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NickCosper.com - Recent Real Estate News

Fiserv, a technology company that provides software solutions for the financial services market, has predicted that property values will increase an average of 7.2% across the nation by 2014.  Of course, there are some areas that have been hit harder than others during this housing crisis.  Some of those are predicted to see much bigger gains in values during the same time period.

According to Fiserv's predictions, the top ten gainers will be:

1. Washington State: Bremerton-Silverdale, +44.7 percent
2. Oregon: Bend, +33.6 percent
3. Michigan: Detroit-Livonia-Dearborn, +33.1 percent
4. California: Napa Valley, +31.7 percent
5. Nevada: Carson City, +31.6 percent
6. Florida: Panama City-Lynn Haven-Panama City Beach, +26.9 percent
7. Arizona: Flagstaff, +26 percent
8. New Mexico: Sante Fe, +25.8 percent
9. Wyoming: Cheyenne, +23.7 percent
10. Alaska: Anchorage, +20 percent

In the meantime, mortgage rates continue to hit new record lows.  In Oregon, there are lenders offering 30 year fixed rate loans as low as 4.125% for the most qualified borrowers.  FHA rates are following very closely with conventional rates and are available as low as 4.25%!

It is forecast by many that mortgage rates are likely to remain low until after the November elections, and then forecast to begin to rise.  Mortgage rates tend to follow the 10 year Treasury bond yield - which is currently at a startling 2.81%.  Earlier this year, the rate topped 4% for a brief period which drove mortgage rates above 5%.

Just a reminder that while FHA rates and mortgages are currently very attractive, the fees for these loans are scheduled to begin to rise, very dramatically, beginning September 7, 2010.  The increase in fees will effectively increase the rates that home buyers will pay for those loans.

 

Source

 

Are We There Yet?

Strong evidence that the market has bottomed and that a more balanced housing market is emerging in many parts of the U.S. can be found in the latest HouseHunt Current Market Conditions survey data reported during the first quarter of 2010.  Although uneven, the results show prices have stabilized after steep declines over the past two to four years and in some cases are actually appreciating despite the drag of foreclosures, short sales, job uncertainties and reluctant lenders.

Perhaps the most positive news is that the buyer-seller ratio is almost dead even in HouseHunt's national random survey of member-agents.  Also important, repeat buyers now represent 50% of all transactions with first-time buyers when investors are factored into the equation.  Three months ago, repeat buyers accounted for only 34% of home purchases.  The normal ratio is two-thirds repeat buyers.

Improvement is also seen in the average time needed to sell a home.  Fifty-two percent of HouseHunt's member-agents report that their customers received 95 to 100% of their asking prices.  Another 35% said they received more than 90%.

"From the member-agents I talk to, there seems to be a sense the market has hit bottom and sales activity is continuing to pick up," observes Michael Bearden, president and CEO of HouseHunt, Inc.  "Business is by no means easy but is getting better and more reliable.  Our lead flow remains good with plenty of interest in real estate.  Consumer demand is building, especially from repeat and move-up buyers.  The federal $8,000 and $6,000 first-time buyer tax credits approved by Congress last year were strong motivators for fence-sitters to do something.  Any increase in current mortgage interest rates could stimulate additional buyer activity this summer and fall."

When individual agents were asked if the housing market has bottomed in their communities, their opinions ranged from "yes" to a flat "no."  A majority of them agreed that more personal contact with customers is needed, both by phone and by e-mail, to meet changing market demands.  Here's a sampling:

"I'm definitely trying to spend more time being in touch with my customers," said Steve Hinrichs of Edina Realty, who with his partner Jean O'Reilly are agents in Maple Grove and Rogers, MN, in the suburban Minneapolis area.  "I'm currently offering to update my customers on a monthly or quarterly basis on homes that have sold in their communities.  It keeps me in front of them and allows me to see what is going on in their areas.  As far as local market activity, our focus has been on first-time buyers.  We're seeing a little price growth in some areas but will know better in a month or two.  Our market will come back.  Our biggest problem right now is consumer confidence.  People are nervous and unsure about their jobs and the economy.  I try to be honest and forthright with them.  Trust is of utmost importance now."

Geri Boyer of Altura Real Estate Group in Laguna Beach, CA, said she is seeing a stabilization of prices but expects a little more price dropping through the end of the year.  "The activity is out there," she said, "but our biggest problem is getting loans for my buyers.  Competition from second home buyers and investors is also keen for properties in the $350,000 range.  Recently, I had a listing on a bank-owned property that attracted 33 offers.  It sold for $100,000 over the list price.  First-time buyers are being outbid any investors with cash."  Boyer added: "I'm doing everything different to compete in this market.  I've had to reinvent myself."

Dealing with the lenders is also a big problem for Alexia Gallagher of Keller Williams Realty Atlanta Partners in Suwanee, South Forsyth County and Cumming, GA.  "The majority of buyers who come to us are looking for deals, so we're looking at foreclosures, short sales and distressed properties.  Our biggest problem is getting banks to be reasonable and to get them to respond in a timely manner.  We have been in multiple bidding wars.  It's a different market."  She noted: "I think as far as value goes, we probably have bottomed out price-wise.  Our inventory of unsold homes is down quite a bit, which is very good.  We've had a surplus of inventory with lots of new construction.  We continue to have a record number of foreclosures as well.  So we have a mixed market with some positive signs and some negative signs."

Not convinced that the housing market has bottomed is Barry Newman of Century21 M.B. in Glenview, IL, a suburb of Chicago.  "I feel that we're over-inventoried.  I also have a hard time believing that there are as many buyers as sellers out there.  I had a great December and January, then things started to dry up, which was disappointing."  Newman continued: "One thing I am doing to be more effective in this market is to talk more with my customers rather than e-mail them.  I now see that talking directly to people is the best way to go.  It's better to be in front of your customers than communicating the way I have been doing."



By: Mike Bearden, www.realtown.com

 

Are interest rates going to rise this spring?

It looks like interest rates will be on the move this summer and not in the direction we all like. Interest rates have started to slowly climb this year and will continue. To get in on these low interest rates the time to act is now.

Check out this video for some great information on how interest rates change and some insight as to why changes are on the way.

 

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10 Questions for Homebuyers Who Want to Go Green - Or Just Save on Their Utilities

For homebuyers, green is fast becoming a priority -- whether it's because they want to reduce their energy costs, minimize their carbon footprint or improve indoor air quality.

Here are 10 questions that prospective buyers or renters ought to ask to find out how green a house or apartment is.

1. How big is it?

The bigger the home, the more energy it uses.  The U.S. Green Building Council considers a "neutral size" home -- basically what most people need, without what might be considered luxury space -- to be 900 square feet for a one-bedroom home, 1,400 square feet for two bedrooms and 1,900 square feet for three bedrooms.  A 100% increase in the size of the home adds anywhere from 15% to 50% to energy use.

2. Where is it?

Can you walk to public transportation?  Are there sidewalks or easy places to walk in the neighborhood so you don't always have to drive?  How close are shopping centers and other places you would frequent?  The Web sitewalkscore.com rates the walkability of cities, neighborhoods and individual addresses and shows the distances to stores, restaurants, schools and amusements.

3. How is it oriented?

South-facing windows can trim heating costs in the winter.  Shade from trees to the south and west can reduce cooling costs in the summer.

4. Is it well-insulated, and are doors and windows sealed tightly against air leaks?

The U.S. Energy Star Web site, energystar.gov, features a calculator to help determine how much insulation you need, based on your location.  To guard against air leaks, windows and exterior doors ideally should have an Energy Star rating, which indicates they meet a certain standard of efficiency in preventing the loss of heat in the winter and cooling in the summer.  You may be able to feel air leaks, or you can hire an energy auditor to conduct a "door blower test" -- a big fan placed in a doorway sucks air out of the home, creating easily detectable drafts rushing in from outside wherever there's a leak.

5. Has the indoor air quality been tested?

Well-insulated, well-sealed homes not only hold in heat and cooling, but also can retain toxins such as formaldehyde, mold, asbestos and lead.  A test will show whether any toxins are present in levels that exceed the safe maximums established by the Environmental Protection Agency.  You might also ask whether the home was constructed or renovated with nontoxic building materials and furnishings, such as low- and zero-emission paints.

6. If it's an older home, have insulation, heating and cooling systems and appliances been upgraded?

Newer products are far more efficient than those bought several years ago.  Also, has higher-efficiency lighting been installed?

7. How efficient is the water usage?

Are the kitchen and bathrooms equipped with water-efficient plumbing fixtures?  If it's a house, does it have a water-conserving irrigation system for the grounds, and landscaping that minimizes the use of water?  It may also have a rainwater collection and storage system, particularly in drier areas where water is increasingly scarce and costly.

8. What's on the roof?

A lighter-colored roof reflects more heat than a dark-colored roof, which absorbs heat, putting more strain on the cooling system.  Does it have skylights that let in natural light?

9. Where did the home's materials come from?

Recycled or salvaged building materials reduce the home's impact on the environment.  Also preferable are materials that are locally available, can be processed with less energy and water, are reusable or recyclable, are durable and are abundant in the environment.

10. Has it been certified green?

The U.S. Green Building Council, the Environmental Protection Agency and others offer ratings on homes, based on inspections by trained third-party professionals.

 

By: Sari Krieger, www.wsj.com

 

FHA Buyers that are on the fence... It might be time to jump off

Waiting a few extra days or weeks to purchase a home this spring could cost buyers thousands of extra dollars as the office of Housing and Urban Development (HUD) implements several changes for loans guaranteed by the Federal Housing Authority (FHA).

Coming just weeks before the April 30 deadline for the Home Buyer Tax Credit and just days after the March 31 expiration of the Federal Reserve Board's mortgage backed securities purchase program (which has kept home loan rates artificially low for over a year), these FHA changes make it even more important to act now to save big.

Here are a few reasons why:

On April 5th, the cost of required up-front mortgage insurance for loans guaranteed by the FHA will increase from 1.75% to 2.25%. For a borrower purchasing a $200,000 home with a $7,000 down payment, the up-front mortgage insurance will increase by $965. Up-front mortgage insurance is typically financed in the final loan amount so the impact to a monthly payment will be minimal but overall, the increase is still borne by the borrower both upfront and monthly.

Later this spring, the amount of money that a seller can return to the buyer from their sale proceeds will be reduced from 6% to 3%. The reduction in these "seller concessions" can increase the amount of cash a buyer will be required to pay at closing by $6,000 for a home purchase of $200,000.

There is only one way to avoid being affected by all of these costly changes that lie ahead – submit all FHA mortgage applications by the last week of March.


 
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