Provided By: Realty Times
In the first quarter of 2013 our economy grew by 2.5 percent. While some were disappointed with that figure because it fell short of the consensus estimate of 3.0 percent, it's still a sign of better times, according to Corelogic.com.
The company recently released "The MarketPulse" which highlighted the following: economic recovery is benefitting from residential investment, "census division of price declines in the housing collapse varied dramatically by depth and duration, and the census divisions with the largest declines have the fastest current recoveries."
There are four census divisions in the United States. These geographical regions contain two or three census divisions for a total of nine. How these areas were impacted and how they are recovering depends on various factors such as the development of new housing.
Build it and they will come. The new housing industry is growing stronger and helping boost the Gross Domestic Product (GDP). Homebuyers seeking new homes are encouraging this growth.
At the lowest point, new home sales dropped to 273,000 annualized sales in February 2011, marking the lowest sales rate in almost 50 years. The highest peak reached 1.4 million annualized sales in July 2005 and today it's increasing 19 percent from a year ago, according to the U.S. Census Bureau data from March 2013.
Meanwhile, residential home prices are continuing to rise. However, the increase in home prices isn't uniform across the country. Instead, the recovery is geographically confined to areas that are "either recovering from the boom-bust cycle, or exhibiting strong economic fundamentals and strengthening demographic demand," according to Corelogic.
The increase in housing prices is also happening in areas where building is booming.
New housing competes with foreclosures and short sales. These latter two groups are now experiencing a decline, making new housing a good solution for some buyers.
Mortgages categorized as seriously delinquent (90 days or more past due) peaked nationally at 3.7 million in January 2010. The figure has recently dropped by 33 percent to 1.2 million.
Corelogic reported that there were 55,000 completed foreclosures through March 2013, which is a decrease of 16 percent compared with the number of the same period last year.
Meanwhile, the summer sizzle season is arriving soon and analysts expect another possible increase in sales and prices which could encourage more sellers to list their homes for sale
If you're interested in buying, here are a few tips. Act now. Start putting your finances in order so you know what you can actually afford to purchase. Delaying this could mean the loss of your favorite home to a better prepared borrower.
Meet with experts to get the best information and advice about the real estate market you're interested in. While real estate information is available on line from anywhere in the world, prices vary greatly depending on the local market. Your best bet is to find an expert in the area you're interested in to assist you with your questions and guide you through your search.
Remember that many sellers are still in a recovery mode. They may just now be adjusting to no longer having their home mortgage "under water". So, when you find a home you're interested in, act quickly to engage negotiation about the final sales price.
Also, keep in mind that the housing inventory is likely to increase as housing prices continue to rise. However, many experts predict the shortage of existing homes for sale is likely to remain a problem throughout the rest of 2013.
Wednesday, May 22, 2013
Monday, May 20, 2013
Thursday, May 16, 2013
8 smart moves for buying a foreclosure
Provided By: interest.com
The days of scooping up foreclosed homes at a discount of 20% or more appear to be coming to an end across much of the United Sates.
That’s good news overall, because it's a sign the U.S. housing market finally is getting back on its feet after five terrible years. More demand is boosting prices.
But it also means would-be buyers need to be careful they’re making a smart choice if they bid on a repossessed home.
A recent study by Zillow, the real estate website, found that when equivalent home listings are compared, the discount for foreclosed homes has fallen to about 7%.
"With for-sale inventory tight in most markets right now … and demand slowly increasing, it wouldn't be surprising to see the foreclosure discount decrease even more," Stan Humphries, Zillow’s chief economist, says in a release.
That’s a big change.
Nearly 13 million foreclosures have been filed since the housing market collapsed in 2007, according to the website RealtyTrac. Initially, the glut of foreclosures meant they could often be had significantly below market value.
No more. If you’re shopping foreclosed homes in most places today, you’ll probably have to pay closer to regular market price. That puts a premium on doing the job properly.
Thursday, May 2, 2013
Green Living: Making it Last
Provided By: Realty Times
We live in a disposable society. The products that fill our daily lives are used and discarded. This habitual "use and lose" puts a dent in not only our pocketbooks, but also in the environment.
According to Cleanair.org, every year Americans throw away enough paper and plastic cups, forks, and spoons to circle the equator 300 times. Yes, 300 times. This is just the tip of the trash iceberg. Parents all across the nation gird the loins of their joyful little cherubs with disposable diapers. Cleanair notes, "Disposable diapers are the third largest single consumer item in landfills, and represent about 4% of solid waste. In a house with a child in diapers, disposables make up 50% of household waste." In addition, these diapers take hundreds of years to decompose and cost thousands of dollars to use. Plus, the oil used to produce those dandy disposables is more oil than used during the lifetime use of your car! The EPA reports that in 2010, American generated about 250 million tons of trash, with just a 34.1 percent recycling rate. What is being tossed that could be repurposed, reused, or revisioned? Learning to reduce, reuse, and recycle is a great way to cut down on household expenses, something that many homeowners are searching out. There's a honorable movement spreading across the nation bent on saving money and preserving the environment. The new book Make it Last: Prolonging and Preserving What We Love bridges the gap between life in a disposable culture and the basic skills needed to save money and live more sustainably. This book teaches the reader how to extend the lives of the things they love by repairing clothing, preserving home-grown food, and even repairing your kitchen sink. Raleigh Briggs takes her longtime commitment to community building through the DIY movement and shares her valuable experience with the reader through a conversational tone in her hand drawn and illustrated guide. "People are starting to realize not only that they can do this stuff, but that it's fun and fulfilling to boot." says Briggs. "Whenever you think about the choices you're making, you're doing a good thing."Verbicide Magazine described it as "a Gideon Bible-like manual that should be heavily circulated to people who are just scraping by in life. Her pragmatic approach to taking back your home is what makes this book so appealing." Save money while saving the planet. That's some noble work!
We live in a disposable society. The products that fill our daily lives are used and discarded. This habitual "use and lose" puts a dent in not only our pocketbooks, but also in the environment.
According to Cleanair.org, every year Americans throw away enough paper and plastic cups, forks, and spoons to circle the equator 300 times. Yes, 300 times. This is just the tip of the trash iceberg. Parents all across the nation gird the loins of their joyful little cherubs with disposable diapers. Cleanair notes, "Disposable diapers are the third largest single consumer item in landfills, and represent about 4% of solid waste. In a house with a child in diapers, disposables make up 50% of household waste." In addition, these diapers take hundreds of years to decompose and cost thousands of dollars to use. Plus, the oil used to produce those dandy disposables is more oil than used during the lifetime use of your car! The EPA reports that in 2010, American generated about 250 million tons of trash, with just a 34.1 percent recycling rate. What is being tossed that could be repurposed, reused, or revisioned? Learning to reduce, reuse, and recycle is a great way to cut down on household expenses, something that many homeowners are searching out. There's a honorable movement spreading across the nation bent on saving money and preserving the environment. The new book Make it Last: Prolonging and Preserving What We Love bridges the gap between life in a disposable culture and the basic skills needed to save money and live more sustainably. This book teaches the reader how to extend the lives of the things they love by repairing clothing, preserving home-grown food, and even repairing your kitchen sink. Raleigh Briggs takes her longtime commitment to community building through the DIY movement and shares her valuable experience with the reader through a conversational tone in her hand drawn and illustrated guide. "People are starting to realize not only that they can do this stuff, but that it's fun and fulfilling to boot." says Briggs. "Whenever you think about the choices you're making, you're doing a good thing."Verbicide Magazine described it as "a Gideon Bible-like manual that should be heavily circulated to people who are just scraping by in life. Her pragmatic approach to taking back your home is what makes this book so appealing." Save money while saving the planet. That's some noble work!
Thursday, April 25, 2013
Turn Tax Hindsight into Financial Foresight
Provided By: realtytimes.com
So, how’s that income tax "make over" going?
A few short weeks ago, you were among the millions moaning "If only I’d…" and agonizing about how much they owed in income tax. Were you also caught up in the last-minute-filing scramble?
Tax time hits us in the face with financial reality.
For too many of us, tax time represents the only time each year we take a close look at our finances. Unfortunately, this is usually on the fly when there’s no time for fixes and forecasts; however,savvy Americans decide it is time to do things differently . They make achievable resolutions to improve their financial health. It’s what happens after the filing deadline that really matters.What have you learned from filing your tax return? Did Uncle Sam get your money while you ended up with debts and dissatisfaction? Do you want to repeat this outcome in April 2014, or take a financial step forward? It’s your choice.The secret to keeping more of what you earn is not a secret. In fact, those who paved the road to financial literacy and financial security have left deep ruts for others to follow. Yes, it can be a bumpy ride, because you are letting go of some expensive bad habits, but the experience can be empowering. Financial improvement takes longer to achieve than one weekend since you are replacing ingrained ineffective habits and biases with a new way of thinking and acting when it comes to money, but results are evident very quickly.Starting points abound, and they all begin with you.The first step does not involve heading to the net via a popular search engine, because the first step is you observing you. You watching what triggers your spending, and alternatively what makes you think twice before you pull out credit cards or click on "BUY NOW" buttons. Record every dollar you spend for at least a week, and you’ll begin to see patterns. Do this for longer, and you’ll reveal relatively easy opportunities to save money and not spend it. Once you know where your weakness lies, assess your advantages. Start simple. Act on what you learn.
Published: April 30, 2013
So, how’s that income tax "make over" going?
A few short weeks ago, you were among the millions moaning "If only I’d…" and agonizing about how much they owed in income tax. Were you also caught up in the last-minute-filing scramble?
Tax time hits us in the face with financial reality.
For too many of us, tax time represents the only time each year we take a close look at our finances. Unfortunately, this is usually on the fly when there’s no time for fixes and forecasts; however,savvy Americans decide it is time to do things differently . They make achievable resolutions to improve their financial health. It’s what happens after the filing deadline that really matters.What have you learned from filing your tax return? Did Uncle Sam get your money while you ended up with debts and dissatisfaction? Do you want to repeat this outcome in April 2014, or take a financial step forward? It’s your choice.The secret to keeping more of what you earn is not a secret. In fact, those who paved the road to financial literacy and financial security have left deep ruts for others to follow. Yes, it can be a bumpy ride, because you are letting go of some expensive bad habits, but the experience can be empowering. Financial improvement takes longer to achieve than one weekend since you are replacing ingrained ineffective habits and biases with a new way of thinking and acting when it comes to money, but results are evident very quickly.Starting points abound, and they all begin with you.The first step does not involve heading to the net via a popular search engine, because the first step is you observing you. You watching what triggers your spending, and alternatively what makes you think twice before you pull out credit cards or click on "BUY NOW" buttons. Record every dollar you spend for at least a week, and you’ll begin to see patterns. Do this for longer, and you’ll reveal relatively easy opportunities to save money and not spend it. Once you know where your weakness lies, assess your advantages. Start simple. Act on what you learn.
- Perhaps you’ve read a financial book or two, or know someone who has.
- Your workplace may offer financial education programs.
- Friends and family have had good and bad experiences to save you repeating mistakes. They can also refer you to professionals who have proven their value.
- Realtytimes.com hosts a wide range of articles, including those in this column Decisions & Communities, that can start you thinking differently about real estate buying, financing, and investing.
- What’s your point in working to earn money?If you have no goals beyond the next paycheck, money will slip through your fingers. We support goals that involve property ownership and investing in real estate. What matters to you? It’s easier to work toward something you really want. Divide a big goal like owning your home or paying off your mortgage into manageable projects. Make them small enough that you are aware you’re making progress. Be realistic. Start with a goal you can achieve this week. Then a bigger one for the month of May and on you’ll go. Doing something has a huge advantage over doing nothing, or wishing you had in hindsight.
- Talk to those who know more than you doFrom the day after tax deadline, most accountants and financial advisors have time to talk to prospective clients like you. Discover where tax savings lie and how you can start on the path to financial security. Come to the conversation prepared to clearly and specifically explain your situation. Details matter. If you’re vague or unprepared, how can the professional provide specific, relevant information to get you started?
- Get organizedWhat do you know about your financial strengths and weaknesses?
Exactly how much cash do you have in your wallet right now? What is the current balance of your principal debit account? Exactly what is the outstanding balance of your two highest-interest debts? Exactly how much income have you earned this month? How much have you saved so far?
Published: April 30, 2013
Tuesday, April 23, 2013
Down payment help isn’t just for first-time home buyers
Provided By: interest.com
Think down payment assistance is only for poor, first-time home buyers? It’s not.
Banks, nonprofits and government agencies all pass out money to middle-income home buyers.
"Most people self-select out of these programs because they don’t see themselves in need," says Marietta Rodriguez, deputy director of National Homeownership Programs and Lending for NeighborWorks, a national network of community development nonprofits.
Assistance programs typically target people who make between 80% and 120% of area median income. That can be a pretty high number.
In Washington, D.C., for example, a single person can earn about $90,000 and still qualify for $20,000 from Wells Fargo’s Neighborhood LIFT program. In Atlanta, a family of four could earn about $80,000 and qualify for $15,000 in LIFT funds (www.wellsfargo.com/mortgage/lift).
Not only do you not have to be poor, you don’t even have to be a first-time home buyer to use Neighborhood LIFT; you just have to sell your current home first.
Assistance can come in the form of a gift, a second mortgage or a loan (with or without interest) that’s forgiven over time.
The LIFT money is a zero-interest loan, but 20% of the loan is forgiven each year as long as you don’t move out, sell your home or refinance into a higher-rate loan.
You’ll find assistance programs offered by other sponsors, too.
"Some municipalities are still using Community Development Block Grant or Home funds (via the U.S. Department of Housing and Urban Development)," Rodriguez says. "Sometimes employers make down payment assistance pools available, there is philanthropic money, and many of our NeighborWorks nonprofits are also community development financial institutions, and that opens up a window of capital they can use."
The U.S. Department of Agriculture offers a loan program in rural areas, and the Federal Home Loan Banks offer help putting money down and paying for closing costs.
Check for the strings that often come attached, such as restrictions on where you can buy a home or a requirement that you work for a particular employer (like a public school system). Many programs force you to attend homeownership classes to learn budgeting and home maintenance skills.
Even with assistance, you’ll still have to qualify for a mortgage based on your employment history, income, debts and credit rating.
Rodriguez recommends consumers start their home search by consulting a homeownership counselor even before choosing a real estate agent or lender.
"Your Realtor and your lender have a business proposition," Rodriguez says. "That’s why they’re in business. So does a nonprofit, but they’re less about selling you a certain thing and more about facilitating a sustainable purchase that makes sense for the home buyer."
Get started with our guide on how large your down payment will need to be when purchasing a home.
Think down payment assistance is only for poor, first-time home buyers? It’s not.
Banks, nonprofits and government agencies all pass out money to middle-income home buyers.
"Most people self-select out of these programs because they don’t see themselves in need," says Marietta Rodriguez, deputy director of National Homeownership Programs and Lending for NeighborWorks, a national network of community development nonprofits.
Assistance programs typically target people who make between 80% and 120% of area median income. That can be a pretty high number.
In Washington, D.C., for example, a single person can earn about $90,000 and still qualify for $20,000 from Wells Fargo’s Neighborhood LIFT program. In Atlanta, a family of four could earn about $80,000 and qualify for $15,000 in LIFT funds (www.wellsfargo.com/mortgage/lift).
Not only do you not have to be poor, you don’t even have to be a first-time home buyer to use Neighborhood LIFT; you just have to sell your current home first.
Assistance can come in the form of a gift, a second mortgage or a loan (with or without interest) that’s forgiven over time.
The LIFT money is a zero-interest loan, but 20% of the loan is forgiven each year as long as you don’t move out, sell your home or refinance into a higher-rate loan.
You’ll find assistance programs offered by other sponsors, too.
"Some municipalities are still using Community Development Block Grant or Home funds (via the U.S. Department of Housing and Urban Development)," Rodriguez says. "Sometimes employers make down payment assistance pools available, there is philanthropic money, and many of our NeighborWorks nonprofits are also community development financial institutions, and that opens up a window of capital they can use."
The U.S. Department of Agriculture offers a loan program in rural areas, and the Federal Home Loan Banks offer help putting money down and paying for closing costs.
Check for the strings that often come attached, such as restrictions on where you can buy a home or a requirement that you work for a particular employer (like a public school system). Many programs force you to attend homeownership classes to learn budgeting and home maintenance skills.
Even with assistance, you’ll still have to qualify for a mortgage based on your employment history, income, debts and credit rating.
Rodriguez recommends consumers start their home search by consulting a homeownership counselor even before choosing a real estate agent or lender.
"Your Realtor and your lender have a business proposition," Rodriguez says. "That’s why they’re in business. So does a nonprofit, but they’re less about selling you a certain thing and more about facilitating a sustainable purchase that makes sense for the home buyer."
Get started with our guide on how large your down payment will need to be when purchasing a home.
Thursday, April 18, 2013
Mortgage interest rates tick up during first quarter
Provided By: interest.com
Home loans are still quite a bargain. Just not the exceptional bargain they were late last year.
The average cost of 30-year, fixed-rate mortgages, the most popular way to finance a home, is up a quarter of a point since reaching a record low in early December.
The average cost of a 15-year mortgage, which is very popular with borrowers looking to refinance a home, is about a tenth of a percent more than last fall.
Have mortgage interest rates bottomed out?
It's too soon to say. But here's what we do know.
Most mortgages are sold to investors through two government-owned companies called Fannie Mae and Freddie Mac. Because of that, mortgage rates usually rise and fall in sync with the returns on long-term Treasury bills.
The Federal Reserve remains committed to holding long-term interest rates at historic lows until our lethargic economy is growing faster and creating more jobs.
But investors seem to be shaking the bunker mentality of the past few years that had them piling into safe assets such as Treasuries no matter how pitiful the returns might be.
Money is flowing back into stocks, which is why the Dow Jones Industrial Average and S&P 500 ended the first quarter at record highs.
The return on 10-year Treasury bonds fell to a record low of 1.38% in July, then rose to surpass 2% for the first time in nine months in late January, before falling back to end the first quarter at 1.85%.
What does this tell us about mortgage rates as the spring and summer unfold?
The Fed will be able to hold interest rates down, put probably won't be able to replicate the record lows we saw in late 2012.
Savvy borrowers with decent credit can expect to pay a quarter to half of a point less than these average rates.
Search our extensive database of the best interest rates offered by hundreds of lenders for better-than-average deals.
Where you live will have a lot to do with how much you pay.
The cheapest 30-year loans are in Kansas City (3.64%), closely followed by Detroit (3.65%) and Phoenix (3.67%).
The most expensive loans are in Tampa, where the average rate is nearly three-quarters of a point higher at 4.35% and Denver (3.97%).
Click here to find the average rates for all 25 major cities we track. You’ll find the data for 30- and 15-year fixed-rate loans and 5/1 adjustable-rate mortgages (ARMs).
Rates this low mean the payments for principal and interest for the average 30-year loan are a very affordable $464 per month for every $100,000 borrowed.
Use our mortgage calculator to see what your monthly principal and interest payments would be on any fixed-rate loan.
How long we'll enjoy such low rates depends on the Federal Reserve.
In September, the Fed’s policy-making committee announced plans to buy $40 billion of mortgage debt a month for the foreseeable future.
When the Fed buys bonds backed by thousands of home loans, it essentially floods the market with money, pushing down the cost of financing a home.
Although the Fed has purchased $2 trillion dollars’ worth of government and government-backed mortgage debt since the financial crisis hit in 2008, it’s never had an open-ended commitment like this.
It always spelled out exactly how much it was going to spend and when those purchases would take place.
At the December meeting of the Open Markets Committee, the governors appeared to be evenly split on whether the Fed would continue buying bonds until the end of 2013 or stop sooner than that.
Minutes of their January meeting said "many" members are now concerned at the higher-than-expected pace of purchases — about $85 billion a month — and the amount of debt the bank has accumulated — more than $3 trillion.
Those records say an "ongoing evaluation of the efficacy, costs and risks of asset purchases might well lead the committee to taper or end its purchases before it judged that a substantial improvement in the outlook for the labor market had occurred."
That's the first indication that the committee could be wavering on its September commitment — and something for anyone planning to buy or refinance later this year must watch.
When the Fed stops buying, you'll almost certainly pay more for a mortgage.
Home loans are still quite a bargain. Just not the exceptional bargain they were late last year.
The average cost of 30-year, fixed-rate mortgages, the most popular way to finance a home, is up a quarter of a point since reaching a record low in early December.
The average cost of a 15-year mortgage, which is very popular with borrowers looking to refinance a home, is about a tenth of a percent more than last fall.
Have mortgage interest rates bottomed out?
It's too soon to say. But here's what we do know.
Most mortgages are sold to investors through two government-owned companies called Fannie Mae and Freddie Mac. Because of that, mortgage rates usually rise and fall in sync with the returns on long-term Treasury bills.
The Federal Reserve remains committed to holding long-term interest rates at historic lows until our lethargic economy is growing faster and creating more jobs.
But investors seem to be shaking the bunker mentality of the past few years that had them piling into safe assets such as Treasuries no matter how pitiful the returns might be.
Money is flowing back into stocks, which is why the Dow Jones Industrial Average and S&P 500 ended the first quarter at record highs.
The return on 10-year Treasury bonds fell to a record low of 1.38% in July, then rose to surpass 2% for the first time in nine months in late January, before falling back to end the first quarter at 1.85%.
What does this tell us about mortgage rates as the spring and summer unfold?
The Fed will be able to hold interest rates down, put probably won't be able to replicate the record lows we saw in late 2012.
Savvy borrowers with decent credit can expect to pay a quarter to half of a point less than these average rates.
Search our extensive database of the best interest rates offered by hundreds of lenders for better-than-average deals.
Where you live will have a lot to do with how much you pay.
The cheapest 30-year loans are in Kansas City (3.64%), closely followed by Detroit (3.65%) and Phoenix (3.67%).
The most expensive loans are in Tampa, where the average rate is nearly three-quarters of a point higher at 4.35% and Denver (3.97%).
Click here to find the average rates for all 25 major cities we track. You’ll find the data for 30- and 15-year fixed-rate loans and 5/1 adjustable-rate mortgages (ARMs).
Rates this low mean the payments for principal and interest for the average 30-year loan are a very affordable $464 per month for every $100,000 borrowed.
Use our mortgage calculator to see what your monthly principal and interest payments would be on any fixed-rate loan.
How long we'll enjoy such low rates depends on the Federal Reserve.
In September, the Fed’s policy-making committee announced plans to buy $40 billion of mortgage debt a month for the foreseeable future.
When the Fed buys bonds backed by thousands of home loans, it essentially floods the market with money, pushing down the cost of financing a home.
Although the Fed has purchased $2 trillion dollars’ worth of government and government-backed mortgage debt since the financial crisis hit in 2008, it’s never had an open-ended commitment like this.
It always spelled out exactly how much it was going to spend and when those purchases would take place.
At the December meeting of the Open Markets Committee, the governors appeared to be evenly split on whether the Fed would continue buying bonds until the end of 2013 or stop sooner than that.
Minutes of their January meeting said "many" members are now concerned at the higher-than-expected pace of purchases — about $85 billion a month — and the amount of debt the bank has accumulated — more than $3 trillion.
Those records say an "ongoing evaluation of the efficacy, costs and risks of asset purchases might well lead the committee to taper or end its purchases before it judged that a substantial improvement in the outlook for the labor market had occurred."
That's the first indication that the committee could be wavering on its September commitment — and something for anyone planning to buy or refinance later this year must watch.
When the Fed stops buying, you'll almost certainly pay more for a mortgage.
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