Real Estate Today

Economy

2012-02-09T19:59:00.000-05:00

Economy

The East Coast – particularly North Carolina – continues
to attract new residents. According to a 2011 Atlas Van
Lines’ Migration Patterns study, our state was among the
top inbound states for moves. And the U.S. Census supports
this claim. In the 15 months that ended in July, North
Carolina added an estimated 121,000 residents – the fifth
largest number in the nation for that time period.

For the first time since June, the unemployment rate in
North Carolina fell below double digits in December to 9.9
percent. Nationally, unemployment has also fallen while
income in the United States rose 0.5 percent – the strongest
increase since March.

North Carolina’s revenue collections exceeded budget
projections by $60 million in December, primarily because
businesses did particularly well with corporate and franchise
collections, reaching 14.5 percent above budget,
according to Gov. Bev. Perdue. Overall, revenue collections
exceeded forecasts for the first half of the fiscal year by $150
million – a healthy sign for our economy.

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Homeownership

2012-02-09T19:57:00.000-05:00

Homeownership

The new year is off to a good start. Moody’s Analytics
expects existing home sales to increase 12 percent this year,
singlefamily
housing starts to increase 37 percent, and
newhome
sales to soar by 74 percent. Further good news:
Raleigh was recently named by Inman News as the nation’s
For the Record
No. 1 market – expected to “outshine all the rest” – for the
coming year.

The National Association of Home Builders/Wells Fargo
Builder Sentiment Index rose to its highest level since June
2007 in January. What’s more, January’s index reading of 25
is only the third time the index has been at 20 or above in the
past two years.

A surplus housing inventory has been a concern since the
economic downturn began. But at the end of 2011, there
were fewer homes listed for sale nationally than in any of the
previous four years. In just a year, housing inventory has
declined 22.3 percent, according to data compiled by
Realtor.com.

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Amid Squeeze on Home Equity, A Revival for Reverse Mortgages

2012-02-06T20:55:00.001-05:00

Converting home equity into cash has been a challenge for homeowners since the real-estate downturn, but a growing number of lenders are quietly reviving a loan for seniors that does just that: the reverse mortgage.

Reverse mortgages allow homeowners who are at least 62 years old to draw down on their home's equity in exchange for cash in several ways, including one lump sum, a line of credit or monthly payments.

Compared to a few years ago, the total number of reverse mortgages is small. But lending has been picking up. In 2011, MetLife Bank originated 10,512 reverse mortgages, up 171% from the previous year, according to data firm Reverse Market Insight. The firm tracks reverse mortgages insured by the Department of Housing and Urban Development, or about 95% of total originations. Other lenders also had sharp increases. .

This comes in spite of recent moves by HUD to lower the amount homeowners can borrow. The limit is now 62% of a home's value for a 62-year old; an 80-year-old can borrow up to 72% of the home's value.

With falling home values making it difficult for homeowners to refinance or sell—and the stock market not delivering great gains—the loans are understandably attractive to many Americans. But there are good reasons why advisers have historically recommended them only as a last-gasp way to raise cash.

For one, because borrowers are still responsible for property taxes and homeowner's insurance, if they fall behind, lenders can foreclose on the property, says Karin Hill, director of single family program development at HUD.

Also, reverse mortgages carry hefty fees. Origination fees can be up to 2% of a home's value, capped at $6,000, says John Lunde, president of RMI. Closing costs vary but are often about 2% of the loan and there are also mortgage-insurance fees charged by HUD.

Some advisers say a home-equity loan, which allows homeowners to borrow against some of their home equity in one lump sum, is often the safer bet. Closing costs tend to be smaller than on a typical reverse mortgage and in some cases lenders can waive them, says Buz Livingston, a certified financial planner in Santa Rosa Beach, Fla. The downside? Average interest rates on home-equity loans are currently higher.

There are situations where reverse mortgages make sense. Financial planner Mike McGervey of North Canton, Ohio, says he thinks they can be a good solution for people in their 80s, who are usually able to convert more home equity into cash than younger borrowers.

In some cases, homeowners sign up for a reverse mortgage as a lump sum to pay off their mortgage. That is what Joseph Rinaldi, 62, did when he signed up through US Mortgage Corp. three months ago. Now, rather than paying $2,200 a month in mortgage payments, Mr. Rinaldi, who lives in Mamaroneck, N.Y., says he and his wife use that money for everyday living expenses. "This saved mine and my wife's life," he says.

By ANNAMARIA ANDRIOTIS
WSJ.com

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Optimism Builds in Housing Market

2012-02-06T20:50:00.000-05:00

Several recent indicators for the real estate industry are pointing to a market that is on the mend and entering recovery mode.

Housing experts’ predictions for the new year tend to center around a market stabilizing before entering a gradual, albeit very slow, recovery. However, the tone is more upbeat than it has been in years for the housing market.

Here are a few of the signs that are showing the market moving in a more positive direction:

Home sales: Existing home sales are expected to increase 12 percent this year, following a 2 percent jump last year, Moody’s Analytics predicts. The signs are already showing: In November, pending home sales — a gauge for future home buying — reached its highest level in 19 months, the National Association of REALTORS® reported. (Read more.)

New-home market: Coming off of what could be considered the worst year for new-home building ever recorded, the sector is expected to bounce back this year. New-home sales and starts were already showing a rebound in the last few months of 2011. Moody’s is predicting that single-family housing starts will increase 37 percent this year, and new-home sales will soar 74 percent.

Housing stocks: Investors are starting to get optimistic about the possibility of a rebound too, and are turning to home builder stocks. These equities have recently outperformed the broader stock market and the S&P 1500 homebuilding index has increased 38 percent since mid-October, USA Today reports.

Consumer confidence: With mortgage rates at record lows and housing affordability high, about 71 percent of Americans say now is a good time to purchase a home. Also, more Americans are optimistic that home prices will rise over the next year — about 26 percent say prices will rise in 2012, an increase of 4 percent over the last survey, according to Fannie Mae’s December National Housing Survey

Source: “Housing Outlook Is More Upbeat,” USA Today (Jan. 15, 2012) and “Consumers More Confident, Survey Says,” Deseret News (Utah) (Jan. 16, 2012)

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JANUARY 2012 Newsletter Housing Trends eNewsletter

2012-01-26T15:50:00.001-05:00

JANUARY 2012 Newsletter Housing Trends eNewsletter

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

Please click here to view the JANUARY 2012 Newsletter Housing Trends eNewsletter.

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919-771-4747
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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Create a Home Inventory for Insurance

2012-01-05T11:36:00.000-05:00

Create a home inventory before disaster strikes to make filing an insurance claim a smoother process.

A home inventory is essential

From appliances, plates, and glasses to collectibles, rugs, and furniture, the average home is packed with an array of items collected over the years. And while you may be able to list many of them in a pinch, chances are you'd miss some important possessions if you ever needed to reconstruct your home's contents from memory, says Mark Goldwich, founder of GoldStar Adjusters, a Jacksonville, Fla., claims adjusting firm.

"Home inventories are a must no matter what the value of the home's items are," says Goldwich. "If you're going to insure your property and pay for that insurance, you really should be able to document the ownership and the value of the items that you're insuring. If you don't have proof of the items you owned, it makes filing your claim much more difficult."

Your job doesn't end once you've compiled a home inventory, a detailed list of everything in your household. Be sure to compare estimated values to your policy's coverage to ensure that you'll be able to replace your belongings in case of damage or theft, says Goldwich, who is the author of "Uncovered: What Really Happens After the Storm, Flood, Earthquake or Fire." In some cases, he says, you can purchase additional coverage if the value of your possessions exceeds the limits on your homeowners, flood, or other disaster policy.

Take photos and video of possessions

Jack Hungelmann, author of "Insurance for Dummies," says a picture can be worth more than just a thousand words--it can add up to thousands in cash if you ever need to file an insurance claim. Hungelmann recommends using a digital camcorder or camera to take pictures of each room to document your belongings. "I recommend that people open up their cupboards and drawers. Be sure you have a record of all the things you own," he says.

Goldwich says that creating such a home inventory might seem daunting, but digital video--you can pick up a decent camcorder for about $150--can make the task much easier.

Homeowners can literally walk from room to room and record narrative descriptions of items. You should note whether something is an antique, for example, or if it has other qualities that make it especially valuable such as the size of a television screen or the type of stones in a piece of jewelry. Get close-up shots of serial numbers on electronics, power tools, and the like.

Filling in a printed checklist with serial numbers, brands, quantities, and estimated values will prove indispensible if an insurance claim ever needs to be filed. The adjuster will likely ask for such a list, and you can use the video or photos as proof of ownership. Download our free home inventory checklist to create your own.

Keep your home inventory safe

Of course, such documentation is useless if it's destroyed in a natural disaster, consumed by fire, or stolen along with your personal computer. Hungelmann says that using digital media allows you to store the files on online backup services like Carbonite.com or iBackup.com in case your home is destroyed.

If you'd like to save the $10 or more per month these services typically cost, you could also save the files on a USB drive that's kept in a safe-deposit box, at a relative's home, or in your emergency bag. The bag should include essentials your family needs in case you're forced to flee on short notice.

It's also a good idea to keep a file with receipts and any appraisals of valuable items you own. Store these documents off-site as well. Goldwich says that the more documentation you have to prove what you owned and what it was worth, the easier the claims process will be.

By: Gwen Moran
HouseLogic

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DEC-2011 Newsletter Housing Trends eNewsletter

2011-12-27T10:16:00.000-05:00

Real Estate Today

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

Please click here to view the DEC-2011 Newsletter Housing Trends eNewsletter.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

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For more information contact me:
919-771-4747
Email - ronlwilson@ronlwilson.com

ronlwilson.com

NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

Moving, have property to sell or buy outside of our area? I can recommend an experienced and capable agent in the new area of the state or country.

Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Hiring an HOA Manager: What to Consider

2011-12-06T21:25:00.000-05:00

When your homeowners association has more to do than its volunteers can handle, it's time to call in a professional manager. Here are 10 tips for picking the right one.

1. Know what you need. Start your search by making a list of what you’d like the management company to do. You can put anything on the list, as long as the HOA board keeps the responsibility to oversee the management company’s actions. Knowing what your HOA needs will help you focus your search.

2. Choose a person or committee to do the preliminary search. Expect to devote about 20 hours to choosing a company, says Elizabeth White, an attorney at LeClairRyan in Williamsburg, Va., who represents community associations.

3. Ask if your state requires some level of manager licensing. If so, seek out companies and candidates with the proper credentials. “We’re finding a lot of management companies in states that require licensing (that) haven’t gotten the license,” White says. States that require licenses or registration include Alaska, Connecticut, the District of Columbia, Florida, Georgia, Nevada, and Virginia. Starting in 2011, Illinois will require licenses.

4. Consider a company certified by the Community Associations Institute. This Alexandria, Va.-based organization has a range of certifications for companies and individual managers.

5. Be sure the company performs criminal background checks on its employees, especially its managers. Do your own background checks, too. Check references and do an onsite visit. “Speak to board members of associations managed by that company,” suggests David Regenbaum, CEO of Association Management Inc. in Houston. “Visit the company’s office and get a sense of its business philosophy. Some are merely bookkeeping and secretarial services. Others are fully committed and involved in the community. Make sure you select the company that’s appropriate to your needs.”

6. Investigate the firm’s bonding and insurance. Your state law and governing documents may spell out minimum standards for both, Taylor says. But a management company should also have liability insurance and workers’ compensation insurance covering its employees. Ask for a copy of the company’s insurance certificate, recommends Robert White, managing director of KW Property Management & Consulting in Miami. His firm carries a $2 million liability policy, plus a $10 million umbrella policy.

7. Read the fine print. It’s the rare management company that works without a signed contract. “It goes without saying,” Elizabeth White says, “that you should never sign the management company’s form contract.” Have your association lawyer suggest changes.

8. Try to negotiate for a one-year contract rather than the three-year contracts many companies seek. Why commit to a three-year contract if you can negotiate a one-year contract with the option to renew at one-year intervals for two years at the same price?

9. Scrutinize termination provisions. “As a manager, I don’t mind receiving 30 days’ notice of termination,” Regenbaum says. “But you shouldn’t allow the management company to give you 30 days’ notice because it’s difficult to scramble to find another manager in that time.” You need 60 to 90 days to repeat the search process if things don’t work out with your current management company.

10. Ask for a complete fee schedule, so you can compare competing contracts. Big costs may be buried in extra fees. For example, a company may provide for a manager to attend one meeting every six months and charge $100 per hour after that. It may also charge separately for postage and to manage a vote on and payment collection for special assessments. The lesson, according to Elizabeth White: Bids that come in significantly lower than others should be red flags.

By: G. M. Filisko
HouseLogic

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Should Your HOA Manage Itself or Hire a Professional Manager?

2011-12-06T21:22:00.000-05:00

Does your community need a professional HOA manager or can volunteers handle the load?

Checklist: A pro is the way to go if:

Your HOA must manage a lot of building systems, amenities, and properties.
Home owners don’t have time to volunteer to manage the association.
Home owners don’t have the skills to do association work, such as depositing and recording dues checks or managing a pool.
The management companies you’re considering can get discounts from contractors or service providers, such as insurance companies, and those discounts are important to your HOA.

Our HOA doesn’t need a professional manager

OK, if the issues above don’t stand in your way, you can save money by not hiring a professional manager. Recruit volunteers who can handle billing, correspondence, and complaints. In general, you’ll want to fill board and committee volunteer positions with folks who have skills in:
Finance
Operations
Law
Public relations
Vendor management

Use a mix of pro and DIY in your HOA

If your HOA can cover some but not all of the jobs on your list, split the work between in-house volunteers and outside professionals. Some HOAs have an accounting firm handle billing, deposits, and audits, while board members manage contractors and tackle correspondence, complaints, and inquiries from owners.

Either way, a professional management company should never run the whole show. It should take its direction from the board. Nor would it be fiscally wise to let an outside firm have full control over your finances.

And keep your eyes on the prize: property values. Smart home buyers will avoid buying into associations where common areas aren’t spiffy and community budgets show cost overruns and special assessments for unplanned repairs.

By: G. M. Filisko
HouseLogic

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Last Call for Energy Efficiency Homeowner Tax Credits

2011-12-06T21:15:00.000-05:00

The Alliance to Save Energy urges American consumers to give themselves the gift of energy efficiency this holiday season—and reap the benefits when they file their 2011 federal tax returns—by taking advantage of tax credits for energy efficiency home improvements. The tax credits of up to $500 are set to expire on December 31, and Congress may not renew them for 2012.

"The outlook for renewal of federal energy efficiency tax incentives is uncertain at best," stated Alliance President Kateri Callahan, "so we encourage homeowners to complete those upgrades before the ball drops in Times Square at midnight on New Year's Eve.

"Making efficiency improvements this year will lower home energy bills and improve home comfort for years to come, while also reducing 2011 federal income tax bills," Callahan added. "Energy efficiency is truly the gift that keeps on giving!"

The specific home improvements that qualify for tax credits fall into a number of categories:

• Exterior windows, skylights and storm windows.
• Insulation, exterior doors, roofs, storm doors and products to seal air leaks such as caulking, weather stripping and foam sealants.
• Highly-efficient heating and cooling equipment, including central air conditioners, heat pumps, furnaces, boilers, water heaters and biomass (e.g. corn) stoves.
• Each product category also must meet specific energy efficiency requirements, which are spelled out on the Alliance's tax credits web page.
• Percentage and/or dollar limits on particular energy-efficient upgrades include:
• 10% of the cost of insulation and sealing materials, exterior doors and roofs.
• 10% of the cost, up to $200, of exterior windows or skylights.
• Up to $300 for electric heat pump water heaters, electric heat pumps, central air conditioners, biomass stoves and natural gas, propane or oil water heaters.
• Up to $50 for advanced main air circulating fans.
• Up to $150 for natural gas, propane or oil furnace or hot water boilers.

And to see what energy efficiency can do in your home, check out the Alliance's home energy tips videos produced with energyNOW!

For more information, visit http://www.ase.org/.

RISMedia
The Leader in Real Estate Information Systems and Real Estate News

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Adjustable Mortgage Rates Hit Record Lows

2011-12-06T21:10:00.000-05:00

Freddie Mac (OTC: FMCC) recently released the results of its Primary Mortgage Market Survey® (PMMS®), showing average fixed mortgage rates changing little and remaining near their historic lows while adjustable-rate mortgages averaged new record lows. The 30-year fixed has averaged at or below 4 percent for the fourth consecutive week.

30-year fixed-rate mortgage (FRM) averaged 3.98 percent with an average 0.7 point for the week ending November 23, 2011, down from last week when it averaged 4.00 percent. Last year at this time, the 30-year FRM averaged 4.40 percent.

The survey showed that 15-year FRM this week averaged 3.30 percent with an average 0.7 point, down from last week when it averaged 3.31 percent. A year ago at this time, the 15-year FRM averaged 3.77 percent.

Additionally, the 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.91 percent this week, with an average 0.6 point, down from last week when it averaged 2.97 percent. A year ago, the 5-year ARM averaged 3.45 percent.

1-year Treasury-indexed ARM averaged 2.79 percent this week with an average 0.6 point, down from last week when it averaged 2.98 percent. At this time last year, the 1-year ARM averaged 3.23 percent.

"Mortgage rates eased slightly this week with fixed-rate loans hovering above all-time lows and ARMs reaching a new nadir,” said Frank Nothaft, the vice president and chief economist for Freddie Mac commented . “The high-degree of home-buyer affordability in recent months translated into a 1.4 percent pickup in existing home sales during October, according to the National Association of Realtors (NAR). The NAR also reported that contract cancellations were up in October as well, which restrained sales from achieving a stronger rebound. “

For more information, visit www.freddiemac.com.

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Forestalled subdivisions back in business

2011-11-27T08:30:00.000-05:00

CLAYTON -- When a strange car drives by Manly Turner's house, he climbs into his red SUV and drives out to investigate.

Turner is cautious about who enters his property. He says he calls the police at least every two to three days.

Living in a home that sits all alone on a 76-acre tract of land across from the Glen Laurel subdivision, Turner has taken on the responsibility of driving four-wheeling teens and amorous couples off the property since Lyndale Developers, LLC filed for bankruptcy in April 2010, leaving the subdivision empty save for the model house.

The streets are there, curbs and all, and electricity meters sit idly by, ready to serve houses that never got built.

Turner, a now out-of-work builder, moved into the model home he helped build for the developers, anxious to protect the investment from arson. Two model homes on that same lot were burned down during the rash of arsons that swept the Glen Laurel area in 2009 and 2010.

Now, Turner is hopeful his job as sentry will near its end as BMV, LLC moves in to resume the development of Chandler's Ridge, a single-family-home subdivision that plans for houses in the $200,000 range.

After the housing bubble burst, developers of low-risk properties, like smaller single-family-home subdivisions, found themselves unable to complete their projects and filed for Chapter 11 bankruptcy.

SunTrust Bank lost two potential Chandler's Ridge developers to bankruptcy twice in 2010. Summerlyn, a subdivision project down the street, saw the same forestalling on its development when CTC Summerlyn Development, LLC crumbled partway through building its $200,000-range single-family homes and was dissolved by the N.C. Department of the Secretary of State.

"Developers went belly up," said town planning director David DeYoung. "We were left with partially completed subdivisions."

The first developers in Chandler's Ridge had gone ahead and installed water, sewer, electric and streets, but never got around to building a second house.

"Infrastructure that isn't functioning is undesirable. It's designed to function. Otherwise, it degrades," DeYoung said.

The town paid to install the electric infrastructure but hasn't been recouping any money from its use by households.

Hope down the street

Summerlyn is also finding a second chance at life through Raleigh-based developers Granite Land and Timber, who acquired the 124-acre subdivision from SunTrust.

The town made a developers' agreement to grant them 52 building permits, more than the 15 the town had planned to grant any new developers who would attempt to finish the seemingly plagued subdivision.

The deal is such that no more building permits would be granted for the 305-lot development until the developers begin work on a pool, clubhouse and a greenway that will lead to the new off-leash dog park - all amenities promised to original Summerlyn buyers. DeYoung said that home values diminish when the originally promised amenities don't come through.

The agreement posts the bond for amenities at 125 percent of the improvement value. That way, if the developers fall through, the town can pull the bond and complete the improvements itself.

"This is a great example of the town coming up with a developers' agreement that gives us security," DeYoung said. "It's the public sector and the private sector successfully working together."

New homes on the 52 permitted lots are already under construction and the pool and clubhouse area are being dug. DeYoung said the pool should be finished by Memorial Day, when pool season usually gets under way in North Carolina.

Demand still low

As for the overall health of the housing market, things haven't recovered entirely in Clayton.

Across the street from Chandler's Ridge, 38 houses are on the market in the slightly higher-priced Glen Laurel subdivision.

Allyson Caison, a property manager with Century 21, said she's seeing a lot of homeowners choosing to rent their homes because they can't sell them - even in an upper-middle-class neighborhood like Glen Laurel.

"Where sellers can't sell a house, they opt to rent it, especially if they have to move because of a job," Caison said. "Renting has increased tremendously since the housing crisis."

The inventory of homes for sale in Johnston County is down 15.6 percent from last October. Whether that's because of renting or low expectations from would-be sellers is unclear.

"Clayton is still a very desirable place to live," DeYoung said. "But I think demand is still low."

Town manager Steve Biggs said that before any further subdivisions are approved, the projects at Chandler's Ridge and Summerlyn need to be built and cleared.

"It has a chilling effect on the rest of the market," Biggs said of forestalled developments. "But I feel positive about these developers carrying through to completion."

BY REBECCA PUTTERMAN
Clayton News-Star

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November 2011 eNewsletter

2011-11-23T13:03:00.003-05:00

NOVEMBER - 2011 Newsletter Housing Trends eNewsletter

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

Please click here to view the NOVEMBER - 2011 Newsletter Housing Trends eNewsletter.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

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Merger of Two Top-Selling Coldwell Banker Franchises Creates State’s Third-Largest Residential Real Estate Brokerage

2011-11-18T17:56:00.000-05:00

November 17, 2011

Merger of Two Top-Selling Coldwell Banker
Franchises Creates State’s Third-Largest
Residential Real Estate Brokerage

Two of the top-selling Coldwell Banker franchises in North Carolina have joined forces, creating the state’s third-largest residential real estate brokerage company.

The merger of Coldwell Banker Sea Coast Realty of Wilmington and Coldwell Banker Advantage of Raleigh and Fayetteville creates a regional powerhouse with a sales team of more than 600 agents and 26 sales offices in Raleigh, Wilmington, Fayetteville, Jacksonville and other Eastern North Carolina markets.

The two companies combined to generate more than $1.3 billion in sales volume from 6,500 real estate transactions in 2010, which would have ranked the merged company as the state’s third-largest brokerage, according to REAL Trends, a real estate industry trade magazine.
Those totals would also have ranked among the top 55 brokerages in the country in sales volume and among the top 75 in transactions, according to the magazine.

The two companies are on track to surpass last year’s sales and transactions totals in 2011, having already exceeded $1 billion in sales and 6,000 transactions through October, according to statistics provided by local offices of the Multiple Listing Service (MLS).
The merger was announced by Coldwell Banker Real Estate Corporation CEO Jim Gillespie on Thursday, November 17th in separate news conferences in Raleigh and Wilmington.

“Today’s merger creates the fifth largest Coldwell Banker affiliated company in North America,” Gillespie said.

“Coldwell Banker Advantage and Coldwell Banker Sea Coast Realty have been long-time members of the Coldwell Banker Chairman’s Circle, representing the best-of-the-best of our great brand,” he said.

The new company will be led by co-CEOs Tim Milam of Sea Coast Realty and Gary Rabon of Advantage. In Wilmington, it will be called Coldwell Banker Sea Coast Advantage, while in Raleigh and Fayetteville it will continue to operate under the Advantage name.

“This is a true merger of equals,” Milam said. “It is not an acquisition. I want to emphasize that in the strongest possible terms. All owners of both companies will remain owners with the new company. Neither company is buying the other. Instead we’re joining forces to compete more effectively in today’s challenging marketplace.

“Gary and I have been friends for years,” he added. “Our companies have been built on similar values and culture. We’ve talked about merging for at least the last five years, and finally decided this summer the time was right to get it done.”

Rabon added: “This is a merger where both companies are strengthened. It builds our regional footprint and enables us to do an even better job of supporting our team of brokers and agents in the field. It also creates a lot of synergies in terms of marketing, training and technology.”

The merger brings together two companies that have dominated their respective markets. Sea Coast Realty is currently the number one brokerage in Wilmington, Brunswick County, Topsail and Jacksonville with over 23 percent of the market.

Advantage, meanwhile, ranks number four in Raleigh and number one in Fayetteville, according to MLS statistics.

Both have emerged as leaders in North Carolina’s fast-growing military market, with strong positions among military families in Fayetteville and Jacksonville – home of Fort Bragg and Camp LeJeune, respectively.

The merged companies will also have an advantage in serving the two-way traffic between the Raleigh/Research Triangle and the Wilmington/Wrightsville Beach markets, Rabon said.

“There’s a lot of cross-pollination on I-40 in both directions,” he said. “Triangle families are looking in Wilmington area for second-home opportunities, while a lot of Wilmington area families are looking to move to the Triangle for job opportunities.

“The merger gives us an even better connection to this growing segment of the market, one that we are both going to capitalize on.”

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F.H.A. Audit Sees Possible Bailout Need

2011-11-16T19:24:00.000-05:00

WASHINGTON — Chances are nearly 50 percent that the Federal Housing Administration will need a bailout next year if the housing market deteriorates further, the agency’s independent auditor said in a report released Tuesday.

The F.H.A., which offers private lenders guarantees against homeowner default, has just $2.6 billion in cash reserves, the report found, down from $4.7 billion last year.

The agency’s woes stem from the national foreclosure crisis. In the last three years, the F.H.A. has paid $37 billion in insurance claims against defaulting homeowners, shrinking its cash cushion.

The auditors determined the agency’s level of supplemental cash reserves by projecting losses on its mortgage portfolio and counting them against expected premium revenue. This year, the audit found that the F.H.A. supplemental reserve was less than one-quarter of a percentage point of its current portfolio: $2.6 billion against a $1.1 trillion mortgage portfolio, as of Sept. 30. Legally, the housing agency is required to keep a 2 percent cash buffer, a target it has not met since 2008.

F.H.A. officials argue that the likelihood the 77-year-old agency will need its first taxpayer bailout is slim. “It would take very significant home price declines to create a situation in which the portfolio would require any additional support,” said Carol Galante, acting commissioner. “There is no evidence or widespread prediction that home prices are going to decline to the kind of levels” requiring a bailout, she said.

The baseline plan included in the report does not foresee the F.H.A.’s going into the red. It presumes that home prices will stabilize in coming months and start to rise in 2012. In that case, the agency’s capital ratio will increase to 1 percent in 2012 and 2 percent, the legal minimum, in 2014.

But if housing prices decline, losses from an enormous cohort of loans, most originated between 2006 and 2009, could subsume the agency’s reserves. The audit contends that “significant declines of home prices” in fiscal year 2012 “would create a situation in which the current portfolio would require additional support” from the Treasury Department. In the worst case provided in the report, housing prices would continue to decline through 2014 and the agency would require a total of $43.2 billion from the Treasury. (Congress would not need to approve these funds.)

Ms. Galante said that before the agency got to that point, it would consider several measures, including raising the F.H.A. insurance premiums borrowers pay.

Traditionally, the F.H.A. has helped borrowing by first-time home buyers or those with low to moderate income. When the housing bust hit, the agency greatly expanded its purview, and the value of its loan portfolio more than tripled. In 2006, the F.H.A. backed about 5 percent of mortgages. In 2010, it insured one-third.

The F.H.A. provides lenders with a guarantee if mortgages meet certain underwriting criteria. It finances itself by charging borrowers a premium that offsets the cost of payouts on defaulting loans.

Numerous independent reports in the last three years have predicted the agency’s insolvency. Last week, for instance, the American Enterprise Institute, a policy research organization, released a study by Joseph Gyourko, a professor at the Wharton School at the University of Pennsylvania, stating that the agency was underestimating its future losses by “tens of billions” and arguing that “the recapitalization required will be at least $50 billion, and likely much more.”

“If the economy and housing markets deteriorate unexpectedly, we need to be ready to infuse even more capital” into the reserve account, Mr. Gyourko wrote, estimating that the F.H.A. may ultimately need as much as $100 billion.

Many housing experts have called for additional Congressional oversight of the agency, given the possibility of a bailout. “Along with Fannie Mae and Freddie Mac, the F.H.A. is the third leg of the government stool supporting the entire housing market,” said Christopher Papagianis, managing director of Economics21, a research organization. “What is embarrassing for Congress is that, unlike Fannie and Freddie, the F.H.A. is directly under their purview. It’s always been a government agency, subject to hearings and oversight. They clearly haven’t been minding the store, given this report.”

Other housing experts caution that the F.H.A.’s insolvency is not a foregone conclusion. “Whether or not they are adequately capitalized depends on their projections,” says Ann B. Schnare, an independent housing consultant, who has studied F.H.A. solvency. “But they have been over-optimistic about their future book for three or four years. Every year, it’s like, ‘We’re losing on this end, but we’re going to make it up going forward!’ ”

Ms. Schnare added: “They are doing very high loan-to-value loans in a market that is extremely fragile. People are entering the program without a lot of equity. They’re skating on thin ice.”

The F.H.A. report comes as lawmakers are considering raising the maximum loan amount that the agency can guarantee, possibly exposing the agency to more risk. On Oct. 1, the ceiling dropped to $625,500, from $729,750, in some high-cost areas like the New York metropolitan area. However, a bill moving through Congress would return the ceiling to the higher level.

The New York Times
Annie Lowery

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Lawmakers Near Deal on Raising FHA Loan Limits

2011-11-16T19:18:00.000-05:00

WASHINGTON -- U.S. lawmakers are near a deal to increase the maximum size of mortgage loans that can be insured by the Federal Housing Administration, a crucial source of mortgages for first-time home buyers, congressional aides said Monday.

The likely agreement between House and Senate lawmakers to lift the loan limits is being hashed out as part of a spending bill for several federal agencies that is expected to clear Congress by Thursday, aides said.

The loan limits fell on Oct. 1 to $625,500 for mortgages backed by the FHA, Fannie Mae and Freddie Mac in expensive markets like New York, San Francisco and Washington, D.C.

The agreement being worked out between House and Senate negotiators wouldn't include loans backed by Fannie and Freddie, which are the main source of funding for U.S. home loans. Instead, the deal would restore the FHA's loan limits to as high as $729,750 in high-cost cities through 2013. FHA charges mortgage insurance premiums for its borrowers, which adds to the cost of obtaining a loan.

The deal is a mixed bag for housing-industry lobbyists, who mounted an intense push in recent weeks to restore higher limits through the end of 2013 for Fannie, Freddie and FHA. They argued that the decline in limits is harming an already-shaky housing market.

The effort to raise the loan limits was led Sen. Robert Menendez (D., N.J.) and other Democrats and backed by some Republicans in expensive housing markets in California.

The FHA doesn't make loans directly but insures lenders against defaults and charges insurance premiums to borrowers. Home buyers with FHA-backed loans can take out mortgages with minimum down payments of 3.5%. The agency currently backs about a third of all new mortgages or home purchases, up from around 5% in 2006.

Raising the limits for FHA-backed loans could carry less political risk than doing so for Fannie- and Freddie-backed loans, but it comes at time when the agency's finances appear increasingly shaky and many lawmakers want to reduce the government's role in the housing market.

"This is just a subsidy for higher-income households," said Joseph Gyourko, a real estate and finance professor at the University of Pennsylvania's Wharton School.

While the FHA has avoided a taxpayer rescue so far, a study published last week by Mr. Gyourko predicted that the agency will ultimately need a taxpayer bailout of least $50 billion to $100 billion. An annual report on the FHA's finances is due Tuesday.

In contrast, Fannie and Freddie have been propped up with taxpayer money for more than three years and are the subject of mounting criticism on Capitol Hill for nearly $13 million in bonuses paid to executives at the start of this year.

Many House and Senate Republicans battled against raising the size of loans that Fannie and Freddie can guarantee, arguing that doing so would continue their bailout, which has cost taxpayers nearly $151 billion to date.

By ALAN ZIBEL and COREY BOLES
WSJ.com

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Foreclosures rose in Carolinas last month

2011-11-16T19:13:00.000-05:00

CHARLOTTE — U.S. foreclosure filings rose an average 7 percent in October compared with September but remain below last year's levels, a new report shows.

Filings rose more dramatically in the Carolinas last month.

The data add to a growing belief among real estate experts that more foreclosures are on their way as the banks work through paperwork problems that led to a temporary moratorium on foreclosure filings last year.

"The October foreclosure numbers continue to show strong signs that foreclosure activity is coming out of the rain delay we've been in for the past year," said James Saccacio, chief executive of RealtyTrac, a real estate research firm that produced the report.

Foreclosure filings in North Carolina increased 35 percent between September and October.

South Carolina's foreclosure filings also rose sharply, jumping 36 percent between September and October and rising 19 percent from the same time last year.

The big leaps don't mean the Carolinas will suffer more foreclosure woes than the rest of the country, said Daren Blomquist, RealtyTrac's director of marketing communications.

Instead, Blomquist said, picture the filings like an ocean wave.

"In the last 12 months, we've been in a period of calm. Now we are starting to see the waves come in," he said. "It's not that the Carolinas are going to get hit harder. It's just that they're getting hit this month. It's more like a set of waves that will come in versus one huge tsunami."

State rules can also govern the pace of foreclosure activity. Some states' court systems require more paperwork be filed, for example.

Nationwide, one in every 563 housing units had a foreclosure filing in October. Foreclosure filings, which include default notices, scheduled auctions and bank repossessions, were issued on 230,678 homes, according to RealtyTrac.

Even with the increases in foreclosure filings, North Carolina ranks among the states with the lowest number of foreclosures, coming in at No. 34. Filings were issued on 2,939 homes statewide last month.

South Carolina, which saw more than 3,600 foreclosure filings in October, moved up to No. 13 from No. 16 in September.

In North Carolina, Guilford County had the highest foreclosure activity -- with one out of every 549 houses having a foreclosure filing. Mecklenburg County had the third-highest activity -- with one in every 632 houses having a foreclosure filing.

In South Carolina, Dorchester County had the most filings followed by York County, where one out of every 319 homes had a filing.

By Charlotte Observer

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Fall Landscaping: How to Prepare Your Yard for Winter

2011-11-01T13:55:00.001-04:00

.

Fall landscaping preparations ready your yard for a long winter and glorious spring.

Spread mulch

“Fall mulching is better for the plants than spring mulching,” says Dan Taft, owner of The Cutting Edge in Chantilly, Va. “It helps protect roots from frost and helps retain moisture during a cold and dry winter.”

Spread 2 to 3 inches of fresh mulch around shrubs and trees. Taft warns home owners to avoid using free mulch from municipal piles, which often contain disease spores; instead, buy hardwood shredded mulch from home and garden centers, he says.

“Cheap, dump mulch mainly is made from trees that have died from disease,” Taft says. “Many diseases will linger in the mulch, like leaf spot and pine bark borers. You don’t want ground-up diseased plants around your landscaping.”

Remove the dead and dying

Fall isn’t the time to prune, because that encourages growth when healthy plants should remain dormant. But don’t shelve your shears and loppers yet. Fall is the time to neaten your landscaping before putting it to bed for the winter.

“If you remove dead landscaping in fall, you don’t have to look at it all winter,” Taft says.
Remove dead annuals.
Deadhead spent blooms, and cut back dead and desiccated ornamental grasses and perennials.

Lightly prune dead and dying branches from shrubs and trees. Carefully remove dried blossoms from hydrangea, but don’t remove dead-looking stalks, where new buds will form in spring.
After the first frost, cut back tea roses to about a third of their height.

Wrap delicate shrubs

Heavy snow, ice, and high winds can dry and split your delicate and pricey shrubs. To protect your landscaping from the winter elements:
Hide small plants under overturned plastic pots or buckets.
Wrap shrubs, such as boxwoods, in burlap.
Surround vulnerable trees with shredded leaves.

Take advantage of fall sales

Early fall until the ground freezes is a good time to plant trees and shrubs. Not only do cooler weather and autumn rain put less stress on young landscaping plants, nurseries often have sales to empty their shelves before winter.

“They need to sell every plant by Dec. 1,” Taft says. “Nurseries generally pay a third of the price that you’re paying. So don’t be afraid to offer less than the asking price. If you’re buying several things, the manager may give you a break.”

By: Lisa Kaplan Gordon

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Statement: MBA Welcomes Changes to HARP

2011-11-01T13:47:00.000-04:00

David H. Stevens, President and CEO of the Mortgage Bankers Association (MBA) issued the following statement in response to the recent announcement of changes to the Home Affordable Refinance Program (HARP).

"The mortgage industry welcomes these changes designed to help more underwater borrowers who are current on their mortgages refinance at today's historically low interest rates. Not only will these changes allow more borrowers to qualify, but they will streamline the process and reduce the cost to borrowers and should lessen risk for Fannie Mae and Freddie Mac.

"Lenders are particularly gratified that the refinements will provide relief from some representations and warranties that lenders face when originating new loans. These changes alone should encourage lenders to more actively participate in HARP.

"Borrowers need to be aware that these changes will not be implemented overnight. Lenders likely won't receive specific guidance and operational details from the regulators for a couple of weeks, after which it will take a bit of additional time for lenders to implement them. Therefore we ask borrowers for patience as the changes are put into practice.

"While ultimately helpful, these changes are not going to be a silver bullet to solve all the issues facing our housing market and borrowers who owe more on their mortgages than their homes are worth. But they will offer lenders another tool to help borrowers and hopefully help bring some stability to housing markets, particularly those most impacted by home value declines."

For more information, visit www.mortgagebankers.org.
RISMedia

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Is Your Loan Modification Stuck?

2011-11-01T13:44:00.000-04:00

If you’re on the verge of losing your home, or you know someone who is, then you also know about the long, bureaucratic process involved in applying for a loan modification from a lender. The most common approach is to apply under the new Home Affordability Mortgage Program (HAMP), but lenders also accept modifications from mortgage holders because lenders really don’t want to take the house – they just want their money.

In many cases, however, the approval process takes longer than many homeowners can afford. But one expert believes it doesn’t have to be that way, and that there are solutions for homeowners whose applications seem stuck in the mud.

“Applying for a loan modification can be an extremely stressful process,” said Stephfan Nurse, CEO of Consumer Education. “Even if you send in your documents and your lender tells you everything is okay, you may still have a great amount of anxiety because you have no idea what the lender is doing with your file. You may not know what the next step is and how long it takes to move through each step in the process. Your lender may tell you what the next step is, but you may not understand why it will take so long. There are reasons, however, why the process can get stuck, and there are ways to move that process along, if you understand what goes on behind the scenes.”

Nurse’s tips for making the process smoother include:

Account Numbers – It often happens that when you fax your paperwork to your lender, the lender either says they lost your paperwork or they just didn’t receive it all. This isn’t because they are incompetent. It’s because they receive thousands of faxes each day, and they use an image scanning technology to capture them all and place them in the appropriate file. In that system, a cover sheet that has your account number on it will get placed correctly, but the following sheets that lack your account number can be easily misplaced. The solution is to put your account number on every page of your paperwork, so they have a better chance of placing all your paperwork in your file.

Complete the Paperwork – When your file gets assigned to a document manager, typically about 30 days after you first applied for the modification, the document manager’s job is to check to make sure all your required documents are ready to be submitted to the negotiator/specialist for review. If you have an incomplete file, even if you’re missing just one single required document, the document manager will note your account as having an incomplete file and move on to the next file to review. At this point, a generic letter is automatically mailed to your home requesting the additional information your file lacks. This letter can take up to two weeks to get to you, and then another two to four weeks before they look at your updated information. The key is to never send an incomplete package to your lender. It can lead to a delay or even a flat out denial.

Follow Up – Finally, follow up every week with your lender to make sure all the documents they have are up to date. Don’t worry about being a pest. After all, it’s your house on the line if things get stuck in neutral. If you do this consistently, you will avoid getting caught in the delay cycle.

“The process is like any other, and it can be rife with mistakes and bureaucratic snafus,” Nurse added. “But if you take the steps to reduce the opportunities for error, your application can move through the process much faster and you’ll have a much better chance at being approved.”

Source: www.consumereducationonline.com.
RISMedia

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The Ins and Outs of Obama's New Mortgage Refi Plan

2011-10-26T20:20:00.000-04:00

President Obama announced Monday a plan to ease eligibility rules for home owners who want to refinance to take advantage of ultra-low mortgage rates and lower their mortgage payments. The administration hopes that by broadening its requirements for the Home Affordable Program that about 1 million home owners will now be able to qualify.

Here are more details about the newly announced changes to the program:

What is HARP?

It’s a program started in 2009 that allows home owners to refinance their mortgages at lower rates without having to meet the typical requirement of having at least 20 percent of equity in their home to do so. Under current guidelines, many underwater borrowers have been ineligible for the program because their home values had to be no more than 25 percent below what they owed their lender. Also, some home owners were unable to afford the closing costs and appraisal fees to participate.

What’s changing?

Many of the extra fees to participate in the program have been waived, and home owners' eligibility won't be contingent on how far their home's value has fallen.

Who’s eligible?
• Home owners with loans backed by Fannie Mae or Freddie Mac can participate. (Home owners can visit: freddiemac.com/mymortgage or fanniemae.com/loanlookup to determine if their mortgage is owned by either).
• Home owners must be current on their mortgage.

When will it take effect?

The changes could take effect by Dec. 1. HARP also is being extended through 2013 to allow more home owners the opportunity to qualify.

How successful will this be?

The administration hopes that by home owners being able to lower their monthly mortgage payments (with an average annual savings of $2,500 expected), they’ll be more likely to stay current on their mortgage and avoid foreclosure. Also, the administration hopes that it will then free up household money to start spending more on other things, which could provide an overall boost to the economy. However, the administration says it realizes that aiding the housing market requires much more than a refinancing plan.

"This is only one piece of a broader strategy to help the housing market," says Housing Secretary Shaun Donovan. Donovan also notes federal efforts to help home owners who are delinquent on their mortgages and the unemployed.

Daily Real Estate News

Source: “A Guide to Administration’s New Mortgage-Refi Plan,” The Associated Press (Oct. 24, 2011) and “Refinancing Plan Won’t Help Housing Market Much,” CNNMoney (Oct. 24, 2011)

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Real Estate Today - eNewsletter

2011-10-25T15:15:00.000-04:00

OCTOBER - 2011 Newsletter Housing Trends eNewsletter

Please click here to view the OCTOBER - 2011 Newsletter Housing Trends eNewsletter.

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

If you are interested in determining the value of your home, click the Home Evaluator link for a free evaluation report.

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FHFA Directs Fannie Mae and Freddie Mac to Switch Foreclosure Attorney Networks

2011-10-23T14:38:00.000-04:00

The Federal Housing Finance Agency (FHFA) has directed Fannie Mae and Freddie Mac to transition away from current foreclosure attorney network programs and move to a system where mortgage servicers select qualified law firms that meet certain minimum, uniform criteria. Under current practice, in certain states each Enterprise designates law firms eligible under the Enterprise’s criteria to undertake foreclosure work and mortgage servicers then select and work with these firms.

The new approach is in line with FHFA’s Servicing Alignment Initiative that produced uniform foreclosure processing standards to assist servicers, homeowners and lenders. FHFA believes these efforts will lead to greater transparency and benefit delinquent borrowers who become subject to the foreclosure process. Further, the change will be supportive of the Consent Orders entered into by financial regulators and servicers.

The changes will be implemented after a transition period in which input will be taken from servicers, regulators, lawyers and other market participants. During this period, existing contracts remain in place and in effect.

For more information, visit www.fhfa.gov.
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Home Sales Alert: Slow in September but Still Higher Than a Year Ago

2011-10-23T14:35:00.000-04:00

Existing-home sales were down in September on the heels of a strong gain in August, but remain well above a year ago, according to the National Association of REALTORS®.

Total existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, declined 3.0 percent to a seasonally adjusted annual rate of 4.91 million in September from an upwardly revised 5.06 million in August, but are 11.3 percent above the 4.41 million unit pace in September 2010.

Lawrence Yun, NAR chief economist, says the market has been stable although at low levels, and there is plenty of room for improvement.

"Existing-home sales have bounced around this year, staying relatively close to the current level in most months," he says. "The irony is affordability conditions have improved to historic highs and more creditworthy borrowers are trying to purchase homes, but the share of contract failures is double the level of September 2010. Even so, the volume of successful buyers is higher than a year ago and is remaining fairly stable—this speaks to an unfulfilled demand."

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.11 percent in September, down from 4.27 percent in August; the rate was 4.35 percent in September 2010.

Contract failures were reported by 18 percent of NAR members in September, unchanged from August; they were 9 percent in September 2010. Contract failures are cancellations caused by declined mortgage applications, failures in loan underwriting from appraised values coming in below the negotiated price, or other problems including home inspections and employment losses.

NAR President Ron Phipps says access to credit is unbalanced. "All year we've been discussing the fact that many creditworthy home buyers are being denied mortgages," he says. "On top of that, loan limits have been lowered, which means buyers of higher priced homes, including many in more expensive housing markets, now have to pay a higher interest rate for a jumbo mortgage than buyers who can qualify for a conventional loan. We need to remove the roadblocks to a housing recovery—not place more obstacles in the way of financially qualified buyers."

All-cash sales accounted for 30 percent of purchase activity in September, up from 29 percent in August and 29 percent also in September 2010; investors make up the bulk of cash purchases.

Investors purchased 19 percent of homes in September, down from 22 percent in August; they were 18 percent in September 2010. First-time buyers accounted for 32 percent of transactions in September, unchanged from August; they were also 32 percent in September 2010.

The national median existing-home price for all housing types was $165,400 in September, down 3.5 percent from September 2010. Distressed homes—foreclosures and short sales typically sold at deep discounts—accounted for 30 percent of sales in September (18 percent were foreclosures and 12 percent were short sales), down from 31 percent in August and 35 percent in September 2010.

Total housing inventory at the end of September declined 2.0 percent to
3.48 million existing homes available for sale, which represents an 8.5-month supply at the current sales pace, compared with an 8.4-month supply in August.

Single-family home sales fell 3.6 percent to a seasonally adjusted annual rate of 4.33 million in September from 4.49 million in August, but are 12.2 percent above the 3.86 million-unit level in September 2010. The median existing single-family home price was $165,600 in September, down
3.9 percent from a year ago.

Existing condominium and co-op sales rose 1.8 percent a seasonally adjusted annual rate of 580,000 in September from 570,000 in August, and are 5.6 percent above the 549,000-unit pace one year ago. The median existing condo price was $163,800 in September, which is 1.0 percent below September 2010.

Regionally, existing-home sales in the Northeast rose 2.6 percent to an annual level of 790,000 in September and are 6.8 percent above a year ago. The median price in the Northeast was $229,400, down 3.3 percent from September 2010.

Existing-home sales in the Midwest slipped 0.9 percent in September to a pace of 1.09 million but are 17.2 percent higher than September 2010. The median price in the Midwest was $137,400, which is 1.4 percent below a year ago.

In the South, existing-home sales declined 2.6 percent to an annual level of 1.89 million in September but are 10.5 percent above a year ago. The median price in the South was $144,400, down 3.0 percent from September 2010.

Existing-home sales in the West fell 8.8 percent to an annual pace of 1.14 million in September but are 10.7 percent higher than September 2010. The median price in the West was $207,400, which is 4.5 percent below a year ago.

"The falloff in Western sales from a surge in August was expected because many lenders had lowered mortgage loan limits over concerns that sales wouldn't close before the higher loan limits expired at the end of the September," Yun says. "Given the concentration of higher cost housing in the West, particularly in California, many buyers were motivated to close in the months leading up to the changeover while they could still get low interest rates on conventional mortgages. Unless Congress reinstates the higher limits, the overall housing market recovery will be slower than it otherwise could be, and will hold back the broader economic recovery."

For more information, visit www.realtor.org
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For-Sale Housing Inventories Shrink to New Lows

2011-10-20T09:34:00.000-04:00

Nationwide, 2.19 million homes were listed for sale at the end of September, a drop of 20 percent compared to a year earlier, and marking the lowest level on record since REALTOR.com began tracking housing inventory data in 2007.
All 146 markets that REALTOR.com tracks saw housing inventory fall year-over-year, except for Denver and El Paso, Texas. Listings were down by 49 percent in Miami, 48 percent in Phoenix, and 46 percent in Orlando, Fla.
But while reduced inventories usually help lift prices, in the current real estate market, housing prices are staying flat or declining. That’s because demand remains soft, housing experts say.
Real estate professionals told The Wall Street Journal that inventories are shrinking because some home sellers have decided to take their homes off the market instead of trying to sell at a steep discount. Banks are also moving more slowly at repossessing foreclosures, which has reduced the supply of foreclosed properties on the market — albeit a temporary decrease, many experts note.
"The inventory is low, so it's hard for buyers to find their dream home," Joan Downing, a real estate professional in the Detroit area of Bloomfield Hills, Mich., told The Wall Street Journal. "That's been our challenge more than anything: finding the inventory for the clients. Nobody's complaining about the pricing or the interest rates."

Daily Real Estate News
Source: “Slim Pickings Are Latest Headache for Home Sales,” The Wall Street Journal

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Credit Scores Poised to Get More Personal

2011-10-19T09:35:00.000-04:00

Many consumers applying for a mortgage are going to start sharing more personal information with lenders next year, like it or not.

FICO scores, the industry standard for determining credit risk in mortgages backed by Fannie Mae, Freddie Mac and the Federal Housing Administration, largely have been based on a person’s credit history. But in an attempt to develop a more well-rounded picture of a person’s finances beyond credit, tools are being developed to help the lending industry dig deeper.

Fair Isaac Corp., or FICO, the company behind the widely used scoring formula, and data provider CoreLogic last week announced a collaboration that will result in a separate score that will be available to mortgage lenders and incorporates information that will include payday loans, evictions and child support payments. In the future, information on the status of utility, rent and cellphone payments may also be included.

Separately, last month, the big three credit reporting agencies, Experian, Equifax and TransUnion, began providing estimates of consumer income as a credit report option. And earlier this year, Experian began including data on on-time rental payments in its reports.

The new information could prove to be a double-edged sword for consumers: It may open the door to homeownership to some consumers who have, according to industryspeak, a “thin file” or worse, a “no-file,” meaning they lack sufficient credit histories.

On the other hand, the extra information may make a borderline borrower look even worse on paper. And it’s unlikely to quiet critics who complain that too much emphasis is put on a single number.

Still, there is thought among researchers that consumer transparency, if it demonstrates both good and bad behavior, has its place.

“You’re trying to convince someone to loan you an awful lot of money at a low interest rate,” said Michael Turner, president of the Policy and Economic Research Council. “Only you know whether you’re going to pay it back. There is a harmony in this data exchange.”

The FICO-CoreLogic partnership won’t result in a credit score that will rule out a borrower for a mortgage backed by Fannie Mae, Freddie Mac or the FHA, which together own or guarantee at least 90 percent of the mortgages being written. That’s because the “tri-merge” report required for such a loan does not rely on CoreLogic data. But it could mean either more or fewer mortgage fees or a higher or lower interest rate charged by lenders that in today’s cautionary lending environment have heartily adopted risk-based pricing.

“We’re fascinated to see, as we get into the data, whether that may expand the universe of people who can get a mortgage,” said Joanne Gaskin, director of product management global scoring for FICO. “Banks are saying, ‘How do I find ways to safely increase loan volume, to find the gems out there?’ ”
As a result, there’s a rush by credit reporting agencies to provide financial companies, whether it’s a mortgage bank or a credit card provider, with a wealth of information on individual customers.

“Before the (housing) bubble burst, there was a huge amount of interest in targeting the unbanked,” said Brannan Johnston, an Experian vice president. “It was a desperate dash to try and grow and go after more and more consumers. When the bubble burst, that certainly dialed back some. They want to grow their business responsibly by taking good credit risks.”

FICO scores have been around since the 1950s, but they didn’t become a major factor in mortgage lending until 1995, when Fannie Mae and Freddie Mac began recommending their use to help determine a mortgage borrower’s creditworthiness. The score, which ranges from 300 to 850, factors in how long borrowers have had credit, how they’re using it and repaying it, and if they have any judgments or delinquencies logged against them.

The change comes at a time when the average FICO scores of homebuyers who qualify for loans continue to rise, as mortgage lenders reward the most creditworthy borrowers with low rates and tack extra fees onto loans for those with lower credit scores.

In a report last year, the Woodstock Institute, a Chicago-based research and advocacy group, found that residents in Illinois’ “communities of color” were far more likely to have lower, “non-prime” credit scores compared with people in predominantly white communities. Statewide, 20 percent of people had a credit score of less than 620, which meant they had a hard time qualifying for a mortgage as well as other forms of credit.

Among other ideas, Woodstock recommended that businesses report on-time and delinquent payment histories for items such as rent, health care, utility and cellphone bills, to truly determine a person’s default history.

“Any time you can get a fuller picture of a customer’s risk profile, it makes it more likely that they can get the product they are most suited to,” said Tom Feltner, Woodstock vice president. “The concern, of course, is what is that information and does it reflect the rate of default?”

There also are concerns about whether inquiries and charge-offs from payday and online lenders should be included. “Payday loans are extremely onerous,” said Chi Chi Wu, a staff attorney at the National Consumer Law Center. “They trap people in a cycle of debt. To report on them is to cite that person as financially distressed. We certainly don’t think that’s going to help people with a credit score.”
The extra information may also help more affluent homeowners who aren’t on the credit grid.

Two years ago, David Pendley, president of Avenue Mortgage Corp., worked with a client, a college professor, who didn’t believe in using credit. “He was putting down 40 percent and he had the hardest time getting a loan, even though he had $120,000 in the bank and he was 22 years on the job.”

Eventually, Pendley secured a loan for the customer through a private bank, but he paid for it. “He didn’t get the lowest rate possible,” Pendley recalled.

Distributed by MCT Information Services
RISMEDIA
By Mary Ellen Podmolik Chicago Tribune

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Mortgage Interest Deduction a Must for Middle Class

2011-10-16T20:07:00.000-04:00

Eliminating or curtailing the mortgage interest deduction would have a disproportionate impact on younger, middle-class families, who would see their ability to become home owners significantly diminished, with sober implications for their longer term financial prospects, the National Association of Home Builders (NAHB) told Congress recently.

"How housing is treated in any future tax reform will shape the economy going forward," Robert Dietz, an economist and assistant vice president for NAHB, testified during a Senate Finance Committee hearing on tax reform options to provide incentives for homeownership.

Most Americans consider homeownership to be their single best long-term investment and a primary source of wealth and financial security. According to the 2007 Federal Reserve Survey of Consumer Finances, the median net worth of a home owner is $234,600, compared to $5,100 for renters.

"We believe that any policy change that makes it harder to buy a home, or delays the purchase of the home until an older age, will have a significant long-term impact on household wealth accumulation and the make-up of the middle class as a whole," says Dietz.

In the short term, tampering with the mortgage interest deduction would undermine an already fragile housing market and wreak havoc on the tenuous economic recovery by hurting housing demand, which would place downward pressure on home prices. In turn, this would leave more home owners underwater and trigger even more foreclosures.

This cornerstone of American housing policy provides benefits for home buyers at all income levels and retains overwhelming public support. In a New York Times/CBS News poll conducted in June of 2011, 89 percent of the respondents said that homeownership is an important part of the American Dream and more than nine in 10 opposed doing away with the mortgage interest deduction.

Public support runs strong, despite misleading claims that the deduction benefits only wealthy taxpayers and only a small number of home owners utilize the deduction because they must itemize their deductions in order to claim it.

Setting the record straight, Dietz told lawmakers that 70 percent of the tax benefits go to middle-class home owners who earn less than $200,000 and that a deduction that reduces the net cost of monthly house payments is particularly important to younger home buyers, who typically have large home loans and less equity and are paying mostly interest in the early years of the mortgage.

Dietz said that arguments that most home owners do not itemize and cannot benefit from the deduction are false.

"Out of 75 million home owners, 35 million claimed the mortgage interest deduction in 2009," he said. "This fails to take into account the millions of taxpayers who are renters and one day aspire to own a home of their own and the roughly 25 million who own their homes free and clear and used the deduction in the past. The bottom line is that 70 percent of home owners with a mortgage have claimed the deduction."

Dietz also stressed the importance of several other housing tax incentives, including the Low Income Housing Tax Credit, which is the most successful affordable rental housing production program in the nation's history and produces approximately 90,000 full-time jobs per year.

The second home deduction is also important for many who do not think of themselves as owning two homes. "For example, the second home deduction facilitates moving when owning two homes during the tax year and also permits existing home owners to claim interest on a construction loan for a future home," said Dietz.

Eliminating the mortgage deduction for second homes could threaten the economic viability of second home and vacation markets.

"We are not just talking about well-known coastal markets, but also small towns in states such as Maine, Vermont, New Hampshire, Michigan, Colorado and Florida," said Dietz. "And nearly every state has areas with significant numbers of second homes; 49 states have a county where at least 10 percent of the housing stock consists of second homes."

Home owners are also allowed to deduct interest on up to $100,000 of home equity loan debt. Half of all home equity loans are used for remodeling and home improvement, which provides jobs and are important activities for a nation with an aging housing stock.

As policymakers look to create jobs and boost economic growth, housing has an important role to play, said Dietz.

"Building 100 single-family homes creates more than 300 full-time jobs," he said. "Housing can act as a catalyst for job growth and an economic recovery because home building employs such a wide range of workers."

For more information, visit www.nahb.org.

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Fall Lawn Care: 4 Ways to Say G’Night For The Winter

2011-10-16T19:54:00.000-04:00

Labor Day through Halloween is your window for preparing lawns for a lush spring.

“I’m already thinking about next year,” says John Dillon, who takes care of New York City’s Central Park, which features 200 acres of lawn in the middle of Manhattan. “The grass I grow this fall is what will be there next spring.”

Fall lawn care is no walk in the park. It’s hard work, and Dillon guides you through the four basic steps.
1. Aeration
Aeration gives your lawn a breather in autumn and provides room for new grass to spread without competition from spring weeds. Aeration tools pull up plugs of grass and soil, breaking up compacted turf. That allows water, oxygen, and nutrients to reach roots, and gives seeds room to sprout.

If kids frequently play on your lawn, plan to aerate twice a year — fall and spring. If your lawn is just for show, then aerate once a year — and maybe even once every other year.

A hand-aerating tool ($20), which looks like a pitchfork with hollow tines, is labor-intensive and meant for unplugging small sections of grass. Gas-powered aerating machines (rental, $20/hour) are about the size of a big lawn mower, and are good for working entire lawns. Bring some muscle when you pick up your rental: Aerating machines are heavy and can be hard to lift into your truck or SUV.

Depending on the size of your property, professional aeration costs about $150.
2. Seeding
Fall, when the soil temperature is about 55 degrees, is the best time to seed your lawn because turf roots grow vigorously in fall and winter. If you want a lush lawn, don’t cheap out on the seed.

Bags of inexpensive seed ($35 for 15 pounds) often contain hollow husks, weed seed, and annual rye grass seed, which grows until the first frost then drops dead. Splurge on the good stuff ($55 for 15 pounds of Kentucky Bluegrass seed), which resists drought, disease, and insects.

Water your new seed every day for 10 to 20 days until it germinates.
3. Fertilizing
A late fall fertilization — before the first frost — helps your grass survive a harsh winter and encourages it to grow green and lush in spring. Make your last fertilization of the year count by choosing a product high (10% to 15%) in phosphorous, which is critical for root growth, Dillon says.

Note: Some states are banning phosphorous-rich fertilizers, which are harmful to the watershed. In those places, look for nitrogen-rich fertilizers, which promote shoot and root growth. Check with your local extension service to see what regulations apply in your area.
4. Mulching
Instead of raking leaves, run over them a couple of times with your mower to grind them into mulch. The shredded leaves protect grass from winter wind and desiccation. An added bonus — shredded leaves decompose into yummy organic matter to feed grass roots.

A mulching blade ($10) that attaches to your mower will grind the leaves even finer.

By: Lisa Kaplan Gordon

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Why Choosing the Perfect Neighborhood is Just as Important as the House Itself

2011-10-12T10:11:00.000-04:00

It’s easy to fall in love with a house, but buyers need to think about more than just the home itself before deciding to live there. While the home may have the perfect number of rooms, a large play area for the kids and that master bathroom you have always dreamed about, you also need to consider the neighborhood in which the home is located.

That’s why before buying any home, a buyer should explore the surrounding neighborhood and area to make sure it has everything they want and need.

For buyers with children or those thinking of starting a family, the first thing you will want to look at is the local school system. You’ll also want to research the closest parks and community centers and consider how busy the streets in the neighborhood get. Even if you are single, living in a top school district will raise your property value.

Another consideration is your daily commute to work. You’ll want to understand the traffic patterns to and from your job and figure out if you’re going to be sitting in traffic for several hours a day. Researching the local mass transit system is also important, as you may want a neighborhood that gives you the option to not have to drive to work.

Profiling the perfect neighborhood also involves scoping out the neighbors themselves. Are there a lot of kids on the block? Are there neighborhood events? Do you see a lot of fences and “Keep Out” signs? It’s never a bad idea to take a walk through the neighborhood and say hello to some of the people you see and ask about the neighborhood before putting in an offer.

Don’t forget to map out stores and restaurants in the area as well. You may be used to a five-minute drive to the local grocery store, only to find out that the home you are interested in is 25 minutes away from the nearest place to buy milk. And if you like to walk to stores and shops, make sure to tell your agent that you want a place where this is possible.

You also want to find out if your potential new home is part of a neighborhood association and if your community has lawn or construction restrictions and if there’s a yearly fee involved. The last thing you want is to find out that you can’t put those holiday decorations up because of a strict town ordinance.

Also consider warning signs that the neighborhood could be in trouble. If you see abandoned buildings, vandalism or a lot of “For Sale” signs, it could be a sign that the community is heading in the wrong direction.

A perfect home isn’t always in the perfect neighborhood and you’ll want to make sure that both meet your expectations.

RISMedia By Keith Loria

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What You Need to Know about GSE and FHA Loan Limit Expiration

2011-10-11T14:14:00.000-04:00

On October 1, 2011, mortgage loan limits for the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac, as well as the Federal Housing Administration (FHA), dropped from their current increased levels back to their normal (and lower) limits, which vary depending on the MSA.

While the base limit—which defines the size of “conforming” mortgages that can be purchased and securitized by the GSEs—will remain at $417,000, the limit for mortgages in “high-cost areas” will drop from $729,750 to $625,000. Loan limits for FHA loans will likewise vary from market to market, but are typically lower than that of the GSEs.

Any and all loans that fall outside of these limits will possibly be subject to tighter credit conditions, including higher interest rates and larger downpayments.

Recent analysis by the National Association of Home Builders (NAHB) found that the scheduled decline in GSE loan limits will affect 204 counties across America, containing 1.38 million owner-occupied homes in the affected price ranges. When added to the number of homes currently outside the temporary mortgage loan limits, an estimated five million homes would be unavailable for GSE funding if they were put on the market after October 1.

The effects for scheduled declines in FHA limits are even more impactful: these declines will affect 620 counties, adding 3.87 million homes to those outside temporary loan limits, for a total of 12.2 million homes ineligible for FHA-insured mortgages.

With numbers like that, it’s easy to believe this will only serve to further weaken an already fragile housing market, curtail lending, as well as place first-time and move-up buyers out of the market entirely.

But there is a double ray of hope—having these now-ineligible loans backed by private mortgage insurance (MI) instead and, in some cases, more affordably, with a lower cost of financing than the borrower would have received with the FHA.

Finding alternative sources of financing will be a requirement of survival once the current loan limits expire. And that’s where the opportunity is—savvy real estate agents will be aware of and loan officers will have alternatives that can still make homeownership an affordable dream in these markets. Those in the know will use those alternatives as a means to distinguish themselves from their competition.

Taking a closer look at loans backed by MI would be a solid first step in finding alternative financing, as many mortgage insurers have already launched non-GSE “jumbo” loan programs—the company I work for, Radian, has a program that will insure up to $650,000 for loans with loan-to-values of 85.01% - 90% and $750,000 for loans with loan-to-values of 85% and lower.

With low downpayments and a variety of payment options, there is an MI product suited for each and every kind of borrower.

This knowledge, along with a lending partner that can leverage MI as an alternative, can have a tremendous impact on your sales volume, helping you keep potential buyers in the market who may have otherwise thought there were no affordable options for them.

While every home buyer is different, high balance loans backed with MI can help bridge the gap between a buyer being eligible for homeownership and being left behind, and for real estate professionals—making the sale or losing it to another agent. With the impending expiration of the GSE and FHA loan limits, educated and knowledgeable industry professionals will be integral in helping their buyers achieve the American Dream of homeownership.

By Brien McMahon
Brien McMahon is chief franchise officer of Radian Guaranty Inc. More information may be found at www.radian.biz.

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Keep Your Kids Safe with These Halloween Safety Tips

2011-10-11T14:10:00.002-04:00

Monday, October 10, 2011

Halloween is an exciting time of year for kids, and to help ensure that they have a safe holiday, here are some tips to keep in mind throughout the season:

All Dressed Up:
• Plan costumes that are bright and reflective. Make sure that shoes fit well and that costumes are short enough to prevent tripping, entanglement or contact with flame.
• Because masks can limit or block eyesight, consider non-toxic makeup and decorative hats as safer alternatives. Hats should fit properly to prevent them from sliding over eyes.
• When shopping for costumes, wigs and accessories, look for and purchase those with a label clearly indicating they are flame resistant.
• If a sword, cane, or stick is a part of your child's costume, make sure it is not sharp or too long. A child may be easily hurt by these accessories if he or she stumbles or trips.
• Obtain flashlights with fresh batteries for all children and their escorts.
• Teach children how to call 9-1-1 (or their local emergency number) if they have an emergency or become lost.

Home Safe Home:
• To keep homes safe for visiting trick-or-treaters, homeowners should remove from the porch and front yard anything a child could trip over such as garden hoses, toys, bikes and lawn decorations.
• Homeowners should check outdoor lights and replace burnt-out bulbs.
• Wet leaves should be swept from sidewalks and steps.
• Restrain pets so they do not inadvertently jump on or bite a trick-or-treater.

On the Trick-or-Treat Trail:
• A parent or responsible adult should always accompany young children on their neighborhood rounds.
• If your older children are going alone, plan and review an acceptable route. Agree on a specific time when they should return home.
• Only go to homes with a porch light on and never enter a home or car for a treat.
• Remind children to stay in a group and communicate where they will be going.
• Remain on well-lit streets and always use the sidewalk.
• If no sidewalk is available, walk at the far edge of the roadway facing traffic.
• Never cut across yards or use alleys.
• Only cross the street as a group in established crosswalks (as recognized by local custom). Never cross between parked cars or out driveways.
• Don't assume the right of way. Motorists may have trouble seeing Trick-or-Treaters. Just because one car stops, doesn't mean others will.
• Law enforcement authorities should be notified immediately of any suspicious or unlawful activity.

Healthy Halloween:
• A good meal prior to parties and trick-or-treating will discourage youngsters from filling up on Halloween treats.
• Consider purchasing non-food treats for those who visit your home, such as coloring books, or pens and pencils.
• Wait until children are home to sort and check treats. Though tampering is rare, a responsible adult should closely examine all treats and throw away any spoiled, unwrapped or suspicious items.
• Try to ration treats for the days following Halloween.

Source: The American Academy of Pediatrics (AAP)RISMedia

Mortgage Survivors Get Bargains as Price-Drop Danger Eases

2011-10-06T08:16:00.002-04:00

Sept. 28 (Bloomberg) -- Cynthia and Gerald Matthews left a booming property market in Ottawa, the Canadian capital, to buy a home in Bloomington, Indiana, where real estate prices are beginning to recover from a five-year slump.

“It was much cheaper than we thought it would be,” said Cynthia Matthews, who got a 5 percent discount off the $196,999 asking price of the three-bedroom, brick neo-Colonial style house, and a mortgage rate close to 4 percent. “To say it’s a buyer’s market would be an understatement.”

People like the Matthewses who are able to survive the scrutiny of mortgage lenders are getting the best deals of the five-year U.S. housing bust, and perhaps the best deals of a generation, after a 31 percent decline in home prices since 2006. It’s the bright side of an otherwise bleak real estate market: Good houses at cheap prices are plentiful, while loan rates are hovering at record lows.

“It’s hard to see the possibility of losing on a home purchase right now, with these mortgage rates,” said Dean Baker, an economist who in 2005 predicted a decline in the government’s home-price index that now is within two percentage points of his forecast. “Prices may go lower, but not by much. Even if they do, you’re still getting a good deal.”

The lowest mortgage rates on record, coupled with a new Federal Reserve program to reduce them further, are turning housing bears like Baker into optimists. Loan payments on a home financed at last week’s 4.09 percent average 30-year U.S. rate would be lower than the bill for a property purchased next year after a 3.5 percent price decline and a half-percentage-point rate increase, a scenario forecast by the Mortgage Bankers Association for mid-2012.

$18,000 Difference

Buying a $300,000 home at current rates means a monthly mortgage bill of about $1,158, assuming a 20 percent down payment. Delaying a purchase until next year would put the tab higher, at $1,186, based on the MBA forecast for prices and rates. That amounts to an $18,000 difference over a 30-year mortgage for those who wait.

Regardless of the rate, most Americans seeking to buy a house need to qualify for a loan. Mortgage applications for home purchases rose 2.6 percent last week, the fifth consecutive gain, the MBA reported today. Fannie Mae and Freddie Mac, which securitize about two-thirds of new U.S. mortgages, have enacted the strictest qualification standards in more than a decade as they try to improve the credit quality of their portfolios.

Lender Scrutiny

That makes the mortgage process a grueling experience for borrowers like Christine Trendell. She bought a house two months ago in Canton, Massachusetts, a suburb of Boston, where real estate prices fell 25 percent through early this year before gaining 10 percent in the recent quarter, according to the National Association of Realtors.

The wood-shingled house, built in 1920, has an old- fashioned screened-in front porch furnished with rocking chairs. The entrance hall is dominated by a wide oak staircase, and the hardwood floors, newly refinished, gleam in the sun.

Trendell and her husband, Ben, had to submit a pile of bank statements, retirement-fund tallies, and years of tax returns that stacked to almost two inches high, she said. The lender required them to fax their paystubs repeatedly near the end, she said, to make sure they hadn’t lost their jobs before the closing date. They were able to get the mortgage because they have pristine credit records, she said.

Didn’t Know

“The low rates made it affordable to buy the house, but we didn’t know if we were going to be able to get a loan,” said Trendell, standing in her driveway earlier this week after walking two of her three children to a nearby elementary school. “Rates don’t matter if you can’t get a mortgage,” she said as her youngest child, a 3-year-old daughter, wheeled a doll-size baby carriage in circles around her.

Buyers are still cautious about taking advantage of deals. Sales of previously owned homes were down 31 percent in August from their 2005 peak, the National Association of Realtors reported last week. Neither Baker, co-director of the Center for Economic & Policy Research, nor Karl Case, co-founder of the Case-Shiller home price index, expect property bargains to be a cure-all for the worst housing collapse on record.

“Houses are cheap right now, but a lot of people are too scared to buy, no matter what kind of deal they get,” Case said from his home in Wellesley, Massachusetts. “We’re bumping along the bottom with prices, but I don’t think we’re at a bottom in terms of confidence.”

The Case-Shiller index of prices in 20 U.S. cities fell 4.1 percent in July from a year earlier, the group reported yesterday. Values were little changed from the previous month after adjusting for seasonal variations.

Operation Twist

Buyers passing up bargains are confounding attempts by Fed Chairman Ben S. Bernanke to boost the broader economy and stimulate housing demand. Policy makers said last week they will commence a third bond-buying program aimed at lowering home-loan rates. This effort, known as Operation Twist, will replace some shorter-term securities in the central bank’s $1.6 trillion portfolio with longer-term Treasuries.

The goal is to twist the so-called yield curve so longer- term bonds such as 10-year Treasuries, used as a benchmark by investors in mortgage-backed securities, have lower interest rates. The Fed used the same maturity-exchange program during the early 1960s in a joint operation with the Treasury Department shortly after John F. Kennedy became president.

Rate Spread

No matter how much policy makers try to manipulate bond yields, investors in mortgage-backed securities may not cooperate, keeping home-loan rates higher than they should be, according to Diane Swonk, chief economist at Mesirow Financial Inc. in Chicago.

“Rates have not come down in lockstep with Treasuries,” Swonk said. “We’re not getting all of the pass-through.”

The difference, or spread, between the average 30-year fixed mortgage rate and the benchmark 10-year Treasury yield widened to 2.26 percentage points last week, the biggest gap since 2009, according to data compiled by Bloomberg. If the spread matched the gap of 1.17 percentage points in February, the 2011 low, home-loan rates now would be close to 3 percent.

Mortgage-bond investors may be demanding higher risk compensation as the economy slows, Swonk said. Or, they may be hedging their exposure to so-called prepayments on speculation the government might embark on a new mortgage refinance program.

Moving Near Son

The Matthewses didn’t wait to see if rates would go lower. They moved to Bloomington to be near Indiana University, where their teenage son will attend a pre-college program at the Jacobs School of Music. The couple paid $187,500 for their home in August, according to real estate records.

The median house price in Bloomington fell to $149,000 at the beginning of this year, 13 percent below a 2005 high, before gaining 4.8 percent in the second quarter, according to the Realtors group.

The Matthewses looked at dozens of properties before settling on their 12-year-old house with hardwood floors, a fireplace in the living room, and a room over the garage they’ve turned into a den. Their front door, painted red, is framed with white columns, giving the two-story home an elegant look.

Yacov Sinai, in Santa Monica, California, didn’t want to wait, either. He got a four-bedroom one-story house in the tony Regent Square neighborhood for $1.87 million last month. Prices in the oceanfront city 20 miles west of Los Angeles may fall another 4 percent to 8 percent, he estimated. Waiting, though, would mean he would have to deal with competition, Sinai said.

“Next year, when you make an offer on a property, there’ll be another 10 people behind you waiting to get in the door,” said Sinai. His new house has four bedrooms, a double garage, and a half-circle driveway.

Writing an Essay

About five years ago, before prices in the Los Angeles metropolitan area tumbled 38 percent, as measured by a Case- Shiller index, Sinai made an offer on a different property in Santa Monica that had several competing bids. The seller required an essay from all potential buyers saying why they should be allowed to purchase it, he said.

“It was ludicrous,” said Sinai, who lost the writing contest, and the house. In his recent purchase, he negotiated a 12 percent discount off the listing price -- a $267,000 savings -- and he was the only one bidding.

Sinai said he isn’t worried about the economy, but a lot of potential buyers are. In the first three months of the year, gross domestic product grew at the slowest pace since the end of the recession in mid-2009. The slowdown sapped consumer confidence that already was waning.

Doom and Gloom

“You’ve really got to turn off the doom and gloom to buy a house right now, or you’re going to worry about a recession, or about your job,” said Todd Garrett, a nurse who has a home under contract in Omaha, Nebraska, that he plans to buy next month. “I just made sure the house had good bones.”

He’s paying $104,900 for the ranch-style house, in a neighborhood where similar properties have sold for as much as $120,000, Garrett said. His price is close to the $102,000 the three-bedroom house went for nine years ago, according to real estate records.

The Conference Board’s Consumer Confidence Index during the last two months has been the lowest since early 2009. The share of people in September who said jobs are hard to find rose to the highest level since 1983, and the gauge of current business conditions fell for the fifth straight month, according to the New York-based research firm’s report yesterday.

Little to Gain

“Even if there is another recession, people who can qualify for a mortgage won’t gain anything by playing the waiting game,” said Nariman Behravesh, chief economist at Englewood, Colorado-based IHS Inc., who predicts another 5 percent national decline before prices hit bottom next year. “They may get lucky with the price, but they probably won’t be getting these low mortgage rates.”

While the economy is the largest drag on the housing market, the freeze in mortgage credit has been second, Behravesh said. However, there are some signs of a thaw, he said. The share of banks reporting tightened standards for prime mortgages in the third quarter dropped 1.9 percent, the first decline in a year, according to the Fed’s Senior Loan Officer Survey.

People who find the right deal and pass muster with lenders shouldn’t try to time the bottom of the market, said Baker, the formerly pessimistic economist.

“It’s like buying a stock -- if you think it’s a good stock, and it’s at a good price, then you buy it,” Baker said last week. “That’s not to say prices won’t go lower, but these mortgage rates could go higher if people wait a year.”

By Kathleen M. Howley

--Editors: Kara Wetzel, Christine Maurus

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As Mortgage Rates Dip Lower, Homeowners Should Consider Refinancing

2011-10-04T14:02:00.000-04:00

RISMEDIA, Tuesday, October 04, 2011— Rates were already low at the start of the quarter, but following the Fed's announcement last week, the national average rate on a traditional 30-year, fixed-rate mortgage has inched lower. Informa Research Services, a subsidiary of Informa plc (LSE: INF), encourages qualified homeowners to take advantage of low interest rates and look to refinancing their current home loan.

According to BusinessInsider.com, "Mortgage rates were already near record lows when the Federal Reserve Board acted last week to further reduce long-term interest rates in general, and included a targeted effort to push down mortgage rates even more." Following this announcement, national average 30 year mortgage rates dropped from 4.37% last week to 4.29% this week.

Homeowners who want to reduce their monthly mortgage obligation can check convenient rate tables found on websites such as ERATE.com to stay abreast of the most current mortgage rate movement. Furthermore, the lenders featured on these rate tables typically offer rates significantly lower than the already low national average.

A successful refinance will bring qualified homeowners immediate savings in the form of reduced monthly mortgage payments, but more importantly, larger savings over the remaining term of their loan. That being said, homeowners who are considering refinancing a current loan should research their options to ensure that the benefits of refinancing their mortgage will outweigh the costs. This relies heavily on the rate that is attached to the current home loan.

********************************************************************
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Energy Rebates From Your Utility Help You Manage Rising Energy Costs

2011-10-01T10:55:00.000-04:00

Surprise: Your utility may offer big-time energy rebates to offset the cost of energy-efficient retrofits.

Because regulations now give them financial rewards for meeting energy-efficiency goals.

Even though it costs about one-third to one-fourth less to save a kilowatt hour through conservation than it does to build, fuel, and operate a new power plant, utilities resisted conservation programs for years, says Martin Kushler, senior fellow with the American Council for an Energy-Efficient Economy (ACEEE). Instead, they opted to finance new plants over the long term and pass along the costs to all of us as higher rates—until regulators stepped in.
What energy rebates are available through your utility?
Some are small—say, a $20 rebate after you purchase a programmable thermostat. Others range into the thousands of dollars, especially for expensive items such as solar panels.

A few examples of home improvements that can qualify for energy rebates from utilities:

Installing Energy Star appliances

Adding insulation

Weatherizing

Sealing ducts

Installing programmable thermostats

Installing geothermal heating

Replacing water heaters with high-efficiency models

Getting a home energy audit (see below)

What does my utility offer?

Check your utility's website for a list of any incentives.

Visit the Database of State Incentives for Renewables & Efficiency. DSIRE's search function allows you to filter results for residential rebates offered by utilities.

Get your utility to slash home energy audit price

Paralyzed by all the potential rebate options? Get an energy pro to come to your house and tell you exactly which energy-efficient retrofits will be cost-effective for you.

Some utilities:

Offer free in-home energy evaluations performed by utility staff.

Give a rebate against the price of an energy audit conducted by an independent pro.

Rebate part of the cost of any recommended improvements. In California, for example, Pacific Gas & Electric offers up to $4,000 in rebates for any household that receives an energy audit, implements the recommended changes, and achieves a 15% reduction or more in energy consumption.

The auditor will advise you on the potential cost of recommended improvements vs. the money they'll save you on your energy bills. If your utility rebates part of the cost of those improvements, the return on your investment will come much faster.

It's definitely worth checking out—especially if the audit is free or at a reduced cost.

By: Karin Beuerlein

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How to Choose Household Products Based on Energy Performance

2011-10-01T10:52:00.001-04:00

Is energy performance key for your next appliance or home system? Use Energy Star, the Consortium on Energy Efficiency, and Energy Guide to untangle the options.

Energy Star is the name you likely know, but if truly stellar energy performance revs your motor, go straight to the Consortium for Energy Efficiency (CEE).

What it means: CEE rates appliances, electronics, lighting, HVAC systems, and gas heating systems. At the website, you can download lists of products that meet CEE’s criteria. Do it before you shop because — bummer — CEE doesn't put a label on compliant products.
CEE ratings are so stringent that the highest-rated Energy Star products are considered the low end of CEE’s roster (and Energy Star isn’t shabby!):

Appliances and HVAC systems are grouped into three tiers, taking both energy performance and water usage (if applicable) into account.

Tier 1 products meet Energy Star requirements at a minimum.

Tier 3 products are super-efficient—the cream of the crop.

CEE updates its ratings every month.

Pricing: Often high-efficiency products rated by CEE (and Energy Star) are more expensive than their less-efficient peers, but may cost less to operate annually.

Speaking of Energy Star...

Energy Star

What it means: Energy Star, the U.S. Environmental Protection Agency's flagship label, identifies roughly the top 25% of each product category it rates in terms of energy performance. It's the best-known and most widely applied green stamp of approval, covering more than 50 product categories, including appliances, lighting, plumbing, and heating and cooling systems.

Bad press leads to more reliable Energy Star ratings

Energy Star beefed up its standards after getting bad press in 2010, when the U.S. Government Accountability Office reported it was able to get fake products approved. All products must now be individually reviewed by Energy Star staff and tested by approved third-party labs.

But Energy Star is still trustworthy, says BuildingGreen, an independent company that educates building professionals on green product certifications:

Its standards get more stringent every two years to coincide with manufacturing cycles for new products.

It responded quickly after being called on the carpet by changing its product approval process.

It's easy to find Energy Star labels in the store, but if you want to research your purchase in advance, download compliant product lists.

Pricing: Often high-efficiency products rated by Energy Star are more expensive than their less-efficient counterparts, but you save money on annual operating costs.

Energy Guide

OK, one more rating label to add to the mix. You’ve probably seen the ubiquitous yellow Energy Guide sticker on new appliances in stores.

What it means: Energy Guide lists the manufacturers' self-reported performance numbers, not the results of independent third-party testing. Plus, those numbers may not reflect how you'll use the product in your own home (do you make a special effort to use the most energy-efficient settings at all times, or do you dry tons of laundry on high heat?) or the rates your utility charges.
So if you use Energy Guide labels at all, use them to compare models in the store in terms of up-front cost vs. annual operating cost. But the labels don't provide enough context to tell you whether a product is really the best energy-saving deal you can get for the price. That's where Energy Star and CEE come in.

Pricing: Energy Guide labels are government mandated and appear on all products in all price ranges. So it's not a way to sort by price.

By: Karin Beuerlein

Karin Beuerlein has covered home improvement and green living topics extensively for FineLiving.com, FrontDoor.com, and HGTV.com. She and her husband started married life by remodeling the house they were living in. They still have both the marriage and the house, no small feat.

********************************************************************
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The Top 5 Contractor Scams and How to Avoid Them

2011-10-01T10:48:00.000-04:00

Protect yourself against contractor scams that threaten to stick you with shoddy workmanship or take your money and run.

The vast majority of contractors are honest, hardworking professionals. Protecting yourself against the few bad apples requires checking references, having a solid contract, and being alert to the warning signs of these top five contractor scams.

Scam 1: I’ll need the money up front

This is the most common ruse reported to the Better Business Bureau. Your contractor explains that because he has to order materials and rent earthmoving equipment to get the job started, he needs, say, 30% to 50% of the project price up front. Once you’ve forked over the dough, one of two things happens: He disappears on you, or he starts doing slapdash work knowing that you can’t really fire him because he’s sitting on thousands of your dollars.

How to protect yourself: Never prepay more than $1,000 or 10% of the job total, whichever is less. That’s the legal maximum in some states, and enough to establish that you’re a serious customer so the contractor can work you into his schedule—the only valid purpose of an advance payment. As to the materials and backhoe rentals, if he’s a professional in good standing, his suppliers will provide them on credit.

Scam 2: Take my word for it

When you first meet with the contractor, he’s very agreeable about doing everything exactly to your specifications and even suggests his own extra touches and upgrades. Some of the details don’t make it into the contract, but you figure it doesn’t matter because you had such a clear verbal understanding.

Pretty soon, you notice that the extras you’d discussed aren’t being built. When you confront the contractor, he tells you that he didn’t include those features in his price, so you’ll have to live without them or pony up additional money to redo the work.

How to protect yourself: Unfortunately, you have no legal recourse because you signed a contract that didn’t include all the details. Next time, make sure everything you’ve agreed on is written into the project description. Add any items that are missing, put your initials next to each addition, and have the contractor initial it, too—all before you sign.

Scam 3: I don’t need to pull a permit

You’re legally required to get a building permit for any significant construction project. That allows building officials to visit the site periodically to confirm that the work meets safety codes.

On small interior jobs, an unlicensed contractor may try to skirt the rule by telling you that authorities won’t notice. On large jobs that can’t be hidden, the contractor may try another strategy and ask you to apply for a homeowner’s permit, an option available to do-it-yourselfers.

But taking out your own permit for a contractor job means lying to authorities about who’s doing the work. And it makes you responsible for monitoring all the inspections—since the contractor doesn’t answer to the inspector, you do.

How to protect yourself: Always demand that the contractor get a building permit. Yes, it informs the local tax assessor about your upgrade, but it weeds out unlicensed contractors and gives you the added protection of an independent assessment of the work.

Scam 4: We ran into unforeseen problems

The job is already under way, perhaps even complete, when this one hits. Suddenly your contractor informs you that the agreed-upon price has skyrocketed. He blames the discovery of structural problems, like a missing beam or termite damage, or design changes that you made after the job began.

The additional fees might very well be legit, but some unscrupulous contractors bid jobs low to get the work and then find excuses to jack up the price later. If you’re unsure whether your contractor is telling the truth about structural problems, you can get an impartial opinion from a home inspector, the local branch of the National Association of Home Builders, or even your local building department.

How to protect yourself: Before signing the contract, make sure it includes a procedure for change orders--mini-contracts containing a work description and a fixed price--for anything that gets added to the job in progress. The extra work, whether it’s related to unforeseen building issues or homeowner whims, can proceed only after the change order is signed by both homeowner and contractor.

Scam 5: I’ve got extra materials I can sell you cheap

This hoax is usually run by driveway paving companies, whose materials—hot-top asphalt and concrete—can’t be returned to the supplier. So the crew pulls up to your house with a load of leftover product and quotes a great price to resurface your driveway on the spot.

Even if it’s really a bargain (by no means a sure thing), taking them up on the offer is risky if you have no idea who they are and haven’t checked references. And if the driveway starts cracking next year, you can bet you won’t find this bunch again.

How to protect yourself: Never hire a contractor on the spot, whether it’s a driveway paver, an emergency repairman who shows up after a major storm, or a landscaper with surplus plantings. Take your time to check contractors out to make sure they have a good reputation and do quality work. 

By: Oliver Marks

A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. He’s currently restoring his second fixer-upper with a mix of big hired projects and small do-it-himself jobs.

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9 Unexpected Energy (and Money) Savers

2011-10-01T10:37:00.000-04:00

Here are a few surprising and simple ways to cut your energy bill this season.

Put lamps in the corners: Did you know you can switch to a lower wattage bulb in a lamp or lower its dimmer switch and not lose a noticeable amount of light? It’s all about placement. When a lamp is placed in a corner, the light reflects off the adjoining walls, which makes the room lighter and brighter.

Switch to a laptop: If you’re reading this article on a laptop, you’re using 1/3 less energy than if you’re reading this on a desktop.

Choose an LCD TV: If you’re among those considering a flat-screen upgrade from your conventional, CRT TV, choose an LCD screen for the biggest energy save.

Give your water heater a blanket: Just like you pile on extra layers in the winter, your hot water heater can use some extra insulation too. A fiberglass insulation blanket is a simple addition that can cut heat loss and save 4% to 9% on the average water-heating bill.

Turn off the burner before you’re done cooking: When you turn off an electric burner, it doesn’t cool off immediately. Use that to your advantage by turning it off early and using the residual heat to finish up your dish.

Add motion sensors: You might be diligent about shutting off unnecessary lights, but your kids? Not so much. Adding motion sensors to playrooms and bedrooms cost only $15 to $50 per light, and ensures you don’t pay for energy that you’re not using.

Spin laundry faster: The faster your washing machine can spin excess water out of your laundry, the less you’ll need to use your dryer. Many newer washers spin clothes so effectively, they cut drying time and energy consumption in half—which results in an equal drop in your dryer’s energy bill.

Use an ice tray: Stop using your automatic icemaker. It increases your fridge’s energy consumption by 14% to 20%. Ice trays, on the other hand, don’t increase your energy costs one iota.

Use the dishwasher: If you think doing your dishes by hand is greener than powering up the dishwasher, you’re wrong. Dishwashers use about 1/3 as much hot water and relieve that much strain from your energy-taxing water heater. Added bonus: you don’t have to wash any dishes.

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

Moving, have property to sell or buy outside of our area? I can recommend an experienced and capable agent in the new area of the state or country.

Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Short Sales Lose Appeal Among First-time Buyers

2011-09-29T16:10:00.000-04:00

Daily Real Estate News

Short sale transactions are becoming less popular among first-time home buyers. Buying a home in a short sale transaction may offer a huge bargain—sale prices average 27 percent lower than non-distressed properties—but more first-time home buyers say the processing delays aren’t worth the trouble.

Among first-time buyers, their short sale purchase share dropped to 39.7 percent of all short sale transactions in August—posting a three-month drop and reaching its lowest share ever recorded for first-time home buyers, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. In November 2009, first-time home buyers’ share of short sales had reached a peak of 54.1 percent of all short sale transactions.

With bargain deals, why are short sales losing their appeal? Buyers are complaining that short sale transactions take too long to close, with approval times often taking several months after a buyer even submits an offers. Some buyers frustrated at the delays are placing offers on multiple properties, planning to close on whichever one is approved the fastest. The average time on market for short sales is 16.6 weeks, and the majority of that time is spent waiting for short sale approval, the HousingPulse Tracking Survey found.

Source: “First-Time Buyers Losing Interest in Short Sales,” RISMedia

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Appeal Your Property Tax Bill

2011-09-29T14:14:00.000-04:00

To successfully appeal your property tax bill, you first need to do a bit of sleuthing into your real estate assessment.

Read your assessment letter

A real estate assessment is conducted periodically by the local government to assign a value to your home for taxation purposes. An assessment isn't the same as a private appraisal, and the assessed value of your home isn't necessarily how much you could sell it for today. Real estate assessment letters are mailed to homeowners annually, or perhaps every two to three years, depending where you live.

The letter will include some information about your property, such as lot size or a legal description, as well as the assessed value of your house and land. Additional details—number of bedrooms, for example, or date of construction—can often be found in the property listing on your local government's website. Your property tax bill will usually be calculated by multiplying your home's assessed value by the local tax rate, which can vary from town to town.

If you think your home's assessment is higher than it should be, challenge it immediately. The clock starts ticking as soon as the letter goes out. You generally have less than 30 days to respond, though the time frame varies not just between states, but within each state. Procedures are often outlined on the back of the letter.

Gather evidence

Start by making sure the assessment letter doesn't contain any mistakes. Is the number of bathrooms accurate? Number of fireplaces? How about the size of the lot? There's a big difference between "0.3 acres" and "3.0 acres." If any facts are wrong, then you may have a quick and easy challenge on your hands.

Next, research your home's value. Ask a real estate agent to find three to five comparable properties—"comps" in real estate jargon—that have sold recently. Alternatively, check a website like Zillow.com to find approximate values of comparable properties. The key is identifying properties that are very similar to your own in terms of size, style, condition, and location. If you're willing to shell out between $350 and $600, you can hire a private appraiser to do the heavy lifting.

Once you identify comps, check the assessments on those properties. Most local governments maintain public databases. If yours doesn't, seek help from an agent or ask neighbors to share tax information. If the assessments on your comps are lower, you can argue yours is too high. Even if the assessments are similar, if you can show that the "comparable" properties aren't truly comparable, you may have a case for relief based on equity. Maybe your neighbor added an addition while you were still struggling to clean up storm damage. In that case, the properties are no longer equitable.

Present your case

Once you're armed with your research, call your local assessor's office. Most assessors are willing to discuss your assessment informally by phone. If not, or if you aren't satisfied with the explanation, request a formal review. Pay attention to deadlines and procedures. There's probably a form to fill out and specific instructions for supporting evidence. A typical review, which usually doesn't require you to appear in person, can take anywhere from one to three months. Expect to receive a decision in writing.

If the review is unsuccessful, you can usually appeal the decision to an independent board, with or without the help of a lawyer. You may have to pay a modest filing fee, perhaps $10 to $25. If you end up before an appeals board, your challenge could stretch as long as a year, especially in large jurisdictions that have a high number of appeals. But homeowners do triumph. According to Guy Griscom, Assistant Chief Appraiser of the Harris County (Texas) Central Appraisal District, of the 288,800 protests filed in his Houston-area district in 2008, about 58% received reduced assessments.

How much effort you decide to put into a challenge depends on the stakes. The annual U.S. median property tax paid in 2008 was $1,897, or 0.96% of the median home value of $197,600. Lowering that assessed value by 15% would net savings of about $285. In some parts of New York and Texas, for example, where tax rates can approach 3% of a home's value, potential savings are greater. Ditto for communities with home prices well above the U.S. median.

There are a few things to keep in mind as you weigh an appeal. The board can only lower your real estate assessment, not the rate at which you're taxed. There's also a chance, albeit slight, that your assessment could be raised, thus increasing your property taxes. A reduction in your assessment right before you put your house on the market could hurt the sale price. An easier route to savings might lie in determining if you qualify for property tax exemptions based on age, disability, military service, or other factors.

This article provides general information about tax laws and consequences, but is not intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Readers should consult a tax professional for such advice, and are reminded that tax laws may vary by jurisdiction.

By: Barbara Eisner Bayer

Barbara Eisner Bayer has written about mortgages and personal finance for the past 15 years for Motley Fool, the Daily Plan-It, and Nurse Village, and is the former Managing Editor of Mortgageloan.com and Credit-land.com. She has successfully challenged her real estate assessment.

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HousingTrends eNewsletter

2011-09-22T14:24:00.001-04:00

SEPTEMBER 2011 HousingTrends eNewsletter

Please click here to view the SEPTEMBER - 2011 Newsletter Housing Trends eNewsletter.

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

If you are interested in determining the value of your home, click the Home Evaluator link for a free evaluation report.

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Septic system checkup

2011-09-17T10:46:00.004-04:00

Septic system checkup

Homeowners face varied regulations

There's an older home in the neighborhood that was occupied by a single woman for more than two decades. When she died of cancer a few years ago, her son inherited the home and moved in. Not long after, the septic system failed and had to be replaced.

Eric Knopf, owner of Indigo Designs Inc., a company that designs and maintains septic systems, said that septic systems definitely have a life span. "You can get about 30 years on a home's roof. Some cars will get you 200,000 miles; some maybe 300,000. Septic systems also have a definite life span."
According to the Environmental Protection Agency, an estimated 30 percent of all households use a soil-absorption septic system to dispose of waste. A properly designed, installed and maintained septic system is comprised of a watertight container, drain field, and adequate soil conditions beneath the drain field.

Only 32 percent of all septic systems in existence meet the criteria for adequate soil absorption, due to the presence of bedrock, sandy soil and high water tables.

Here's the quick scoop on what happens in an on-site septic system -- i.e., the sewage treatment a home needs if not hooked in to a community sewer:
Wastewater leaves the house and enters the septic tank. The septic tank acts as a holding tank and allows the solids to settle. The heavier solids sink to the bottom forming the sludge layer; the lighter solids -- fats, oils and grease -- rise to the surface and form the scum layer.
The relatively clear layer in the middle is called effluent. While this is going on, naturally occurring anaerobic bacteria begin breaking down the solids in size and destroying the pathogens, or germs.

As the effluent enters the drain field, it percolates through the gravel bed where a large portion of the pathogens are destroyed. Pockets of oxygen created by the uneven shape of the gravel allow the more efficient aerobic bacteria to exist. As the effluent exits the drain field, the natural soil completes the treatment process.
By the time the effluent has traveled 2-3 feet through the soil, all the remaining pathogens have been destroyed.

"What happens in a septic tank is a beautiful thing," Knopf said. "You have all these little critters working together. When you introduce something that kills what they are doing, it disrupts the process -- at least for a while. What's going on in there is fairly robust and will come back."

Jim vonMeier, who operates www.septicprotector.com, advises homeowners to have their septic contractor inspect the system in the beginning to get a benchmark of how the system is operating because they can tell when a system is "cooking" properly.
Medications are one potential disruptor to septic system processes. "The drugs people take can have a negative impact on a septic system," vonMeier said.
"Antibiotics, for example ... kill bacteria in your body, but that killing process does not stop there. When you go to the bathroom, you are flushing those antibiotics out to your septic system, where they kill the 'good' bacteria in the tank and soil. Chemotherapy drugs can also have the same effect."
States and counties have different rules and regulations regarding on-site septic systems. For example, Washington's Kitsap County requires that all developed property utilizing an on-site sewage system have the system inspected and evaluated through the Kitsap County Health District prior to conveying the property to a new owner. New homes and businesses that have never been occupied are exempt.

"It's common to hear that the best solution to pollution is dilution," Knopf said. "While systems do recover, they are not designed to take everything we give them. For example, in Washington state, kidney dialysis patients are allowed to install a small drain field just for that use. It just depends where you are and what you are dealing with."

By Tom Kelly, Inman News™

Boomers Hunt for Smaller Houses

2011-09-09T08:58:00.000-04:00

Regional Spotlight—(MCT)—When it comes to housing, baby boomers are different from many people in two important ways: they have more equity in their homes, and many are preparing to move.
If housing experts are right, boomers—the 77 million Americans ages 47 to 65—soon may be a sweet spot in an otherwise sour market for new homes.

But if you’re a Central Indiana boomer looking to downsize, good luck finding the house you want.
Homebuilders—caught in a slump that has slashed U.S. new homes sales in half since 2007—have been slow to adjust. And the stock of existing homes in Central Indiana is not exactly rich in the type of amenities boomers say they want. A few builders are shifting to the senior market, but there’s not nearly enough construction planned to meet the pent-up demand, says Edsel Charles, a national and local housing researcher.

“Right now,” says Charles, of Tennessee-based MarketGraphics, “I think only about 60 percent (of boomers) will find what they want, and it should be much higher.”

So empty nesters such as Bruce and Nancy Childs, who decided to downsize from a large home on an acre lot on Indianapolis’ Far Northside, had better be ready for a slog. The Childses started with a list of 220 houses—and ended up dismissing all but two before eventually buying in Noblesville’s Lochaven neighborhood.

“It was a madcap search,” says Bruce Childs, 64, “and they didn’t have a lot we were interested in.”
It’s a story that Charles, who has been researching new housing in more than 20 states, including Indiana, says will be told more and more frequently as early as next year.

Ready to downsize

The retirement market, experts say, appears ripe for change.
Having raised families, many baby boomers are ready to turn in the keys to their oversized suburban McMansions. Research suggests boomers are tired of climbing stairs and mowing lawns and will seek ranch-style homes along quieter blocks, with features that make life a little easier on achy backs and knees.

So far, however, boomers haven’t started moving in big numbers.

“They have hesitated because of the recession,” Charles says. “Once the government and the stock market settle down, and the market turns, you will find this bunch that has hesitated will become a pent-up demand.”

Boomers and retirees, he says, will be among the largest share of the market beginning as early as 2012.
If so, it could be a potent market.

It would be hard enough to ignore 1.7 million Hoosier boomers, who make up a quarter of the state’s population, but add in the housing slump, and it would seem impossible.
“These days a lot of people can’t move,” says Indiana University economist Willard Witte, “because they can’t or won’t sell their house at a big loss.”

Unlike the younger families targeted by most builders, however, boomers have been building equity for decades. They have paid down their mortgages over time, putting them in a better position to sell. Witte said boomers may be the first demographic to move when the market picks up. Charles agreed.
“I think we are heading into a huge retirement market,” he says.

Long wish list

What boomers want, however, appears to be in short supply.
Most boomers now favor ranch homes that are about 1,500 to 2,500 square feet, Charles’ research shows, selling for $140,000 to $230,000. Some prefer age-restricted communities, low-maintenance townhomes and Downtown condominiums. The majority, his research shows, say they want single-story houses within neighborhoods that attract a broader mix of people — and are close to where they now live.

And they carry along a pretty specific checklist:
• Open spaces to host friends and family, rather than separate dining rooms, living rooms and kitchens.
• Features such as vanities and electrical sockets that are a bit higher off the ground than normal.
• Storage, especially his and hers master closets, plus structurally reinforced attics.
• Backyard living spaces—not swimming pools or outdoor kitchens, but large decks with fireplaces, hot tubs and wet bars.

By Chris Sikich Print Article

2011 The Indianapolis Star

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Avoid Home Equity Loan and Refinancing Scams

2011-09-06T20:38:00.001-04:00

Home equity loan and refinancing scams can cost you more than money--these scams can cost you your house.

Loan flipping

Loan flipping is a scam targeted at homeowners looking to get money back when they refinance a mortgage. This is often referred to as a cash-out refi. Scammers take advantage of this desire to tap the equity in a home to pay for things the homeowner couldn't otherwise afford.

A cash-out refi in itself isn't a scam. For some, it's a smart way to borrow. What is a scam is when a lender, after receiving a few payments, comes back to you with an offer of another refinance, this time to fund a vacation or a new car. The easy money is difficult for some homeowners to turn down.

Many borrowers don't realize how much they're paying in fees to refinance. The U.S. Federal Reserve estimates the settlement costs on a typical refi to be 3% to 6% of the loan amount. Loan flippers often charge much more, plus they may quietly roll the settlement costs into the loan to disguise the total charges. Take a day or two to get quotes from several lenders and compare terms.

Loan flipping ultimately leaves you with more debt and more years that you'll owe on that debt. When the equity finally dries up, you might not be able to afford your higher monthly payments and another refinancing will be impossible. You could be forced to sell your home.

Equity stripping

Equity stripping can occur in several ways, but at its heart is a scam artist who gains ownership of your home, borrows against it or sells it, pockets the proceeds, and disappears. You're often left with a hefty mortgage balance and no place to live.

A telling sign of equity stripping is a lender that offers more loan than you can afford or that encourages you to pad your income on a loan application. Homeowners with low incomes but a good amount of equity built up are prime targets because they otherwise would have a hard time borrowing. According to the U.S. Federal Trade Commission, a lender that's pushing a home loan with too-high monthly payments is likely counting on foreclosing on the property when you fall behind.

A variation on equity stripping has a scam artist talking you into selling your home at a discount or signing over the deed, perhaps with a promise of securing better loan terms if your name isn't on it. The scammer promises to let you stay in the home as a renter until the refinancing is finalized, then you can buy back the home. In reality, the scam artist drains equity by borrowing against the house or selling the house, perhaps after evicting you.

According to Consumers Union, don't agree to a home equity loan if you can't afford it. A good rule of thumb: Your combined home loan payments shouldn't exceed 28% of your gross income. The nonprofit publisher of Consumer Reports magazine also warns against signing any documents unless you understand them and turning over you property to anyone without first consulting a trusted adviser.

Phantom help

Watch out for unsolicited offers to refinance from companies claiming government affiliations. In particular, don't be fooled by the use of official-sounding acronyms like "TARP" or official-looking website addresses. Scammers use these to gain your trust. Once they do, they'll likely try to charge you for access to government assistance. Worse, they might extract enough personal information to commit identity theft.

You never need to pay to find out about legitimate government programs. A housing counselor approved by the U.S. Department of Housing and Urban Development can point you in the right direction. For federal refinancing and loan modification help, check out the Making Home Affordable program.

New disclosure rules make spotting scams easier

Many unscrupulous lenders have relied on confusing paperwork to dupe borrowers into paying excessive upfront fees on loans. Others would pull last-minute rate switches at closing. Still others would disguise prepayment penalties, which can prove costly if you ever try to refinance again or retire a loan early.

Balloon payments, which come due at the end of a loan term, can also catch borrowers off-guard. A lender may offer a low monthly payment on an equity loan, but only because the payment is interest-only. The principal is due in one lump sum. Surprised homeowners must scramble to refinance again, tap other assets, or sell.

Disclosure rules that went into effect Jan. 1, 2010, make spotting these types of deceptions easier. All lenders are required to use redesigned Good Faith Estimate and HUD-1 Settlement Statement forms that clearly disclose key loan terms--including interest rates, prepayment penalties, and balloon payments--and closing costs.

The GFE is an estimate of loan terms and closing costs, while the HUD-1 is a final accounting of terms and costs. The redesigned forms, cross-referenced by line number, must be used for mortgage refinancing and home equity loans (with the exception of home equity lines of credit, or HELOCs). The only fee a lender is allowed to collect to issue a GFE is a charge for a credit report, which averages $37.

If you don't receive the new forms, don't do business with the lender. If the estimates on the GFE don't match the final figures on the HUD-1, ask why. Some, but not all, fees are allowed to increase within a fixed range.

By: Donna Fuscaldo

Donna Fuscaldo has written about personal finance for Dow Jones, the Wall Street Journal, and Fox Business News for more than a decade. Like many homeowners, her mortgage is precariously close to being underwater.

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Seal Air Leaks Around Windows and Doors

2011-09-06T20:34:00.000-04:00

Seal air leaks around your windows and doors to prevent wasting precious home heating and cooling energy that costs you money.

Check for air leaks

With windows and doors closed, hold a lit stick of incense near window and door frames where drafts might sneak in. Watch for smoke movement. Note what sources need caulk, sealant, and weather-stripping.

Seal air leaks around windows

If you have old windows, caulking and adding new weatherstripping goes a long way toward tightening them up.

Bronze weatherstripping ($12 for 17 feet) lasts for decades but is time-consuming to install.

Self-stick plastic types are easy to put on but don’t last very long.

Adhesive-backed EPDM rubber ($8 for 10 feet) is a good compromise, rated to last at least 10 years.

Nifty gadgets called pulley seals ($9 a pair) block air from streaming though the holes where cords disappear into the frames.

Seal air leaks around doors

Check for air leaks, and replace old door weatherstripping with new.

Foam-type tape has an adhesive backing; it’s inexpensive and easy to install. If it comes loose, reinforce it with staples.

Felt is either adhesive-backed or comes with flexible metal reinforcement. it must be tacked or glued into place. It’s cheap and easy to install, but it has low durability.

Tubular rubber, vinyl, and silicone weatherstripping is relatively expensive and tricky to install, but it provides an excellent seal. Some types come with a flange designed to fit into pre-cut grooves in the jambs of newer doors; check your existing weatherstripping and replace with a similar style.

Check exterior trim for any gaps between the trim and your door frames, and the trim and your siding. Caulk gaps with an exterior latex caulk ($5 for a 10-ounce tube).

Seal door bottoms

If a draft comes in at the bottom, check the condition of the threshold gasket. Replace worn gaskets. If you can see daylight under the door, you may need to install a new threshold with a taller gasket ($25 for a 36-inch door). Or, install a weather-resistant door sweep designed for exterior doors ($9). Door sweeps attach directly to the door and are easy to install.

By: Jeanne Huber

Jeanne Huber is the author of 10 books about home improvement and writes a weekly column about home care for the Washington Post.

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Attic Air Leaks: How to Find and Seal Them

2011-09-06T20:32:00.000-04:00

Even if your attic floor is filled with adequate insulation, seal air leaks around pipes and other attic openings to prevent waste of heating and cooling energy--and money.

Find air leaks

From below your attic, check the ceilings and note the locations of all light fixtures, ceiling fans, and electrical outlets. From the attic-side of your ceiling, find the fixtures you noted. You’ll have to pull back existing insulation to find them.

Electrical connections for fixtures, fans, and outlets require a hole cutout in your ceiling drywall. Each of these cutouts is a likely air leak. You can stop air leaks by sealing the cutouts from above with acrylic latex or silicone caulk, or with low-expansion polyurethane foam, depending on the size of the gap.

Also check for anything that penetrates the ceiling:

pipes

vent stacks

flues and chimneys

electrical wiring

heating and air conditioning ducts

access hatch

Gaps around these locations should also be sealed from above.

Plug large gaps

Low-expansion polyurethane foam in a can is great for plugging openings 1/4-inch to 3 inches wide, such as those around plumbing pipes and vents. A standard 12-ounce can ($5) is good for 250 feet of bead about half an inch thick.

The plastic straw applicator seals shut within two hours of the first use, so to get the most mileage out of a can, squirt a lubricant such as WD-40 onto a pipe cleaner and stuff that into the applicator tube between uses.

Plug small gaps

Caulk makes the best gap-filler for openings less than 1/4-inch wide, such as those cut around electrical boxes. Silicone costs the most ($8 a tube) but works better next to nonporous materials, such as metal flashing, or where there are temperature extremes, as in attics. Acrylic latex caulk ($2 per tube) is less messy to work with and cleans up with water.

Seal air leaks around flues and chimneys

Building codes require that wood framing be kept at least one inch from metal flues and two inches from brick chimneys. But that creates gaps where air can flow through. Cover the gaps with aluminum flashing ($12) cut to fit and sealed into place with high-temperature silicone caulk ($20).

To keep insulation away from a hot flue pipe, form a barrier by wrapping a cylinder of flashing around the flue, leaving a one-inch space in between. To maintain the spacing, cut and bend a series of inch-deep tabs in the cylinder’s top and bottom edges.

Weatherstrip the attic access hatch

A quarter-inch gap around pull-down attic stairs or an attic hatch leaks the same amount of air as a bedroom heating duct. Seal it by caulking between the hatch frame and the rough opening, or by installing foam weatherstripping around the perimeter of the hatch opening. Or, you can buy a pre-insulated hatch cover kit for about $150.

Tips for working in attics

Work on a cool day.

Wear protective gear: disposable clothes, gloves, and a double-elastic mask or half-face respirator to protect you from the insulation.

Bring along a droplight with a fluorescent bulb, plus at least two pieces of plywood big enough to span two or three joists to support you as you work.

To save trips up and down a ladder, try to move up all of the materials you need before you get started.

One warning: If you find vermiculite insulation, hold off until you’ve had it checked for asbestos; your health department or air-quality agency can recommend a lab.

Jeanne Huber is the author of 10 books about home improvement and writes a weekly column about home care for the Washington Post.

By: Jeanne Huber

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Pending Home Sales Slip in July but Up Strongly From One Year Ago

2011-08-31T20:55:00.000-04:00

Pending home sales declined in July but remain well above year-ago levels, according to the National Association of Realtors®. All regions show monthly declines except for the West, which continues to show the highest level of sales contract activity
.
The Pending Home Sales Index,* a forward-looking indicator based on contract signings, slipped 1.3 percent to 89.7 in July from 90.9 in June but is 14.4 percent above the 78.4 index in July 2010. The data reflects contracts but not closings.

Lawrence Yun, NAR chief economist, said sales activity is underperforming. “The market can easily move into a healthy expansion if mortgage underwriting standards return to normalcy,” he said. “We also need to be mindful that not all sales contracts are leading to closed existing-home sales. Other market frictions need to be addressed, such as assuring that proper comparables are used in appraisal valuations, and streamlining the short sales process.”

The PHSI in the Northeast declined 2.0 percent to 67.5 in July but is 9.7 percent above July 2010. In the Midwest the index slipped 0.8 percent to 79.1 in July but is 18.8 percent above a year ago. Pending home sales in the South fell 4.8 percent to an index of 94.4 but are 9.5 percent higher than July 2010. In the West the index rose 3.6 percent to 110.8 in July and is 20.6 percent above a year ago.

“Looking at pending home sales over a longer span, contract activity over the past three months is fairly comparable to the first three months of the year, and well above the low seen in April,” Yun said. “The underlying factors for improving sales are developing, such as rising rents, record high affordability conditions and investors buying real estate as a future inflation hedge. It is now a question of lending standards and consumers having the necessary confidence to enter the market.”

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.

###

*The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.
The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.
An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined as well as the first of five consecutive record years for existing-home sales; it coincides with a level that is historically healthy.

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Repair and Replace Kitchen Counters to Stay on Top of Scratches

2011-08-23T20:16:00.000-04:00

You can repair kitchen counter mishaps with only a little time and money. Big boo-boos, however, will need professional help.

Granite

Even granite counters suffer kitchen wear and tear. But you can make them shine with a little time and know-how. After you fix them, don’t forget to reseal them.

Cracks, chips, scratches: Fill nicks in granite by building up layers of epoxy resin colored to match the stone. Clean the area first with acetone, which breaks down grease. Be sure to open a window for ventilation.

Stains: The type of stain--wine or ink, oil or bleach--determines the type of poultice you’ll need to suck it out. A paste of flour and hydrogen peroxide pulls out grease, oil, bleach, and ink stains; a mix of flour and bleach cleans wine stains. If you want to go commercial, check out Alpha, Aqua Mix, and StoneTech stone cleaners. Cost: $6 to $20.

Solid surface counters

Solid surface countertops, such as Corian, are man-made from resin, acrylic, and other materials. They’re tough but not impervious to scratches and stains. To repair minor scratches, rub a white polishing compound on the area with a wool pad, then apply a countertop wax.

For deeper scratches or cuts, call a professional. Figure labor costs at about $15 to $35 an hour. If you need to replace portions of the counter, figure at least $35 to $65 per square foot.

Laminate

Fixing gouges or covering burns in laminate is tough for mortals, though repairing minor problems is doable.

Fix small chips with laminate repair paste that matches the color of the countertop.

Cover scratches with countertop polish or car wax.

Fix peeling laminate with contact cement applied to both surfaces and pressed back into place.

Remove coffee and tea stains with vinegar or a paste of baking soda and household cleaner.

Bigger problems will require replacing the damaged stretch. Laminate comes in a billion colors, but finding an exact match for an old counter could be difficult.

To get the look you want, replace the counter. Labor will cost $15 to $35 per hour; countertops range from $3/linear ft. for Plain Jane straight-edged laminates to $100/linear ft. for laminates with a beveled edge that look like granite.

Tile

If you’ve planned ahead and stockpiled old tiles, then grab a few and replace cracked or scratched areas. If you don’t have extra tile, then attempt the following first aid:

Wipe away scratches with a dab of toothpaste on a clean cloth.

Work epoxy glue into cracks with a toothpick, then color with matching oil-based artist paint.

Remove old grout with a utility knife, then replace with a rubber trowel.

Stainless steel

Stainless steel countertops become scratched, stained, and dull over time. While you’ll never completely remove scratches, you can buff them into a warm patina by massaging with vegetable oil.

Remove stains with a paste of baking soda and dish soap. A sprinkle of Barkeeper’s Friend will remove stains without scratching.

By: Jane Hoback

Jane Hoback is a veteran business writer who has written for the Rocky Mountain News, Natural Foods Merchandiser magazine, and ColoradoBIZ Magazine.

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AUGUST - 2011 Newsletter

2011-08-22T19:26:00.000-04:00

AUGUST - 2011 Newsletter Housing Trends eNewsletter

Please click here to view the AUGUST - 2011 Newsletter Housing Trends eNewsletter.

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

If you are interested in determining the value of your home, click the Home Evaluator link for a free evaluation report.

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Study: N.C. No. 5 in corporate relocations

2011-08-17T19:39:00.000-04:00

An Atlas Van Lines migration study shows that North Carolina continues to rank among the strongest states in the country as a corporate relocation destination.

North Carolina came in tied at No. 5 in the nation for inbound moves to the state for corporate relocations after recording an 18 percent increase in the number of people who moved to the state in 2010. The number of outbound moves increased nearly 6 percent compared to the year prior.

North Carolina recorded 3,501 “move-ins” in 2010, compared to just 2,411 “move-outs,” meaning that about 57 percent of total corporate relocation activity was inbound.

It was the 10th consecutive year that North Carolina achieved inbound status, according to the report. The Atlas Van Lines Migration Patterns study tracked nearly 75,000 corporate relocation moves in 2010 as reported by human resources executives from across the country.

Washington D.C. ranked at No. 1 among the top inbound migration regions with 68 percent of the corporate relocation moves coming into the district. It was followed by Kentucky (63 percent), while Arizona and Georgia tied for the third slot with 60 percent each. Maryland, New Mexico, North Carolina and Vermont all had 57 percent.

The top states with outbound migration were Ohio with 68 percent of its relocations moving out of state, followed by Indiana, Louisiana and New Jersey with a 58 percent outbound percentage rate each.

The Business Journal - by Amanda Jones Hoyle

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AUG-2011 Housing Trends eNewsletter

2011-08-15T19:28:00.000-04:00

AUG-2011 Newsletter Housing Trends eNewsletter

Please click here to view the AUG-2011 Newsletter Housing Trends eNewsletter.

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

If you are interested in determining the value of your home, click the Home Evaluator link for a free evaluation report.

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ForSalebyOwner.com Founder Uses Agent to Sell Home

2011-08-10T16:13:00.001-04:00

The founder of a popular for-sale by owner Web site used a real estate broker to help sell his 2,000-square-foot, two-bedroom New York apartment after it lingered on the market for six months. Colby Sambrotto, the founder and former chief operating officer of ForSalebyOwner.com, tried to sell the property himself by listing it online and through classified ads, but after six months of it sitting on the market, he sought the help of a real estate broker.
Broker Jesse Buckler told Sambrotto the condo was priced too low and wasn’t attracting the right buyer for the condo.
"At first he wouldn't let me increase the price," Buckler said. "I told him I know what I am doing—the market is picking up."
The condo soon attracted multiple offers and ended up closing recently for $150,000 more than the original asking price.

Daily Real Estate News
Source: “DIY Guru Gets Broker Help,” The Wall Street Journal (Aug. 3, 2011)

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Daily Economic Update: Fannie and Freddie Downgrade

2011-08-10T16:10:00.000-04:00

Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update highlights Standard & Poor’s downgrade of Fannie Mae and Freddie Mac.

Fannie and Freddie have been downgraded today after the U.S. government was tarnished over the weekend with a less than stellar credit rating.
Given that Fannie and Freddie are effectively nationalized with implicit government backing, it is common sense that the ‘offspring’ would also get the same mark down as the ‘parent’ (the government in this case). FHA loans have explicit (not implicit) government backing so FHA mortgage rates will move directly in proportion to the U.S. government borrowing rate.
The spread between Fannie and Freddie bonds with the U.S. Treasury has opened up because of implicit and not explicit backing. Still, the fall in the Treasury interest rates is large enough that even Fannie and Freddie backed loans will get lower rates despite the widening spread.
The heavy hit was not to borrowing costs, but to the stock market. A hit to consumer confidence from the downgrade will slow consumer spending growth or even cause an outright contraction. That will hold back economic growth and corporate profits.
The stock market equity had been $19.5 trillion in spring of this year. Today, the value is $16.8 trillion, a loss of nearly $3 trillion. Consumers will be more hesitant than before. We may possibly see $150 billion less in consumer spending during upcoming quarters, unless there is a meaningful rebound in stock prices.
Oil prices have been falling as well. Lower oil prices tend to boost consumer spending, as less money is spent at the gas pump making more money available for other items.
Going the other direction: gold, now at above $1700 per ounce. On the expectation of slow economic growth, the Federal Reserve might return to printing money again. One way to protect against too much printed money and currency depreciation is to hold onto hard assets that hold value. Gold and real estate have traditionally served as a good hedge against inflation. This time around, only gold is rising while real estate is not.

August 8, 2011 by Lawrence Yun, Chief Economist & Senior Vice President, Research

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Does debt deal put mortgage interest deduction in play?

2011-08-03T17:13:00.000-04:00

WASHINGTON -- Just as Social Security and Medicare benefits were dangled above the shredder in the debt ceiling debate, another of Washington's sacred cows could end up on the chopping block soon.
The mortgage interest deduction, which allows 35 million homeowners to write off their mortgage interest payments, may be in for serious restructuring if ongoing efforts to pare the bulging federal debt are broadened.
As part of the just-concluded debt ceiling debate, a bipartisan group of senators known as the "Gang of Six" proposed lowering the limit on mortgages eligible for the deduction from $1 million to $500,000 and restricting the tax break only to primary residences.

But as it has through decades of federal budget cuts and crises, the popular provision emerged unscathed in the debt limit compromise that President Barack Obama signed into law Tuesday. That reprieve, however, may not last.
With lawmakers looking for $1.2 trillion to $1.5 trillion in additional budget cuts by the end of the year, the deduction - which will cost the federal treasury about $131 billion next year - makes for a juicy target.
First of all, the revenue the government forgoes because of the deduction is huge; more than twice the entire budget of the Department of Housing and Urban Development. And there are better, more cost-efficient ways for the tax code to encourage homeownership, economists argue. Plus, the benefits of the deduction go disproportionately to the upper middle class, whose bigger homes and mortgages bring bigger tax write-offs.
In fact, the average value of the deduction increases with income, from $91 for those who make less than $40,000 a year to $5,459 for those who earn more than $250,000, according to a 2010 report by the Tax Policy Center, a joint project of the Urban Institute and the Brookings Institution, two center-left research centers.

For most homeowners who take the deduction, the tax savings it provides doesn't make the difference between owning and renting. It simply helps them afford more expensive homes.
Housing advocates have long argued that if homeownership is the provision's goal, a refundable tax credit for all taxpayers would be more effective.
"If we wanted to increase homeownership, we'd target the incentives towards the families who are on the margins of possibly not being able to afford to own a home. ... It's pretty clear that's not what the mortgage interest deduction does in the way it's currently designed," said Seth Hanlon, the fiscal policy director at the liberal Center for American Progress.

The idea of curbing the mortgage tax break has been around for years. President George W. Bush's tax overhaul panel recommended limiting the deduction in 2005, but the issue quickly disappeared as lawmakers showed no stomach for it.
The Great Recession may have changed that, however. As federal revenues plummeted, calls to trim and revamp the deduction have came from the Bipartisan Policy Center's Debt Reduction Task Force and President Barack Obama's National Commission on Fiscal Responsibility and Reform.
"While nothing has happened in response to any of these ideas, it is definitely now on the table as it has never been before," said Eric Toder, a co-director of the Tax Policy Center.
So don't be surprised if the deduction is back on the carving table just in time for Thanksgiving, when a new 12-member bipartisan debt-reduction legislative committee created by the debt ceiling compromise must recommend even more budget cuts.
At an estimated cost of more than $484 billion from 2010 to 2014, the mortgage deduction is second only to the employer-paid health insurance exemption as the nation's most costly individual tax break, according to the congressional Joint Committee on Taxation.

Many want some of the tax savings from the mortgage deduction to address the housing needs of low-income renters and buyers.
A new study by the conservative Reason Foundation suggests eliminating the deduction altogether in order to fund a revenue-neutral 8 percent cut in federal taxes for everyone. Currently, only about 25 percent of taxpayers benefit from the mortgage interest deduction.
Only taxpayers who itemize can claim the deduction, so only about 30 percent of filers typically take it each year. Lower-income people are less likely to itemize.
"The deduction is used almost exclusively by people in the top income brackets with large mortgages. Renters, along with lower- and middle-class families, are getting a raw deal. Taxpayers and the economy would be best served by ditching the mortgage deduction and lowering overall tax rates," said Anthony Randazzo, the director of economic research at the Reason Foundation and a co-author of the report.
Lawrence Yun, the chief economist at the National Association of Realtors, said that now would be the worst possible time to tinker with the deduction because it would further depress demand in the struggling housing sector. Any reductions would most hurt younger families, who typically have higher amounts of interest on their mortgage balance sheets, Yun said.

He said that eliminating the deduction would amount to a tax hike on the middle class and would lower property values by 15 percent. Others project that without the deduction, property values would fall anywhere from 2 to 12 percent.
Rather than eliminating the deduction altogether, Hanlon and the Center for American Progress have proposed gradually stepping down the value of the deduction over a 20-year period until it becomes a flat 15 percent tax credit that's available to all households. He said Britain did the same thing over 25 years with little effect on homeownership rates and home prices.

By TONY PUGH - McClatchy Newspapers
newsobserver.com

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Raleigh-Cary Area Local Market Report, First Quarter 2011

2011-08-01T21:03:00.002-04:00

What's Happening in Local Markets

For a comprehensive view of the Raleigh Region Real Estate Market, click the link below.

North Carolina - Raleigh Region Real Estate Market Update

Prepared by National Association of REALTORS®

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Seven Out of 10 Renters Say Owning a Home is a Top Priority

2011-08-01T20:53:00.001-04:00

Most Americans still believe that owning a home is a solid financial decision, and a majority of renters aspire to home ownership as a long-term goal. According to the 2011 National Housing Pulse Survey released today by the National Association of Realtors®, 72 percent of renters surveyed said owning a home is a top priority for their future, up from 63 percent in 2010.

Seven in 10 Americans also agreed that buying a home is a good financial decision while almost two-thirds said now is a good time to purchase a home. The annual survey, which measures how affordable housing issues affect consumers, also found that more than three quarters of renters (77 percent) said they would be less likely to buy a home if they were required to put down a 20 percent down payment on the home, and a strong majority (71 percent) believe a 20 percent down payment requirement could have a negative impact on the housing market.

“Despite the economic setbacks Americans have experienced in today’s current climate, it is clear that a strong majority still believe in home ownership and aspire to own a home,” said NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “However, achieving the dream of home ownership will become increasingly difficult for buyers if they are required to make a 20 percent down payment, which may be a reality for many of tomorrow’s buyers if a proposed Qualified Residential Mortgage rule is adopted. That is why Realtors® are strongly urging regulators to go back to the drawing board on the proposed rule.”

Defining the QRM rule is important because it will determine the types of mortgages that will generally be available to borrowers in the future. As currently proposed, borrowers with less than 20 percent down will have to choose between higher fees and rates today – up to 3 percentage points more – or a 9-14 year delay while they save up the necessary down payment.
Over half – 51 percent – of self-described “working class” home owners as well as younger non-college graduates (51 percent), African Americans (57 percent) and Hispanics (50 percent) who currently own their homes reported that a 20 percent down payment would have prevented them from becoming home owners.

Pulse surveys for the past eight years have consistently reported that having enough money for a down payment and closing costs are top obstacles that make housing unaffordable for Americans. Eighty-two percent of respondents cited these as the top obstacle, followed by having confidence in one’s job security.

The survey also found respondents were adamantly against eliminating the mortgage interest deduction. Two-thirds of Americans oppose eliminating the tax benefit, while 73 percent believe eliminating the MID will have a negative impact on the housing market as well as the overall economy.

“The MID facilitates home ownership by reducing the carrying costs of owning a home, and it makes a real difference to hard-working American families,” said Phipps. “Home ownership offers not only social benefits, but also long-term value for families, communities and the nation’s economy. We need to make sure that any changes to current programs or incentives don’t jeopardize our collective futures.”

When asked why home ownership matters to them, respondents cited stability and safety as the top reason. Long-term economic reasons such as building equity followed closely behind. On a local level, respondents said neighbors falling behind on their mortgages and the drop in home values were top concerns. Foreclosures also continue to remain a large concern, with almost half of those surveyed citing the issue as a problem in their area.

The 2011 National Housing Pulse Survey is conducted by American Strategies and Myers Research & Strategic Services for NAR’s Housing Opportunity Program. The telephone survey polled 1,250 adults nationwide, with an oversample of interviews of those living in the 25 most populous metropolitan statistical areas. The study has a margin of error of plus or minus 3.1 percentage points.
The National Association of REALTORS

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Why Home Sales Will Rise This Year

2011-08-01T20:40:00.000-04:00

The first quarter ended with decent home sales activity, but the rest of the year should be even better.

Here's why.

The first quarter ended with decent home sales activity, with existing homes selling at an annualized pace of 5.1 million. The remainder of the year should be better still for the following reasons:

More jobs
Rising stock market wealth
Rising apartment rents
Continuing high affordability conditions
Home values at historically justifiable levels
Investors looking to hedge against inflation
Foreigners buying U.S. homes on the cheap

Other potential contributing factors, although they’re not happening yet, are huge bank profits translating into more desire to lend and some reduction to market friction as lenders’ short sale approval processes improve and appraisals become less of an issue.

So, if existing-home sales either hold at the 5.1 million pace of the first quarter or improve on that, then the annual sales tally will easily exceed the 4.9 mil-lion home sales we saw last year.
Still, the stars are not all aligned. There will be obstacles. High gas prices are a daily reminder that something is not right with the economy; that will hold back consumer confidence. Washington policymakers are debating the ending of government guaranteed mortgages and requiring a minimum down payment of 10 to 20 percent on conventional mortgages, even though the FHA and VA mortgage programs have very low down payments and have yet to require a single dime of taxpayers’ money. And there will be attempts to chip away at the mortgage interest deduction by invoking class warfare—the " let’s go after the rich " approach.

At least through 2011, improving market developments should outweigh the negative impact imposed by Washington policymakers.

By Lawrence Yun

Learn how NAR plans to ensure the continued accuracy of its existing-home sales calculation in the years ahead: "How NAR Calculates Existing-home Sales"

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New-Home Market Shows Signs of Stabilizing

2011-08-01T20:36:00.000-04:00

New-home sales dropped in June, but a sharp increase in prices and declining inventories may be signs the sluggish new-home market is finally showing signs of rebounding, the Commerce Department reported Tuesday.

Sales of new homes dropped 1 percent in June, reaching an annual rate of 312,000 -- less than half the 700,000 rate that most economists consider healthy for the new-home sector. New-home sales fell to record lows in the Northeast and were also particularly sluggish in the West.

The Commerce Department reported 164,000 new homes for sale in June, which is a record low. Taking into account June’s sales pace, the supply of new homes on the market dropped to a 6.3-month supply, the lowest since April 2010.

However, builders are starting to build more. Last week, the Commerce Department released a report that showed a rebound in June for new building permits -- an indication for future building. Also, builders broke ground on more homes in June, with housing starts soaring 14.6 percent last month, marking a six-month high in housing starts.

Meanwhile, the median price of a new home increased to $235,200 in June, up 5.8 percent from May. Compared to June last year, the median price rose 7.2 percent. However, new-homes continue to be considerably higher than previously owned homes. The median price on existing-homes averaged $184,300 in June.

Daily Real Estate News

Source: “U.S. New Home Sales Fall in June, Prices Rise,” Reuters News (July 26, 2011)

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Buyers Rejected for Loans Can Now Find Out Why

2011-07-25T14:34:00.000-04:00

A provision in the Dodd-Frank financial reform law, which took effect this week, is requiring lenders to provide consumers with a free credit score, which will help provide new insights into why they may have been rejected for a loan or did not qualify for the best, lowest rate.
While borrowers can access their credit scores from the credit bureaus, the credit score that a lender uses isn’t always the same one that the credit bureau provides you. According to a report by the Consumer Financial Protection Bureau, some credit bureaus sell consumers “educational” scores that aren’t the same ones used by lenders, or these bureaus may base the score on a different model than the one lenders use.
Now, borrowers for the first time will get a more accurate view of what credit score lenders are using to base their mortgage on.
Under the new provision, lenders will be required to provide potential borrowers with a free credit score whenever they reject an application for a loan. Lenders must provide borrowers with an “adverse action” notice, which will include their credit scores as well as an explanation of why they were rejected for a loan.
Lenders will also be required to provide a free credit score and an explanation whenever they approve a loan but at a higher rate than what is given to their best customers.
Mark Greene, CEO of FICO, says that many borrowers may be surprised to learn that they didn’t qualify for a lender’s lowest rate when applying for a loan.
Source: “Turned Down for a Loan? Now You Can Find Out Why; Consumers Can Also Get Free Credit Scores if Loan Rate Isn’t Best Available,” USA Today (July 21, 2011)

Daily Real Estate News | Thursday, July 21, 2011

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North Carolina among cheapest in country for mortgage closing costs

2011-07-20T16:28:00.000-04:00

North Carolina is the second-least-expensive state for mortgage closing costs even though those expenses are going up nationwide, according to a new survey from Bankrate Inc.

The Bankrate (NYSE:RATE) 2011 Closing Costs Survey shows that nationwide the average origination and title fees on a $200,000 mortgage are up 8.8 percent from a year ago for a total of $4,070.

In North Carolina, the total cost is $3,410, which includes $1,839 in title and closing costs, as well as $1,571 in origination fees. Origination fees include lender charges for services such as underwriting and processing. Only Arkansas, at $3,378, has a lower total
.
New York is the most expensive state, with total fees of $6,183 It is followed by Texas ($4,944) and Utah ($4,906).

Click here to see how each state ranks in the survey.

Even with the low closing costs and mortgage rates that dipped to an average of 4.51 percent last week for a 30-year loan, there are scant signs of improvement in Charlotte's housing market.
As previously reported, Charlotte-area home prices continued to fall through April, dropping to the lowest point since the Standard & Poor’s/Case-Shiller Home Price Index began tracking housing markets in 2006.

Home prices in the Charlotte market dropped 6.6 percent for the year ended in April, according to the index.

That’s only a fraction better than last month’s index report, which showed Charlotte prices declining 6.8 percent for the year ending in March. Prices in April were down 0.3 percent from March levels.

Charlotte Business Journal - by Olivia Barrow, Triangle Business Journal

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JULY - 2011 Newsletter Housing Trends eNewsletter

2011-07-19T17:15:00.000-04:00

JULY - 2011 Newsletter Housing Trends eNewsletter

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

Please click here to view the JULY - 2011 Newsletter Housing Trends eNewsletter.

If you are interested in determining the value of your home, click the Home Evaluator link for a free evaluation report.

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Escrow Accounts: What’s the Deal?

2011-07-09T20:14:00.000-04:00

Does your escrow account ever cross your mind? Probably not. But forgetting to monitor it can lead to lost money and a big headache.

Escrow accounts: lenders love them; you might not
As handy as they are, you’ll find some significant hitches:

You lock up your money before your tax and insurance payments are due, since your lender is taking the money out each month, often long before the tax payment is actually due.

Your lender usually doesn’t have to pay you interest on your escrow account—it varies by state.

Your lender may screw up paying taxes or insurance, and even though it has to fix mistakes, you have to make the time and effort to follow up.

There may be tax advantages to timing your property tax expenses—but you can’t do that if you’re paying a flat fee in escrow each month.

But your lender may insist on an escrow account because it:

Helps guarantee your insurance and taxes will be paid.

Ensures your lender will get the first claim on your house if you default, ahead of the local government.

In fact, your lender may do you the honor of charging you a flat fee for opting out of an escrow account, or it will add 0.25% to 0.5% to the loan amount if you decline to use an escrow account.

How to manage your escrow account
Your lender has to give you an annual escrow account statement and refund any available balance when you sell your house or refinance your mortgage. Check your escrow account statement carefully:

Make sure everything adds up. "If I have my escrow statement, my property tax bill, and my homeowner insurance declaration page, and everything matches up, then I'm fine," says Debbie Siegel, president of Westchester Mortgage in Newton, Mass.

Check the size of the escrow account. Lenders are allowed to keep a reserve of no more than two months in payments in most states, and in some situations it’s even less. Your REALTOR® or lawyer can give you the skinny in your case.

Contact your lender in writing if you find a problem in your escrow account. If your lender missed an insurance payment, it should pay any late fees as long as your mortgage payments are current, according to the U.S. Department of Housing and Urban Development. If your insurance is canceled as result of your lender's late payment, you can sue your lender.

Know your rights. Your lender must acknowledge your letter within 20 days and try to fix your problem within 60 days. If you're still not satisfied, file a complaint with HUD.

Don’t worry, however, if your escrow account balance is temporarily negative. It’s probably due to a recent increase in your taxes or insurance. Your lender will pay your taxes and insurance, although you will need to reimburse your lender for the shortfall.

A final word: Usually basic home owners insurance will be paid out of an escrow account. If you have extra coverage for your original Matisses, for example, you may need to pay that premium directly to your insurer.

By: Susan B. Weiner

Susan B. Weiner has written on financial topics for Bottom Line/Personal, Financial Planning, Wealth Manager, and other national publications for more than 15 years. She learned firsthand that when your house combines two lots, your escrow account may initially fail to pay the tax bill on the second lot.

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What Affects Credit Scores? 7 Misconceptions

2011-07-09T20:05:00.001-04:00

If you’re trying to raise your credit score to get a good rate for a refinance or HELOC, you might be surprised by what affects—or doesn’t affect—your score.

More money improves your credit score

False. Your level or sources of income don’t affect your credit score, although lenders may look at it when making loan decisions, according to the Fair Isaac Corp., the company that issues the commonly used FICO credit scores.

Ownership of several credit cards can hurt your credit score

Mostly false. Having many credit lines isn’t necessarily a bad thing, says credit expert Liz Weston, author of Your Credit Score. Multiple lines give you a favorable debt-to-available-credit ratio. But use them correctly: It’s best to keep any balances below 10% or 20% of the total credit line, she says. Anything more will affect the ratio of debt-to-available-credit, which can decrease your credit score.

Opening and closing credit lines can hurt your credit score

True. New credit applications can decrease your credit score, so be careful about applying for new credit cards or personal loans before applying for a HELOC, second mortgage, automobile loan, or other large line of credit.

Surprise: Closing existing credit lines may also hurt your credit score, since it’ll damage your debt-to-available-credit ratio. A good rule is not to make any credit changes in the months leading up to a major credit request, such as for a HELOC.

Consolidating credit lines will help your credit score

Mostly false. Although it may seem like a good idea to move all your balances to one card, that can actually hurt your credit score, since your debt-to-available-credit ratio will spike on that card, says Weston.

However, credit expert Harrine Freeman says such a slight decline isn’t necessarily a deal-breaker for a loan, especially if the card has a lower interest rate and will allow you to pay off the balance sooner. Your score will increase as soon as that ratio goes down.

Changing jobs can hurt your credit score

Partly true. Taking a new job or losing your job doesn’t affect your credit score. However, if you have a spotty employment history, lenders may hold that against you in making a loan. Dips in income may signal that it could be difficult to pay bills in a timely manner.

Co-signing for others can hurt your credit score

Partly true. Simply co-signing on a loan for someone else may not affect your score, but if that person is late on paying the loan, it’s likely to show up on your report, says Freeman. And that’s a nasty surprise if you didn’t know the person was late.

Judgments and liens aren’t considered in your credit score

False. If you’ve had a judgment or lien filed against you, it’s considered in your payment history, which represents 35% of your score.

Similarly, while most utility companies don’t report payment history to credit bureaus, your account will likely be reported if it is seriously delinquent and referred to a collection agency.

By: Gwen Moran

Additional details on how to manage your FICO score are available on the FICO site.
Gwen Moran is a freelance business and finance writer from the Jersey shore. She’s the co-author of The Complete Idiot’s Guide to Business Plans and writes frequently about real estate.

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Big Banks Bow Out of Reverse Mortgage Market

2011-07-06T16:15:00.001-04:00

The two biggest lenders in the market won’t offer the product anymore. What does that mean for retirees?

Seniors will have fewer avenues to secure steady retirement income, now that the two largest lenders in the reverse-mortgage business have decided to discontinue offering the product.
Wells Fargo, the nation's top reverse-mortgage lender, announced earlier this month that it will stop originating the loans, citing inflexible government regulations and concerns that home prices could continue to sink. Wells Fargo's announcement comes on the heels of Bank of America's move to exit the market earlier this year. As of April, the two banking giants issued nearly 44 percent of reverse mortgages, according to research firm Reverse Market Insight

While reverse mortgages make up only a small portion of the larger lending landscape—just under 115,000 of the loans were on banks' books at their 2009 peak—tightening credit standards for traditional mortgages coupled with falling retirement portfolio values has heightened demand for the loan product, even as the recession has drained equity from American homes.
Conceptually, reverse mortgages are another retirement-income option for older Americans who might not have a lot of savings, but have built up equity in their homes. Homeowners who are at least 62 years old can apply for these mortgages, which allow them to borrow money to create an income stream—either in a lump sum or regularly scheduled payments—against their home equity. Borrowers can continue to live in their home providing they keep up with property taxes, pay insurance premiums, and adequately maintain the home. (In some cases, borrowers have to pay for mortgage insurance, and, just like with traditional mortgages, lenders often tack on origination and closing fees.)

When the borrower leaves or dies, the home is sold, the lender collects the outstanding loan amount from the sale, and any remaining funds go to the borrower or their heirs. Everyone's happy, right?
The product sounds perfect for retirees whose only asset is their house, but the ongoing ravages of the recession and housing-market slump have depressed home prices significantly, jeopardizing seniors' ability to repay the loans they borrowed against equity. That, coupled with strict government regulations prohibiting banks from evaluating an applicant's creditworthiness, were the primary contributing factors to Wells Fargo's decision to bow out of the marketplace. (Bank of America cited the effects of the recession as the primary driver of its decision.)
"It really came down to the restrictions associated with the reverse mortgage product," says Franklin Codel, Wells Fargo executive vice president and head of national consumer lending. "We can't examine the ability of seniors to sustain their lifestyle and responsibilities, so we were seeing increasing defaults on taxes or on insurance or both. It became very evident to Wells Fargo that this product was not sustainable in its current standing."

The move comes as an increasing number of ill-prepared Americans are expected to head into retirement, which has some financial planners worried about how asset-poor seniors will make ends meet with one less option for retirement income.
"The government [has to] do something to shore up the program, to right the ship so that legitimate financial institutions will still participate," says Dick Van Dyke, a registered investment adviser based in Springfield, Ill. "We've never seen anything like the amount of folks that are going to retire over the next 15 years that aren't prepared for retirement."
But Van Dyke doesn't blame banks for exiting the market and says the government needs to revise the guidelines governing reverse mortgages to make the product more attractive to lenders again. Looking ahead, Van Dyke expects demand for reverse mortgages to pick up considerably, with many retirees relying on these products to be available to supplement their income stream after retirement.

Historically, the cost of reverse mortgages has been higher than conventional mortgages, but without enough lenders competing for borrowers, those costs could go even higher, Van Dyke says, further restricting the availability of the product for seniors.
"There's nothing stopping banks from pulling out of this program," Van Dyke says. "But as soon as the government realizes that this program has to be adjusted to work with the private sector, and the private sector really is the most efficient, they're going to have to work hand in hand."
"This doesn't need to be a welfare program," he adds. "For people who have legitimate equity in their properties, this can still be a win-win [program] if it's designed properly."

By Meg Handley

U.S.News & World Report

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Raleigh returns to top of Forbes business climate list

2011-07-06T16:08:00.000-04:00

Raleigh, N.C. — Raleigh is once again the best place in America to do business.
After a year at No. 3 on Forbes magazine's list of Best Places for Business, the Capital City regained its No. 1 spot in the list 13th annual released Wednesday. It topped the list each year from 2007 to 2009.
Durham ranked 31st on the latest list. Charlotte was 22nd, and Asheville was 24th.
"Low business costs (18 percent below the national average) and a smart labor force (42 percent have a college degree) make North Carolina’s capital an attractive spot for employers," the magazine wrote. "Job seekers get it: The net migration rate to Raleigh was the second highest in the U.S. over the past five years."
Raleigh was the lone East Coast city featured in the Forbes list. Des Moines, Iowa, Provo, Utah, Lexington, Ky., and Fort Collins, Colo., finished behind Raleigh. Nashville, Tenn., Austin, Texas, San Antonio, Denver and Dallas rounded out the top 10.

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Keep Backyard Pests from Eating Your Greens

2011-07-03T20:25:00.002-04:00

Backyard pests--squirrels, rabbits, moles--can destroy your landscaping and lawns. Here’s how to get rid of the ravenous critters.

Rabbit rascals

Calling cards: Ravaged vegetables, beheaded borders and flowers (especially tulips), and gnawed trees, such as red maple, honey locust, and evergreens.
Protection: Install 2-ft.-high fences that extend to the ground or below ($50 for 100 ft. of galvanized poultry fencing). Surround young tree trunks with plastic tree guard cylinders ($10).
Change habitat: Eliminate piles of brush, barricade cozy spots under sheds, and flatten back-lot debris piles where rabbits nest. Ivy, wisteria, and periwinkle will curb the munching, and fragrant herbs like thyme and lavender will turn them away.

Squirrely pests

Calling cards: Bumps in the night because they nest in your attic; power loss due to frayed wires; missing vegetables and flower bulbs; quickly emptied bird feeders.
Protection: Plug house entry places, such as gaps around utility pipes, broken windows, and uncapped chimneys. Cover wires with plastic pipe that will rotate, causing the squirrel to fall ($2.50 for a 2-ft. section). Sandwich bulbs underground between two layers of wire mesh ($175 for 100 ft. of 24-inch wire mesh).

Change habitat: Trim tree branches 6 to 8 ft. from buildings so squirrels can’t jump onto your roof. Switch to squirrel-proof tilting bird feeders ($25 and up) or domed feeders that close when weight limits are exceeded. Don’t plant oak trees--acorns are squirrel caviar.

Gopher/mole problems

Calling cards: Dirt mounds, lawns pocked with ankle-breaking holes, power loss due to damaged underground utilities; weakened trees due to gnawed roots; missing plants.
Protection: Install mesh fencing 18 inches deep with one-half inch or smaller openings (25 sq. ft. for $175). Trapping is the best way to eliminate gophers and moles. Scissor-jaw or choker-loop traps will snag star-nosed and hairy-tailed moles ($15 for two). Gopher traps look like a twisted mess, but they quickly snap and trap ($15 for a pair). Both can be cleaned and reused.
Change habitat: Since they like easy-to-tunnel, well-watered lawns, try compacting soil and cutting down on irrigation. But moles and gophers are so adaptable that habitat changes won’t keep them out, just slow them down.

Deer disturbance

Calling cards: Flowering plants nibbled to the nubs; leaves torn from plants from ground level to 6 ft.; 2-inch gouges on tree trunks; hoof prints that resemble a broken heart.

Protection: Fencing at least 8 ft. high; homemade and commercial repellents that taste and smell bad; barking dog.

Change habitat: Replace tasty fruit trees with spruce and pine. Swap lilies for ferns and rosemary. Add switch grass and ribbon grass--they’ll avoid these ornamentals. Bonus: Works for bunnies, too.

By: Theresa Klisz

Theresa Klisz lives in Northern Virginia and was a general-interest features editor and writer for a national wire service. She serves on her community association board of directors.

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Fencing: A Guide to the Options

2011-07-03T20:22:00.000-04:00

When shopping for a fence, you need to consider everything from style to function to how much maintenance it’ll require.

A fence can do any of these things—if you choose the right one. There are hundreds of different styles to choose from, plus a handful of different construction materials, each with their own maintenance requirements and prices.
And you’ll need to make sure your fence doesn’t create animosity in the neighborhood—or even violate local laws and regulations. Here’s how to avoid those pitfalls and get a beautiful long-lasting fence that fits your home and your budget.

Follow the rules

Fences are subject to local zoning codes, which dictate the maximum height allowed, how far they must be from property lines, and whether they’re even permitted in front yards. So contact your municipality’s zoning department first, suggests Janet Arden, of the American Fence Association, a trade group based in Glen Ellyn, Ill.

Also, if you’re in a neighborhood association, a historic district, or a fairly new development, you may face further limitations on fence style, height, and location—so check with local officials.

Be a good neighbor

As Robert Frost wrote, good fences make good neighbors—but they can also make angry ones if the fence appears one day without warning. If possible, consult with any neighbors whose property will abut your new fence to give them a chance to prepare emotionally for the change. (Heck, they might even offer to share the cost if you compromise on some design feature that they prefer.)

Also, unless you’ve had your lot surveyed, ask your neighbors to confirm your understanding of where the property lines are, says Roy Cuzzocreo of Orange Fence & Supply in Orange, Conn. “I’ve had to come back to relocate an entire fence by an inch and a half because the homeowner was wrong about the property line,” he says.

Consider your goals

The first thing any fence salesman is going to ask you is why you want a fence—because your answer will help narrow your choices. There are four basic categories to choose from:

Privacy fence: If the goal is to block sight lines, you need solid fencing, which generally means it’ll have tightly spaced vertical boards, pickets (pointed stakes), or framed panels to prevent you from seeing out and others from seeing in. It should be at least 6 feet tall so most people won’t see over it—taller if the neighbor’s teenagers are on the basketball team.

If a little visibility is okay, then the pickets can have spaces between them, or you can use a lattice or decorative fence pattern.

Security fence: To keep people out, you’ll again want a fence that’s 6 feet tall or higher to hinder anyone from simply hopping over it. Pickets or other spiky tops help to deter climbers—especially if the fence has a smooth outer face, so there’s no place to step. For fences with horizontal rails on one side and vertical pickets on the other—in other words, for most fences—that means facing the pickets out.

Decorative fence: If the goal is to establish property lines, add a structural element to the landscape or boost curb appeal, your fence doesn’t need to be nearly as large or obtrusive. You can choose one that’s just two to four feet high, and with spaced pickets, latticework, or all sorts of ornamental designs that don’t block the view, but enhance it. Or you can go totally simple, with a rail fence (just posts and two or three horizontal members) like the ones used on horse farms.

Safety fence: To create a dog run, enclose a pool area, or deter wildlife from trespassing on your property—without changing the view—the most durable option is a wire fence, such as chain link. At their most economical, these consist of galvanized metal mesh, but adding a black or green vinyl coating helps to make the fence almost disappear from view. Or, for an even lower-cost fence, you can use a metal or plastic mesh hung on metal posts or stakes.

Pick your material

Once you’ve decided on your fence type, choose the material it’s made from. That’s what’s going to determine its price, the maintenance it needs, and its warranty. (Note: These are ballpark prices. Costs vary wildly around the country—and even among fence companies in the same ZIP code.)

Wood: By far the most common fence material, wood provides a traditional look at a moderate price. Depending on the species you choose, from low-cost pine to high-end cedar or redwood, your installer may recommend treating it with a stain or wood preservative to protect it from insects, rot, and ultraviolet light. Expect to repeat the job every three to five years.

Cost: $7 to $10 per foot, installed, for a simple split-rail fence; $20 to $50 per foot, installed, for a 6-foot high privacy fence.

Warranty: From 0 to 15 years depending on wood species and the retailer.

Vinyl and composite: These faux-wood fences are made from either solid vinyl or a mix of wood fibers and plastic resins. In either case, the material is formed into rails, pickets, and other fence parts that get assembled piece-by-piece just like wood fences.

Their color—usually white, but available in numerous hues—is mixed into the material itself, so they never need painting. The best of these products look exactly like the real thing, so if you want a painted wood fence, this is a way to get it without all of the maintenance that wood requires.

Cost: $40 to $60 per foot per foot, installed, for a 6-foot high privacy fence.

Warranty: From 20 years to lifetime, depending on manufacturer.

Iron and aluminum: The classic wrought-iron fence can be anything from an ornate decorative property-line marker to a tall, spiky enclosure that provides high security.

These days, though, the fences aren’t actually wrought iron. They’re made from welded tubes of steel or aluminum. Thanks to factory paint coatings, a good metal fence will need virtually no routine upkeep, though you should touchup any spots where the coating cracks or peels to prevent corrosion.

Cost: $25 to $30 per foot installed (for a 4 foot high fence), plus $5 to $10 per foot to add ornamental finials and rings.

Warranty: From 20 years to lifetime, depending on manufacturer.

Chain link and wire: The most economical of fences, chain link also has the advantage of almost disappearing into the scenery, especially if it has a black or green plastic coating on the mesh.

If, on the other hand, you prefer not to see through the fence, you can order it with vertical privacy slats woven into the mesh.

Cost: $12 to $15 per foot installed (for a 4 foot high fence); add $4 to $5 for vinyl coating and another $6 to $10 for privacy slats.

Warranty: From 12 to 15 years, depending on manufacturer.

A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. His back yard is encircled by a white picket fence that keeps his Labrador retriever close to home.

By: Oliver Marks

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Fourth of July: Take a Step Toward Energy ‘Independence’

2011-07-03T20:18:00.000-04:00

By: John Riha

Published: July 1, 2011

The Fourth of July -- Independence Day -- is a great time to reflect on how lucky we are to live in the United States of America, and what we can do to make our nation better, stronger, and more prosperous. As President Kennedy famously said many years ago, “Ask what you can do for your country.”

We’d all like to do our part. But our individual efforts sure seem small compared with the goings-on of world politics and global economies.

How can we — average American home owners — really achieve big goals, such as influencing national energy policy and building a strong economy? After all, we’ve got our own daily stuff to deal with: work, home repairs, getting the kids to softball practice, and the dog to the vet.

One good way is to reduce energy consumption in our own homes. This simple act can have a major impact. Not just in terms of helping hold the line on the family budget, but in slowing the ever-spiraling costs of energy. Lessening demand — even incrementally — eases the price of energy, which can free up capital that creates jobs and helps get our economy kicking.

Here are examples of small contributions you can make that add up:

Ask cable or satellite providers for an energy-efficient set-top box, (the device that receives and dispatches TV signals to your DVR). Set-top boxes, which run 24 hours a day, have become a leading energy drain in the home. Newer Energy Star-rated models are at least 30% more efficient. If all set-top boxes sold in the U.S. were Energy Star-rated, energy savings would total $2 billion each year, and greenhouse gases would be reduced by an amount equivalent to 3 million cars and trucks.

Replacing an old, kaput dishwasher with an Energy Star-qualified model cuts the annual energy cost of the machine by 50% — to $60 from $120. If every clothes washer purchased in the U.S. this year were an efficient Energy Star model, the national energy savings would total $350 million, not to mention conserving 32 billion gallons of water.

Buying a high-efficiency gas or electric water heater, when yours reaches the end of its useful life, saves 3% to 4% on the average home’s hot water bill. Energy standards enacted by the U.S. Dept. of Energy in 2010 were designed to cut energy usage of new water heaters by 3% to 4%. Over a 30-year period, U.S. consumers should save $8.7 billion and reduce CO2 emissions by 170 million tons — that’s equal to the yearly emissions of 30 million cars.

Replacing a 60-watt incandescent light bulb with a 13-watt compact fluorescent equivalent saves $30 over the life of the bulb. Alternative: LED bulbs, although costly ($30 for 7-watts), last 3 to 4 times longer than CFLs, burn cooler, and — unlike CFLs — contain no mercury. If every home in America replaced just one incandescent bulb with an Energy Star-qualified CFL, the savings would be enough to light more than 3 million homes. The savings would also reduce greenhouse gas emissions caused by fossil-fuel energy production equivalent to 800,000 autos.

More easy ways to be patriotic (and save):

Create a breeze with a ceiling fan instead of using the AC. For every degree you raise the air conditioning thermostat above 78 degrees, you can save 3% to 8% on cooling costs.

Install a programmable thermostat and save as much as $180 per year.

Plump up attic insulation from R-11 to R-49 and save up to $600 per year.

Turn down the thermostat on your refrigerator and save $22 per year.

Outsmart sneaky energy vampires by turning off (or putting “to sleep”) computers, printers, and other electronics when not in use: Shave another $100 from your annual energy bill.

Let’s put the independence in Independence Day.

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Home prices rise, snapping 8-month drop streak

2011-06-29T16:25:00.000-04:00

NEW YORK (CNNMoney) -- The downward cycle in home prices broke in April after eight consecutive months of decline, according to a survey released Tuesday.
According to the S&P/Case Shiller 20-city index, prices rose 0.7% compared with March, although they fell 0.1% when adjusted for the strong spring selling season. Prices were down 4% year-over-year.

"In a welcome shift from recent months, this month is better than last -- April's numbers beat March," said David Blitzer, S&P's spokesman, in a statement. "However, the seasonally adjusted numbers show that much of the improvement reflects the beginning of the spring-summer home buying season."
"It is much too early to tell if this is a turning point or simply due to some warmer weather," Blitzer added.
Any hint of good news in the troubled housing market will likely bring cheer to the industry, and there are some signs that market conditions are not quite as dire as some of the other statistics may indicate. Foreclosures, for example have been falling.
That has translated in a decline of 16% in the sales volume of distressed properties this year, while volume of non-distressed sales rose 11%, according to Joseph LaVorgna, chief economist for Deutsche Bank.
That's good news because much of the price drop over the past year can be blamed on severe price slashing for homes in foreclosure, as Federal Reserve chairman Ben Bernanke pointed out in a press conference last Wednesday. Prices for homes sold by regular sellers have held up much better.

Foreclosures down for seventh straight month

"That suggests," said Bernanke, "if we can reduce the current number . . . maybe 40% of home sales, which are on a distressed basis, that would do a lot for stabilizing the market and helping give people confidence that they can buy and not be buying into a falling market."
Still, the fact that prices perked up in April is not necessarily something to write home about, said Mike Larson, a housing market analyst for Weiss Research.
"It happens every spring," he said "It's very clear there's a seasonal component. Even non-statisticians can see that. The report was, however, better news than what people were expecting."
Metropolitan Washington continued to be the strongest of the 20 cities covered by the report. Prices rose 3% in April there and have been on the plus side year-over-year, up 4%.

Foreclosures for sale: Big supply, low prices

The worst performing market for the month was Detroit, where prices fell 2.9%. The biggest year-over-year drop was recorded by Minneapolis, where prices have plunged 11.1% since last April.
The big picture is that a housing market recovery has yet to gain any steam, according to Larson.
"We're not falling off a cliff anymore, but we're only going sideways," he said.
The year-over-year price comparisons could start to become more favorable, according to LaVorgna. For many months, price changes have looked worse than they might actually have been because they were being compared to months when the home buyer tax credit was in effect, which boosted prices.
"[W]ith the homebuyer tax credit having expired in June 2010, we will soon be getting "clean" housing data unencumbered by artificial distortion," he said.

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Community Reports on Clayton, NC from REALTOR.COM

2011-06-18T20:44:00.000-04:00

A Comparison of the two main zip codes in Clayton, NC.

Community, income, housing, climate, crime and school information

Click here to take a look

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ron-wilson.homesandland.com

NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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June eNewsletter - Real Estate Today

2011-06-14T06:49:00.000-04:00

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

Please click on this link to view the JUNE -2011 Newsletter Housing Trends eNewsletter:
http://ronlwilson.housingtrendsenewsletter.com/?Newsletter_ID=273&Period_ID=380

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau, Realtor.org reports and other sources.

It also includes press releases with charts and videos, key market indicators and real estate sales and price statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

If you are interested in determining the value of your home, click the “Home Evaluator” link for a free evaluation report:
http://ronlwilson.housingtrendsenewsletter.com/?Newsletter_ID=273&Period_ID=380

Sound decisions can only be made with accurate and reliable information, and I am happy to be a trusted resource for you. Thank you for the opportunity to provide you with this monthly eNewsletter, and I look forward to answering any questions you may have and to the opportunity to be your REALTOR® in the future.

Sincerely yours,

Ron Wilson
Coldwell Banker Advantage
34 Oleander Dr - Suite 104 Clayton
NC 27527
919-553-4003
919-771-4747
Email:rlw.realestate@gmail.com

(While I hope you find the information contained in this eNewsletter useful and informative, if you wish to no longer receive it, you may click on the “unsubscribe” link at the bottom of the newsletter.)

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Will boomers and 20-somethings carry housing recovery?

2011-06-10T14:16:00.001-04:00

Baby boomers looking to downsize and young adults who can afford to finally move out will be key drivers of the residential recovery, says Harvard University's state of the nation's housing report, released Monday.

The U.S. home recovery, expected by many industry leaders to come around slowly, in the meantime has been hampered by declining prices, high rates of foreclosure in states such as California and people faced with negative equity.

"The state of the nation's housing is sobering," said Eric S. Belsky, the managing director of the Joint Center for Housing Studies, which wrote the report. "Total housing construction over the previous decade now barely exceeds the lowest level of any ten-year period in records dating back to 1974."

Hopes of a housing turn-around depend largely on two groups: boomers and those in their 20s.

Authors of the housing paper say the majority of boomers, born from 1946 to 1965, will likely stay in their current homes and "age in place." However, an estimated 3.8 million people in this age range are expected to move to smaller units and gravitate toward "preferred retirement destinations," including areas in the South and West, the report says.

Meanwhile, more "echo-boomers" - those born after 1986 - are expected to move out of Mom and Dad's place and into starter apartments, although that impact hinges mainly on job creation.

Home prices have dropped drastically during the last three years throughout the U.S., causing real home equity to fall from $14.9 trillion at its peak in early 2006 to $6.3 trillion at the end of 2010.

Despite new levels of affordability and the continued aspiration to own, many potential homebuyers can't afford the higher down payments, income requirements and credit score minimums.

Those factors have kept many from entering the starter-home market, especially minorities, whose average incomes are on average lower than whites, the report says.
As the owner-occupied market suffered, the rental market picked up: vacancy rates fell and rents rose, a scenario that has played out in San Diego County.

"If employment growth, especially among young adults, continues to pick up and homeownership rates continue to slide," the report says. "renter household growth should remain strong." That in turn will result in higher demand in rental housing, perhaps prompting more multi-family construction, authors say.

Gary Painter, director of research at University of Southern California’s Lusk Center for Real Estate, told the Union-Tribune last week it will take two years before people buy again. Meanwhile, the rental market will be the first to pick up.

Recovery-wise, California is among five states that have "the farthest to go." What's critical to a recovery, Harvard experts say, is an increase in the creation of households, which will help the rental market. Also a factor is consumers' perception that prices have hit bottom. Once that happens, buyers on the fence will return to the market and "quickly burn through the lean inventory" and "slim down the excess supply," the report says.

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Lawmakers: 20% Down Payment Is Too High

2011-06-02T15:32:00.000-04:00

Lawmakers: 20% Down Payment Is Too High

A bipartisan group of lawmakers are urging federal regulators to overhaul a mortgage proposal that includes a call for a 20 percent down payment for the “safest mortgages,” saying that it could threaten a full economic recovery “from years to come.”

In a letter obtained by the media on Wednesday, more than 160 lawmakers in the House of Representatives called the federal regulator’s mortgage proposal “overly burdensome government dictate” and said that the proposal would reduce the availability of affordable mortgages.

In an effort to urge more responsible lending and borrowing, several federal agencies have been developing a proposed risk-retention regulation under the Dodd-Frank Wall Street reform law, which requires lenders that securitize mortgage loans to retain 5 percent of the credit risk unless the mortgage is considered a safe mortgage or a “qualified residential mortgage.” (FHA and VA mortgages would be exempt.)

QRMs would be exempt from the 5 percent credit requirement but would have to meet certain guidelines, such as the proposed 20 percent downpayment requirement. Borrowers with less than 20 percent down could then be forced to pay higher fees and interest rates.

In the letter, the lawmakers called the 20 percent downpayment guideline too high and asked federal regulators to consider lower downpayment loans that have mortgage insurance that would constitute a QRM.

The National Association of REALTORS® has been an outspoken critic to the higher downpayment requirement, arguing that the 20 percent down payment would greatly jeopardize a housing recovery.

“We need to strike a balance between reducing investor risk and providing affordable mortgage credit,” NAR President Ron Phipps said in a public statement last week. “Better underwriting and credit quality standards have greatly reduced risk. Adding unnecessarily high minimum down payment requirements will only exclude hundreds of thousands of buyers from home ownership, despite their creditworthiness and proven ability to afford the monthly payment, because of the dramatic increase in the wealth required to purchase a home.”

Source: “House Lawmakers to Regulators: Kill Mortgage Plan,” Reuters News (June 1, 2011)

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Affordability Reaches Highest Level in 20 Years

2011-06-02T15:27:00.002-04:00

Affordability Reaches Highest Level in 20 Years

Homes are more affordable to more families, according to the latest index for the first quarter of 2011 that shows affordability reaching its highest level in more than 20 years.

Nearly 75 percent of all new and existing homes sold in the first quarter of 2011 were affordable to families earning the national median income of $64,400, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index. The previous high was set in the fourth quarter of 2010 with 73.9 percent.

"With interest rates remaining at historically low levels, today's report indicates that home ownership is within reach of more households than it has been for more than two decades," says Bob Nielsen, chairman of the National Association of Home Builders.

The most affordable metro housing market in the nation? Syracuse, N.Y., in which 94.5 percent of all homes sold were affordable to households earning the area's median family income of $64,300.

Other metro cities ranking high on the affordability index were Youngstown-Warren-Boardman, Ohio-Pa.; Indianapolis-Carmel, Ind.; Warren-Troy-Farmington Hills, Mich.; and Toledo, Ohio.

Meanwhile, the least affordable major housing market for the first quarter of 2011 was New York-White Plains-Wayne, N.Y.-N.J.

Source: “Housing Affordability Rises to Record Level, Tight Financing Continues to Constrain Sales,” National Association of Home Builders (May 25, 2011)

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

Moving, have property to sell or buy outside of our area? I can recommend an experienced and capable agent in the new area of the state or country.

Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

2011-05-30T10:33:00.002-04:00

Fence Etiquette: Tips to Avoid Neighbor Disputes
If you practice fence etiquette and bone up on local zoning regs, you can avoid neighbor disputes. Read

Visit houselogic.com for more articles like this.

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ron-wilson.homesandland.com

NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

Moving, have property to sell or buy outside of our area? I can recommend an experienced and capable agent in the new area of the state or country.

Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Real Estate Today May 2011 eNewsletter

2011-05-17T13:47:00.003-04:00

MAY-2011 Newsletter Housing Trends eNewsletter

Please click here to view the MAY-2011 Newsletter Housing Trends eNewsletter.

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you're in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

If you are interested in determining the value of your home, click the Home Evaluator link for a free evaluation report.
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For more information contact me: 919-771-4747

Email - rlw.realestate@gmail.com

ron-wilson.homesandland.com

NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

Moving, have property to sell or buy outside of our area? I can recommend an experienced and capable agent in the new area of the state or country.

Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Mortgage rates at 2011 low, but many won't benefit

2011-05-13T21:37:00.001-04:00

NEW YORK -- Mortgage rates have hit lows for the year and could soon near the decades-low levels of last year.

Those rates are providing an incentive for buyers, along with falling home prices. They're tempting for refinancers, too.

Still, analysts say the combination isn't likely to lift the depressed housing industry or contribute much to the overall economy. In many metro areas, real estate is straining under the weight of foreclosures, higher down-payment requirements, tighter credit, still-high unemployment and buyers' expectations of even lower prices.

"If people aren't confident about the economy, about jobs and home prices, they certainly aren't going to sign up for the biggest purchase of their lives," said Greg McBride, a senior analyst at Bankrate.com.

But for those with jobs, money and creditworthiness, today's rates can be tantalizing.

This week, a qualified buyer could expect to finance a home over 30 years at an average fixed rate of 4.63 percent, according to mortgage buyer Freddie Mac. That's the lowest average rate in five months. In November, the rate hit a four-decade low of 4.17 percent.

The 15-year fixed mortgage, popular with refinancers, is down to 3.82 percent. That's also the lowest point since December.

Mortgage rates have fallen for four straight weeks, tracking the yield on the 10-year Treasury note. The 10-year yield has dropped as investors have snapped up Treasurys and other safe securities because of uncertainties about the global economy and the volatile prices of oil and other commodities.

Weak sales and a growing belief that prices have yet to hit bottom five years after the housing bubble burst have become a major obstacle for the economy. Homebuilding is down. Fewer first-time buyers are entering the market. The pace of home sales remains far below the level economists view as healthy.

But the biggest threat is foreclosures, said Mark Vitner, a senior economist at Wells Fargo. A wave of foreclosures is forcing down prices in most major U.S. cities.

About 3.7 million homeowners are at serious risk of losing their houses, according to the Mortgage Bankers Association. Foreclosures typically drag down the prices of nearby homes, putting even more homeowners in a financial bind.

More than a quarter of homeowners can't sell their homes because they owe more on their mortgage than their house is worth. And many would-be buyers are holding off on a purchase, mindful that prices might fall further.

"What good is a low rate if you're upside down on your mortgage?" said J. Philip Faranda, who runs a real estate firm in Westchester County, N.Y.

Even those who do feel ready to buy are having a harder time qualifying for a mortgage. The average credit score for a loan backed by Fannie Mae and Freddie Mac has jumped to 760, compared with 720 four years ago, according to the government-run mortgage buyers that back 90 percent of new loans. Fewer than half of American adults have credit scores as high as 760.

And banks are insisting on higher down payments. The median down payment rose to 22 percent last year in at least nine major U.S. cities, according to a survey by Zillow.com, a real estate data firm. That's up from 4 percent in 2006.

"Lenders are reluctant to hand out loans unless you can bring some skin to the deal, in the form of a bigger deposit," said Patrick Newport, U.S. economist for HIS Global Insight. "Until that changes, low mortgage rates aren't going to make that much of a difference. Credit is simply hard to get."

Home-loan financing has remained tight despite a wave of hiring, stronger consumer and business spending and a steadily rising economy. About 92 percent of banks say credit standards on mortgage loans have remained basically unchanged, according to the Federal Reserve's senior loan office opinion survey released last month. About 45 percent said demand for home loans has been moderately weaker.

"There aren't many buyers with deep enough pockets who can put 20 to 25 percent down," said Julie Longtin, a real estate agent with RE/MAX Cityside in Providence, R.I.

And only two-thirds of Americans view homeownership as a safe investment, down from 83 percent in 2003, according to a Fannie Mae survey this year. Few economists see home values rebounding this year.

"The concern is, 'Are values going to go up at this point, or go down or flatline?'" said Ben Coleman, broker-owner of Century 21 Hartford Properties in San Francisco. "I've seen where interest rates were dropping, and it's almost like a 'ho-hum.'"

The rate on the 30-year mortgage has spent most of the past year below 5 percent. Until last year, that would have been considered a bargain. This time, even those who could afford to buy will likely take a pass.

"What really may be the catalyst for buyers is when rates start moving back up," said Mark Zandi, chief economist at Moody's Analytics. "Rates are low and still seem to be falling, so there's no pressure now to pull the trigger."
Kravitz reported from Washington. AP Business Writer Alex Veiga in Los Angeles contributed to this report.

JANNA HERRON and DEREK KRAVITZ - AP Real Estate Writers

http://www.newsobserver.com/

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Low-Maintenance Lawn Alternatives: Turf Grasses

2011-05-08T21:28:00.002-04:00

Low-Maintenance Lawn Alternatives: Turf Grasses
If you want a yard that demands less time, money, and water, consider low-maintenance grasses in lieu of the traditional lawn. Read

Visit houselogic.com for more articles like this.

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ron-wilson.homesandland.com

NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Tree Falls Over Property Line: Who Pays? Who Picks Up the Pieces?

2011-05-08T21:25:00.000-04:00

Tree Falls Over Property Line: Who Pays? Who Picks Up the Pieces?
If a neighbor’s tree falls over your property line, file an insurance claim for repairs and cleanup. No house damage? Check if chopping and hauling debris is covered. Read

Visit houselogic.com for more articles like this.

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

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Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Understanding Real Estate Representation

2011-05-01T20:59:00.001-04:00

Understanding Real Estate Representation
Whether you’re buying or selling, it’s important to choose representation that meets your needs in the transaction. Read

Visit houselogic.com for more articles like this.

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ron-wilson.homesandland.com

NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

Moving, have property to sell or buy outside of our area? I can recommend an experienced and capable agent in the new area of the state or country.

Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Pet Odor Can Chase Away Buyers

2011-05-01T20:56:00.000-04:00

Pet Odor Can Chase Away Buyers
Don’t let pet odors derail your home sale. Read

Visit houselogic.com for more articles like this.

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

Moving, have property to sell or buy outside of our area? I can recommend an experienced and capable agent in the new area of the state or country.

Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.

Mortgage denied: Sometimes, for no good reason

2011-04-29T18:12:00.000-04:00

NEW YORK (CNNMoney) -- Getting a mortgage just keeps getting tougher, and many homebuyers are getting rejected for loans they could easily afford.

The issue: Tighter standards from Fannie Mae and Freddie Mac, the government entities that back mortgages made by banks.

423134Email Print Banks are reluctant to make loans without the Fannie and Freddie guarantee, and loans backed by them account for just about every mortgage written these days.

In 2009, the agencies lifted the minimum credit score that borrowers must have from 580 to 620. That's probably for the best.

But they've pushed through a host of other requirements as well, and that means real estate deals don't get done, even for some relatively low-risk borrowers.

"You can have one Fannie/Freddie guideline you violate and that gets you rejected," said Alan Rosenbaum of GuardHill Financial.

A quarter of all mortgage loan applicants get denied for loans, according to the Federal Reserve. Many other potential homebuyers never even try to get loans, said Jerry Howard, president of the National Association of Home Builders.

"The pendulum has swung too far in the other direction," Howard said. "This overreaction is retarding the housing market recovery." (Homes: What a million bucks buys)

Here are some of the reasons that banks must turn down borrowers for mortgages:

Too few of the condos in your association have been sold

For Fannie/Freddie lenders to approve a mortgage to finance purchase of a condo, a large majority of the units -- 70% -- have to be already sold or under contract to individuals. Before 2009, the threshold was 51%.

If more than 30% are still owned by the company that built the complex or sponsored its conversion from rental units, the mortgage will be denied, no matter how qualified the buyer is.

Vulture investors flipping their way to big profits

The reasoning is that condo developments where the builders or sponsors still own a large share of the units are more likely to get into financial difficulty. If the builder or sponsor runs out of funds before it can sell off the units, it may stop paying the common charges and property taxes.

Struggling sponsors have also lost unsold units to creditors, which resold them off at bargain basement prices. That jeopardizes the values of all the condo units, sending borrowers underwater and making them more likely to default.

The agencies also refuse to fund condo loans if buildings face some pending legal liability, if more than 15% of owners are behind on homeowner dues or if more than 10% of units are owned by a single entity.

Your debt is too high

Fannie and Freddie have also increased their emphasis on income relative to debt.

If someone's total debt payments exceed 45% of income, the mortgage will be denied. In 2009, the limit was 55%.

Using that as a hard and fast rule can penalize very qualified buyers, ones who should be able to meet their debt obligations.

Take, for example, a couple that wants to buy a second home as a rental. Two mortgage payments could easily push them past the 45% threshold, even though they'll have rental income and home equity.

The 45% rule can also hurt small business owners who have had a couple of bad years. Their incomes may be down relative to their debt, but they may have plenty of cash to keep from defaulting on a mortgage.

The wait after foreclosure is extended to seven years from five

Some borrowers lost homes to foreclosure but then diligently rebuilt their financial health. Despite high credit scores, ample assets and income and steady employment, lenders are not allowed to finance their Fannie/Freddie mortgages if their foreclosures happened any time within the past seven years.
Before spring last year, the wait time was five years.

Missed payments on credit card debt

Fannie and Freddie also have gotten stricter in how they factor in missed payments on credit cards, auto loans and other debts in which the balances do not have to be paid off every month.

They used to be okay with a missed payment or two. Now, one missed payment will hit your debt-to-income ratio, because banks will add 5% of your outstanding loan balance to the debt part of the calculation.

That would be an extra $1,000 on a $20,000 student loan balance, for example.

Where to go

"Portfolio lenders will look at the entire credit history and see a blemish and say, 'This has no impact on credit worthiness,'" said Rosenbaum.

They may offer rates and terms competitive with agency loans but if there are serious risk factors, loans can be more expensive, according to Bob Moulton, a mortgage broker with Americana Mortgage on Long Island.

"It's a tough environment," he said "For people like the self-employed, mortgages can get pricey."

He recently arranged a mortgage for a private businessman through a savings bank. His client paid a rate of 7.9%, about three points higher than the average 30-year fixed. The rate is only good for three years, after which it resets and can rise by as much as two points annually and go as high as 13.9%.

By Les Christie - CNNMoney

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NEW LISTINGS emailed to you the day they are placed on the MLS. Customized to your personal needs - anywhere within the Triangle MLS area. Specify what kind of property or land you want and your price range. Send me your contact information! It is just that easy.

Moving, have property to sell or buy outside of our area? I can recommend an experienced and capable agent in the new area of the state or country.

Don't know how much house you can afford? I have mortgage bankers available for FREE credit evaluations.