Boise Still Good Housing Bet!

As reported in Forbes magazine Boise is number 10 on the list of Top Ten Housing Bets in the country for investors.

"Investments in single-family homes for rental properties will remain an attractive venture in many markets in the new year, says Ingo Winzer, president of Local Market Monitor. Winzer notes that Texas and Oklahoma offer some of the best bets “with their low unemployment rates and ability to profit for years from new shale oil and gas development.”

Local Market Monitor and HomeVestors, an investment company that brands itself “We buy ugly houses,” named the following top 10 housing markets for investing in single-family homes for 2014. All of these markets have posted strong appreciation in the past year but are still underpriced by up to 28 percent.

1. Forth Worth, Texas


2. Dallas


3. Charlotte, N.C.


4. Nashville


5. Houston


6. Atlanta


7. Oklahoma City


8. Orlando, Fla.


9. Las Vegas


10. Boise City"

So whether you are looking for a home to live in or for an investment, give me a call and make your good housing bet!

Housing Predictions for 2014

As the end of the year approaches it becomes time for both new year resolutions and also predictions. Here are the predictions from Diana Olick of CNBC.

 

Home sales will rebound: After a brief lull in the fall of 2013, I predict that sales activity will return to the market with more homebuyers. The steep jump in home prices has brought thousands of homeowners above water on their mortgages, enabling them to sell and move. Negative equity has been one of the biggest barriers to home sales since the housing crash. Come spring, there will most likely be more sellers, more homes on the market and therefore more transactions.

 

Home-price gains should ease: Prices will still rise, no question, but probably not as steeply as they did in 2013. Annual gains of more than 12 percent were driven in large part by investors on the low end of the market. As foreclosures ebb and fewer distressed sales are in the mix, prices will moderate. Still low inventories, however, will keep them in the positive.

Rents will rise: Despite the return of home sales, renter nation should continue throughout 2014, as younger Americans and first-time homebuyers are still left out of the recovery. Saddled with student debt and unable to come up with the large down payments required from today's mortgage lenders, this cohort will probably continue to fuel both the multifamily apartment market and the single-family rental trade.

 

Investors will not leave the market: Some have predicted that with rising home prices, the large-scale private-equity investors will leave the newly evolving single-family rental market. Just the opposite. Now that they have built economies of scale and figured out the management, they will most likely settle in for the long haul — perhaps not buying as many new properties, but keeping the bulk of the ones they have. Some smaller investors may opt to sell, but they may sell to the bigger guys rather than to individual-owner occupants.

Mortgage rates will rise: The days of the 3.5 percent, 30-year fixed are over. Rates are already up well over a full percentage point from a year ago and as the Federal Reserve begins its much-anticipated exit from the bond-buying business, I believe rates will inevitably go higher. How much that affects home sales will depend entirely on job and wage growth. Mortgage underwriting will remain tight, but buyers with solid credit should be able to weather slightly higher rates. By historical standards, they are still relatively low. It is less rate and more availability that will continue to hamper sales.

 

Canyon County Showing Stability and Growth

The following graph, courtesy of the Idaho Statesman, shows an a increasing stable real estate market in Canyon County.

November Market Report in Pictures – Pretty but complicated

Courtesy of the Ada County Association of Realtors

Today's Prices Compared to Peak

I found this graphic rather interesting. I would like to also see one illustrating the increase from the bottom of the trough that our market was in a couple of years ago.

Harvard: 5 Financial Reasons to Buy a Home

From KCM Blog:

Harvard: 5 Financial Reasons to Buy a Home  Posted: 10 Dec 2013 04:00 AM PST Eric Belsky is Managing Director of the Joint Center of Housing Studies at Harvard University. He also currently serves on the editorial board of the Journal of Housing Research and Housing Policy Debate. This year he released a new paper on homeownership - The Dream Lives On: the Future of Homeownership in America. In his paper, Belsky reveals five financial reasons people should consider buying a home. Here are the five reasons, each followed by an excerpt from the study: 1.) Housing is typically the one leveraged investment available. “Few households are interested in borrowing money to buy stocks and bonds and few lenders are willing to lend them the money. As a result, homeownership allows households to amplify any appreciation on the value of their homes by a leverage factor. Even a hefty 20 percent down payment results in a leverage factor of five so that every percentage point rise in the value of the home is a 5 percent return on their equity. With many buyers putting 10 percent or less down, their leverage factor is 10 or more.” 2.) You're paying for housing whether you own or rent. “Homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord.” 3.) Owning is usually a form of “forced savings”. “Since many people have trouble saving and have to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings to another day.” 4.) There are substantial tax benefits to owning. “Homeowners are able to deduct mortgage interest and property taxes from income...On top of all this, capital gains up to $250,000 are excluded from income for single filers and up to $500,000 for married couples if they sell their homes for a gain.” 5.) Owning is a hedge against inflation. “Housing costs and rents have tended over most time periods to go up at or higher than the rate of inflation, making owning an attractive proposition.” Bottom Line We realize that homeownership makes sense for many Americans for many social and family reasons. It also makes sense financially.

 

November Real Estate Market Report for Ada County – Some good some not so much

Single family home sales in November 2013 were 548 in Ada County, a decrease of 3.3% compared to November 2012.  I expected a better month, but sales fell about 30 units short. Year-to-date sales are 7,385; up 14% over 2012 YTD sales of 6,471. Dollar volume for November was up 9.5% to $131 million and YTD we are just over $1.7 billion in sales. We now have had two consecutive months with sales falling behind the previous year. October 2012 was a really strong month; up 19%. November 2012 was pretty good too; up 15%. December is an interesting month for sales. Some years its higher than November. Some years close and some years well below. The last two months sales have been with 5% of previous year. If that trend continues in December sales will be very near 500 units which will give us a total sales increase for 2013 of 13%. Days on market averaged 52 in November, no change from October.  Our year-to-date average is 51 days. New homes sold in November totaled 105; down 14% from November 2012…but slightly stronger than in October Historically, November sales decrease an average of 9% from October.  November 2013 sales decreased 11% compared to October 2013. Of the total sales in November, 10% were distressed; up 1% from last month. In November 2012, 24% of sales were distressed. For the month of November, REO sales (57% of Distressed; 31 total sales) exceeded Short Sales (43% of Distressed; 24 total sales), for the first time in 2013. Pending sales at the end of November were 831; down 9% from September 2013; but even to what was pending in 2012 at the end of November. Of Pending sales in distress (13%), there was an increase in the number of Short Sales (from 52% to 59% of activity; 63 total sales) and a decrease in REO sales (from 48% to 41%; 44 total sales). November median home price was $205,700; up 16% from November 2012. According to NAR’s most recent report; national median price is $199,500. New Homes median price for November was $274,161; up 10% from November 2012. For Existing homes the increase is 15% to $185,000. This is the fifth month in which we’ve been above $200K. In Ada County, the median family income is $67,519; making a $205,700 home within reach for that “median family income” family. The number of houses available for sale at the end of November decreased 10% from October 2013 to 2,263.  This is the third consecutive month of decrease.  This is 21% more than last year at this time. Since January we have increased the number of single family homes for sale by 36%, allowing us to grow our YTD sales increase. Historically, inventory decreases steadily from August to December. Anecdotally, I’ve spoken with several sellers who listed their homes in September/October at an aggressive price; then took one or two reductions before pulling the listing from the market, deciding to wait until Spring 2014. Of the total active listings, 11% are distressed, up 1% from the end of October 2013. With inventory experiencing seasonal decreases and the percentage of distressed inventory holding very low, median home price will remain strong through the end of this year. Of our Distressed Inventory, 71% is Short Sales (163) and 29% is REO (66). Available inventory decreased at all price points except in the $120,000 to $160,000 range, with an increase of 16 homes. In Ada County we now have 3.9 months of inventory on hand, up a little from the end of October. The price category in shortest supply is <$100K where we have 1.8 months. All price points up to $400,000 have a 4 month’s supply. Above $400,000 the supply is closer to five months.  Remembering that six months of available inventory describes a “stable real estate market”; it looks like we are heading into a period of “normal” like we haven’t seen in several years. Of sales in November, the most popular price point was $120,000 to $160,000 (21%); followed by $160,000 to $200,000 (17%), $200,000 to $250,000 with 14%. So…what’s next? Lawrence Yun, NAR chief economist, said a flattening trend is expected. “The erosion in buying power is dampening home sales,” he said. “Moreover, low inventory is holding back sales while at the same time pushing up home prices in most of the country. More new home construction is needed to help relieve the inventory pressure and moderate price gains.” For Ada County, the positives that have helped push the pace of our recovery past the national average are still in place; growing population, jobs creation and quality of life issues will bridge us through the slow winter months.

 

Knowing Your Options for the "Fixer Upper"

The fixer-upper properties on the market will give you more purchasing power when shopping for a new home. Bargains can be found in homes that have been foreclosed, seized by the government or just fallen out of repair due to homeowner neglect. While it is true that you will save thousands of dollars on these homes that will need lots of work, there are hidden costs that buyers fail to consider. Ask yourself if it’s worth it and know your options.

Know exactly what you are getting into

Don’t underestimate the cost of renovations and repairs. A home inspection will let you know the fundamental repairs and maintenance that must be done to the home. Without a home inspector, you may end up over paying for the fixer-upper anyway.

The inspector will evaluate any problems with the interior and appliances, roofing, heating and cooling system, plumbing, electrical wiring, insulation and ventilation, and the structural foundation, exterior faults and more. Fixer-uppers may have a lot of problems with these parts of the home, and a realtor can downplay the extent of the issues because of their stake in the outcome of the sale. A home inspector is worth hiring to get an unbiased perspective and uncover problems you can’t see yourself.

You ultimately have to decide how much money you are actually saving by buying the fixer-upper once you add in the costs. Once you spend all the money on repairs to make it habitable, will you still be satisfied with your choice? Will you hire someone to do the repairs or do you have the patience and skill to do it yourself?

Consider a FHA insured HUD 203(K)

It is worth checking to see if you qualify for a program known as HUD 203(k). It allows the buyer to purchase a fixer-upper with a FHA guaranteed loan, and the best part is that it protects you from extra costs if the “fixing” part costs more than estimated. You must submit a comprehensive list of repairs with corresponding cost estimates with your application, so you will need to get a home inspector, have the cost of labor and repair determined, and prepare your detailed plan for accomplishing it all for the FHA and your creditor.

DIY

The ideal fixer-upper would consist of superficial revamps rather than major appliance, ventilation, or structural repairs. Minor renovations would be painting inside and out, installing ceiling fans and light fixtures, and replacing carpets, windows, or doors.

Be patient

Fixing up the house might take longer than you originally planned, but it can be well worth it. Remodeling and minor repairs will most likely take longer than you expect, especially if you are haven’t dealt with this before. You chose to save money with a fixer-upper. It takes time to give a house the proper care that will result in a comfortable house to call your home. Do your homework and make an informed decision.

 

NAR's Exisiting Home Sales Report [INFOGRAPHIC]

Baby it's COLD outside!

I  don't know about you, but as far as I am concerned they can take this  "arctic blast" somewhere else! I have had enough. Of course when I start complaining I check the temperature for my daughter in Miles City Montana and they hit 35 below! so perhaps I should just grin and bear it.

I also think of a couple of people whom I have sold houses to this past summer from much warmer climates, I am sure they are questioning what they have gotten themselves in for.

I did see these recommendations that are worth reprinting.

During the current winter weather conditions we recommend you do the following to protect your home and protect your pipes from freezing: Close foundation vents around the base of your home when the temperature is below 20º F then open them once above 20º F if they are around a water area (i.e. exterior hose spicket, etc.) Leave a little water dripping from inside faucets If you have plumbing that runs along an outside wall, be sure to leave cabinets open & wrap exposed pipes with insulation, as well as wrapping any exterior pipes with insulation If you water heater is in the garage, keep the garage door closed Disconnect hoses from outside the home I guess it is time for me to go put on my 6 layers of clothing and go for my walk today. ENJOY!

14,027 Houses Sell Every Day in the U.S.!!

There are some homeowners that might consider waiting for the spring to sell their house thinking that no one buys a home during the winter months. What we should understand is that homes sell EVERY DAY. As a matter of fact, according to the latest Existing Homes Sales Report from the National Association of Realtors, on average14,027 homes sell daily in this country.

It is true that more houses sell in the spring than the winter in most markets.  However, it is also true that there will be more competition as many sellers wait to the spring to put their house on the market.

Thousands of homes sell each and every day in this country. Don’t be afraid to put your house on the market this winter.

 

Clients’ Cash Deposits Can Delay Closing

DAILY REAL ESTATE NEWS | TUESDAY, NOVEMBER 19, 2013

Home buyers who make cash deposits to their checking accounts that don't come from payroll checks or income tax refunds during the processing of a mortgage likely will face delays in closing, lending experts warn. That's because lenders are required to investigate possible suspicious activity for deposits that are not documented or cannot be explained, slowing down the process.

Scott Sheldon, a senior loan officer with Sonoma County Mortgages, told Credit.com only money that can be adequately "sourced" can be used in the mortgage transaction.

"If you are self-employed and show cash deposits, that's OK — so long as you claim those monies as income on your tax return and you 'show' income from a filing standpoint," Sheldon says.

For example, if borrowers receive money from parents or family members, they will need to document and explain that deposited check to lenders. Sheldon says that buyers may want to avoid making deposits that will need to be explained at least 60 days prior to closing.

 

5 Reasons to Sell Before Spring

KCM Blog presents 5 reasons to sell before spring.

Many sellers feel that the spring is the best time to place their home on the market as buyer demand increases at that time of year. However, the fall and winter have their own advantages. Here are five reasons to sell now.

Only Serious Buyers Are Out

At this time of year, only those purchasers who are serious about buying a home will be in the marketplace. You and your family will not be bothered and inconvenienced by mere 'lookers'. The lookers are at the mall or online doing their holiday shopping.

There Is Far Less Competition

Housing supply always shrinks dramatically at this time of year. The choices for buyers will be limited. Don't wait until the spring when all the other potential sellers in your market will put their homes up for sale.

The Process Will Be Quicker

One of the biggest challenges of the 2013 housing market has been the length of time it takes from contract to closing. Banks have been inundated with both purchase and refinancing loan requests. Both of these will slow in the winter cutting timelines and the frustration these delays cause both buyers and sellers.

There Will Never Be a Better Time to Move-Up

If you are moving up to a larger, more expensive home, consider doing it now. Prices are projected to appreciate by over 25% from now to 2018. If you are moving to a higher priced home, it will wind-up costing you more in raw dollars (both in down payment and mortgage payment) if you wait. You can also lock-in your 30 year housing expense with historically low interest rates right now. There is no guarantee rates will remain at these levels in years to come.

It's Time to Move On with Your Life

Look at the reason you decided to sell in the first place and decide whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?

You already know the answers to the questions we just asked. You have the power to take back control of the situation by pricing your home to guarantee it sells. The time has come for you and your family to move on and start living the life you desire. That is what is truly important.

 

Treasure Valley distressed properties reach post-recession low

Home sale prices are increasing in the Treasure Valley in part because of the decline in distressed properties.

Distressed properties — homes in the process of foreclosure or short sale — made up 59 percent of Ada and Canyon county home sales in January 2011, according to statistics kept by the Ada County Association of Realtors. That dropped to 10 percent in October.

Marc Lebowitz, president of the association, said the decline is partially due to the federal government’s Home Affordable Refinance Programs that have helped homeowners avoid short-selling their homes for less than they owe on their mortgages.

“This is a combination of the intrinsic strength of our market and some supportive federal policy that have made this picture a lot brighter,” Lebowitz said.

Distressed properties typically sell for far less than market value, Lebowitz said. The reduction in the inventory of distressed homes is one of the reasons median home prices have increased 20.5 percent in Ada County to $214,000 and 19.7 percent in Canyon County to $130,500 since October 2012.

Brad Barker, president of the Boise real estate agency Group One, said the local market has recovered from the recession.

“We have to be approaching or maybe even have reached a normal market now,” Barker said.

Some areas in the country should still be concerned about a “shadow inventory” of distressed properties, meaning homes that are in the process of foreclosure but don’t yet show up in the stats, Barker said. That’s only the case in states that have a judicial foreclosure process, which Idaho does not, he said.

“There isn’t anything hung up in the courts, because we don’t use the courts,” he said.

Read more here: http://www.idahostatesman.com/2013/11/21/2882660/treasure-valley-distressed-properties.html#storylink=cpy

 

 

Properties Sold in Ada and Canyon Counties

Sales UP in Ada and Canyon Counties

My thanks to Hennessey Appraisals for the above graphs.

Where are Prices Headed?

A few days ago I published the median price predictions for Ada County for this year. Today will be national predictions for the next 5 years.

Today, many real estate conversations center on housing prices and where they may be headed. That is why we like the Home Price Expectation Survey. Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists about where prices are headed over the next five years. They then average the projections of all 100+ experts into a single number.

The results of their latest survey

The latest survey was released last week. Here are the results:

• Home values will appreciate by 4.3% in 2014.


• The average annual appreciation will be 4.2% over the next 5 years


• The cumulative appreciation will be 28% by 2018.


• Even the experts making up the most bearish quartile of the survey still are projecting a cumulative appreciation of over 16.8% by 2018.

 

Ignoring Insurance Risks Can Be Costly

Having just gone through purchasing a home and obtaining home insurance I thought this article from KCM Blog was very appropriate. I will also add it certainly pays to shop around for insurance, I ended cutting the proposed premium in half, with the same coverages!

One of the first stages during the hunt for a new home is crunching the numbers to figure out your budget. And no matter how high or low that budget may be, prospective homebuyers should take into consideration the cost of insuring the home.

It's easy to overlook insurance, especially since you may be more worried about the number of bedrooms, the school district, or the size of the backyard. But before you can close on the purchase, your lender will require you to line up homeowners insurance. You may be hit with some sticker shock if the home you are about to buy ends up being a high risk- and therefore high cost- home to insure.

Once you’ve got a few homes in your sight, you should get some preliminary home insurance quotes on each property. Just as you will compare asking price and property taxes- figure your insurance costs into the equation as well. Even homes of similar size and style can vary greatly in terms of cost to insure.

Here are a few lesser known home features that affect insurance costs:

Location- The location of a home will have a huge impact on the insurance premiums due to the proximity to a fire station, the fire station ratings and the flood zone it’s located in.

• When you shop for homeowners insurance you will be asked how close the home is to a fire hydrant and to a fire station. In the event of a fire, the quicker the fire department can respond to the home, the less damage will be incurred. The average claim for a residential fire exceeds $33,000, according to the Insurance Information Institute (III). Therefore insurers typically charge lower premiums for homes within a close proximity of each.


• Fire stations in each community each have a specific fire protection class rating which also affects the home insurance premiums on a home.


• Last but certainly not least, the specific type of flood plain that a home is located in may require you to carry a separate flood insurance policy in order to obtain a mortgage. Flood insurance is recommended for all properties, however, in certain high-risk flood plains a flood insurance policy is not only required- but the coverage could double your annual insurance spend.

Roofing- Ask your realtor about the home's roof. You'll want to know how old it is and the material it's made of. Roofs that are 20 or more years old can be considered high risk and may be expensive to insure. Replacing a roof also can be costly so you'll want to weigh the pros and cons. Newer roofs, built with impact-resistant material, are ideal. These roofs are made to withstand nature's harshest elements, and they can also qualify homeowners for more preferred home insurance policies.

Swimming Pool- You might be looking specifically for a house with a pool but you should know swimming pools can drive up your insurance premiums. Accidents frequently happen in and around pools so insurance companies see them as a high-risk home feature. Remember, you can be held liable even if a trespasser has an accident at your pool. For this reason, homes with swimming pools located on the property should meet all local safety codes and carry high limits of liability coverage.

Age- The age of the home can also affect your premium. Typically older homes have outdated electrical wiring and plumbing systems, which can lead to fires or water damage. If you are considering an older home, ask your realtor the age of the plumbing, HVAC and electrical systems. If they have been updated in recent years, this is important to note with your insurance agent. If not, make sure you know what this may cost you in additional premiums and to upgrade in the future.

Security equipment- Security equipment is a plus for obvious reasons- items such as burglar alarms, deadbolt locks, and smoke alarms can make your home a safer environment. In addition, insurance providers offer discounts for homes featuring these items. In fact, you could save 10% or more on your premium. Take note of the types of safety devices in the homes you are comparing so you can get accurate discounts figured into your insurance rates.

You likely won't make a decision on a house because of insurance factors alone. But it's best to have an idea of where you stand as you consider your options. Start by checking out average home insurance rates in your state. Then work with an agent you can trust to compare quotes on various properties. An educated search can help you find the home of your dreams and home insurance premiums that won't break the bank.

 

Profile of Buyers and Sellers

The National Association of Realtors does research each year on buyers and sellers. Here are a few excerpts for you to peruse. With the exceedingly high numbers of buyers using the internet in their home searches coupled with the high numbers using real estate agents, using my flat fee service is being shown as the best, most effective and efficient way to sell your home!  I am here to answer any questions, give me a call or shoot me an email today!

Sixty-six percent of buyers were married couples—the highest share since 2001. For 42 percent of home buyers, the first step in the home-buying process was looking online for properties The use of the Internet in the home search rose slightly to 92 percent. The typical home buyer searched for 12 weeks and viewed 10 homes. Eighty-eight percent of buyers purchased their home through a real estate agent Eighty-eight percent of sellers were assisted by a real estate agent Two-thirds of home sellers only contacted one agent before selecting the one to assist with their home sale. The share of home sellers who sold their home without the assistance of a real estate agent was nine percent. Forty percent knew the buyer prior to home purchase.

 

Ada County Real Estate Market Report-October

Here is the low down from Marc Lebowitz of the Ada County Association of Realtors.

 

Single family home sales in October 2013 were 615 in Ada County, a decrease of 4% compared to October 2012.  We had a strong feeling that October was going to be lackluster and it was.  Plus, October 2012 was a gangbuster month.  I’ll go out a limb right now and predict that November 2013 will beat November 2012 sales by at least 7%. Year-to-date sales are 6,810; up 15% over 2012 YTD sales of 5,905. Dollar volume for October was up 13% to $152 million and YTD we are just under $1.6 billion in sales. Days on market averaged 52 in October, up from 46 in September.  Our year-to-date average is 51 days. New homes sold in October totaled 137; down 17% from October 2012. Historically, October sales decrease an average of 3% from September.  October 2013 sales decreased 10% compared to September 2013. The impact of the Government shutdown in October will take months to figure out. Preliminarily, homes took longer to sell; sales decreased more than just “seasonably adjusted”; Pending Sales nudged up a little. Of the total sales in October, 9% were distressed; no change from last month. In October 2012, 23% of sales were distressed. Pending sales at the end of October were 910; down 1% from September 2013. Of Pending sales in distress (13%), there was an increase in the number of REOs (from 38% to 48% of activity; 38 total sales) and a decrease in short sales (from 62% to 52%; 42 total sales). At the end of October, we had 9% fewer sales pending than at the end of October 2012. This is the third consecutive month in which we’ve seen a decline in pendings relative to the previous year. This is a key number to monitor moving forward. October median home price was $214,000; up 21% from October 2012. According to NAR’s most recent report; national median price is $199,200. New Homes median price for October was $275,000; up 14% from October 2012. For Existing homes the increase is 17% to $190,000. This is the highest monthly median price we’ve had in 2013 and the fourth month in which we’ve been above $200K. In Ada County, the median family income is $67,519; making a $214,000 home within reach for that “median family income” family. The number of houses available for sale at the end of October decreased 1% from September 2013 to 2,496.  This reverses nine consecutive months of increasing inventory.  This is 27% more than last year at this time. Since January we have increased the number of single family homes for sale by 52%, allowing us to grow our YTD sales increase. Of the total active listings, 10% are distressed, down 1% from the end of August 2013. With inventory increasing and the percentage of distressed inventory decreasing, median home price will remain strong through the end of this year. Of our Distressed Inventory, 76% is Short Sales (189) and 24% is REO (59). Available inventory decreased at all price points except in the $160,000 to $200,000 range, with an increase of 26 homes. In Ada County we now have 3.8 months of inventory on hand, up a little from the end of September. The price category in shortest supply is <$120K where we have 2.3 months. All price points up to $400,000 have a 4 month’s supply. Above $400,000 the supply is greater than five months.  Remembering that six months of available inventory describes a “stable real estate market”; it looks like we are heading into a period of “normal” like we haven’t seen in several years. Of sales in October, the most popular price point was $120,000 to $160,000 (21%); followed in a near dead heat by $160,000 to $200,000, $200,000 to $250,000 and $300,000 with 17% each. So…what’s next? The only thing we’re sure of right now is that we’re not really sure of anything.  At the NAR Convention last week, Boise was singled out as one of the nation’s “bright spots” for 2014. What does that mean?  It means that we are more likely than most to continue with strong sales, improving median price and sustainable inventory levels.  Couple those with better employment and our quality of life and we come out on top every time. I’m sticking by my median price projection of between $195K and $200K for the year.

 

National Sale by Price Points

Importance of Curb Appeal

This graphic offers some very on the mark suggestions for making your house look it's very best and correspondingly bring the most return.

Buying or Selling: Now May Be The Time

As we enter the winter months, many expect the real estate market to begin to slow down. However, this winter there are many reasons that both buyers and sellers should consider moving forward with their real estate goals instead of waiting until the spring.

BUYERS

Waiting until the spring will probably mean increases in the two elements that determine the cost of purchasing a home: home prices and mortgage rates.

SELLERS

A seller will get the best price when demand is high and inventory is low. Demand will remain strong throughout this winter (see above) while inventory historically shrinks this time of year.

 

When the Neighborhood was Built!

This is a fascinating way to visualize when various regions across the U.S. first got developed.

Seth Kadish at the blog Vizual Statistix has put together this map showing when the plurality of homes in any given county were built.

So, for example, in the bright, off-yellow counties, more homes were built pre-1930s than in any other period.

As you can see, in the West and in the Southeast, you actually have many counties where more homes were built post 1990s than in any other period.

It's also fascinating to see the pockets out West that haven't been crazily developed recently, and where the homes remain very old, such as parts of Oregon and Texas.



Read more: http://www.businessinsider.com/when-houses-in-your-neighborhood-were-built-2013-10#ixzz2jJdZc5c5

 

Pending Home Sales Down

Pending home sales declined in September for the fourth month in a row, a signal to expect lower home sales this quarter and a flat trend going into next year, a trade group said Monday.

The pending home sales index, a forward looking indicator, fell 5.6% to 101.6 in September from a downwardly revised 107.6 in August and is 1.2% below last year's level, the National Association of Realtors says.

That the index is lower than last year marks the firs time that's occurred in 29 months, NAR says.

"This tells us to expect lower home sales for the fourth quarter," says Lawrence Yun, NAR chief economist. Even so, he expects prices to continue to rise, but at a slower pace -- echoing expectations of many housing watchers and other economists.

Higher mortgage interest rates and home prices curbed consume buying power, NAR says. The government shutdown also played a role, as government and contract workers were on the sidelines.

 

Reality TV is not really reality!

Have you ever watched those house buying shows on TV? My wife watches occasionally and I will come in and see a bit and it drives me crazy! It is certainly not life as I know it. So if you came to buy a house, and I tell you you I will let you choose out of 3 homes, how would that go over? Or you tell me you have a maximum budget of $300,000, and I proceed to show a house priced at $395,000?

And while I am on that subject of reality, all the automatic house payment calculators out there which fail to include taxes, hazard insurance and mortgage insurance. Or the on-line house value estimators, yes Zillow I am talking about you, which many times are not even in the right ball park.

I found this graphic from the KCM Blog that compares some of the myths vs. reality.

Bottom Line: Reality TV may be entertaining, but it is not reality! (And online payments and values can give some background but ask a professional before you start making a decision.)

Vacancy Report

The 3rd Quarter vacancy rates are in and it looks like a good solid market for landlords, many people have considered it over the years, perhaps now is the time to jump in!  I thank Park Place Property Management for the following charts.



 

Forbes: Buy Now or Pay More Later?

Even though no one at KCM actively lists or sells real estate, some of our readers believe that there is an inherent basis toward the real estate community in our writing. For that reason, we want to quote a third party source today.Forbes, in their online edition last week, spoke to the importance of buying a home now rather than waiting.

The article, Should You Buy a Home Now or Pay More Later?, explains:

“With mortgage rates creeping up toward 5% as 2013 draws to a close, potential home buyers have some decisions to make — and soon.

The danger for potential homebuyers isn’t that mortgage rates are nearing 5.00%; the real threat is that rates could go higher, to 5.50% or even 6.00% in 2014.”

The article spells out the financials consequences a buyer would face by waiting. ($67,746 on a $300,000 mortgage).

They gone on to identify four things a buyer should take into consideration before delaying a decision to purchase.

1. Rates will likely rise — and soon with 5% interest rates right around the corner.


2. The Federal Reserve will stop “tapering” causing rates to return to historically normal levels (6-7%).


3. Home values are rising


4. The autumn buying season is underrated “as you can take advantage of year-end tax breaks and the fall weather makes it an ideal time to move”.

Bottom Line

The financial advice Forbes gave to their readers was rather simple. Buy now or pay more later!!

Thanks to KCM Blog for this timely advice, and to Forbes. If you are ready to head the advice, give me a call or shoot me an email and I'll get searching for your new home TODAY!

 

10 Hidden Hazards When Buying Foreclosures

I have sold several foreclosures over the past few years, and buyer's have generally been pleased with their purchases with a minimum amount of surprises. (Some surprises never the less!) But one must always use caution and do their due diligence. The following article from KCM Blog lists 10 potential hazards of which a foreclosure should be aware.

10 Hidden Hazards When Buying Foreclosures  Buying a foreclosed home can seem like a dream. What could be better than getting a home for a fraction of the market value? Some may even say that the deals sound like they could be too good to be true. In some cases, those doubters aren't too far off the mark. There are some hidden dangers in buying foreclosure properties that, if you're not aware of them, could be disheartening and disappointing. If you are pursuing this route in buying your new home, be sure to look out for these hazards and hidden costs. Destruction of Property – A sad truth about foreclosure properties is that they have often been purposely destroyed. Sometimes the homeowners do this out of frustration over losing their homes, or out of simple carelessness when they realize their home is irretrievably gone after too many missed mortgage payments. If the homeowners have not destroyed the property themselves, there is also a chance that the home has been vandalized by other people because it has been left sitting empty. Poor Maintenance – If homeowners were unable to afford their mortgage payment, they almost certainly were unable to perform routine maintenance on the property. Problems can be as minor as a few leaky faucets, or as major as damaged roofing or central units. It May Be Unclean – A house being left unoccupied for a significant amount of time can mean it will be unclean, either through neglect on the part of the former owners or normal depreciation as the property is left uninhabited and not looked after. When a homeowner is selling the home, they will scrub the house clean or hire a cleaning service to entice buyers. A foreclosed home will not have this benefit. Depending on how long it was left and what condition it is in, there may even be vermin or termites to deal with. Undesirable Renovations – Sometimes homeowners were in the middle of a renovation when they lost their ability to pay their mortgage, so you can wind up with a half finished project on your hands when you purchase the property. There is also a chance that a garage or basement was turned into a living space to rent out in order to try and offset the cost of the mortgage. No Electricity – There is a good chance the electricity will be off in the foreclosed home, so you will have a hard time seeing what you are buying. Depending on the weather it may also be very hot or very cold in the house, and vacancy can take its toll on appliances left behind. Personal Property Left Behind – Many homeowners leave items behind, either because they now have no place to put them or because they were locked out of the house before they could retrieve them. You will now be left with the job of disposing of these items if you decide to purchase the property. Lack of Landscaping – More than likely, nobody has been maintaining the lawn of a foreclosed home. You may have a yard full of dead grass or a lawn so overgrown it seems like a jungle! Your foreclosed home will almost certainly require some degree of upkeep when it comes to to the landscaping surrounding the structure. No Disclosure – Because the owner of the property is a bank and the bank has not actually lived in the house, they have no idea what problems or issues there may be in the home and they have no obligation to tell you even if they did. You will have to get your own home inspection done to uncover potential issues. Stripped Bare – You may find your new foreclosed home completely stripped of appliances, copper piping, and anything else that might be worth money. Many times the previous owners do this to try and make back some money on their lost home. Other times, the home was broken into and robbed after the previous owners left. Judgments and Liens – Foreclosure properties can sometimes come with titles encumbered by judgments or liens that you may have to pay off to close on the deal. In short, buying a foreclosed property can be a great way to save money. However, be sure to look into all the potential costs involved before making a final decision. Do the math to determine if you will really wind up saving, or if the property will end up costing you when all is said and done.

 

 

TO DO LIST-when buying a home.

Keep ALL copies of your: Paystubs Bank Statements Tax Returns W2's Make ALL your payments on time Keep employment stable Document your assets Get Pre-Approved so you know how much home you can afford Save money for your down payment and closing costs Talk to your family about a gift if you will need one. If necessary, ask family members for gift funds for your down payment and closing costs Track and be prepared to provide sources of all large deposits Work with a reputable real estate professional

I found this to be a brief but useful reminder. Thanks to Sohayl Saboori of Eagle Home Mortgage.

Strategic Defaulters in Fannie and Freddie's Crosshairs

Fannie Mae and Freddie Mac are looking to collect unpaid mortgage debt from “strategic defaulters,” those underwater home owners who skipped out on their mortgages even though they had the ability to pay.

If a home is sold at foreclosure but the proceeds don't cover the outstanding balance of the home owner's loan, the mortgage giants can pursue judgments against the home owner forcing him or her to pay the deficiency. And the Federal Housing Finance Agency, which regulates Fannie and Freddie, is pushing them to step up their efforts to do just that.

The FHFA says Fannie and Freddie haven’t been aggressive enough in going after strategic defaulters, and the inspector general's office notes that the GSEs could cut their losses by making it more of a priority. The inspector general’s office estimates that Fannie and Freddie could recoup billions of dollars if they made strategic defaulters pay up. So far, the office has found that Freddie Mac did not refer 58,000 foreclosures — estimated deficiencies of $4.6 billion — for collection.

Some states do not allow deficiency judgments, but in more than 30 states and the District of Columbia, they are permissible. The FHFA says it will more closely monitor how effective Fannie Mae and Freddie Mac are in collecting deficiency judgments.

What I read was that Idaho allows deficiency judgements, BUT they must be filed within 90 days of the foreclosure. (I am not an attorney and am only repeating what I have read, I do not know if it is accurate and you are encouraged to consult an attorney if this may apply to you.) So you should beware if you are looking at a coming up short-sale or foreclosure and you have the ability to pay the debt.

Roofs, Random Thoughts

I am going to have a new roof put on my house in the next couple of weeks.

OUCH! New roofs are expensive, that is the first thing I learned.

Building codes only allow a maximum of two layers, which my roof already has, so that makes it even more expensive. (Which was the 2nd thing I learned.)

Prices, even between reputable firms vary drastically, it can pay to shop around. (Lesson #3?)

I happened to receive an email on vent problems in a roof from Dave Thomsen Inspections, I thought I 'd include those as well.

As with any other system, roof venting may have been installed incorrectly, may not have enough area, may have been rendered inoperable by changes to the home, or may have been badly modified by the homeowner in an attempt to save energy.  Such problems include: a lack of vents. It is not uncommon to see a complete lack of ventilation. In these cases, the high temperatures within the roof covering will induce a rapid breakdown of the materials. This not only affects asphalt shingle roofs, but also flat and tile roofs that use roll roofing as the primary water barrier. It is also common to find high levels of moisture in these attics, which promotes moisture-related issues, such as rotting sheathing and mold growth. blocked vents. Very often, inspectors will see instances of poorly installed insulation blocking the soffit and other vents. These should be reported as in need of repair. false vents. It is all too common to see what appear to be vents installed that are, in fact, not connected through the structure.  Inspectors will sometimes see instances of ridge vents apparently installed, but the roofers did not trim back the roof sheathing along the roof's peak to allow the vents to actually work. I have vents currently, but all the roofers I obtained bids from are increasing the number of vents.

The inspection on one of my last sales revealed possible mold in the attic due to the bathroom being vented into the attic instead of outside. The listing agent indicated she had found that on several homes built by a particular builder. YIKES

So keep a good roof over your head, ya hear!

Why You Should Sell Your House Now

Several valid things to consider for our area as well as nationally! Posted: 15 Oct 2013 04:00 AM PDT Many now realize that it is a great time to buy a home.  It might also be an opportune time to sell your house.  Here are the five reasons we believe now may be a perfect time to put your house on the market. 1. Demand Is High The most recent Existing Home Sales Reports by the National Association of Realtors (NAR) show a double digit percent increase in sales year-over year; sales have remained above last year’s levels for over 25 months.  There are buyers out there right now and they are serious about purchasing. 2. Supply Is Beginning to Increase Total housing inventory is again approaching historic norms of a 5 month supply compared with 4.3 months in January.  Many expect inventory to continue to rise as 3.2 million homeowners escaped the shackles of negative equity in the last 12 months and an additional 1.9 million are expected to enter positive equity in the next 12 months.  Selling now while demand is high and before supply increases may garner you your best price. 3. New Construction Is Coming Back Over the last several years, most homeowners selling their home did not have to compete with a new construction project around the block.  As the market is recovering, more and more builders are jumping back in.  These ‘shiny’ new homes will again become competition as they are an attractive alternative for many purchasers. 4. Interest Rates Will Again Rise Although Freddie Mac’s Primary Mortgage Market Survey shows that interest rates for a 30-year mortgage have softened recently, most experts predict that they will begin to rise later this year.  The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison projecting that rates will be up almost a full percentage point by this time next year. Whether you are moving up or moving down, your housing expense will be more a year from now if a mortgage is necessary to purchase your next home. 5. It’s Time to Move On with Your Life Look at the reason you are thinking about selling and decide whether it is worth waiting.  Is the possibility of a few extra dollars more important than being with family; more important than your health; more important than having the freedom to go on with your life the way you think you should? You already know the answers to the questions we just asked.  You have the power to take back control of your situation by putting the house on the market today.  The time may have come for you and your family to move on and start living the life you desire.  That is what is truly important.

COURTESY OF KCM BLOG

Homeownership and Net Worth

Over the last five years, homeownership has lost some of its allure as a financial investment. As homeowners suffered through the housing bust, more and more began to question whether owning a home was truly a good way to build wealth. A recentstudy by the Federal Reserve formally answered this question.

Some of the findings revealed in their report:

• The average American family has a net worth of $77,300


• Of that net worth, 61.4% ($47,500) of it is in home equity


• A homeowner’s net worth is over thirty times greater than that of a renter


• The average homeowner has a net worth of $174,500 while the average net worth of a renter is $5,100

Bottom Line

The Fed study found that homeownership is still a great way for a family to build wealth in America.

 

Ada County in Pictures! (September Market Report That Is!)

Yesterday I published the Ada County Market report, for those of you who like the look of graphs better, today is for you.

Home sales, inventory levels and median prices are all up.

September Housing Market Summary…are you people in Washington really going to mess this up?

Single family home sales in September 2013 were 683 in Ada County, an increase of 20% compared to September 2012. Year-to-date sales are 6,187; up 11% over 2012 YTD sales of 5,266.  NAR data says that for every home sold, $60,000 is added to the local economy.  Based on our sales volume, we have added $371 Million to our local economy so far this year. Dollar volume for September was up 35% to $161 million and YTD we are just over $1.4 billion in sales. Days on market averaged 46 in September, no change from August.  Our year-to-date average is 51 days. New homes sold in September totaled 129, the same number as sold in September 2012. Historically, September sales decrease from August.  This year is no different as September 2013 sales decreased 18% compared to August 2013. Of the total sales in September, 9% were distressed; down 2% from last month. In September 2012, 21% of sales were distressed. Pending sales at the end of September were 949; down 12% from August 2013. Of Pending sales in distress (12%), short sales outnumbered REO’s 2 to 1. At the end of September, we had 15% fewer sales pending than at the end of September 2012. This is the second consecutive month in which we’ve seen a decline in pendings relative to the previous year. This is a key number to monitor moving forward. Unfortunately, it does appear that the government shutdown will have a chilling effect on sales. September median home price was $194,500; up 11% from September 2012. According to NAR’s most recent report; national median price is $212,000. New Homes median price for September was $268,548; up 12% from September 2012. For Existing homes the increase is 14%. The number of houses available for sale at the end of September increased 4% from August 2013 to 2,640.  This is 22% more than last year at this time. Since January we have increased the number of single family homes for sale by 54%, allowing us to grow our YTD sales increase. Of the total active listings, 10% are distressed, down 1% from the end of August 2013. With inventory increasing and the percentage of distressed inventory decreasing, median home price will remain strong through the end of this year. Of our Distressed Inventory, 73% is Short Sales (182) and 27% is REO (67). Available inventory increased at all price points except in the +$450K range.  The price range adding the most homes to the market is $120,000 to $160,000, with an increase of 34 homes. In Ada County we now have 3.2 months of inventory on hand, up a little from the end of August. The price category in shortest supply is <$120K where we have 1.9 months. All price points up to $500,000 have a 4 month’s supply. We’ve left behind the Summer of ’13 and its highest sales and median prices of the year.

 

Buyers-Window of Opportunity Still Open

Yesterday I spoke of knowing where we are "headin." Here is some additonal projections about where the mortgage rates will head. The Fed recently announced they would contiue to purchase bonds, which eased the upward pressure on mortgage rates.

The Fed recently announced they would continue their current pace of purchasing bonds until the economy was stronger. This bond purchasing program is the reason that mortgage interest rates are at historic lows. Rates began to increase over the last several months just on the anticipation that the Fed would announce that they would be reducing the level of bond purchases last month. When that didn’t happen, rates actually decreased (4.50 to 4.37).

That was great news for any buyer in the process of purchasing a home. However, this window of opportunity is expected to close in the very near future as most experts expect the Fed to taper the bond purchasers in December. Even Ben Bernanke, Chairman of the Fed, suggested that the Fed could still scale back the stimulus this year. He stated:

"If the data confirms our basic outlook, then we could move later this year.”

Where will mortgage rates head in 2014?

The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors have each projected that the 30 year fixed rate mortgage will have interest rates in excess of 5% by this time next year. The average of their four projections is 5.3%. The table below shows the impact this will have on the monthly principal and interest payment on a $250,000 mortgage:

A buyer should take advantage of the current window of opportunity before it is too late.

Give me a call today, to get started finding your home before the window closes!

 

Where are we going?

This is a song from the old musical, "Paint your Wagon." The lyrics go something like this: Where am I goin?/I don't know./ Where am I headin?/I ain't certain./ All I know am I am on my way.

There is also a quote from Voltaire stating: "I don't know where I am going, but I am on my way."

We may not know where the housing market is going but we are on our way. But there are folks who predict where we are" headin." The National Association of Realtors predict the following.



 

 

 

 

Skip the Bagel!!

Today’s InfoGraphic courtesy of our great friend Dave Savage from Mortgage Coach.

 

The KCM Blog - Housing Inventory Making a Comeback

The shortage of homes for sale earlier in the year created an imbalance of supply to demand which resulted in double digit year-over-year price increases nationally. According to a recent Wall Street Journal article, the inventory of homes for sale is now beginning to reach more normal levels. The article reported:

“Housing inventories increased in August and stood just 2.5% below their levels of a year ago, offering the latest sign that more sellers are testing the market after swift home-price gains over the past year.

Nationally, there were 1.98 million homes listed for sale in August, according to a report released Thursday byRealtor.com. That was up by more than 24% from the low point in February and up 1% from July. Inventories have increased for six straight months.”

What about Home Prices?

This doesn’t mean prices will collapse. The inventory levels are still depressed, just improving. As the article mentions:

“While the overall level of homes for sale remains relatively depressed, the report suggests that inventory may have hit a bottom earlier this year after an extended two-year decline.”

However, as we mentioned last week, properly pricing your home in this market can be tricky. You should depend on the advice of your real estate agent.

 

August Market Report…the Perfect End of Summer Party Favo

By Marc Lebowitz, RCE, CAE Executive Director, Ada County Association of REALTORS® Single family home sales in August 2013 were 812 in Ada County, an increase of 12% compared to August 2012. Four months in a row above 800!!!  We sure haven’t seen that in a while.  Actually you have to go back to the summer of ’06. Year-to-date sales are 5,490; up 17% over 2012 YTD sales of 4,696.  NAR data says that for every home sold, $60,000 is added to the local economy.  Based on our sales volume, we have added $329 Million to our local economy so far this year. Dollar volume for August was up 28% to $193 million and YTD we are just over $1.2 billion in sales. Days on market averaged 46 in August, two days more than last month.  For the first six months the average was 52 DOM. New homes sold in August totaled 152, one more than the total new homes sold in August 2012. Historically, August sales increase 2% over July, but August 2013 sales decreased 8% compared to July 2013. Of the total sales in August, 11% were distressed; no change from last month. In August 2012, 21% of sales were distressed.  In August 2013 45% of distressed properties were REOs (40) and 55% were short sales (49). In August 2012 we experienced significant improvement in the health of distressed property sales – only 21% compared to 44% in 2011.  We are now seeing distressed properties reduced by almost half again. Pending sales at the end of August were 1,071; down 14% from July 2013. Of Pending sales in distress (12%), short sales outnumbered REO’s 2 to 1. At the end of August, we had 4% fewer sales pending than at the end of August 2012. This is the first time this year we’ve seen a decline in pendings relative to the previous year. This is a key number to monitor moving forward. August median home price was $201,992; up 12% from August 2012. For the first time since 2008, the medium home price has been over $200,000 for three consecutive months. According to NAR’s most recent report; national median price is $213,500.  We continue to outpace the national housing recovery. New Homes median price for August was $283,004; up 26% from August 2012. For Existing homes the increase is 12%. The number of houses available for sale at the end of August increased 4% from July 2013 to 2,456.  This is 14% more than last year at this time. Since January we have increased the number of single family homes for sale by 48%, allowing us to grow our YTD sales increase. Of the total active listings, 12% are distressed, down 2% from July. With inventory increasing and the percentage of distressed inventory decreasing, median home price will continue to strengthen well into the third quarter. Of our Distressed Inventory, 73% is Short Sales (207) and 27% is REO (76). Available inventory increased at all price points except in the <$120K range; which decreased by 14%. The price range adding the most homes to the market is $160,000 to $250,000, with an increase of 30 homes. In Ada County we now have 2.9 months of inventory on hand, up a little from the end of July. The price category in shortest supply is <$120K where we have 1.7 months. All price points up to $500,000 have a <4 month’s supply. We’ve left behind the Summer of ’13 and its highest sales and median prices of the year.  The question now is, as it was to Newton (“Laws of Motion”), how far into the future the momentum will carry us. Based on year-to-date performance, it’s likely we will finish the year with more than 8,000 total homes sold, which would represent an 11% increase is sales year over year. Median home prices will likely stabilize in the $195K to $200K price range for the fourth quarter.

 

Reasons to Sell NOW!

Thinking of Selling Your House? 5 Reasons to Do it Now Posted: 10 Sep 2013 04:00 AM PDT   Many now realize that it is a great time to buy a home. Today, we want to look at why it might also be an opportune time to sell your house. Here are the Top 5 Reasons we believe now may be a perfect time to put your house on the market. 1.) Demand Is High The most recent Existing Home Sales Report by the National Association of Realtors (NAR) showed a 17.2 percent increase in sales over July 2012; sales have remained above year-ago levels for 25 months. There are buyers out there right now and they are serious about purchasing. 2.) Supply Is Beginning to Increase Total housing inventory last month rose 5.6% to 2.28 million homes for sale. This represents a 5.1-month supply at the current sales pace, compared with 4.3 months in January. Many expect inventory to continue to rise as 3.2 million homeowners escaped the shackles of negative equity in the last 12 months and an additional 1.9 million are expected to enter positive equity in the next 12 months. Selling now while demand is high and before supply increases may garner you your best price. 3.) New Construction Is Coming Back Over the last several years, most homeowners selling their home did not have to compete with a new construction project around the block. As the market is recovering, more and more builders are jumping back in. These ‘shiny’ new homes will again become competition as they are an attractive alternative for many purchasers. 4.) Interest Rates Are Rising According to Freddie Mac’s Primary Mortgage Market Survey, interest rates for a 30-year mortgage have shot up to 4.57% which represents a jump of more than a full point since the beginning of the year. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison projecting that rates will continue to climb. Whether you are moving up or moving down, your housing expense will be more a year from now if a mortgage is necessary to purchase your next home. 5.) It’s Time to Move On with Your Life Look at the reason you are thinking about selling and decide whether it is worth waiting. Is the possibility of a few extra dollars more important than being with family; more important than your health; more important than having the freedom to go on with your life the way you think you should? You already know the answers to the questions we just asked. You have the power to take back control of your situation by putting the house on the market today. The time may have come for you and your family to move on and start living the life you desire. That is what is truly important.

 

14,767 Houses Sold Yesterday! Did Yours?

There are some homeowners that have been waiting for months to get a price they hoped for when they originally listed their house for sale. The only thing they might want to consider is…

If it hasn’t sold in this hot market, maybe it’s not priced properly.

After all 14,767 houses sold yesterday, 14,767 will sell today and 14,767 will sell tomorrow. 14,767!

That is the average number of homes that sell each and every day in this country according to the National Association of Realtors’ (NAR) latest Existing Home Sales Report. NAR reported that sales had increased 17.2% over the year before. According to the report, annualized sales now stand at 5.39 million. Divide that number by 365 (days in a year) and we can see that, on average, almost 15,000 homes sell every day.

We realize that you want to get the fair market value for your home. However, if it hasn’t sold in today’s surging real estate market, perhaps you should reconsider your current asking price.

 

Fannie Mae's Crystal Ball

 

The KCM Blog - The COST of a Home: Last Year, This Year & Next Year

The COST of a Home: Last Year, This Year & Next Year Posted: 26 Aug 2013 04:00 AM PDT   The cost of a home is determined mainly by two components: price and mortgage rate. Today, we want to show how the monthly cost of purchasing a median priced home has changed over the last twelve months and how it might change over the next twelve months. For the first two examples, we will be using the National Association of Realtors’ (NAR) Existing Home Sales Report to establish median price and Freddie Mac’s Primary Mortgage Market Survey to establish mortgage rate. We also assumed a 20% down payment in all examples. LAST YEAR The median priced home in the country was selling for $187,800. The 30-year fixed mortgage rate was at 3.5%. Here is what it would cost to buy a home last year: TODAY The median priced home in the country is selling for $213,500. The 30-year fixed mortgage rate is at 4.5%. Here is what it would cost a purchaser to buy a home today: The monthly cost increased by: $190.78! NEXT YEAR Projecting into the future in real estate can be rather tricky. To establish future pricing, we depended on the over 100 housing experts surveyed for the Home Price Expectation Survey who called for an approximate appreciation rate of 5% over the next twelve months. For the interest rate, we took the average of the projections from the Mortgage Bankers’ Association, Freddie Mac and Fannie Mae. Here is what these experts project will be the approximate cost of a home a year from now: The monthly cost will increase by about: $97.32! Bottom Line From a financial perspective, why wait if you are thinking about buying?

 

Past Bankruptcy, Short Sale or Foreclosure? Time to Buy?

New guideline released by HUD may result in you being able to buy a house again sooner ranter than later. I am including a introduction below. If you think this might help you, contact me for a good lender to consult with.

HUD recently announced that people who lost their home through a foreclosure, short sale or bankruptcy, may be eligible to finance a home again in as little as 12 months. This is a reduction from the previously required minimum of 36 months from the date of the “most recent event.”

Released August 15, HUD provided guidelines under “Back to Work – Extenuating Circumstances” meant to ease the path for home ownership for many.

Boomerang  homebuyers, as they are now known, will need to document that the reason they were unable to make their payments was due to a specific Economic Event.  This impact of this event must have resulted in a decline in income of 20% or more for at least six months.

Some boomerang homebuyers who experienced a bankruptcy and simultaneous foreclosure have discovered that the two events may not be recorded at the same time. In cases where the property did not transfer back to the lender at the time of the bankruptcy, the period for the 36 month minimum waiting period as was required by HUD, did not start until the title transferred back to the lender.  In some states, the time for transfer could be months or even years after the discharge of the bankruptcy.

Extenuating Circumstances

Extenuating circumstances for the purpose of these guidelines are as follows. The borrower(s) must have experienced a decline in income of 20% or more for a period of at least six months. This could have been due to a job loss or a loss of income tied to earnings like commissions or other customary bonus or incentive income.

Demonstrated Cure

With any situation of extenuating circumstances, a boomerang homebuyer must be able to document that the event was isolated in nature and not likely to reoccur again in the future. The borrower must also be able to document that they have regained economic stability through timely payments for a minimum of 12 months.

The timely payment history will include rental/mortgage payments, installment payments, and/or revolving payments for the 12 months preceding the mortgage application. There also should not be any new collection accounts.

In addition to re-establishing acceptable credit, the borrower(s) will be required to complete Housing Counseling.

Eligibility Requirements for Documenting Loss of Income

In the event of a loss in employment, the lender will need to document the event by a written Verification of Employment evidencing the termination date, public information documenting the closure of the business if applicable and/or documentation of unemployment income.

The lender will also need to substantiate the loss of income through the verification of tax returns, W-2s and tax transcripts.

Important Definitions

HUD announced several key terms that must be reviewed in accordance with this program.

Economic Event: an occurrence beyond the borrowers control that resulted in a Loss of Employment, Loss of Income or a combination of both which resulted in a loss of Household Income of 20% or more for a period of six or more months.

Onset of Economic Event: the month of the start of or loss of income

Recovery from an Economic Event: the re-establishment of acceptable or satisfactory credit. Satisfactory Credit equates to no derogatory credit for any mortgaged or leased property in the 12 months preceding the mortgage application. This also includes any installment or revolving debt for the same period.

Borrower: “Borrower” includes all parties including primary and/or co-borrower as listed on the loan application.

Borrower Household Income: the income of all parties on the application or Household Members as listed from the previous Economic Event and derogatory credit.

Housing Counseling: Counseling from a HUD-approved housing counseling agency related to home ownership and meets acceptable requirements.

Other Requirements and Information

HUD establishes a base line for lenders to underwrite and approve mortgage applications. Some lenders may choose to require baseline standards that exceed the minimum guidelines listed here with regards to time from short sale, foreclosure or bankruptcy.

Lenders may also choose to enact additional overlays with requirements to evaluation acceptable credit regarding payment history, collection accounts and/or judgments.

In the event a prior defaulted mortgage was endorsed by FHA, the lender will need to request a waiver which may require additional time for processing. For anyone this pertains to, they would be wise to alert the new lender to this as soon as possible in the loan process.

Boomerang homebuyers whose prior hardship was economically driven should be excited by this announcement from HUD. For many, it is now recognized the worst is behind them and the time to buy a new home is here.