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Housing Experts: Now Is a Perfect Time to Buy

by Michael Marsden

Don’t forget to remind potential buyers of something that is obvious to real estate professionals: Now is the time to buy, but that opportunity may be slipping away. 

For people who have a job and money, a dream house is within reach, writes Marc Roth, founder of Home Warranty of America and a columnist for BusinessWeek. 

He points out that mortgage rates remain low, prices are still at historic lows, and the government is offering incentives for first-time homebuyers.

He also adds that the inventory of homes to buy is still large, but it is shrinking. According to the NATIONAL ASSOCIATION OF REALTORS®, the housing inventory peaked in November 2008 at an 11-month supply. At the end of May 2009, it had fallen to a 9.6-month supply.

Roth says anyone who dallies will miss a good opportunity to buy a first home at a terrific price or go shopping for a move-up property that is a great buy.

Source: BusinessWeek.com, Marc Roth (11/17/2009)

Pending Home Sales Record Fourth Straight Monthly Gain

by Michael Marsden

Pending home sales show a sustained uptrend, rising for four consecutive months with very favorable housing affordability and a first-time buyer tax credit boosting activity, according to the latest survey. The Pending Home Sales Index increased 0.1 percent to 90.7 from an upwardly revised reading of 90.6 in April, and is 6.7 percent higher than May 2008 when it was 85.0. The last time there were four consecutive monthly gains was in October 2004. Lawrence Yun, NAR chief economist, cautions that there could be delays in the number of contracts that go to closing. “Closed existing-home sales have improved but are coming in lower than expected because some contracts are delayed or falling through from the application of new appraisal rules for many transactions,” he said. “Rises in contract activity show buyers are becoming more active even as they face much more stringent loan underwriting standards. Speedy clarification of the appraisal rules could smooth a housing market recovery and support the overall economy.”


Troubled Jumbo Loans Hurt Broader Market

by Michael Marsden

Houses that cost more than $730,000 – the cap for conforming jumbo loans – can be extremely tough to buy, sell, or refinance these days, freezing the high-end market and holding down activity in lower-priced markets, real estate practitioners say.

The slowdown results from lenders’ reluctance to offer mortgages above the amount Fannie Mae and Freddie Mac will insure.

"What you're seeing are those properties sitting on the market for a lot longer because people can't get loans," says David Kerr, an associate with ZipRealty in Marin County, Calif. " All of what we're showing is in the $200,000 to $300,000 price range."

States that are most affected are those where jumbos account for more than 10 percent of all mortgages, including Hawaii, California and New York, as well as Washington, D.C., New Jersey, Maryland, Massachusetts, Virginia, Connecticut, Washington, Nevada, and Florida.

The Obama administration program to refinance underwater mortgages doesn’t offer help to holders of jumbo mortgages, so borrowers who can’t refinance are defaulting in increasing numbers. According to First American CoreLogic, jumbos that are 90 days or more delinquent reached 4.83 percent in March 2009, up from 1.68 percent in March 2008.

"We need to have a market recovery in all segments," says Lawrence Yun, chief economist for the National Association of REALTORS®. "If the high-end market weakens, those in the middle have to reduce prices . . . All of Middle America is undoubtedly impacted."

Source: USAToday, Stephanie Armour (09/15/2009)

Prices Slide in Wealthiest Towns

by Michael Marsden

America’s high-end neighborhoods could feel the pain as homes linger on the market and prices slide.

There are more than 60,000 homes priced above $1 million listed on Realtor.com with the inventory at levels far above the national average of 10 months. 

Some observers predict that big inventories in formerly protected enclaves will drive down prices as much as average prices fell in less-pricey metros a year ago. "Any [inventory] over seven months generally means falling prices," says David Stiff, chief economist at Fiserv in Brookfield, Wis.

Multi-million dollar communities with significant risk of taking big slides are:

  1. Incline Village-Crystal Bay, Nev.
  2. New Vernon, N.J.
  3. Alpine, N.J.
  4. Sagaponack, N.Y.
  5. Amagansett, N.Y.
  6. Bridgehampton, N.Y.
  7. Ross, Calif.
  8. Old Westbury, N.Y.
  9. Santa Barbara, Calif.
  10. Southampton, N.Y.

CHESTER MUSIC FESTIVAL

by Michael Marsden

presented by Small Town Concert Series
with help from Acoustic Music.org and Leonard Wyeth Architects

 

FRIDAY July 10th GAZEBO/OUTDOORS (IN MEETING HOUSE IF RAIN)

 

4:00 – Welcome!  Opening set with Agnelli & Rave (pop/rock/folk); 4:45 - rockin’ with sayWHAT? (classic rock & originals); 5:30 – songwriter/vocalist Kierstin Sieser (original folk/pop); 6:15 – songwriter/vocalist Forrest Harlow (rockin’ autoharp); 7:00 – The Moving Target Jazz band (jazz/folk/pop); 8:00 – Roadside Manor (rock/blues/reggae) 

 

SATURDAY July 11th -  GAZEBO/OUTDOORS (Will move to the MEETING HOUSE INDOORS IN CASE OF RAIN and then all inside/outside acts will be rescheduled indoors, with shorter sets)

 

Gazebo/Outdoors:  11 AM – Chester Music Fest Welcome!  11:15 AM – The Hairy Men (rock/Americana/blues); 12:00 PM – Joe’s Garage with Larry Taylor (rock/folk/blues); 12:30 – Mike Harris (folk rock with a message); 1:15 – The Small Pond All Stars (Classic Jazz/Pop); 2:15 – Drum Circle – all are welcome to join in; 3:30 – songwriter/vocalist Chris Listorti & The Freedom Show (indie folk/pop); 5:00 – songwriter/vocalist/guitarist Rodney Maxwell & friends (country rock pop); 5:45 – songwriter/vocalist Lauren Agnelli & friends (folk pop rock + country); 6:30 – songwriters Ebin-Rose (classic folk & originals); 7:00 – “Amalgamated Muck” (official debut of Lauren A., Ebin-Rose, Rod Maxwell & Matt Male); 8:00 – The Small Town Concert Series Big House Band (rock/folk/country/boogie woogie!) featuring Lauren Agnelli, Bill Calhoun, Forrest Harlow, Emily Lisker, Rodney Maxwell, Jon Morse &
Leif Nilsson; 9:00 – Dave Rave (rock/pop) & friends from STCS all join in for a rousing GOOD NIGHT set!

 

Meeting House/Indoors (Air Conditioned!):  12:00 PM – Songwriter/vocalist Kurtiss Fargo (country/rock and originals); 12:30 PM – Songwriters John Gavin and Butch Foster (folk/blues/Americana); 1:00 – Ukelele Hour with Jim & Liz Beloff, Kurtiss Fargo and Al Cornell (classic Hawaiian/Americana/folk/pop); 2:00 – Bill Calhoun & Emily Lisker (piano, accordion, boogie woogie, blues, originals); 2:45 – songwriter/vocalist Jen Taylor (original folk rock/Americana); 3:30 songwriter/vocalist Ken Chmielewski (original folk pop); 4:00 – songwriter/vocalist Linda Clifford (original folk/Americana); 4:30 – songwriter/vocalist George Morgio (original folk rock/Americana).

 

IN THE EVENT OF RAIN, the OUTDOORS acts on Saturday will be moved indoors and all sets juggled accordingly (shorter sets, more juggling, more cooperation).  Please bring a picnic, bring a friend.  Please tell your friends!  No alcohol on grounds, please; keep it clean, keep it fun!  SEE YOU THERE – in CHESTER at the Music Festival.

 

Phone Matthew & Lauren on 860-526-4777

More On The $8,000 New Buyer Credit

by Michael Marsden

I sold a house last week and I stepped back and took a look at the good fortune for these two.  A young woman was buying her first home, and they bought the house for more than $25,000 less than what it first went on the market for, and got the sellers to pay some closing cost assistance and many repairs. Add to that the fact the seller had upgraded the electric, insulated the house, replaced the windows and roof, and refinished the floors. During the inspection the septic failed and paid for the hookup to city services.   The net out of pocket for the buyer will be about $10,000.   Then - the US Government will pay them $8,000 as first time home buyers meaning they she's in for a net difference of $2,000!   Add to this the 5.25% interest rate she got  andcould there really be a better time for a first time home buyer to buy a home ?

Please listen to my podcast all about the $8,000 credit

CLICK HERE to see the actual IRS form to claim the credit

The River To Shore Group has been quite busy placing 17 homes under contract in the past 8 weeks. 

If you know of anyone who could qualify as a first time home buyer (generally meaning someone who hasnt owned a home in more than three years), please.

 

Pending Home Sales Rise Again!

by Michael Marsden

The River To Shore Group has just placed it's 17th home under contract for 2009 and we can definitely see real activity. Inventory levels are down due to sales of homes that have been priced for the market as well as those sellers whom have simply withdrawn from the market after many months of trying to fetch a price to cover their mortgages. This article I cam across from the NAR certainly is seeing a brighter picture nationally. Here's what they reported:

Pending home sales show a sustained uptrend, rising for four consecutive months with very favorable housing affordability and a first-time buyer tax credit boosting activity, according to the National Association of REALTORS®.


The Pending Home Sales Index, a forward-looking indicator based on contracts signed in May, increased 0.1 percent to 90.7 from an upwardly revised reading of 90.6 in April, and is 6.7 percent higher than May 2008 when it was 85.0. The last time there were four consecutive monthly gains was in October 2004.

Lawrence Yun, NAR chief economist, cautions that there could be delays in the number of contracts that go to closing. 

“Closed existing-home sales have improved but are coming in lower than expected because some contracts are delayed or falling through from the application of new appraisal rules for many transactions,” he says. “Rises in contract activity show buyers are becoming more active even as they face much more stringent loan underwriting standards. Speedy clarification of the appraisal rules could smooth a housing market recovery and support the overall economy.”

Region

  • Northeast: The Pending Home Sales Index in the Northeast rose 3.1 percent to 80.9 in May and is 6.8 percent above a year ago.
  • Midwest : In the Midwest, the index slipped 1.3 percent to 89.2 but is 11.4 percent above May 2008.
  • South: The index in the South declined 1.7 percent to 92.6 in May but is 7.9 percent higher than a year ago.
  • West: In the West, the index rose 2.2 percent to 96.9 and is 0.7 percent above May 2008.


The Effects of Appraisals
NAR President Charles McMillan says the appraisal issue is complicated. “We see that distressed homes often are selling for 20 percent less than normal homes in the same area, but some appraisals don’t distinguish between traditional homes and distressed property,” he says. “In many cases appraisers from outside the area are being used, but as everyone knows real estate is local and appraisals should be done by an expert with local expertise.”

McMillan says sellers shouldn’t hesitate to speak with an appraiser about their home. “Sellers should feel free to tell an appraiser about improvements and renovations to their home, and how it compares with other homes in the neighborhood,” he adds.

“Also, if recent sales in the neighborhood were discounted, but not similar to your home in terms of quality or condition, that should be pointed out. It wouldn’t hurt to put all this in writing, especially if an appraiser is not familiar with your area. "

Affordability at a high
NAR’s Housing Affordability Index remains at historic highs. The affordability index fell to 171.6 in May from an upwardly revised 178.8 in April, which was the highest on record dating back to 1970. “Under these conditions the typical family would devote only 14.6 percent of gross income to mortgage principal and interest, which is one of the lowest percentages on record,” Yun says.

The HAI is a broad measure of housing affordability using consistent values and assumptions over time, which examines the relationship between home prices, mortgage interest rates, and family income.

A median-income family, earning $60,800, could afford a home costing $296,700 in May with a 20 percent down payment, assuming 25 percent of gross income is devoted to mortgage principal and interest. Affordability conditions for first-time buyers with the same income and small down payments are roughly 80 percent of what a median-income family can afford. The affordable price was significantly higher than the median existing single-family home price in May, which was $172,900.

 

Displaying blog entries 1-7 of 7

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