Monday, August 31, 2009
Fed Chair Says the Worst Is Over
Now Is the Time to Buy in Real Estate
Buying a single-family house. This could be a first home, dream home, or a home to rent out.
Buying a multi-family investment property.
Snapping up a vacation property. There are deep discounts to be found in high-end resort areas.
Investing in a Real Estate Investment Trust. REITs were hit hard in the downturn, but many are on their way back.Source: BusinessWeek, Marc Roth (08/26/2009)
First-Time Buyer Credit Extension Possible
Thursday, August 13, 2009
National Association of Realtors: Existing-Home Sales Rise Again
Existing-home sales rose for the third consecutive month with inventory easing and home prices declining less sharply in June, according to the National Association of REALTORS®.
Existing-home sales — including single-family, townhomes, condominiums, and co-ops — increased 3.6 percent to a seasonally adjusted annual rate of 4.89 million units in June from a downwardly revised pace of 4.72 million in May, but are 0.2 percent lower than the 4.90 million-unit level in June 2008.
Lawrence Yun, NAR chief economist, is hopeful about the gain.
“The increase in existing-home sales occurred in all major regions of the country,” he says. “We expect a gradual uptrend in sales to continue due to tax-credit incentives and historically high affordability conditions. Despite the rise in closed transactions, many REALTORS® are reporting lost sales as a result of new appraisal standards that went into effect May 1 of this year.”
HVCC Issues
A June survey of NAR members shows 37 percent experienced at least one lost sale as a result of the new Home Valuation Code of Conduct, with seven out of 10 reporting an increased use of out-of-area appraisers. Seventy percent of NAR appraiser members said consumers were paying higher fees, while 85 percent report a perceived reduction in appraisal quality.
“Clearly the process needs to be revised, but the most logical approach is to use appraisers with local expertise, industry designations, and access to local data, who make a physical examination of the property and use apples-to-apples comparisons with nearby home sales,” Yun says. “In many cases, normal homes are being compared with distressed homes sold at a discount, which often are in subpar condition – this is causing real harm to both buyers and sellers.”
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 5.42 percent in June from 4.86 percent in May; the rate was 6.32 percent in June 2008. Mortgage interest rates have trended lower in recent weeks.
Inventory Declines
Total housing inventory at the end of June fell 0.7 percent to 3.82 million existing homes available for sale, which represents a 9.4-month supply at the current sales pace, down from a 9.8-month supply in May. Raw inventory totals are 14.9 percent below a year ago.
“This is another hopeful sign — if we can keep the volume of sales above the level of new inventory, prices could stabilize in many areas around the end of the year,” Yun says.
An NAR practitioner survey in June showed first-time buyers accounted for 29 percent of transactions, unchanged from May, and that the number of buyers looking at homes is up nearly 12 percentage points from June 2008.
NAR President Charles McMillan notes that there are very good opportunities. “Despite some of the challenges, the housing market continues to demonstrate signs of recovery,” he says. “The temporary first-time buyer tax credit is clearly helping people make a decision and is contributing to the overall stimulus impact, but since it’s taking longer to close transactions, many would-be beneficiaries may not be able to take advantage of the credit before the Dec. 1 expiration date."
The national median existing-home price for all housing types was $181,800 in June, which is 15.4 percent below June 2008. Distressed properties, which accounted for 31 percent of sales in June, continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes.
Single-family home sales rose 2.4 percent to a seasonally adjusted annual rate of 4.32 million in June from a level of 4.22 million in May, and are 0.2 percent higher than the 4.31 million-unit pace a year ago. The median existing single-family home price was $181,600 in June, which is 15.0 percent below June 2008.
Existing condominium and co-op sales jumped 14.0 percent to a seasonally adjusted annual rate of 570,000 units in June from 500,000 in May, but are 3.1 percent below the 588,000-unit level in June 2008. The median existing condo price was $183,300 in June, down 18.9 percent from a year ago.
By Region
- Northeast: Regionally, existing-home sales in the Northeast rose 2.5 percent to an annual pace of 820,000 in June, but are 4.7 percent below a year ago. The median price in the Northeast was $249,400, down 5.9 percent from June 2008.
- Midwest: Existing-home sales in the Midwest increased 0.9 percent in June to a level of 1.10 million but are 1.8 percent lower than June 2008. The median price in the Midwest was $157,000, which is 9.1 percent below a year ago.
- South: In the South, existing-home sales rose 4.0 percent to an annual pace of 1.81 million in June but are 3.7 percent below a year ago. The median price in the South was $163,200, down 11.9 percent from June 2008.
- West: Existing-home sales in the West improved by 6.4 percent to an annual rate of 1.16 million in June, and are 11.5 percent higher than June 2008. The median price in the West was $214,800, which is 24.9 percent below a year ago.
Source: NAR
Investors Drive Foreclosure Prices Up
Home shoppers in parts of the country with lots of foreclosures are finding it increasingly difficult to buy. Investors are bidding up prices thousands above the original asking price.
Federal legislation slowing the number of foreclosures is adding to the problem by reducing the number of homes on the market. For instance, in Las Vegas, one of the areas where the bidding problem is greatest, home inventories are down 10 percent since March, according to the Las Vegas Association of REALTORS®.
When a bidding war erupts, the problem is particularly difficult for traditional buyers because investors are usually cash purchasers. They can bid up a property without concern whether the appraisal will prevent them from getting a loan.
Experts say the problem is not unlike the situation at the height of the housing bubble.
"This market is about as abnormal as the hypermarket that we came out of a few years ago," says Jay Butler, director of the Realty Studies program at Arizona State University.
Source: The Associated Press, Jonathan J. Cooper
Housing Experts: Now Is a Perfect Time to Buy
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
Home Hunting Without Fear
As any daredevil, extreme sports addict or adrenaline junkie knows, well-grounded preparation for the specific task at hand is what takes the fear out of trying.
The sometimes risky sport of home buying is no different.
Those who've suffered the agony of defeat in what's likely the most dangerous consumer game, learned the hard way that sheer fearlessness isn't enough to become and remain a homeowner -- through good times and bad.
With the rules of the housing game changed forever, preparing to just squeak by the home buying ordeal isn't enough to achieve a decisive and lasting victory.
The idea isn't just to buy a home. The goal is to keep your own roof over your head.
Preparation is key, according to the National Association of Realtors (NAR).
From NAR, here's how to get ready to be and remain a homeowner.
Moving Made Easy, Keep It Simple
The moving industry is complicated.
It uses a lot of lingo that most consumers don't understand: You get your estimates as "binding" or "non-binding"; movers use a "tariff" to determine rates; when the mover ships your goods, you receive a "bill of lading."
And when you go to check out your mover, you run into a mass of regulations. If you're moving within your state, your state government regulates your move; if you're moving across the country, the Federal Motor Carrier Safety Administration does. Finding (and understanding) information about your mover on either of these agencies' Web sites can be hard, too.
It's understandable, then, that most people don't put in this kind of gumshoe work. However, there are three basic moving pitfalls that, if avoided, can help save you from a lousy experience with poor moving companies.
1. Not getting an in-home estimate.
The moving company needs to see exactly what they need to move. If they don't, it's near impossible to derive accurate moving quotes for your move.
Have them come to your home to see exactly what you need moved; otherwise, you could be in for a nasty surprise on moving day if they claim you have more belongings than you indicated on your inventory.
Don't give an inventory over the phone or complete one online. You will have a hard time putting together an accurate inventory on your own, and it also gives unscrupulous moving companies the opportunity to claim that your inventory was incorrect and void the estimate – on moving day, no less.
While on the subject of unscrupulous moving companies, one easy way to decrease your chances of hiring one is to start your search using a database of pre-screened, pre-qualified movers. Check out Web sites such as MovingQuotes.com, which matches consumers with pre-screened, competent movers.
2. Not choosing a mover with a local presence.
There are many reasons for this.
First, it's a good idea to visit the moving company offices to ensure they're a legitimate mover and not just a broker that's going to give your move to someone else.
Second, it will put your mind at ease to see the moving company's facilities, its names on the trucks, etcetera.
Third, logistically, it's just easier. If you're moving from Texas to Seattle, how can a moving company in Ohio do your move? Will that moving company really be handling your move?
Finally, if you must follow up with the moving company for a damage claim or something else after the move, having them nearby makes that process much easier.
3. Going with a low-ball bid.
Beware of an offer that sounds too good to be true. You will almost certainly pay for it in some other way.
True, some companies might offer a lower price, but make sure it's a reasonable discount. First, you should get at least three moving quotes for your move. If two of the movers are priced around the same level, and the third comes in with a price that's 30 percent less, you need to be skeptical.
All moving companies face the same costs, so if someone is telling you they can do your move for a lot less, it's probably because they will make up the difference by larding on a bunch of ridiculous charges later, such as excess packing charges, or claims that you added stuff to be moved after you got your estimate.
Packing up and moving – whether across town or across the country – is always a nerve-racking experience. The thought of dealing with a potentially disreputable moving company adds another layer of unnecessary complexity. By avoiding these three common mistakes, you will increase your chances of having an easier, less stressful moving experience, and move on to enjoying your new home.
Written by Tim Johnson
Monday, August 3, 2009
IN CASE YOU MISSED IT: National Review: Going Alamo: Why jobs and companies are flocking to a big small-government state
Continue Reading...
http://governor.state.tx.us/news/press-release/13234/
Sunday, August 2, 2009
Austin Housing Market Shows Signs of Life
"We've seen the year-over-year gap in sales volume close steadily throughout 2009, and that momentum continues this month," said Jay Gohil, chairman of the Austin Board of Realtors.
Home prices in the Austin area have continued gaining momentum since the beginning of the year. Over the first two quarters of 2009, the average sale price for a single-family home has increased $20,824, while median sales price has increased $24,400.
Also, since January 2009, sales volume is up 61 percent, and active listings are up 14 percent.
Which cities will, and won’t, recover the fastest?
It's true for recovery from a real estate bubble too. Overall, many economists expect the national economy to return to growth later in 2009, perhaps as soon as this summer. But that won't be the case everywhere. While some cities are poised for a quick rebound, others face a slog to recovery that could take years.
Poised for swift recovery are many Texas cities, such as Austin, San Antonio, Dallas and McAllen. These areas did not see the massive real estate bubble that formed in states like California, Nevada and Florida. The economy is diverse, with heavy growth coming from education and health care in recent years.
Many of the cities with the longest road to recovery are California cities, where home prices rocketed out of control, and entire economies were supported largely by a real estate bubble. Fresno, Modesto, Salinas, Bakersfield, Stockton and Los Angeles all saw home prices soar to unsustainable levels and then begin their inevitable plunge. The collapse of the housing markets pushed unemployment rates in these cities above 10 percent.
Even as a flood of foreclosures makes home prices look affordable again, a sign that some of the worst real estate markets may be finding their bottom, it will still take years for unemployment rates as high as 16.8 percent in Modesto or 15.5 percent in Fresno to return to healthy levels.
Cities for recovery:
According to Forbes, here are cities that should turn around sooner rather than later
Austin-Round Rock, Texas
Fayetteville-Springdale-Rogers, Ark.
Boulder, Colo.
Huntsville, Ala.
San Antonio, Texas
"Avoiding the housing bubble helped Texas, will keep California languishing"
To find the 10 cities that look best poised for recovery (and the 10 cities likely looking at the longest climb back), we examined estimates from data provider Moody's Economy.com of the projected gross domestic product of metropolitan areas across the U.S., as well as unemployment figures from the Bureau of Labor Statistics and home prices, incomes and affordability data from the National Association of Home Builders. Because, in general, healthy cities were not victims of as severe a housing collapse, home prices were not used in ranking the cities poised for recovery.
The analysis also shows the importance of a city's economic make-up. Manufacturing has been battered by the recession, leaving cities like Detroit and Flint, Mich., or Youngstown, Ohio, with bad unemployment and a changing economy that's unlikely to replace the lost jobs. Moody's projects the economy in Flint, for example, will decrease by 16 percent from the start of recession to the end of 2010. (One commonly cited rule of thumb for depression is a decline of 10 percent.) Flint might never return to its original size.
New York City, too, once the capital of finance, is now saddled with Wall Street-induced unemployment and homes that are completely unaffordable for most of the region's residents. The NAHB's Housing Opportunity Index reports that only 14 percent of homes in the New York-White Plains-Wayne area are affordable on the area's median income — by far the least affordable region measured by NAHB.
Cities with robust technology sectors are poised for stronger recoveries than manufacturing or finance centers. Cities with high-tech capabilities like Seattle, Huntsville, Ala., or Boulder, Colo., could see quick recovery in coming months.
Link to MSNBC report >>> http://www.msnbc.msn.com/id/31372693/ns/business-forbescom?GT1=43001from/ET
Forbes: Austin Poised for Fastest Recovery!
From now until the end of 2010, the Austin economy is projected to grow by $5 billion. That, coupled with relatively subdued unemployment, has the Texas Capital poised for the quickest economic rebound in the nation, according to Forbes.com.
Overall, many economists expect the national economy to return to growth later in 2009, perhaps as soon as this summer. But, as the Forbes writers point out, that won't be the case everywhere. While some cities are positioned for a quick rebound, others face a slow crawl to recovery that could take years.
Texas cities such as Austin, San Antonio, Dallas and McAllen are in a good position, Forbes' analysis found. That's due in part to the fact that Texas did not see the massive real estate bubble that formed in states like California, Nevada and Florida.
To determine the 10 cities that look best poised for recovery, Forbes examined estimates from data provider Moody's Economy.com of the projected gross domestic product of metropolitan areas across the U.S., as well as unemployment figures from the Bureau of Labor Statistics and home prices, incomes and affordability data from the National Association of Home Builders.
The analysis shows the importance of a city's economic make-up. In essence, the more diverse the industry base is in a particular city, the better off that city is when it comes to quick recovery.
The top five cities for recovery, in order, are Austin; Fayetteville, Ark.; Boulder, Colo.; Huntsville, Ala.; and San Antonio.
To view Austin Business Journal article, click here >>> http://austin.bizjournals.com/austin/stories/2009/07/20/daily35.html
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