TALLAHASSEE, Fla. – April 19, 2011 – A $1 billion program expected to help 40,000 Floridians stave off foreclosure opened statewide Monday, setting off a first-come, first-served rush for government-aided mortgage payments.
The Florida Hardest Hit Fund program, administered by the Florida Housing Finance Corp., is designed to aid unemployed homeowners by paying their mortgages for up to six months, or helping them get caught up on as much as $6,000 in past due payments.
“For the homeowners who qualify, this temporary relief from their mortgage payments will provide some ‘breathing room’ so they can focus on becoming re-employed at a level that will allow them to resume making payments on their own,” Steve Auger, executive director of Florida Housing, said in a statement.
Housing agencies and homeowner help centers reported lots of interest and few hiccups with the online-only application process.
“Needless to say, people were waiting by their computers this morning and have been busy all day,” said Reg Froese, director of homeownership preservation for Neighborhood Housing Services of South Florida.
By midday Monday, about 50 program applicants were referred to NHSSF by Florida Housing, which hands over completed applications to several housing agencies across the state. NHSSF also had about 70 applicants waiting to get help with the program before it launched statewide, Froese said.
Florida Housing spent five months monitoring and tweaking the program during a pilot run in Lee County.
After the pilot, the program parameters and requirements changed. The amount of aid available to homeowners was reduced and participants are now required to contribute at least $70 each month towards their mortgage.
A spokeswoman for Florida Housing said it was too early to gauge the level of interest on the first day of the program’s launch, but data on the number of applications received would be available Friday.
In order to qualify, a homeowner must be unemployed or underemployed, and must be no more than six months behind on mortgage payments. The program is only for primary, or “owner-occupied,” residences.
In South Florida, where unemployment remains in the double-digits, and hundreds of thousands of mortgages are delinquent, interest in the program is likely to be high until the $1 billion in funding runs out.
Ray Payano, a Cutler Bay homeowner who lost his job last year and fell behind on mortgage payments before starting his own business, said he was preparing to apply for the program on Monday.
“I haven’t had a chance to do it yet, but I plan to fill out the application,” he said.
For more information, or to apply, visit www.flhardesthithelp.org. (Peggy: Link this one.)
Copyright © 2011 The Miami Herald, Toluse Olorunnipa. Distributed by McClatchy-Tribune Information Services.
Wednesday, April 20, 2011
Friday, April 1, 2011
Top 6 cities where buying beats renting
ORLANDO, Fla. – March 30, 2011 – Cities hard-hit by the housing market crash now offer some of the best buys in real estate – places where it makes more sense to buy than rent, according to a new report from Deutsche Bank. The study measured affordability by the share of income that residents pay to own a home, as well as the cost of owning vs. renting.
Here six cities that topped Deutsche Bank’s list.
1. Atlanta
Rent as a percent of after tax mortgage payment: 151.2 percent
Median home price change, 2006-2010: -33.2 percent
In Atlanta, the average monthly rent is about 50 percent more than the average after-tax mortgage payment. Plus, home prices in Atlanta have dropped nearly 14 percent year-over-year in February, creating a great opportunity for buyers to cash in.
2. Orlando
Rent as a percent of after tax mortgage payment: 137.2 percent
Median home price change, 2006-2010: -51.3 percent
Orlando saw a larger drop in home prices during the past year than any of Florida’s other metro areas, according to a Florida Realtors® report cited by the Orlando Sentinel.
3. Rochester, N.Y.
Rent as a percent of after tax mortgage payment: 136 percent
Median home price change, 2006-2010: 3.6 percent
While housing prices in Rochester – the second-largest economy in New York State – inched up slightly between 2006 and 2010, the city still favors homeownership over renting.
4. Cleveland
Rent as a percent of after tax mortgage payment: 132.6 percent
Median home price change, 2006-2010: -14.8 percent
It costs about 24 percent less to buy a home in Cleveland than it does to rent.
5. Tampa-St. Petersburg
Rent as a percent of after tax mortgage payment: 131.6 percent
Median home price change, 2006-2010: -41.4 percent
Tampa-St. Petersburg was one of the most overbuilt areas during the housing boom, and it ranks ninth in the country for foreclosures. But it’s still an attractive spot for retirees, and with dropping home prices it’s now more affordable to own than rent here.
6. Las Vegas
Rent as a percent of after tax mortgage payment: 125.1 percent
Median home price change, 2006-2010: -56.5 percent
Empty homes and condos blanket Las Vegas, but a comeback is in sight. More than half of sales in Las Vegas are from cash buyers, signaling investors have re-emerged. A strong rental market also means renting out properties still offer a good return.
Source: “10 best cities for home buyers,” CNNMoney.com (March 28, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
Here six cities that topped Deutsche Bank’s list.
1. Atlanta
Rent as a percent of after tax mortgage payment: 151.2 percent
Median home price change, 2006-2010: -33.2 percent
In Atlanta, the average monthly rent is about 50 percent more than the average after-tax mortgage payment. Plus, home prices in Atlanta have dropped nearly 14 percent year-over-year in February, creating a great opportunity for buyers to cash in.
2. Orlando
Rent as a percent of after tax mortgage payment: 137.2 percent
Median home price change, 2006-2010: -51.3 percent
Orlando saw a larger drop in home prices during the past year than any of Florida’s other metro areas, according to a Florida Realtors® report cited by the Orlando Sentinel.
3. Rochester, N.Y.
Rent as a percent of after tax mortgage payment: 136 percent
Median home price change, 2006-2010: 3.6 percent
While housing prices in Rochester – the second-largest economy in New York State – inched up slightly between 2006 and 2010, the city still favors homeownership over renting.
4. Cleveland
Rent as a percent of after tax mortgage payment: 132.6 percent
Median home price change, 2006-2010: -14.8 percent
It costs about 24 percent less to buy a home in Cleveland than it does to rent.
5. Tampa-St. Petersburg
Rent as a percent of after tax mortgage payment: 131.6 percent
Median home price change, 2006-2010: -41.4 percent
Tampa-St. Petersburg was one of the most overbuilt areas during the housing boom, and it ranks ninth in the country for foreclosures. But it’s still an attractive spot for retirees, and with dropping home prices it’s now more affordable to own than rent here.
6. Las Vegas
Rent as a percent of after tax mortgage payment: 125.1 percent
Median home price change, 2006-2010: -56.5 percent
Empty homes and condos blanket Las Vegas, but a comeback is in sight. More than half of sales in Las Vegas are from cash buyers, signaling investors have re-emerged. A strong rental market also means renting out properties still offer a good return.
Source: “10 best cities for home buyers,” CNNMoney.com (March 28, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
Renters need insurance, too,
WASHINGTON – March 30, 2011 – A majority of renters might be overestimating just how much their landlord is responsible for when it comes to insurance.
Only 43 percent of renters in 2006 had insurance, compared with 96 percent of homeowners, according to a 2006 poll by the Insurance Research Council.
Most apartment dwellers aren’t being intentionally irresponsible on this front but simply don’t know that they need it, says Jeanne Salvatore, senior vice president of public affairs at the organization.
“Tip No. 1 for a renter is simply to get the insurance,” says Salvatore.
A few popular misconceptions are the culprits behind renters forgoing coverage for the belongings in their home, industry experts say.
“People say, ‘I don’t think I have a lot of stuff. I don’t want to pay money to insure it.’ They don’t think it’s very valuable,” says Amy Danise, senior managing editor of Insure.com.
But even the sparsest of apartments could have at least $1,000 worth of stuff counting things such as a bed, computer and clothing items. “It would really be a financial disaster to renters to lose all of your things in something like a fire and not have insurance for it. That kind of financial blow can affect you for the rest of your life,” she says.
Many renters also wrongfully assume they fall under the protection of their landlord’s insurance, Salvatore says. Landlord policies would take care of the actual building and common areas in the case of a disaster, but not the belongings of the tenants.
Unlike homeowners, renters policies don’t come with an automatic percentage for covering possessions, leaving the tenants the choice of determining the appropriate amount of coverage.
Renters should photograph belongings and tally up their value to make sure the policy would take care of replacing everything they own.
Beyond the loss of personal possessions, a renter could face litigation if a guest gets hurt in the apartment and the renter is at fault. Renters insurance policies offer liability coverage in much the same way that homeowners policies do, and even cover medical costs.
“If you have a party, and somebody trips on your rug and has to go to the hospital and get an X-ray, they can file a claim and don’t have to sue you,” Salvatore says.
The immediate survival expenses can quickly add up if a fire or other mishap displaces a renter. A renters insurance policy will cover additional living expenses, such as essentials you need to buy and other living expenses that surpass your typical rental costs, Salvatore says.
Renters insurance can cover a lot, but it doesn’t actually cost much. Average costs for the coverage ran about $176 in 2008.
“That’s probably a fancy coffee drink a week,” says Salvatore. So forgo the Starbucks and put the money into one of these policies, which can typically be purchased from the same provider of your auto coverage.
“It’s a small amount to pay for peace of mind,” says 61-year-old Suzette Eaddy of Corona, N.Y., who says she’s had the coverage for many years – and hasn’t had to use it yet, luckily.
© Copyright 2011 USA TODAY, a division of Gannett Co. Inc.
Only 43 percent of renters in 2006 had insurance, compared with 96 percent of homeowners, according to a 2006 poll by the Insurance Research Council.
Most apartment dwellers aren’t being intentionally irresponsible on this front but simply don’t know that they need it, says Jeanne Salvatore, senior vice president of public affairs at the organization.
“Tip No. 1 for a renter is simply to get the insurance,” says Salvatore.
A few popular misconceptions are the culprits behind renters forgoing coverage for the belongings in their home, industry experts say.
“People say, ‘I don’t think I have a lot of stuff. I don’t want to pay money to insure it.’ They don’t think it’s very valuable,” says Amy Danise, senior managing editor of Insure.com.
But even the sparsest of apartments could have at least $1,000 worth of stuff counting things such as a bed, computer and clothing items. “It would really be a financial disaster to renters to lose all of your things in something like a fire and not have insurance for it. That kind of financial blow can affect you for the rest of your life,” she says.
Many renters also wrongfully assume they fall under the protection of their landlord’s insurance, Salvatore says. Landlord policies would take care of the actual building and common areas in the case of a disaster, but not the belongings of the tenants.
Unlike homeowners, renters policies don’t come with an automatic percentage for covering possessions, leaving the tenants the choice of determining the appropriate amount of coverage.
Renters should photograph belongings and tally up their value to make sure the policy would take care of replacing everything they own.
Beyond the loss of personal possessions, a renter could face litigation if a guest gets hurt in the apartment and the renter is at fault. Renters insurance policies offer liability coverage in much the same way that homeowners policies do, and even cover medical costs.
“If you have a party, and somebody trips on your rug and has to go to the hospital and get an X-ray, they can file a claim and don’t have to sue you,” Salvatore says.
The immediate survival expenses can quickly add up if a fire or other mishap displaces a renter. A renters insurance policy will cover additional living expenses, such as essentials you need to buy and other living expenses that surpass your typical rental costs, Salvatore says.
Renters insurance can cover a lot, but it doesn’t actually cost much. Average costs for the coverage ran about $176 in 2008.
“That’s probably a fancy coffee drink a week,” says Salvatore. So forgo the Starbucks and put the money into one of these policies, which can typically be purchased from the same provider of your auto coverage.
“It’s a small amount to pay for peace of mind,” says 61-year-old Suzette Eaddy of Corona, N.Y., who says she’s had the coverage for many years – and hasn’t had to use it yet, luckily.
© Copyright 2011 USA TODAY, a division of Gannett Co. Inc.
Thursday, March 24, 2011
Investors Dominate Distress Sales
RISMEDIA, March 24, 2011—Investor activity dominated a sluggish distress sale market in February as homebuyers are increasingly frustrated by difficulties getting financing, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. For many homebuyers, mortgage financing is becoming an increasing obstacle. This was highlighted in the latest HousingPulse tracking survey as cash transactions set a new record, accounting for a huge 33.7% of purchases in February. The increase in cash purchases paralleled a rise in investor activity. Investors accounted for 23.5 percent of home purchases in February, up from 19.9% percent in only two months.
Real estate agents who participated in the survey of February transactions confirmed the surge in investors. “We are seeing investors come back into the market. One investor told me that one house he wanted came on Wednesday evening and had nine offers by Thursday morning,” stated an agent in New Jersey. “There are a number of investors and businesses buying up the short sale and REO properties and renovating them and then selling them as traditional sales,” reported an agent from Arizona.
In what could normally be viewed as a positive development, the HousingPulse Distressed Property Index or DPI, a key indicator of the health of the housing market, fell from 49.6 percent in January to 47.3 percent in February. This marked the first decline in the DPI seen since last fall.
But the drop in distressed property transactions was not likely the result of a healing housing market. Rather, it appeared linked to a nationwide delay in the listing and sale of distressed properties as mortgage servicers continued to deal with legal and regulatory fallout surrounding title and paperwork issues.
The proportion of move-in ready foreclosed properties or real estate owned—one category of distressed property—took a tumble in February, going from 17.5 percent in January to 15.4 percent in February. Some move-in ready REO may have been converted into damaged REO during extended vacancies caused by mortgage servicer processing delays.
For more information visit www.realestateeconomywatch.com
Real estate agents who participated in the survey of February transactions confirmed the surge in investors. “We are seeing investors come back into the market. One investor told me that one house he wanted came on Wednesday evening and had nine offers by Thursday morning,” stated an agent in New Jersey. “There are a number of investors and businesses buying up the short sale and REO properties and renovating them and then selling them as traditional sales,” reported an agent from Arizona.
In what could normally be viewed as a positive development, the HousingPulse Distressed Property Index or DPI, a key indicator of the health of the housing market, fell from 49.6 percent in January to 47.3 percent in February. This marked the first decline in the DPI seen since last fall.
But the drop in distressed property transactions was not likely the result of a healing housing market. Rather, it appeared linked to a nationwide delay in the listing and sale of distressed properties as mortgage servicers continued to deal with legal and regulatory fallout surrounding title and paperwork issues.
The proportion of move-in ready foreclosed properties or real estate owned—one category of distressed property—took a tumble in February, going from 17.5 percent in January to 15.4 percent in February. Some move-in ready REO may have been converted into damaged REO during extended vacancies caused by mortgage servicer processing delays.
For more information visit www.realestateeconomywatch.com
Wednesday, March 23, 2011
Buyers ready to snatch bargains this spring
WASHINGTON – March 23, 2011 – Bargain prices on housing combined with low interest rates below 5 percent may bring the real estate market its busiest spring season in years, economists say.
Distressed sales continue to put downward pressure on home prices, which may lure more buyers off the fence and ready to snag a deal during the typical prime-time buying season.
Some builders are ramping up discounts on new homes as well as boosting commissions to brokers to try to spark more transactions.
Sellers of existing-homes also are getting more competitive in pricing their homes.
“After three years of the housing downturn, people are becoming much more realistic in terms of valuing their homes,” says Lawrence Yun, chief economist at the National Association of Realtors®.
An improved job market with better income potential may also motivate more people to buy, says David Berson of the PMI Group. “Household formations are also very important,” Berson says. “Kids may have moved back in with their parents, or two people may have moved in together because of job concerns. Now they can move into their own place.”
While interest rates are sitting comfortably below 5 percent for now (30-year fixed rates averaged 4.76 percent last week), economists warn the attractive low rates won’t last long.
“Few think mortgage rates are going lower,” says Mark Zandi, Moody’s Analytics chief economist. “It’s more likely they will be 6 percent than 4 percent next spring. This lights a fire under buyers.”
Source: “Discounts expected in spring housing market,” The Wall Street Journal (March 22, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
Distressed sales continue to put downward pressure on home prices, which may lure more buyers off the fence and ready to snag a deal during the typical prime-time buying season.
Some builders are ramping up discounts on new homes as well as boosting commissions to brokers to try to spark more transactions.
Sellers of existing-homes also are getting more competitive in pricing their homes.
“After three years of the housing downturn, people are becoming much more realistic in terms of valuing their homes,” says Lawrence Yun, chief economist at the National Association of Realtors®.
An improved job market with better income potential may also motivate more people to buy, says David Berson of the PMI Group. “Household formations are also very important,” Berson says. “Kids may have moved back in with their parents, or two people may have moved in together because of job concerns. Now they can move into their own place.”
While interest rates are sitting comfortably below 5 percent for now (30-year fixed rates averaged 4.76 percent last week), economists warn the attractive low rates won’t last long.
“Few think mortgage rates are going lower,” says Mark Zandi, Moody’s Analytics chief economist. “It’s more likely they will be 6 percent than 4 percent next spring. This lights a fire under buyers.”
Source: “Discounts expected in spring housing market,” The Wall Street Journal (March 22, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
Tuesday, March 22, 2011
First-time buyers prepare for best market in recent history
CAMPBELL, Calif. – March 22, 2011 – Inexperienced first-time buyers may not know if the time is right to make a move into real estate.
“It’s not about timing the market. It’s about time in the market,” says Steve Berkowitz, chief executive officer at Move Inc., the online company that oversees operation of Realtor.com. “Once you know how long you expect to own a home, look at the historical value performance of properties in the neighborhood. Be confident about your own job security, downpayment resources and tolerance for upkeep, as well as the lifestyle you want today and in the near term. Today’s housing market, especially for first-time buyers, makes it almost impossible not to think about the possibilities.”
To help first-time buyers decide if they’re ready, Move created a “reality checklist.”
Get your financial house in order
Before you decide to buy a home, make sure your credit is in good shape and repair any damage previously done. Know your credit score: Thirty-five percent of successful buyers recently reported they didn’t know their credit score when they went house shopping, according to a national survey fielded for MortgageMatch.com. Having enough money set aside for a downpayment is a key component. Also, don’t put all your money in the downpayment as other fees or unexpected expenses often arise after closing.
Don’t fall in love with a house you can’t buy
Find out how much you can afford, including how much money will be required for a downpayment and closing costs. Look for special loans available from FHA and government-sponsored loans for first-time homebuyers that reduce the amount of money required to get into a home.
Learn the lingo
Since first-time buyers are new to the market and will finance a significant portion of their purchase, it’s important to get familiar with the processes and terminology associated with home buying. Here are a few key terms from MortgageMatch.com:
• Bait Rate: Misleading mortgages with low rate promises and no contingencies generally for those with extraordinary credit. Rates are based on: credit, debt-to-income and loan-to-value ratios, the size and type of loan, property location and the day you lock your rate, etc. The loan isn’t locked until the application is accepted. By then, it may be too late to find a better rate from another lender.
• Basis Point: A term used in the mortgage industry, which simply means 1/100th of 1 percent.
• Closing Costs: The fees required to process and close your loan. They’re a cash obligation running from three to five percent of the purchase price. Motivated sellers might pay a portion of these costs.
• FHA: Federal Housing Administration, the federal government agency that oversees the U.S. housing market. FHA loans are loans insured by the U.S. Department of Housing and Urban Development.
• FRM and ARM: A fixed-rate mortgage loan (FRM) is a loan where your interest rate stays the same for the life of the loan. ARMs are adjustable rate mortgages with variable interest rates that fluctuate based on an agreed-upon index.
• GFE: The Good Faith Estimate (GFE) is a document explaining all costs involved in getting a loan.
• TIL: The Federal Truth-in-Lending Form is a document that spells out the costs and fees of the loan.
• Lis Pendens: An official notice that there is a pending lawsuit over real estate.
• Per Diem Interest: Interest you pay per day, from the day you close to the last day of the month.
• Underwriting and Underwriting Fees: Underwriting is a process the lender performs to qualify a borrower for a loan, and the fee is what you pay the lender at closing to cover evaluating the risk involved with loaning you money.
• Warranty Deed: A legal document guaranteeing the seller has a right to sell a property, which is very important if you are considering a distressed or discounted property.
If now isn’t the right time, prepare for your future purchase
If now isn’t the right time to buy a home, make a plan with a target date for when you expect to be ready. Improving your credit, paying down debt, stabilizing your work history and calculating exactly how much you can afford, are the best ways to prepare for your future home purchase. It’s also important to refrain from making any new large purchases or applying for new credit.
© 2011 Florida Realtors®
“It’s not about timing the market. It’s about time in the market,” says Steve Berkowitz, chief executive officer at Move Inc., the online company that oversees operation of Realtor.com. “Once you know how long you expect to own a home, look at the historical value performance of properties in the neighborhood. Be confident about your own job security, downpayment resources and tolerance for upkeep, as well as the lifestyle you want today and in the near term. Today’s housing market, especially for first-time buyers, makes it almost impossible not to think about the possibilities.”
To help first-time buyers decide if they’re ready, Move created a “reality checklist.”
Get your financial house in order
Before you decide to buy a home, make sure your credit is in good shape and repair any damage previously done. Know your credit score: Thirty-five percent of successful buyers recently reported they didn’t know their credit score when they went house shopping, according to a national survey fielded for MortgageMatch.com. Having enough money set aside for a downpayment is a key component. Also, don’t put all your money in the downpayment as other fees or unexpected expenses often arise after closing.
Don’t fall in love with a house you can’t buy
Find out how much you can afford, including how much money will be required for a downpayment and closing costs. Look for special loans available from FHA and government-sponsored loans for first-time homebuyers that reduce the amount of money required to get into a home.
Learn the lingo
Since first-time buyers are new to the market and will finance a significant portion of their purchase, it’s important to get familiar with the processes and terminology associated with home buying. Here are a few key terms from MortgageMatch.com:
• Bait Rate: Misleading mortgages with low rate promises and no contingencies generally for those with extraordinary credit. Rates are based on: credit, debt-to-income and loan-to-value ratios, the size and type of loan, property location and the day you lock your rate, etc. The loan isn’t locked until the application is accepted. By then, it may be too late to find a better rate from another lender.
• Basis Point: A term used in the mortgage industry, which simply means 1/100th of 1 percent.
• Closing Costs: The fees required to process and close your loan. They’re a cash obligation running from three to five percent of the purchase price. Motivated sellers might pay a portion of these costs.
• FHA: Federal Housing Administration, the federal government agency that oversees the U.S. housing market. FHA loans are loans insured by the U.S. Department of Housing and Urban Development.
• FRM and ARM: A fixed-rate mortgage loan (FRM) is a loan where your interest rate stays the same for the life of the loan. ARMs are adjustable rate mortgages with variable interest rates that fluctuate based on an agreed-upon index.
• GFE: The Good Faith Estimate (GFE) is a document explaining all costs involved in getting a loan.
• TIL: The Federal Truth-in-Lending Form is a document that spells out the costs and fees of the loan.
• Lis Pendens: An official notice that there is a pending lawsuit over real estate.
• Per Diem Interest: Interest you pay per day, from the day you close to the last day of the month.
• Underwriting and Underwriting Fees: Underwriting is a process the lender performs to qualify a borrower for a loan, and the fee is what you pay the lender at closing to cover evaluating the risk involved with loaning you money.
• Warranty Deed: A legal document guaranteeing the seller has a right to sell a property, which is very important if you are considering a distressed or discounted property.
If now isn’t the right time, prepare for your future purchase
If now isn’t the right time to buy a home, make a plan with a target date for when you expect to be ready. Improving your credit, paying down debt, stabilizing your work history and calculating exactly how much you can afford, are the best ways to prepare for your future home purchase. It’s also important to refrain from making any new large purchases or applying for new credit.
© 2011 Florida Realtors®
Friday, March 4, 2011
5 markets with the largest price drops
MIAMI – March 4, 2011 – The number of homes where sellers have cut their asking price is up 17.6 percent, according to a ZipRealty survey that analyzed MLS-listed properties in 26 markets.
“In more than half of the surveyed markets, sellers are averaging at least two reductions in price,” says John Oldham, director of marketing for ZipRealty. “Inventory has grown throughout much of the year. As sellers face the pressure of more buying options, they seem to be discounting to attract buyers resulting in list prices being cut for over 46 percent of the homes.”
The median reduction amount has averaged 1.7 percent or $19,088.
Florida leads the nation in the largest percentage discount off the original list price, with Orlando (12.5 percent discount), Jacksonville (12.1 percent), and Miami/Fort Lauderdale/Palm Beach (11.9) leading the pack.
The top 5 markets with the largest overall median price reduction in absolute dollars include:
1. San Francisco: $32,500 median price reduction
2. Orange County, Calif.: $31,000
3. San Diego: $29,100
4. Miami/Ft. Lauderdale/Palm Beach: $25,000
5. Seattle: $25,000
Source: “ZipRealty’s monthly price reduction index reports double digit increase in number of price reduced home listings over last year,” ZipRealty (Feb. 10, 2011)
“In more than half of the surveyed markets, sellers are averaging at least two reductions in price,” says John Oldham, director of marketing for ZipRealty. “Inventory has grown throughout much of the year. As sellers face the pressure of more buying options, they seem to be discounting to attract buyers resulting in list prices being cut for over 46 percent of the homes.”
The median reduction amount has averaged 1.7 percent or $19,088.
Florida leads the nation in the largest percentage discount off the original list price, with Orlando (12.5 percent discount), Jacksonville (12.1 percent), and Miami/Fort Lauderdale/Palm Beach (11.9) leading the pack.
The top 5 markets with the largest overall median price reduction in absolute dollars include:
1. San Francisco: $32,500 median price reduction
2. Orange County, Calif.: $31,000
3. San Diego: $29,100
4. Miami/Ft. Lauderdale/Palm Beach: $25,000
5. Seattle: $25,000
Source: “ZipRealty’s monthly price reduction index reports double digit increase in number of price reduced home listings over last year,” ZipRealty (Feb. 10, 2011)
Thursday, March 3, 2011
Stubborn sellers stand firm on price
COLUMBIA, S.C. – March 3, 2011 – Some sellers say they are unwilling to lower their home’s price to reflect the current real estate market, which some housing experts say is contributing to high inventories and souring the real estate market in their areas.
For example, in Columbia, S.C., some sellers are keeping their prices high and waiting for the market to change, which is causing home sales in the city to continue to slump, even though other parts of the country are already seeing a rebound. The median price for single-family homes in Columbia rose 3.3 percent in January compared to January 2010, but the number of homes sold fell 11.6 percent in January. Home sales have dropped 40 percent since its peak in 2006 in the area.
“This is a price-driven market,” says Doug Bridges, a real estate agent with Coldwell Banker United, Realtors®, in Northeast Richland, S.C. “You’ve gotta have your house better positioned than the next guy’s.” By not lowering the price, the homes linger on the market or have to be put up on the market multiple times, and a buyer often never comes forward.
Seller Jim Brodeur says he refuses to lower the $149,000 price on his two-bedroom, 1,200-square-foot bungalow in Columbia, S.C. He has unsuccessfully put the home up for sale himself three times in the past six years.
Brodeur says a lot of home buyers are looking for a steal nowadays, and “I don’t feel the urge to help anybody steal anything,” says Brodeur. “I don’t have to sell it, and I’m not going to give it away. If I lost my job, it would be different.”
Meanwhile, Bridges suggests sellers get an up-to-date appraisal of their property and have it available to buyers. He says buyers shouldn’t expect to nab the same price they could get a few years ago when housing prices were at their peak.
Source: “Many home sellers won’t budge on price,” The State (Feb. 27, 2011)
For example, in Columbia, S.C., some sellers are keeping their prices high and waiting for the market to change, which is causing home sales in the city to continue to slump, even though other parts of the country are already seeing a rebound. The median price for single-family homes in Columbia rose 3.3 percent in January compared to January 2010, but the number of homes sold fell 11.6 percent in January. Home sales have dropped 40 percent since its peak in 2006 in the area.
“This is a price-driven market,” says Doug Bridges, a real estate agent with Coldwell Banker United, Realtors®, in Northeast Richland, S.C. “You’ve gotta have your house better positioned than the next guy’s.” By not lowering the price, the homes linger on the market or have to be put up on the market multiple times, and a buyer often never comes forward.
Seller Jim Brodeur says he refuses to lower the $149,000 price on his two-bedroom, 1,200-square-foot bungalow in Columbia, S.C. He has unsuccessfully put the home up for sale himself three times in the past six years.
Brodeur says a lot of home buyers are looking for a steal nowadays, and “I don’t feel the urge to help anybody steal anything,” says Brodeur. “I don’t have to sell it, and I’m not going to give it away. If I lost my job, it would be different.”
Meanwhile, Bridges suggests sellers get an up-to-date appraisal of their property and have it available to buyers. He says buyers shouldn’t expect to nab the same price they could get a few years ago when housing prices were at their peak.
Source: “Many home sellers won’t budge on price,” The State (Feb. 27, 2011)
Market rebound for Florida
Until recently Florida was always in the top 2 or 3 for the highest number of foreclosures. This report from CNBC shows that we are now at number 9 and more importantly the change from a year ago is dramatic. The number of foreclosures in this state in down by a whopping 53%! This is HUGE and signals a positive change in our market statewide. Now is the time to buy. As our market continues to improve, prices WILL go up.
Here are the top ten states with the highest number of foreclosures.
10. Colorado
Here are the top ten states with the highest number of foreclosures.
10. Colorado
Rate: One in every 438 households
Properties with filings in 2010: 4,946
Change from Nov. 2010: -3.46%
Change from Dec. 2009: -1.65%
Properties with filings in 2010: 4,946
Change from Nov. 2010: -3.46%
Change from Dec. 2009: -1.65%
9. Florida
Rate: One in every 409 households
Properties with filings in 2010: 21,671
Change from Dec. 2010: -15.48%
Change from Jan. 2010: -53.96%
Properties with filings in 2010: 21,671
Change from Dec. 2010: -15.48%
Change from Jan. 2010: -53.96%
8. Illinois
Rate: One in every 402 households
Properties with filings in 2010: 13,164
Change from Dec. 2010: -6.25%
Change from Jan. 2010: -27.35%
Properties with filings in 2010: 13,164
Change from Dec. 2010: -6.25%
Change from Jan. 2010: -27.35%
7. Georgia
Rate: One in every 318 households
Properties with filings in 2010: 12,772
Change from Dec. 2010: 15.67%
Change from Jan. 2010: 13.29%
Properties with filings in 2010: 12,772
Change from Dec. 2010: 15.67%
Change from Jan. 2010: 13.29%
6. Michigan
Rate: One in every 272 households
Properties with filings in January: 16,716
Change from Dec. 2010: 4.08%
Change from Jan. 2010: -4.88%
Properties with filings in January: 16,716
Change from Dec. 2010: 4.08%
Change from Jan. 2010: -4.88%
5. Utah
Rate: One in every 265 households
Properties with filings in January: 3,601
Change from Dec. 2010: 8.11%
Change from Jan. 2010: -11.89%
Properties with filings in January: 3,601
Change from Dec. 2010: 8.11%
Change from Jan. 2010: -11.89%
4. Idaho
Rate: One in every 241 households
Properties with filings in January: 2,686
Change from Dec. 2010: 29.38%
Change from Jan. 2010: 3.19%
Properties with filings in January: 2,686
Change from Dec. 2010: 29.38%
Change from Jan. 2010: 3.19%
3. California
Rate: One in every 200 households
Properties with filings in January: 67,072
Change from Dec. 2010: 1.76%
Change from Jan. 2010: -6.61%
Brevard Christian Realty is dedicated to providing exceptional, honest service and value to home buyers and sellers based on Christian principles.
Contact us today at 321-684-9900
Properties with filings in January: 67,072
Change from Dec. 2010: 1.76%
Change from Jan. 2010: -6.61%
2. Arizona
Rate: One in every 175 households
Properties with filings in January: 15,757
Change from Dec 2010: 16.19%
Change from Jan. 2010: -25.14%
Properties with filings in January: 15,757
Change from Dec 2010: 16.19%
Change from Jan. 2010: -25.14%
1. Nevada
Rate: One in every 93 households
Properties with filings in January: 12,263
Change from Dec. 2010: -8.97%
Change from Jan. 2010: 3.45%
Properties with filings in January: 12,263
Change from Dec. 2010: -8.97%
Change from Jan. 2010: 3.45%
Brevard Christian Realty is dedicated to providing exceptional, honest service and value to home buyers and sellers based on Christian principles.
Contact us today at 321-684-9900
Wednesday, March 2, 2011
Sellers better off using a Realtor
EMERYVILLE, Calif. – March 1, 2011 – Real estate website HomeGain conducted a survey of 1,000 sellers to gauge their opinion on For Sale By Owner (FSBO) compared to using a Realtor.
Of the sellers surveyed, 83 percent used a Realtor while 17 percent attempted to sell their house on their own. Of those who used a Realtor, 59 percent sold their home; of FSBOs, only 39 percent successfully found a buyer and closed.
Of the successful sellers who used a Realtor, 88 percent said they would do so again; of all Realtor-represented sellers, 81 percent said they would use a Realtor again.
Of FSBOs who successfully sold their homes on their own, 71 percent would attempt to do so again.
However, the survey also found that nearly a quarter of FSBOs ultimately turned to a Realtor to help them sell their properties.
Source: RISMedia (02/25/11)
Of the sellers surveyed, 83 percent used a Realtor while 17 percent attempted to sell their house on their own. Of those who used a Realtor, 59 percent sold their home; of FSBOs, only 39 percent successfully found a buyer and closed.
Of the successful sellers who used a Realtor, 88 percent said they would do so again; of all Realtor-represented sellers, 81 percent said they would use a Realtor again.
Of FSBOs who successfully sold their homes on their own, 71 percent would attempt to do so again.
However, the survey also found that nearly a quarter of FSBOs ultimately turned to a Realtor to help them sell their properties.
Source: RISMedia (02/25/11)
Thursday, February 24, 2011
Existing-Home Sales Rise Again in January
Washington, DC, February 23, 2011 The uptrend in existing-home sales continues, with January sales rising for the third consecutive month with a pace that is now above year-ago levels, according to the National Association of REALTORS®.
Existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 2.7 percent to a seasonally adjusted annual rate of 5.36 million in January from a downwardly revised 5.22 million in December, and are 5.3 percent above the 5.09 million level in January 2010. This is the first time in seven months that sales activity was higher than a year earlier.
Lawrence Yun, NAR chief economist, said the improvement is good but could be better. “The uptrend in home sales is consistent with improvements in the economy and jobs, which are helping boost consumer confidence,” Yun said. “The extremely favorable housing affordability conditions are a big factor, but buyers have been constrained by unnecessarily tight credit. As a result, there are abnormally high levels of all-cash purchases, along with rising investor activity.”
A parallel NAR practitioner survey2 shows first-time buyers purchased 29 percent of homes in January, down from 33 percent in December and 40 percent in January 2010 when an extended tax credit was in place.
Investors accounted for 23 percent of purchases in January, up from 20 percent in December and 17 percent in January 2010; the balance of sales were to repeat buyers. All-cash sales rose to 32 percent in January from 29 percent in December and 26 percent in January 2010.
“Increases in all-cash transactions, the investor market share and distressed home sales all go hand-in-hand. With tight credit standards, it’s not surprising to see so much activity where cash is king and investors are taking advantage of conditions to purchase undervalued homes,” Yun said.
All-cash purchases are at the highest level since NAR started measuring these purchases monthly in October 2008, when they accounted for 15 percent of the market. The average of all-cash deals was 20 percent in 2009, rising to 28 percent last year.
The national median existing-home price3 for all housing types was $158,800 in January, down 3.7 percent from January 2010. Distressed homes edged up to a 37 percent market share in January from 36 percent in December; it was 38 percent in January 2010.
NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said the median price is being dampened by unusual market factors. “Unprecedented levels of all-cash purchases, primarily of distressed homes sold at deep discounts, undoubtedly pulls the median price downward,” Phipps said. “Given the levels of inventory we see today, we believe that traditional homes in good condition have held their value.”
Total housing inventory at the end of January fell 5.1 percent to 3.38 million existing homes available for sale, which represents a 7.6-month supply4 at the current sales pace, down from an 8.2-month supply in December. The inventory supply is at the lowest level since December 2009 when there was a 7.3-month supply.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.76 percent in January from 4.71 percent in December; the rate was 5.03 percent in January 2010.
Single-family home sales rose 2.4 percent to a seasonally adjusted annual rate of 4.69 million in January from 4.58 million in December, and are 4.9 percent higher than the 4.47 million level in January 2010. The median existing single-family home price was $159,400 in January, down 2.7 percent from a year ago.
Existing condominium and co-op sales increased 4.7 percent to a seasonally adjusted annual rate of 670,000 in January from 640,000 in December, and are 7.9 percent above the 621,000-unit pace one year ago. The median existing condo price5 was $154,900 in January, which is 10.2 percent below January 2010.
Regionally, existing-home sales in the Northeast fell 4.6 percent to an annual pace of 830,000 in January from a spike in December and are 1.2 percent below January 2010. The median price in the Northeast was $236,500, which is 4.0 percent below a year ago.
Existing-home sales in the Midwest rose 1.8 percent in January to a level of 1.14 million and are 3.6 percent above a year ago. The median price in the Midwest was $126,300, which is 3.2 percent below January 2010.
In the South, existing-home sales increased 3.6 percent to an annual pace of 2.02 million in January and are 8.0 percent higher than January 2010. The median price in the South was $136,600, down 2.1 percent from a year ago.
Existing-home sales in the West rose 7.9 percent to an annual level of 1.37 million in January and are 7.0 percent above January 2010. The median price in the West was $193,200, down 5.7 percent from a year ago.
The National Association of REALTORS®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.
Existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 2.7 percent to a seasonally adjusted annual rate of 5.36 million in January from a downwardly revised 5.22 million in December, and are 5.3 percent above the 5.09 million level in January 2010. This is the first time in seven months that sales activity was higher than a year earlier.
Lawrence Yun, NAR chief economist, said the improvement is good but could be better. “The uptrend in home sales is consistent with improvements in the economy and jobs, which are helping boost consumer confidence,” Yun said. “The extremely favorable housing affordability conditions are a big factor, but buyers have been constrained by unnecessarily tight credit. As a result, there are abnormally high levels of all-cash purchases, along with rising investor activity.”
A parallel NAR practitioner survey2 shows first-time buyers purchased 29 percent of homes in January, down from 33 percent in December and 40 percent in January 2010 when an extended tax credit was in place.
Investors accounted for 23 percent of purchases in January, up from 20 percent in December and 17 percent in January 2010; the balance of sales were to repeat buyers. All-cash sales rose to 32 percent in January from 29 percent in December and 26 percent in January 2010.
“Increases in all-cash transactions, the investor market share and distressed home sales all go hand-in-hand. With tight credit standards, it’s not surprising to see so much activity where cash is king and investors are taking advantage of conditions to purchase undervalued homes,” Yun said.
All-cash purchases are at the highest level since NAR started measuring these purchases monthly in October 2008, when they accounted for 15 percent of the market. The average of all-cash deals was 20 percent in 2009, rising to 28 percent last year.
The national median existing-home price3 for all housing types was $158,800 in January, down 3.7 percent from January 2010. Distressed homes edged up to a 37 percent market share in January from 36 percent in December; it was 38 percent in January 2010.
NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said the median price is being dampened by unusual market factors. “Unprecedented levels of all-cash purchases, primarily of distressed homes sold at deep discounts, undoubtedly pulls the median price downward,” Phipps said. “Given the levels of inventory we see today, we believe that traditional homes in good condition have held their value.”
Total housing inventory at the end of January fell 5.1 percent to 3.38 million existing homes available for sale, which represents a 7.6-month supply4 at the current sales pace, down from an 8.2-month supply in December. The inventory supply is at the lowest level since December 2009 when there was a 7.3-month supply.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.76 percent in January from 4.71 percent in December; the rate was 5.03 percent in January 2010.
Single-family home sales rose 2.4 percent to a seasonally adjusted annual rate of 4.69 million in January from 4.58 million in December, and are 4.9 percent higher than the 4.47 million level in January 2010. The median existing single-family home price was $159,400 in January, down 2.7 percent from a year ago.
Existing condominium and co-op sales increased 4.7 percent to a seasonally adjusted annual rate of 670,000 in January from 640,000 in December, and are 7.9 percent above the 621,000-unit pace one year ago. The median existing condo price5 was $154,900 in January, which is 10.2 percent below January 2010.
Regionally, existing-home sales in the Northeast fell 4.6 percent to an annual pace of 830,000 in January from a spike in December and are 1.2 percent below January 2010. The median price in the Northeast was $236,500, which is 4.0 percent below a year ago.
Existing-home sales in the Midwest rose 1.8 percent in January to a level of 1.14 million and are 3.6 percent above a year ago. The median price in the Midwest was $126,300, which is 3.2 percent below January 2010.
In the South, existing-home sales increased 3.6 percent to an annual pace of 2.02 million in January and are 8.0 percent higher than January 2010. The median price in the South was $136,600, down 2.1 percent from a year ago.
Existing-home sales in the West rose 7.9 percent to an annual level of 1.37 million in January and are 7.0 percent above January 2010. The median price in the West was $193,200, down 5.7 percent from a year ago.
The National Association of REALTORS®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.
Now is the time to buy...
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http://www.myfoxorlando.com/dpp/money/022311-buying-a-home-and-navigating-loans
Wednesday, February 23, 2011
Florida’s existing home, condo sales up in January
ORLANDO, Fla. – Feb. 23, 2011 – Florida’s existing home and existing condo sales rose in January, according to the latest housing data released by Florida Realtors®. Existing home sales increased 14 percent last month with a total of 12,151 homes sold statewide compared to 10,702 homes sold in January 2010, according to Florida Realtors. January’s statewide sales of existing condos rose 36 percent compared to the previous year’s sales figure.
Seventeen of Florida’s metropolitan statistical areas (MSAs) reported increased existing home sales in January; 16 MSAs had higher condo sales.
“Now is a great time for anyone thinking of buying a home in Florida to make that decision,” said 2011 Florida Realtors® President Patricia Fitzgerald, manager/broker-associate with Illustrated Properties in Hobe Sound and Mariner Sands Country Club in Stuart. “Mortgage rates are historically low, although they are beginning to tick up slightly as the economy shows signs of strengthening. Conditions remain very favorable for buyers, with a range of housing inventory and attractive prices.
“Homebuyers soon will have the opportunity to visit a number of open houses in their preferred locales all in a single weekend, as part of the second annual Florida Open House Weekend, March 26-27, 2011! From the Keys to the Panhandle, Realtors across Florida are participating in this statewide open house event sponsored by Florida Realtors. Consult a local Realtor® about Florida Open House Weekend, and find out more about qualification criteria and opportunities in your local housing market.”
Florida’s median sales price for existing homes last month was $122,200; a year ago, it was $131,000 for a 7 percent decrease. Analysts with the National Association of Realtors (NAR) note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.
The national median sales price for existing single-family homes in December 2010 was $169,300, down 0.2 percent from a year ago, according to NAR. In California, the statewide median resales price was $301,850 in December 2010; in Massachusetts, it was $285,950; in Maryland, it was $240,000; and in New York, it was $225,000.
According to NAR’s latest outlook, improving economic conditions and strong affordability are positive factors for the coming months. “Modest gains in the labor market and the improving economy are creating a more favorable backdrop for buyers, allowing them to take advantage of excellent housing affordability conditions,” said NAR Chief Economist Lawrence Yun. “Mortgage rates should rise only modestly in the months ahead, so we’ll continue to see a favorable environment for buyers with good credit.”
In Florida’s year-to-year comparison for condos, 6,681 units sold statewide last month compared to 4,916 units in January 2010 for an increase of 36 percent. The statewide existing condo median sales price last month was $79,400; in January 2010 it was $97,000 for an 18 percent decrease. The national median existing condo price was $165,000 in December 2010, according to NAR.
The interest rate for a 30-year fixed-rate mortgage averaged 4.76 percent in January, down from the 5.03 percent average during the same month a year earlier, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
© 2011 Florida Realtors®
Seventeen of Florida’s metropolitan statistical areas (MSAs) reported increased existing home sales in January; 16 MSAs had higher condo sales.
“Now is a great time for anyone thinking of buying a home in Florida to make that decision,” said 2011 Florida Realtors® President Patricia Fitzgerald, manager/broker-associate with Illustrated Properties in Hobe Sound and Mariner Sands Country Club in Stuart. “Mortgage rates are historically low, although they are beginning to tick up slightly as the economy shows signs of strengthening. Conditions remain very favorable for buyers, with a range of housing inventory and attractive prices.
“Homebuyers soon will have the opportunity to visit a number of open houses in their preferred locales all in a single weekend, as part of the second annual Florida Open House Weekend, March 26-27, 2011! From the Keys to the Panhandle, Realtors across Florida are participating in this statewide open house event sponsored by Florida Realtors. Consult a local Realtor® about Florida Open House Weekend, and find out more about qualification criteria and opportunities in your local housing market.”
Florida’s median sales price for existing homes last month was $122,200; a year ago, it was $131,000 for a 7 percent decrease. Analysts with the National Association of Realtors (NAR) note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.
The national median sales price for existing single-family homes in December 2010 was $169,300, down 0.2 percent from a year ago, according to NAR. In California, the statewide median resales price was $301,850 in December 2010; in Massachusetts, it was $285,950; in Maryland, it was $240,000; and in New York, it was $225,000.
According to NAR’s latest outlook, improving economic conditions and strong affordability are positive factors for the coming months. “Modest gains in the labor market and the improving economy are creating a more favorable backdrop for buyers, allowing them to take advantage of excellent housing affordability conditions,” said NAR Chief Economist Lawrence Yun. “Mortgage rates should rise only modestly in the months ahead, so we’ll continue to see a favorable environment for buyers with good credit.”
In Florida’s year-to-year comparison for condos, 6,681 units sold statewide last month compared to 4,916 units in January 2010 for an increase of 36 percent. The statewide existing condo median sales price last month was $79,400; in January 2010 it was $97,000 for an 18 percent decrease. The national median existing condo price was $165,000 in December 2010, according to NAR.
The interest rate for a 30-year fixed-rate mortgage averaged 4.76 percent in January, down from the 5.03 percent average during the same month a year earlier, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
© 2011 Florida Realtors®
Tuesday, February 15, 2011
Housing markets: Best Recovery Bets
Palm Bay, Fla.
Median home price: $141,000
Drop since market peak: 49.9%
Forecast gain by 9/2012: 9.4%
The Palm Bay, Fla., metro area fell earlier and further than almost any place in the country. Why? Because the area was severely overbuilt on expectations that baby boomers would flock here to retire.
Those expectations were pushed back by the housing bust and economic crisis. Home prices cratered, falling 37% between mid-2007 and mid-2010 alone. Plus, foreclosures and inventory have ballooned.
And the bust is not over: Fiserve expects an additional decline of 1.4% through Sept. 30, 2011.
After that the market will come roaring back with a double-digit jump between September 2011 and September 2012.
And retirees that decide to come south to Palm Bay will find an altered real estate market compared to four years ago. Prices of existing homes are now 50% below replacement costs, making home buying for the retirees much more affordable.
Those expectations were pushed back by the housing bust and economic crisis. Home prices cratered, falling 37% between mid-2007 and mid-2010 alone. Plus, foreclosures and inventory have ballooned.
And the bust is not over: Fiserve expects an additional decline of 1.4% through Sept. 30, 2011.
After that the market will come roaring back with a double-digit jump between September 2011 and September 2012.
And retirees that decide to come south to Palm Bay will find an altered real estate market compared to four years ago. Prices of existing homes are now 50% below replacement costs, making home buying for the retirees much more affordable.
Thursday, February 10, 2011
Real estate is ‘as affordable as it gets’
NEW YORK – Feb. 10, 2011 – Now is a good time to buy real estate, according to data from Moody’s Analytics. Home affordability has returned to pre-housing bubble levels or even fallen below the average in many U.S. markets.
In fact, housing affordability by the end of September had returned to or fallen below the average reached between 1989-2003 in 47 of the 74 housing markets that Moody Analytics tracked.
In September 2010, the ratio of home prices to annual household income had fallen to 1.6 – below the historical average of 1.9 between 1989 and 2003. The ratio peaked in 2005 at 2.3.
“Based on incomes, this is as affordable as it gets,” says Mark Zandi, chief economist at Moody’s Analytics. “If you can get a loan, these are pretty good times to buy.”
Some of the most undervalued markets include Cleveland, Detroit, Las Vegas, Atlanta, and Phoenix. But those cities also are facing high rates of foreclosures and more borrowers defaulting on their mortgages that could decrease values further in those cities before they start to improve, Zandi says.
In Phoenix, for example, “it’s become cheaper to buy than to rent,” Jon Mirmelli, a real estate investor in Scottsdale, Ariz., who rents out foreclosed homes, told The Wall Street Journal. “But the question is: can you qualify for a loan?”
Source: “Home affordability returns to pre-bubble levels,” The Wall Street Journal Online (Feb. 8, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
Friday, February 4, 2011
Rate on 30-year fixed mortgage rises to 4.81%
NEW YORK – Feb. 4, 2011 – The average rate on the 30-year fixed mortgage edged up this week as bond yields increased.
Freddie Mac said Thursday the average rate rose to 4.81 percent this week from 4.80 percent the previous week. It hit a 40-year low of 4.17 percent in November.
The average rate on the 15-year loan slipped to 4.08 percent from 4.09 percent. It reached 3.57 percent in November, the lowest level on records starting in 1991.
Rates have been little changed this year after spiking more than half a percentage point in the last two months of 2010. Investors sold off Treasury bonds during that time, driving yields lower. Mortgage rates tend to track the yield on the 10-year Treasury note.
High foreclosures, job worries and expectations that home prices will fall further have kept many potential homebuyers on the sidelines. Historically low mortgage rates haven’t been enough to jumpstart the housing market.
To calculate average mortgage rates, Freddie Mac collects rates from lenders across the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a single day.
The average rate on a five-year adjustable-rate mortgage fell to 3.69 percent from 3.70 percent. The five-year hit 3.25 percent last month, the lowest rate on records dating back to January 2005.
The average rate on one-year adjustable-rate home loans was unchanged at 3.26 percent.
The rates do not include add-on fees, known as points. One point is equal to 1 percent of the total loan amount. The average fee for the 30-year and 15-year loan in Freddie Mac’s survey was 0.8 point. The average fee for the five-year ARM was 0.7 point, and the fee for the 1-year ARM was 0.6 point.
Copyright © 2011 The Associated Press, Janna Herron, AP business writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Freddie Mac said Thursday the average rate rose to 4.81 percent this week from 4.80 percent the previous week. It hit a 40-year low of 4.17 percent in November.
The average rate on the 15-year loan slipped to 4.08 percent from 4.09 percent. It reached 3.57 percent in November, the lowest level on records starting in 1991.
Rates have been little changed this year after spiking more than half a percentage point in the last two months of 2010. Investors sold off Treasury bonds during that time, driving yields lower. Mortgage rates tend to track the yield on the 10-year Treasury note.
High foreclosures, job worries and expectations that home prices will fall further have kept many potential homebuyers on the sidelines. Historically low mortgage rates haven’t been enough to jumpstart the housing market.
To calculate average mortgage rates, Freddie Mac collects rates from lenders across the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a single day.
The average rate on a five-year adjustable-rate mortgage fell to 3.69 percent from 3.70 percent. The five-year hit 3.25 percent last month, the lowest rate on records dating back to January 2005.
The average rate on one-year adjustable-rate home loans was unchanged at 3.26 percent.
The rates do not include add-on fees, known as points. One point is equal to 1 percent of the total loan amount. The average fee for the 30-year and 15-year loan in Freddie Mac’s survey was 0.8 point. The average fee for the five-year ARM was 0.7 point, and the fee for the 1-year ARM was 0.6 point.
Copyright © 2011 The Associated Press, Janna Herron, AP business writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Thursday, February 3, 2011
Homebuyer Tax Credit
Special Rules for Members of the Military, the Foreign Service and the Intelligence Community
Recognizing their unique circumstances, Congress approved exceptions that give qualified members of the military, foreign service and intelligence communities an extra year to buy a home and claim the federal homebuyer tax credit. The exceptions apply to both the $8,000 tax credit for first-time homebuyers and the $6,500 tax credit for existing homeowners who purchase another home.
Extension of Tax Credit Rules
• The homebuyer tax credit extension is available for qualified purchases with a binding sales contract in place on or before April 30, 2011, and closed by June 30, 2011. Qualified service members (and if married, the service members’ spouses) who served on official extended duty outside the U.S. for 90 days or more at any time between Jan. 1, 2009, and April 30, 2010, are eligible.
• A person forced to return to the U.S. for medical reasons before completing an assignment of at least 90 days of qualified official extended duty outside the U.S. may also qualify for the one-year extension.
Exemption from Tax Credit Recapture Rules
Typically, homes that are sold or that cease to be used as a principal residence within three years of the initial purchase are subject to recapture (repayment) of the tax credit. However, qualified service members who sell or move from a tax credit home within three years of the initial purchase due to official extended duty assignments are exempt from the recapture rule.
Definitions: Qualified service member means a member of the uniformed services of the U.S military, a member of the U.S. Foreign Service or an employee of the intelligence community. Official extended duty means any period of extended duty outside the U.S. for at least 90 days during the period between Jan. 1, 2009, and April 30, 2010.
Note: Only one spouse must be overseas on official extended duty for the requisite amount of time for either spouse to be eligible for the 2011 extension to purchase a principal residence and claim the credit.
In Florida, no one knows the housing market like a Realtor®.
Learn more about the tax credit and other homebuyer opportunities from this Florida Realtors® website:
www.floridarealtors.org/AboutFar/homebuyer
center/index.cfm
NOTE: This document is for informational purposes and
should not be construed as tax or legal advice. For specific advice on their own tax situation, consumers should always consult a qualified tax professional.
Recognizing their unique circumstances, Congress approved exceptions that give qualified members of the military, foreign service and intelligence communities an extra year to buy a home and claim the federal homebuyer tax credit. The exceptions apply to both the $8,000 tax credit for first-time homebuyers and the $6,500 tax credit for existing homeowners who purchase another home.
Extension of Tax Credit Rules
• The homebuyer tax credit extension is available for qualified purchases with a binding sales contract in place on or before April 30, 2011, and closed by June 30, 2011. Qualified service members (and if married, the service members’ spouses) who served on official extended duty outside the U.S. for 90 days or more at any time between Jan. 1, 2009, and April 30, 2010, are eligible.
• A person forced to return to the U.S. for medical reasons before completing an assignment of at least 90 days of qualified official extended duty outside the U.S. may also qualify for the one-year extension.
Exemption from Tax Credit Recapture Rules
Typically, homes that are sold or that cease to be used as a principal residence within three years of the initial purchase are subject to recapture (repayment) of the tax credit. However, qualified service members who sell or move from a tax credit home within three years of the initial purchase due to official extended duty assignments are exempt from the recapture rule.
Definitions: Qualified service member means a member of the uniformed services of the U.S military, a member of the U.S. Foreign Service or an employee of the intelligence community. Official extended duty means any period of extended duty outside the U.S. for at least 90 days during the period between Jan. 1, 2009, and April 30, 2010.
Note: Only one spouse must be overseas on official extended duty for the requisite amount of time for either spouse to be eligible for the 2011 extension to purchase a principal residence and claim the credit.
In Florida, no one knows the housing market like a Realtor®.
Learn more about the tax credit and other homebuyer opportunities from this Florida Realtors® website:
www.floridarealtors.org/AboutFar/homebuyer
center/index.cfm
NOTE: This document is for informational purposes and
should not be construed as tax or legal advice. For specific advice on their own tax situation, consumers should always consult a qualified tax professional.
Monday, January 31, 2011
State Farm wants to raise average rates by 28%
TALLAHASSEE, Fla. – Jan. 31, 2011 – State Farm Florida Insurance, the state’s largest private property insurer, wants to raise rates by a statewide average of 28 percent.
Although Florida has dodged a direct hit by hurricanes the past five years, the company says the increase is needed to cover rising losses for claims unrelated to storms such as sinkholes. The increase comes after the company received approval in 2009 to raise average statewide rates by 28 percent and approval in November to raise them by 6.6 percent.
State Farm had 678,849 residential property insurance policies in the state as of late last year, including 128,506 in Broward, Palm Beach and Miami-Dade counties and 175,084 in the Orlando area.
The Office of Insurance Regulation will review the request at a hearing on Feb. 15. An actuary from the office wrote in an e-mail late Friday that it appears the proposal is driven by higher claims costs and a higher “profit and contingency” factor, which is, in part, for emergencies or unforeseen events. Just because the request was filed “does not necessarily mean the Office will approve it,” he wrote.
If approved, some policyholders would see increases that are higher than the state average, and others would see lower increases or even decreases.
In early 2009, State Farm threatened to leave Florida’s property insurance market after the state rejected its request for rate increases of either 47 percent or 67 percent. That year, legislators passed a measure to effectively allow the largest home insurers to charge as much as they wanted, but Gov. Charlie Crist vetoed the legislation.
In July 2009, regulators agreed to allow State Farm to eliminate some discounts it had been providing, which resulted in higher rates on average statewide. The company agreed to stay in the state in December 2009 if it was allowed to shed 125,000 policies over several years and raise rates by an average 14.8 percent.
Last year, regulators allowed the company to reduce some discounts it gives homeowners for fortifying their homes against hurricanes, effectively raising statewide average rates by 6.6 percent, said State Farm spokesman Michael Grimes.
Grimes said State Farm, which had reported its premiums weren’t keeping pace with claims and other expenses, helped improve its finances by dropping some policies. It now has about 130,000 fewer residential property insurance policies than it did in late 2009 when it agreed to stay in Florida.
The rate increase also would help, Grimes said. “To ensure State Farm Florida has the resources to sufficiently protect its customers’ property, the premiums need to adequately reflect the risk inherent in providing property insurance coverage in Florida,” he said. “Non-catastrophe loss per policy is up 94 percent the past three years. Much of the insurance losses can be attributed to sinkhole claims.”
The company spent $351 million to cover sinkhole claims from 2007 to October 2010, according to Grimes.
Information about the rate hearing is available at the Office of Insurance Regulation’s website.
Copyright © 2011 Sun Sentinel, Fort Lauderdale, Fla., Julie Patel. Distributed by McClatchy-Tribune Information Services.
Thursday, January 27, 2011
Brand New Listing in Palm Bay!
www.brevardmls.com
List Price: $60,900 - Firm: Keller Williams Rlty of Brvd - List Agent: Kenneth Gordon - Email: KenGordon.re@gmail.com - Perfect for the first time home buyer, young family, or recently retired. Close to schools, churches, shopping, and easy access to I-95. Quiet neighborhood, huge fenced yard, and an enclosed Florida room.
Friday, January 21, 2011
Florida’s existing home, condo sales up in Dec. and for 2010
ORLANDO, Fla. – Jan. 20, 2011 – Sales of existing homes and condominiums in Florida rose in December, a positive trend also reported at the close of 2010 as statewide sales activity posted gains over the previous year, according to the latest housing data released by Florida Realtors®.
A total of 15,550 existing single-family homes sold statewide in December, up 4 percent from the 14,923 homes sold in December 2009. The statewide existing home median sales price last month was $133,100; in December ’09 it was $139,800 for a 5 percent decrease, according to Florida Realtors’ data. However, December’s statewide existing home median price was higher than the $132,700 reported in November 2010. The national median existing single-family home price was $171,300 in November, according to the latest data available from the National Association of Realtors® (NAR). The median is the midpoint; half the homes sold for more, half for less.
In December, 12 of Florida’s metropolitan statistical areas (MSAs) reported higher existing home sales and 14 MSAs reported higher existing condos sales. In the year-to-year comparison for statewide existing condo sales, a total of 6,673 units changed hands last month, up 12 percent from the 5,955 condos sold in December 2009. The statewide existing condo median sales price in December was $88,100; in December ’09 it was $106,700 for a 17 percent decrease. The national median existing condo price was $165,300 in November, according to NAR.
Looking back on 2010, Florida’s existing home sales rose 5 percent for the year, with a total of 170,848 homes sold compared to 162,873 homes sold in 2009. Statewide existing home sales activity in 2010 also was 37.5 percent higher than 2008 statewide sales, records show. The statewide existing home median price for 2010 was $136,500; it was $142,500 in 2009 for a 4 percent decrease.
“It’s encouraging to close out the year for Florida’s housing market with increased sales activity,” said 2011 Florida Realtors President Patricia “Pat” S. Fitzgerald, manager/broker-associate with Illustrated Properties in Hobe Sound. “The homebuyer tax credits helped to fuel home and condo sales during the first half of 2010, while favorable affordability conditions and historically low mortgage rates continued to bring buyers into the market in the waning months of the year.
“Looking to the future, 2011 is going to be a year of opportunity for buyers and sellers,” Fitzgerald added. “Industry analysts report seeing steady economic improvements, including more jobs and stronger consumer confidence, which will have a positive, stabilizing impact on the housing market.”
In Florida’s condo market, a total of 72,050 units sold statewide in 2010, a gain of 29 percent compared to 55,900 units sold in 2009. Statewide existing condo sales activity in 2010 was up 90.6 percent over the 2008 sales level, records show. The statewide existing condo median price in 2010 was $91,300; it was $108,000 in 2009 for a 15 percent decrease.
The latest industry outlook from NAR offers positive predictions for 2011. “Continuing gains in home sales are encouraging, and the positive impact of steady job creation will more than trump some negative impact from a modest rise in mortgage interest rates, which remain historically favorable,” said NAR Chief Economist Lawrence Yun. “All the indicator trends are pointing to a gradual housing recovery.”
In December, the interest rate for a 30-year fixed-rate mortgage averaged 4.71 percent, down from the 4.93 percent average during the same month a year earlier, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
© 2011 Florida Realtors®
A total of 15,550 existing single-family homes sold statewide in December, up 4 percent from the 14,923 homes sold in December 2009. The statewide existing home median sales price last month was $133,100; in December ’09 it was $139,800 for a 5 percent decrease, according to Florida Realtors’ data. However, December’s statewide existing home median price was higher than the $132,700 reported in November 2010. The national median existing single-family home price was $171,300 in November, according to the latest data available from the National Association of Realtors® (NAR). The median is the midpoint; half the homes sold for more, half for less.
In December, 12 of Florida’s metropolitan statistical areas (MSAs) reported higher existing home sales and 14 MSAs reported higher existing condos sales. In the year-to-year comparison for statewide existing condo sales, a total of 6,673 units changed hands last month, up 12 percent from the 5,955 condos sold in December 2009. The statewide existing condo median sales price in December was $88,100; in December ’09 it was $106,700 for a 17 percent decrease. The national median existing condo price was $165,300 in November, according to NAR.
Looking back on 2010, Florida’s existing home sales rose 5 percent for the year, with a total of 170,848 homes sold compared to 162,873 homes sold in 2009. Statewide existing home sales activity in 2010 also was 37.5 percent higher than 2008 statewide sales, records show. The statewide existing home median price for 2010 was $136,500; it was $142,500 in 2009 for a 4 percent decrease.
“It’s encouraging to close out the year for Florida’s housing market with increased sales activity,” said 2011 Florida Realtors President Patricia “Pat” S. Fitzgerald, manager/broker-associate with Illustrated Properties in Hobe Sound. “The homebuyer tax credits helped to fuel home and condo sales during the first half of 2010, while favorable affordability conditions and historically low mortgage rates continued to bring buyers into the market in the waning months of the year.
“Looking to the future, 2011 is going to be a year of opportunity for buyers and sellers,” Fitzgerald added. “Industry analysts report seeing steady economic improvements, including more jobs and stronger consumer confidence, which will have a positive, stabilizing impact on the housing market.”
In Florida’s condo market, a total of 72,050 units sold statewide in 2010, a gain of 29 percent compared to 55,900 units sold in 2009. Statewide existing condo sales activity in 2010 was up 90.6 percent over the 2008 sales level, records show. The statewide existing condo median price in 2010 was $91,300; it was $108,000 in 2009 for a 15 percent decrease.
The latest industry outlook from NAR offers positive predictions for 2011. “Continuing gains in home sales are encouraging, and the positive impact of steady job creation will more than trump some negative impact from a modest rise in mortgage interest rates, which remain historically favorable,” said NAR Chief Economist Lawrence Yun. “All the indicator trends are pointing to a gradual housing recovery.”
In December, the interest rate for a 30-year fixed-rate mortgage averaged 4.71 percent, down from the 4.93 percent average during the same month a year earlier, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
© 2011 Florida Realtors®
Thursday, January 20, 2011
Housing Starts Expected to Climb in 2011
New home construction is looking up this year. During an economic update Wednesday at the International Builders' Show in Orlando David Crowe, chief economist of the National Association of Home Builders, projected single-family housing starts to rise by 21 percent in 2011, reaching 575,000 units.
The estimate is slightly more conservative than the Dec. 30 projection of 716,000 housing starts this year by Lawrence Yun, chief economist of the National Association of REALTORS®. Both estimates assume sustained job growth, increasing U.S. population, as well as continued low interest rates driving construction.
Yun expects about 2 million jobs to be added in 2011. However, as NAHB presenter Frank Nothaft, chief economist for Freddie Mac, pointed out, 2011 got off to a slow start with nonfarm payrolls rising only by 103,000 in December. He called the figure weaker than expected.
Credit is another factor. Lending remains tight, but if it opens up with safe underwriting standards for creditworthy buyers, Yun says there would be a bigger boost to the housing market with spillover benefits for the broader economy. The 30-year fixed-rate mortgage is forecast to rise gradually to 5.3 percent around the end of 2011; at the same time, unemployment should drop to 9.2 percent, according to NAR.
In addition, over the past 10 years the U.S. has added 27 million people. Continued population growth will also spur home construction and sales. “All the indicator trends are pointing to a gradual housing recovery,” Yun says.
An even more conservative projection of 492,000 housing starts in 2011 was released by the Portland Cement Association during the International Builders Show Wednesday. Edward Sullivan, PCA chief economist, does not expect significant increases until 2012 due to tight lending standards, a high home inventory count, and unstable housing prices. He also says that new home construction will vary considerably by region.
-- Erica Christoffer, REALTOR® Magazine
The estimate is slightly more conservative than the Dec. 30 projection of 716,000 housing starts this year by Lawrence Yun, chief economist of the National Association of REALTORS®. Both estimates assume sustained job growth, increasing U.S. population, as well as continued low interest rates driving construction.
Yun expects about 2 million jobs to be added in 2011. However, as NAHB presenter Frank Nothaft, chief economist for Freddie Mac, pointed out, 2011 got off to a slow start with nonfarm payrolls rising only by 103,000 in December. He called the figure weaker than expected.
Credit is another factor. Lending remains tight, but if it opens up with safe underwriting standards for creditworthy buyers, Yun says there would be a bigger boost to the housing market with spillover benefits for the broader economy. The 30-year fixed-rate mortgage is forecast to rise gradually to 5.3 percent around the end of 2011; at the same time, unemployment should drop to 9.2 percent, according to NAR.
In addition, over the past 10 years the U.S. has added 27 million people. Continued population growth will also spur home construction and sales. “All the indicator trends are pointing to a gradual housing recovery,” Yun says.
An even more conservative projection of 492,000 housing starts in 2011 was released by the Portland Cement Association during the International Builders Show Wednesday. Edward Sullivan, PCA chief economist, does not expect significant increases until 2012 due to tight lending standards, a high home inventory count, and unstable housing prices. He also says that new home construction will vary considerably by region.
-- Erica Christoffer, REALTOR® Magazine
Monday, January 17, 2011
Free Federal Reserve brochure explains credit decisions
WASHINGTON – Jan. 17, 2011 – Lenders usually consider a consumer’s credit history or credit score when deciding whether to extend credit and at what interest rate. A new Federal Reserve publication available online helps consumers understand the new notices they may receive from lenders when credit reports or credit scores affect a decision to grant credit.
The publication, “What You Need to Know: New Rules about Credit Decisions and Notice,” describes the types of notices consumers may receive. It includes links to sample notices, information on what consumers should do if they receive a notice, and instructions on how to dispute credit report errors.
The notices are now required by rules issued by the Federal Reserve Board and the Federal Trade Commission. The new rules took effect Jan. 1, 2011.
Under the rules, a creditor must provide a notice to the consumer when, based on the consumer’s credit report, the creditor offers loan terms that are less favorable than terms provided to other consumers. Consumers who receive this “risk-based pricing” notice have a right to get a free credit report to check the lender’s accuracy.
As an alternative to providing risk-based pricing notices, creditors can choose to give credit applicants a free credit score and information about their score.
Today, most consumers must pay a fee to obtain their credit score. While the free credit reports contain information about payment history and other details used to create a credit score, they do not include the numbers that lenders use to determine an interest rates.
To download the report that can be given to homebuyers, go to the Federal Reserve’s website.
© 2011 Florida Realtors®
The publication, “What You Need to Know: New Rules about Credit Decisions and Notice,” describes the types of notices consumers may receive. It includes links to sample notices, information on what consumers should do if they receive a notice, and instructions on how to dispute credit report errors.
The notices are now required by rules issued by the Federal Reserve Board and the Federal Trade Commission. The new rules took effect Jan. 1, 2011.
Under the rules, a creditor must provide a notice to the consumer when, based on the consumer’s credit report, the creditor offers loan terms that are less favorable than terms provided to other consumers. Consumers who receive this “risk-based pricing” notice have a right to get a free credit report to check the lender’s accuracy.
As an alternative to providing risk-based pricing notices, creditors can choose to give credit applicants a free credit score and information about their score.
Today, most consumers must pay a fee to obtain their credit score. While the free credit reports contain information about payment history and other details used to create a credit score, they do not include the numbers that lenders use to determine an interest rates.
To download the report that can be given to homebuyers, go to the Federal Reserve’s website.
© 2011 Florida Realtors®
Rate on 30-year fixed mortgage dips to 4.71%
Mortgage Rate Trend Index
Expect little change in mortgage rates over the short term, say 56% of the industry experts polled by Bankrate.com this week. The remaining 44% predict a rise – and none expect further declines.
NEW YORK (AP) – Jan. 14, 2011 – Rates on fixed mortgages dipped for the second straight week as Treasury yields fell.
Freddie Mac said Thursday the average rate on the 30-year mortgage dropped to 4.71 percent this week from 4.77 percent the previous week. It hit a 40-year low of 4.17 percent in November.
The average rate on the 15-year loan slipped to 4.08 percent from 4.13 percent. It reached 3.57 percent in November, the lowest level on records starting in 1991.
Treasury yields dropped after the December employment report came in weaker than expected. That drove investors to buy safer Treasury bonds, driving up prices and lowering the yields. Mortgage rates tend to track the yield on the 10-year Treasury note.
Rates had been rising since November. Investors shifted money out of Treasurys and into stocks on expectations of faster economic growth and higher inflation. Yields tend to rise on inflation fears.
The recent dip in rates has persuaded some borrowers to refinance, but would-be buyers remain hesitant. The number of homeowners looking to refinance rose last week, the Mortgage Bankers Association said Wednesday. But the ranks of people applying for a purchase mortgage slipped from the week before.
Mortgage rates aren’t expected to revisit last year’s historically low rates, unless the economy takes a sharp turn for the worst. And even if they do, low mortgage rates did little last year to spark flagging home sales.
Higher rates are just another obstacle facing the beleaguered housing market. High unemployment, elevated foreclosures and falling home prices are other drags on the market’s recovery.
RealtyTrac Inc. said Thursday that banks took back more than 1 million homes last year, the highest tally on records dating back to 2005. One in 45 U.S. households received a foreclosure filing in 2010, up 1.67 percent from the year before. The foreclosure listing firm expects bank repossessions to peak this year at 1.2 million.
Foreclosures typically sell at a steep discount of up to 50 percent in some of the hardest-hit regions. That lowers prices of similar homes in the area. Experts predict prices will drop nationally another 5 to 10 percent before bottoming out midyear.
To calculate average mortgage rates, Freddie Mac collects rates from lenders across the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a single day.
The average rate on a five-year adjustable-rate mortgage slipped to 3.72 percent from 3.75 percent. The five-year hit 3.25 percent last month, the lowest rate on records dating back to January 2005.
The average rate on one-year adjustable-rate home loans fell to 3.23 percent from 3.24 percent.
The rates do not include add-on fees, known as points. One point is equal to 1 percent of the total loan amount. The average fee for the 30-year loan in Freddie Mac’s survey was 0.8 point. The average fee for the 15-year fixed loan and the five-year ARM was 0.7 point, and the fee for the 1-year ARM was 0.6 point.
Copyright © 2011 The Associated Press, Janna Herron, AP real estate writer.
Thursday, January 13, 2011
Foreclosure rate took a dive at end of year
WASHINGTON – Jan. 13, 2011 – The pace of foreclosures in the U.S. has dropped since revelations that thousands of foreclosure documents may have been improperly prepared.
In December, U.S. foreclosure filings were off 26 percent from December 2009, RealtyTrac reported today. In November, filings were down 14 percent year over year. The December drop was the biggest in at least five years. December’s foreclosure filings are the lowest monthly total since June 2008, RealtyTrac says.
Lenders and mortgage servicers imposed delays on foreclosure processes in October after reports in September that some servicers did not follow legal procedures in tens of thousands of foreclosures. Mortgage servicers say they’re resuming stalled foreclosures, but RealtyTrac estimates that up to 250,000 may have been delayed by the controversy. Those foreclosures will likely be restarted and added to the numbers in early 2011, says James Saccacio, RealtyTrac CEO.
The Department of Justice and the state attorneys general are investigating. “Lenders have been spanked. They’re spending money to make sure every ‘i’ is dotted and every ‘t’ is crossed,” says Christopher Thornberg, of Beacon Economics. The pace of foreclosures “will pick back up,” he says.
Whether it’ll go back to the torrid pace of the past is unclear. Some states have recently added speed bumps. New York now requires lawyers for firms bringing foreclosures to sign an affirmation that they reviewed court documents – and asked servicers to verify their accuracy. Since that requirement started in October, foreclosure filings have “dropped like a rock,” says Paul Lewis, chief of staff to New York State Deputy Chief Administrative Judge Ann Pfau. They’re running about 150 a month, down from 900, Lewis says. He speculates lawyers need time to get information from banks.
In addition to taking longer to make sure paperwork is correct, companies may be slowing foreclosures so that they don’t glut the market with homes for sale, which would depress prices, says Patrick Butler, head of asset disposition for Foreclosure.com. They may also be delaying foreclosures to avoid the cost of maintaining properties while others remain unsold, Butler says.
In December, bank repossessions nationwide totaled 69,847, down 24 percent from December 2009 but up 4 percent from November.
For the year, almost 2.9 million U.S. properties received foreclosure filings, a record high and up 2 percent from 2009. Nationwide, 1 in 45 homes received at least one foreclosure filing during the year.
Source: USA Today
In December, U.S. foreclosure filings were off 26 percent from December 2009, RealtyTrac reported today. In November, filings were down 14 percent year over year. The December drop was the biggest in at least five years. December’s foreclosure filings are the lowest monthly total since June 2008, RealtyTrac says.
Lenders and mortgage servicers imposed delays on foreclosure processes in October after reports in September that some servicers did not follow legal procedures in tens of thousands of foreclosures. Mortgage servicers say they’re resuming stalled foreclosures, but RealtyTrac estimates that up to 250,000 may have been delayed by the controversy. Those foreclosures will likely be restarted and added to the numbers in early 2011, says James Saccacio, RealtyTrac CEO.
The Department of Justice and the state attorneys general are investigating. “Lenders have been spanked. They’re spending money to make sure every ‘i’ is dotted and every ‘t’ is crossed,” says Christopher Thornberg, of Beacon Economics. The pace of foreclosures “will pick back up,” he says.
Whether it’ll go back to the torrid pace of the past is unclear. Some states have recently added speed bumps. New York now requires lawyers for firms bringing foreclosures to sign an affirmation that they reviewed court documents – and asked servicers to verify their accuracy. Since that requirement started in October, foreclosure filings have “dropped like a rock,” says Paul Lewis, chief of staff to New York State Deputy Chief Administrative Judge Ann Pfau. They’re running about 150 a month, down from 900, Lewis says. He speculates lawyers need time to get information from banks.
In addition to taking longer to make sure paperwork is correct, companies may be slowing foreclosures so that they don’t glut the market with homes for sale, which would depress prices, says Patrick Butler, head of asset disposition for Foreclosure.com. They may also be delaying foreclosures to avoid the cost of maintaining properties while others remain unsold, Butler says.
In December, bank repossessions nationwide totaled 69,847, down 24 percent from December 2009 but up 4 percent from November.
For the year, almost 2.9 million U.S. properties received foreclosure filings, a record high and up 2 percent from 2009. Nationwide, 1 in 45 homes received at least one foreclosure filing during the year.
Source: USA Today
Wednesday, January 12, 2011
January Market Update
The housing market is recovering. As more home buyers are taking advantage of the improved affordability conditions. With mortgage rates hovering around recent record lows and home prices having generally stabilized, economists are expecting an upward trend to a healthy and sustainable level in 2011.
Encouraging signs are showing up across the economy. Retail sales recently hit their highest level since before the recession. Key measures of small and big businesses’ optimism marched back up to pre-recession levels and new claims for jobless benefits are trending lower. Together they bode well for steady job creation and improved consumer confidence which is generally manifested in more spending.As the economy improves, current stimulus efforts by the government and the Federal Reserve Board are expected to gradually wind down. Meanwhile, serious buyers stand to benefit from historically favorable buying conditions.
Home Sales
Existing home sales resumed on an upward trend since bottoming in July. Sales activity rose to a seasonally adjusted annual rate of 4.68 million in November. This was up 22% from July and 5.6% above the 4.43 million level in October, but remained 27.9% below the 6.49 million tax credit rush a year ago. As steady job creation is expected to continue, industry experts are hopeful for 2011.
Home Price
Home prices continued to stabilize. Median home prices edged up slightly to $170,600, 0.4% above year-ago levels. Distressed homes have accounted for a fairly stable market share, representing 33% of sales in November. This is on par with the 34% in October and 33% in November 2009. Historically favorable interest rates, coupled with stable home prices, continue to offer advantageous buying opportunities .
Inventory
The number of homes on the market continued to decline. Total inventory fell to 3.71 million in November from 3.86 million in October. This reflects the increasing response from buyers to improved affordability conditions. As lending standards return to historical norms and consumers become more confident about their financial situation, more people will be able to buy their first home, move up, or invest.
Affordability
Housing affordability set a new record in November. The relationship between mortgage rates, home prices, and family income is the most favorable on record for buying. The home price-to-income ratio, currently at 13.5%, continues to remain well below the historical standard. Stabilizing home prices and rising interest rates are expected to begin drawing affordability back up toward more normal levels.
Source: National Association of Realtors - October housing data released December 22.
Interest Rates
Mortgage rates are inching up but remain historically low. This trend continues to support home buying as it translates to significant savings for buyers. As overall economic recovery remains on track, rates are expected to rise to keep inflation in check.
Type | Rate |
| 30 year fixed | 4.77% |
| 15 year fixed | 4.13% |
| 5/1-year ARM | 3.75% |
| 30 year average for a 30 year fixed rate mortgage | 8.9% |
Source: Freddie Mac, Rates as of Jan 7.
This Month's Video
Topics For Home Owners, Buyers & Sellers
Use the Season to Your Home-Selling Advantage
While summer is generally known as the peak season for home sales activity, the winter can also offer great advantages for sellers – such as less competition from other sellers. With a little effort, you can use the season to your home-selling advantage.
Let’s put these ideas to work, so your home shows at its best.
Keep snow and ice at bay. If the buyer can't get in easily, the house won't sell. That means keeping walkways and driveways free of the frozen stuff. You want to make the home look well maintained.
Warm it up. Think warm, cozy, and homey. Before a buyer comes through, adjust the thermostat to a warmer temperature to make it welcoming. If you have a fireplace, turning it on right before the tour can create a more welcoming ambience.
Emphasize winter positives. Is your home on a bus route or some other vital service that means it's plowed or deiced regularly in bad weather? Be sure to mention that to the buyers.
Make it festive. Even if you're not actually going to be present, greet your buyers as if they were going to be guests at a party. Set up the dinner table with the good china and silver. Have a plate of cookies for your guests, some warm cider, or even chilled bottles of water.
Use the season to your advantage. When the holidays are over, you can still use winter wreaths and dried arrangements around the door to spark interest. In the winter, with the leaves off the trees, you might also have a nice view that isn't as apparent in the spring and summer months.
Friday, January 7, 2011
State Farm in final phase of dropping homeowners insurance policies
TALLAHASSEE, Fla. – Jan. 7, 2011 – State Farm is in the process of notifying 125,000 Florida homeowners that their policies will be dropped, and should finish notifications in the next few weeks.
Rather than withdrawing completely from the Florida market, State Farm made an agreement in late 2009 with Insurance Commissioner Kevin McCarty to shed a limited number of policies and keep almost 700,000 policies. In return, the company was granted an average 15 percent rate increase.
Meanwhile, state-run Citizens Property Insurance has expanded dramatically, and insurance regulators have been hoping that small insurers based in the state would pick up the policies dropped by State Farm.
Source: St. Petersburg Times (FL) (01/04/11) Harrington, Jeff
Rather than withdrawing completely from the Florida market, State Farm made an agreement in late 2009 with Insurance Commissioner Kevin McCarty to shed a limited number of policies and keep almost 700,000 policies. In return, the company was granted an average 15 percent rate increase.
Meanwhile, state-run Citizens Property Insurance has expanded dramatically, and insurance regulators have been hoping that small insurers based in the state would pick up the policies dropped by State Farm.
Source: St. Petersburg Times (FL) (01/04/11) Harrington, Jeff
SIMPLIFY THE NEW YEAR...
Do you feel like you are going off in all directions, struggling to stay on top of the pile, working harder and having less, worn out, stressed to the breaking point, and still not on top of things? Here are ten steps to getting where you need to go safely in 2011!
1. Simplify. Accept the reality that you can't be all things to all people, have it all, and do it all. Life gets more complicated every year. Simplify, simplify, simplify.
2. Live out your faith. Read Matthew 5-7. Remember, it's all about God, not about you! Jesus said we are to seek His kingdom first, and trust Him for "all these things." If you believe God is in control, relax.
3. Prioritize. You can't keep everybody happy, so you have to decide who stands at the head of the line. Start your day with God. Soak yourself in the Word. Pray about your needs.
4. Get rid of the clutter. That includes clutter in your schedule, your garage, your closet and your thinking. Sometimes you have to do some sorting and cleaning in your mental life as well. Ask God to help you decide what your life should be about.
5. Throw out the ibuprofen, aspirin and the sleeping pills. Bring in moderate exercise, time for quiet contemplation, and a common-sense diet. Forget the fads, the fatty foods and the "more is better" approach to desserts.
6. Get started today! That's the hardest part of progress. Vast numbers of people start the New Year with guilt-driven resolutions which never become accomplishments. When you know what the next step is, do it! God will show you step by step what He requires of you.
7. Eat your bug first thing. Remember the reality shows where contestants are required to do something rather repulsive? That thing you have been hating to face or do-a phone call, a job you disdain, a confrontation with someone? Stop postponing what you dislike. Do it first thing and be done with it.
8. Stop tipping God. A waitress who serves your food usually is given 15% of your bill. Doesn't God deserve the same from your income? Discover that God is no man's debtor. You can't out give Him. You will also discover He'll give you back far more than you ever give to Him.
9. Forget about making God your co-pilot; let Him fly your plane. Realize God isn't interested in the co-pilot's seat. He wants to take you where He wants you to go in spite of storms, challenges, and difficulties.
10. Life is short; death is certain. Live like you believe both.
1. Simplify. Accept the reality that you can't be all things to all people, have it all, and do it all. Life gets more complicated every year. Simplify, simplify, simplify.
2. Live out your faith. Read Matthew 5-7. Remember, it's all about God, not about you! Jesus said we are to seek His kingdom first, and trust Him for "all these things." If you believe God is in control, relax.
3. Prioritize. You can't keep everybody happy, so you have to decide who stands at the head of the line. Start your day with God. Soak yourself in the Word. Pray about your needs.
4. Get rid of the clutter. That includes clutter in your schedule, your garage, your closet and your thinking. Sometimes you have to do some sorting and cleaning in your mental life as well. Ask God to help you decide what your life should be about.
5. Throw out the ibuprofen, aspirin and the sleeping pills. Bring in moderate exercise, time for quiet contemplation, and a common-sense diet. Forget the fads, the fatty foods and the "more is better" approach to desserts.
6. Get started today! That's the hardest part of progress. Vast numbers of people start the New Year with guilt-driven resolutions which never become accomplishments. When you know what the next step is, do it! God will show you step by step what He requires of you.
7. Eat your bug first thing. Remember the reality shows where contestants are required to do something rather repulsive? That thing you have been hating to face or do-a phone call, a job you disdain, a confrontation with someone? Stop postponing what you dislike. Do it first thing and be done with it.
8. Stop tipping God. A waitress who serves your food usually is given 15% of your bill. Doesn't God deserve the same from your income? Discover that God is no man's debtor. You can't out give Him. You will also discover He'll give you back far more than you ever give to Him.
9. Forget about making God your co-pilot; let Him fly your plane. Realize God isn't interested in the co-pilot's seat. He wants to take you where He wants you to go in spite of storms, challenges, and difficulties.
10. Life is short; death is certain. Live like you believe both.
Thursday, January 6, 2011
Housing Starts Predicted to Hit 3-Year High
Housing starts will probably reach a three-year high of 739,000 in 2001, creating about 500,000 jobs and helping trim the unemployment rate to 9.1 percent, said David Crowe, chief economist for the National Association of Home Builders, in an interview with Bloomberg.
“This is an ugly economic cycle,” he said. “We need job creation to get people comfortable with buying a home. If they do that, we’ll create jobs that will reinforce that home buying and fuel additional job growth.”
Job growth in other sectors, as well as population growth, will also likely have an effect. The number of U.S. households will rise 0.7 percent to 118.7 million in 2011, the largest annual gain since the beginning of the housing crisis in 2007. Charles Lieberman, chief investment officer at Advisors Capital Management LLC in Hasbrouck Heights, N.J., expects jobs to rise by an average of 200,000 per month in 2011.
The CEO of luxury home builder Toll Brothers is optimistic. “The recovery is here to stay,” said Douglas Yearley. “I think 2011 will be an improving year, but I think 2012 will be a big year for us.”
Source: Bloomberg, Joshua Zumbrun and Kathleen M. Howley (12/28/2010)
“This is an ugly economic cycle,” he said. “We need job creation to get people comfortable with buying a home. If they do that, we’ll create jobs that will reinforce that home buying and fuel additional job growth.”
Job growth in other sectors, as well as population growth, will also likely have an effect. The number of U.S. households will rise 0.7 percent to 118.7 million in 2011, the largest annual gain since the beginning of the housing crisis in 2007. Charles Lieberman, chief investment officer at Advisors Capital Management LLC in Hasbrouck Heights, N.J., expects jobs to rise by an average of 200,000 per month in 2011.
The CEO of luxury home builder Toll Brothers is optimistic. “The recovery is here to stay,” said Douglas Yearley. “I think 2011 will be an improving year, but I think 2012 will be a big year for us.”
Source: Bloomberg, Joshua Zumbrun and Kathleen M. Howley (12/28/2010)
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