenditures are typically highly cyclical, as are other areas of big-ticket discretionary spending. Job worries and a tendency for households to boost savings in today's uncertain economic and financial climate will likely trump the desire to undertake a significant new home renovation."


Copyright © 2009 Realty Times. All Rights Reserved.

Housing Positioned For Growth

From Realty Times on March 3, 2009

Real Estate Outlook: Housing Positioned For Growth
by Kenneth R. Harney


No economist has more information at his or her disposal than Federal Reserve chairman Ben Bernanke, and what he told Congress last week should be encouraging news for anyone interested in real estate: The recession that has gripped the country painfully for 18 months will "end" later this year - moving us into positive economic growth.

In the meantime, housing may be better positioned than other major industries. That's because there appears to be significant interest in the improved $8.000, nonrepayable home buyer tax credit plus a historically-favorable combination of low interest rates and rolled-back home prices.

In a new research report, the National Association of Home Builders found that affordability of houses is now at its best level in years. The association's "Housing Opportunity Index" -- which measures the percentage of homes sold in local markets around the country that are affordable to families earning area median incomes -- hit a near-record 62.4 percent in the most recent quarter for which data is available.

By contrast a year earlier, the index was at 47, meaning that less than half of households could afford to buy a median priced home. During the boom years it was even worse.

Although rising unemployment is a sobering counter-trend, the improvement in affordability may be setting the stage for a real estate rebound -- even if monthly ebbs and flows in sales look gloomy in the first quarter of the year .

Mortgage rates continue to hover in the mid-5 percent range for 30-year fixed rate loans. Fifteen year rates are at 4.7 percent.

While average prices of homes continue to decline on a national basis, according to the Federal Housing Finance Agency, dozens of local markets -- most of them ignored by widely-publicized surveys such as Standard & Poor's Case-Shiller Index -- continue to show net positive selling price performance.

According to the agency's latest quarterly survey, local markets in much of Texas registered higher prices year-to-year, along with parts of the Carolinas, the Northeast, and the Gulf states.

For example, houses selling in Austin, Texas, were up 4.4 percent over last year. In Boulder, Colorado, the average gain was 3 percent. In Houston 3.7 percent; Decatur, Alabama 6.6 percent; Kingsport-Bristol Tennessee 6.3 percent; and Syracuse, New York 3 percent.

You don't hear about these positives because these areas were lower profile during the boom, never experienced a bust, and are just not on the New York radar screens.

But they're for real, and their moderate, sensible growth patterns may be where we're headed in real estate this year.

Copyright © 2009 Realty Times. All Rights Reserved.

Housing Lobbyist Groups Active

From Realty Times of February 2, 2009

Washington Report: Lobbyist Groups Active
by Kenneth R. Harney

Housing and mortgage groups were unusually active last week on Capitol Hill, pushing hard for a better tax credit to spur home purchases.

In coordinated lobbying efforts, homebuilders, Realtors, bankers and mortgage companies focused on the Senate, where final details of a nine hundred billion dollar economic stimulus package were being hammered out all week.

Four trade groups sent a joint letter to the Senate Finance Committee, which has responsibility for all tax-related aspects of the stimulus, applauding the committee's decision to make the existing seven thousand five hundred dollar tax credit nonrepayable as the House Ways and Means Committee voted to do the prior week.

But the amended credit could be improved even more, the groups said, if the Senate makes several additional changes.

Tops on the list: Extend the eligibility period for using the credit from the current deadline of June thirtieth through the end of December.

“If the stimulus bill is signed sometime in February, as anticipated,“ said the groups, “only about four months will remain for the credit to have a meaningful impact. The spring, summer and early fall months are historically the most active seasons for home purchases. Allowing the credit to expire June thirtieth could undermine” the ability of the credit to stimulate potentially hundreds of thousands of sales this year .

The four trade groups, the National Association of Realtors, the National Association of Homebuilders, the Independent Bankers of America and the Mortgage Bankers Association, asked the Senate to take two more steps: expand eligibility to ALL buyers of homes this year --- not simply first time purchasers- and authorize a mechanism whereby the seven thousand five hundred dollar credit could be made available as downpayment cash at settlement.

Eliminating the first time buyer restriction would be a huge change. Under the current tax code and the House Democratic stimulus package, only taxpayers who have not owned a home during the previous three years are eligible for the credit. Opening that up to all purchasers -whether moveup buyers, downsizers or first timers would stimulate sales far more -- perhaps half a million additional sales -- according to some estimates.

Though the four trade groups joined to push for an improved tax credit, they don't necessarily agree on all aspects of the plan. For example, the National Association of Homebuilders continues to lobby Congress and the Obama administration for a ten percent credit up to twenty-two thousand dollars available to all 2009 purchasers.

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Copyright © 2009 Realty Times. All Rights Reserved.


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