Homeownership remains unaffordable for most Americans

by qgregg 14. November 2014 09:25
HousingWire Homeownership remains unaffordable for most Americans Slight improvement, but stagnant wages still drag on borrowers Trey Garrison November 14, 2014 A median-income household can only afford a median-priced home in 10 of the 25 largest U.S. metropolitan areas, according to a new Interest.com report. That’s actually an improvement from last year, when the median-income household fell short in all but eight of the 25 metros. And it's not totally out of line with similar findings. Homebuilders, for example, also say home affordability is slipping. They report the national median home price increased from $214,000 in the second quarter to $221,000 in the third quarter, while average mortgage interest rates decreased from 4.44% to 4.35% in the same period. “Low mortgage rates are helping home affordability to some extent, but the key ingredient – which has been missing to this point – is substantial income growth,” according to Mike Sante, managing editor of Interest.com. “Millennials, in particular, are struggling to overcome their student loans and save enough money for a down payment.” Baltimore was the biggest gainer over the past year, jumping from 17th-most affordable in 2013 to sixth-most affordable in 2014. Minneapolis and Atlanta swapped the top two spots, with Minneapolis taking the crown this year. Sacramento experienced the biggest drop in home affordability over the past 12 months, sinking from 12th to 18th in the ranking. But it’s still more affordable than the other three California metro areas on the list. Los Angeles (22nd), San Diego (24th) and San Francisco (25th) join New York City among the four least affordable markets. Overall, median home prices rose six percent over the past year in the 25 metro areas, while incomes rose by about two percent. Contrary to most expectations, mortgage rates eased a bit, which provided homeowners with some relief. Most Affordable Metropolitan Areas 1. Minneapolis (+23%) 2. Atlanta (+22%) 3. St. Louis (+20%) 4. Detroit (+14%) 5. Pittsburgh (+13%) Least Affordable Metropolitan Areas 21. Miami (-26%) 22. Los Angeles (-32%) 23. New York (-32%) 24. San Diego (-38%) 25. San Francisco (-46%)

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Fall Yard Clean Up Recommendations

by qgregg 31. October 2014 06:28
If rainfall pools on your lawn then it's time to aerate the compressed soil so that water and nutrients can reach the roots. A garden fork can do the job on a small yard, but for larger lawns you can use a walk-behind aerator that will pull out larger plugs of earth that break down by springs. These can typically be rented at your local home improvement store. Cutting back on fertilizer in the late summer months prevents perennials from wasting energy on leaf production. Grass roots keep growing until the ground reaches around 40 degrees so feeding your lawn in the fall is still a good time to do that. Try a high-phosphorus mix to lawns in the fall to encourage root growth. Mow your lawn one final time to a height of 1 1/4 - 1 1/2 inches. Disease has a harder time with shorter grass and fallen leaves will blow across the lawn easier without taller grass to catch on. Just make sure you do not go too low. To make fallen leaves easier to transport, rake them onto a plastic tarp. They can be added to a compost bin to be recycled in your garden. Flip the leaf pile every week to aerate the compost and you will end up with a cheap alternative to store bought fertilizers for your garden. In many parts of the country, planting shrubs in early fall gives the plants a head start at establishing roots in the season's cool, moist soil. The basics: Dig a hole twice the diameter and to a depth of 2 inches less than the height of the root structure; position the shrub in the hole; fill in with soil; water to settle soil; add more soil to top the top of the root structure; mulch. Lifeless branches can succumb to winter snow and winds, endangering you and your home. For big jobs, call the pros. But you can protect small ornamental trees from further damage by cutting cracked, loose, and diseased limbs close to the trunk; leave the wounds exposed to heal. A little work now results in healthier spring beds. Evict tired annuals, as well as the snails and slugs that feed on them, which breed in the fall. Trim spent perennial foliage down to the ground; this send energy to the roots for next season. Every three years, divide crowded tuberous plants, like irises and day lilies. More space means more flowers. Give new beds a layer of mulch-chopped leaves, weed-free straw, or wood chips-after a light frost, but before the ground freezes. Till decomposed layers of organic mulch into the soil, then apply a fresh 2 to 4 inch layer to keep new plantings warm and to control water runoff and soil erosion. Standing water can freeze and crack drip-irrigation tubing. For simple systems, shut the water off, unscrew the joint adapters, and using a high-volume, low-pressure setting on an air compressor, insert an air hose where the system normally attaches to the tap. Blowing the water out avoids having to uproot the entire system.

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Real Estate Matters

How Can a Homeowner Protect Home and Property Against Thieves?

by qgregg 2. September 2014 04:19

No home alarm system is completely full-proof, but those who can afford electronic security systems do rest easier and are less likely to become burglary victims. They feel secure knowing the authorities have automatically been alerted to the crime. As for their valuables, it's not likely a thief will get away with much, especially if he's foolish enough to enter the house with the alarm blaring and the cops on the way.


However, the same bad economy that forced some people to steal to survive and provide for their families has also prevented many homeowners from purchasing state-of-the-art protection, no matter how affordable it may be. When a paid home security company is out of the question, there are still some things that a homeowner can do to make his home less attractive to thieves:

  • Invest in door and window alarms purchased from a hardware or department store. Some models work by numeric code while others use a key to turn the alarm on and off. Prices range from twelve to twenty dollars, respectively. These alarms do make a loud shrill noise; they might scare off a burglar, but may not be loud enough to alert a neighbor.
  • Place a sturdy piece of wood against a sliding patio door frame so that the door won't open even when unlocked.
  • Make it hard for a thief to get into your house. Install quality dead-bolt locks that are resistant to "lock bumping" (Read more on this below). Use security window locks on all windows (in addition to the locks that came with the window). You can also choose a key-less entry system. (Good for family members who tend to lose their house key.)
  • Keep valuables away from windows where they can easily be seen or grabbed. Regardless of an alarm or lock, a thief needs only a few seconds to break a window and snatch a laptop, high-definition television or other valuable that's within easy reach.
  • Install a motion detector outside and/or inside your home. Outdoor types include floodlights that turn on when someone is detected close to the house. The only drawback is that larger animals (dogs, possums and raccoons) tend to set off the lights, too. They don't cost much, but an inside motion detector might be enough to scare off an intruder.
  • Keep garage doors closed, storage and work sheds locked. Thieves can sell power tools, gardening equipment, riding mowers and other such property.
  • Keep your cell phone charged and with you. Even if you have a bedside extension phone, it won't help you if a thief rips out the phone line to the main handset.
  • Keep trash confined, especially during the holidays and any gift-giving occasions. Boxes for expensive electronics, and wrappings for valuables that are left outside in full view, can tell a thief a lot about the home occupants.

Keep pets licensed and invest in a microchip that will help locate your beloved dog or cat should someone steal and try to sell him.

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Smart Steps for Every New Homeowner

by qgregg 25. July 2014 10:43
Turning the key in a lock that no landlord has access to, reading in a hammock in your own backyard and painting your dining room bright red - what could be more exciting than making the leap from renter to first-time homeowner? Getting swept up in all the excitement is a wonderful feeling, but some first-time homeowners lose their heads and make mistakes that can jeopardize everything they've worked so hard to earn. Don't be one of those people; take a few moments to ponder these practical concerns that will help ensure that your first home becomes the place of luxury and financial freedom you've anticipated. 1. Don't Overspend on Furniture and Remodeling You've just handed over a large portion of your life savings for a down payment, closing costs, and moving expenses. Money is tight for most first-time homeowners - not only are their savings depleted, their monthly expenses are often higher as well, thanks to the new expenses that come with home ownership, such as water and trash bills, and extra insurance. Everyone wants to personalize a new home and upgrade what may have been temporary apartment furniture for something nicer, but don't go on a massive spending spree to improve everything all at once. Just as important as getting your first home is staying in it, and as nice as solid maple kitchen cabinets might be, they aren't worth jeopardizing your new status as a homeowner. Give yourself time to adjust to the expenses of home ownership and rebuild your savings - the cabinets will still be waiting for you when you can more comfortably afford them. 2. Don't Ignore Important Maintenance Items One of the new expenses that accompanies home ownership is making repairs. There is no landlord to call if your roof is leaking or your toilet is clogged (on the plus side, there is also no rent increase notice taped to your door on a random Friday afternoon when you were looking forward to a nice weekend). While you should exercise restraint in purchasing the non-essentials, you shouldn't neglect any problem that puts you in danger or could get worse over time, turning a relatively small problem into a much larger and costlier one. 3. Hire Qualified Contractors Don't try to save money by making improvements and repairs yourself that you aren't qualified to make. This may seem to contradict the first point slightly, but it really doesn't. Your home is both the place where you live and an investment, and it deserves the same level of care and attention you would give to anything else you value highly. There's nothing wrong with painting the walls yourself, but if there's no wiring for an electric opener in your garage, don't cut a hole in the wall and start playing with copper. Hiring professionals to do work you don't know how to do is the best way to keep your home in top condition and avoid injuring - or even killing - yourself.

Housing Bubble Worries Are Evaporating

by qgregg 6. July 2014 11:58

Housing Bubble Worries Are Evaporating

Fears of another real estate bubble are disappearingAll that news about another bubble threatening the housing market is fizzling out. The upside for the industry is that prices now seem to be rising at a slower, steadier pace, stemming bubble fears.

The last two years recorded some of the highest price hikes in the country. Prices were rising at a pace that reminded many of the housing bubble of the last decade. It made the industry a bit anxious, and some buyers were intimidated and may have stayed away from making that most important purchase of their lifetime.

But, things began to change this year and the pace of price increases started slowing down. If this trend continues, homes will stay affordable and more buyers will be able to jump onto the homeownership bandwagon, according to Businessweek.com.

“That means that the housing market will avoid becoming overvalued, allowing the recovery in sales activity and housing starts to continue,” Capital Economics property analyst Paul Diggle said in a research note, according to Businessweek.

Home prices in May increased 8.8 percent compared to a year-ago period, according to a recent CoreLogic report.  Although still a big gain, that number is almost 3 percentage points lower than the growth rate reported three months prior. It’s also the lowest annual change seen in 18 months. And, that rate is going to continue to slide as more new homes enter the market.

“We are still under-building compared to population growth,” homebuilding analyst Stephen Kim of Barclays wrote in a recent report, according to Businessweek.

Barclays anticipates housing starts will increase by 200,000 annually, rising to 1.7 million by 2017.

So, you can tell your clients that now is a good time to buy, while prices will remain affordable. Also, with inventory levels expected to increase, they will have more homes to choose from in the coming months.

Models, Private Planes and Other Luxury Marketing Strategies

How far are you willing to go to sell a luxury home?  Would you be willing to offer your clients a private plane or boat ride?

Believe it or not, real estate agents in some markets are doing just that—and more—to sell the luxury lifestyle. One agent even utilized a strategically-placed lingerie model in a photo shoot for a property, according to CNN Money.

Jack Cotton, a real estate agent in Cape Cod, Mass., takes potential buyers out on his powerboat. “That’s kind of our secret weapon,” he told CNN Money, referring to his boat. The rides allow his clients to get a feel for the nearby waterways in order to “experience the lifestyle of being here.”

Luxury real estate agents now using drones, lingerie models and private jets to sell homesMany real estate agents are adapting their marketing strategies based on their location. Some Manhattan agents in the high-end market offer clients limo rides, while their counterparts in Colorado will take clients out skiing.

An agent in Atherton, Calif., which is the highest-earning zip code in the state, recently bought a private plane and uses it to give his clients an aerial view of their potential backyards.

Some agents are also using drone technology to help with aerial photos for their marketing strategies.

“The high-end market is very competitive,” Colette Harron, a real estate agent in Essex, Conn., told CNN Money. “So whatever it takes.”

Signed Home Contracts Shoot Up

Signed contracts for homes jumped in May, according to the National Association of Realtors. The NAR said that its seasonally adjusted pending home sales index increased 6.1 percent to 103.9. That’s the biggest month-over-month gain since April 2010.

This is a positive sign for the housing industry. Pending sales indicate future purchases. Usually, there’s a lag of one or two months between a contract and a completed sale. The uptick in the numbers was triggered by low mortgage rates and increased inventory, according to the Associated Press.  Signed agreements increased in all four regions of the country, the AP said.

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Real Estate Matters

Smart Steps for Every New Homeowner

by qgregg 1. July 2014 03:14
Smart Steps for Every New Homeowner Turning the key in a lock that no landlord has access to, reading in a hammock in your own backyard and painting your dining room bright red - what could be more exciting than making the leap from renter to first-time homeowner? Getting swept up in all the excitement is a wonderful feeling, but some first-time homeowners lose their heads and make mistakes that can jeopardize everything they've worked so hard to earn. Don't be one of those people; take a few moments to ponder these practical concerns that will help ensure that your first home becomes the place of luxury and financial freedom you've anticipated. 1. Don't Overspend on Furniture and Remodeling You've just handed over a large portion of your life savings for a down payment, closing costs, and moving expenses. Money is tight for most first-time homeowners - not only are their savings depleted, their monthly expenses are often higher as well, thanks to the new expenses that come with home ownership, such as water and trash bills, and extra insurance. Everyone wants to personalize a new home and upgrade what may have been temporary apartment furniture for something nicer, but don't go on a massive spending spree to improve everything all at once. Just as important as getting your first home is staying in it, and as nice as solid maple kitchen cabinets might be, they aren't worth jeopardizing your new status as a homeowner. Give yourself time to adjust to the expenses of home ownership and rebuild your savings - the cabinets will still be waiting for you when you can more comfortably afford them. 2. Don't Ignore Important Maintenance Items One of the new expenses that accompanies home ownership is making repairs. There is no landlord to call if your roof is leaking or your toilet is clogged (on the plus side, there is also no rent increase notice taped to your door on a random Friday afternoon when you were looking forward to a nice weekend). While you should exercise restraint in purchasing the non-essentials, you shouldn't neglect any problem that puts you in danger or could get worse over time, turning a relatively small problem into a much larger and costlier one. 3. Hire Qualified Contractors Don't try to save money by making improvements and repairs yourself that you aren't qualified to make. This may seem to contradict the first point slightly, but it really doesn't. Your home is both the place where you live and an investment, and it deserves the same level of care and attention you would give to anything else you value highly. There's nothing wrong with painting the walls yourself, but if there's no wiring for an electric opener in your garage, don't cut a hole in the wall and start playing with copper. Hiring professionals to do work you don't know how to do is the best way to keep your home in top condition and avoid injuring - or even killing - yourself.

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'Boomerang' or Forclosed upon Buyers Get Second Chance

by qgregg 23. June 2014 12:14
'Boomerang' Buyers Get Second Chance Daily Real Estate News | Monday, June 16, 2014 About 7.2 million homes have been lost to foreclosure or short sale since the housing crash began, according to housing data from Black Knight Financial Services. That has forced millions of former home owners into renting, as they work to rebuild their credit. But a government program launched last summer by the Federal Housing Administration is helping these former home owners step back into home ownership in as little as a year after a foreclosure or short sale. The FHA’s Back to Work program allows them to qualify for low interest rates with a minimum of a 3.5 percent down payment. Applicants must show that the main culprit behind losing their home was that they lost at least 20 percent of their household income for at least six months. They also must show they’ve worked to repair their credit for at least a year. Lenders are reporting an uptick in boomerang buyers coming in to explore financing opportunities for a home purchase. "We see a lot of boomerang buyers,” says Matt Weaver, a lender with PMAC Lending Services in Florida. “I'd say about 20 percent of my current clientele has either suffered a short sale or a foreclosure in the past and are now re-buying back into the marketplace." But while opportunities to apply for a home loan are increasing, some are hesitant to step back in, housing analysts say. "Based on the fact that the home ownership rate isn't rising again and demand for single-family rentals is historically high, the comeback buyer is not a significant phenomenon in the market," says Mark Fleming, chief economist at CoreLogic. "Given the duration of the recovery, it's likely that many of the initially foreclosed borrowers have repaired their credit and are now creditworthy, but the scale at which they will enter the market is not sufficient to significantly influence demand." Source: “‘Boomerang’ Homebuyers Getting a Boost From Uncle Sam,” CNBC (June 13, 2014)

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Real Estate Matters

Should You Have An Open House?

by qgregg 13. June 2014 07:23
Written by Blanche Evans on Thursday, 12 June 2014 Since multiple listing services first started putting listings online around 1996, the transparency of homes for sale has improved exponentially. From the virtual "fish-eye" tours of the ‘90s and oughts to sleek present-day videos, homes can be showcased to buyers with the ease of a phone app. So why have an open house? If you're trying to sell your home, you want to employ all the ways home buyers choose a home. Your target buyer may use websites, not apps. Most buyers have real estate professionals helping them. Homes that are market-ready and staged are going to be on their showing lists. Buyers who are just getting started or who don't have an agent are most likely to attend open houses for one simple reason. Seeing is believing. So do you want them to fall in love with your house or someone else's? An open house may help, or you may decide it's not for you. Here are a few ideas to consider. Where and how do home buyers shop for a home? Homebuyers use the Internet to view their choices -- at home and on the road. According to the National Association of REALTORS® (NAR), more than half of Gen Y and Gen X buyers used a mobile device during their home search in 2013. Among those who did, 26 percent of Gen Y and 22 percent of Gen X homebuyers found the home they ultimately purchased via a mobile device. They cruise neighborhoods to decide where they want to live. As homebuyers get into the process, open houses become more important to them. Nearly half of homebuyers attend open houses and found them "useful," says the NAR. But you're not here to educate buyers, you want to sell your home. How can an open house be right for your marketing plan? Homebuyers may use the Internet as a tool, but they usually make their choice in person. An open house sign in the yard is irresistible. There are risks and rewards to open houses. An open house is an invitation to neighbors and strangers to walk through your home. You might not like your privacy invaded, and sometimes you might find small items missing after an open house, like drugs from the medicine cabinet, or small collectibles. The upside is that it's a chance to seal the deal with the right buyer at a personal level. Few buyers choose a home they haven't seen for themselves. To make your open house memorable, do the following: 1.Every seller's list begins with cleaning and decluttering thoroughly so the home will show better. 2.Empty medicine cabinets. Lock away jewelry, collectibles, and your personal papers, including credit card and utility bills to prevent identity theft. 3.Depersonalize. Don't leave out mementoes. Homebuyers want to imagine themselves as the occupants. 4.Don't leave pets on the premises. Make sure their beds, bowls and boxes are put away for the open house. 5.Insist that your listing agent bring an associate to your open house. Having two people, one to show the house and one to take information from open house visitors, discourages "lookie-loos" and petty thieves. 6.Don't hang around. Owners discourage buyers from making honest comments. 7.Make sure your listing agent collects contact information from people who have visited your home for feedback. 8.Be willing to act upon the feedback you receive. If a number of potential home buyers said they hated the paint colors, prepare to repaint. Use the Internet and open houses together. If you make a change to the home, such as a lower price and new improvements, your agent also makes sure the open house attendees get the latest information. And one of those may come back for a second viewing and an offer.

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Real Estate Matters

Planning a summer trip consider.....

by qgregg 9. June 2014 04:11

Planning a summer trip is usually focused on what you’ll do, see and experience.  Enjoy it even more by spending a little time before you leave to make sure your home is safe while you're gone.

Consider these suggestions along with your other normal efforts:

  • Tell your neighbors you’ll be out of town and to be aware of any unusual activity.
  • Notify your alarm company .
  • Discontinue your .postal delivery
  • Use timers on interior lights to make it appear you’re home as usual.
  • Don’t make it easy for burglars by leaving messages on voice mail or posting on social networks.
  • Post on social networks about your vacation after you’ve returned.
  • Remove the hidden spare keys and give one to a trusted neighbor or friend.
  • Lock everything, double-check and set the alarm.
  • Take pictures of your belongings in case you need them.
  • Disconnect TVs and other equipment in case of unexpected power surges.
  • Adjust your thermostat.
  • Arrange for lawn care.
  • Consider disconnecting the garage door opener.
  • Put irreplaceable valuables in a safety deposit box.

 It’s nice to go out of town on a well-deserved trip and it’s always nice to get back home…especially when it is just the way you left it.

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Real Estate Matters

1031 Under Attack

by qgregg 24. April 2014 12:12
Washington Update- 1031 Under Attack ________________________________________ 1031 Exchanges have been an integral part of real estate’s recovery. Now the government is proposing to eliminate all 1031 Exchange activity. For decades, real estate investors, business owners and Fortune 500 companies have used 1031 Exchanges to defer the payment of capital gains tax and depreciation recapture tax associated with the sale of their investment properties. 1031 Exchanges also allow taxpayers to maintain or diversify their portfolios and increase their purchasing power. Any investment property or property held for productive use in a trade or business, ranging from vacant land to shopping centers, can be exchanged. The taxpayer must simply purchase new qualifying real estate and follow some basic rules to complete a tax deferred 1031 Exchange. Even though 1031 Exchanges have long been recognized as a major factor in encouraging real estate sales, as part of tax reform in separate Discussion Drafts, the House of Representatives, Senate and the President’s Budget Office have all proposed eliminating or sharply curtailing the benefits of Section 1031: 1. House Ways & Means Committee Chairman Dave Camp released a Discussion Draft of his Comprehensive Tax Reform Proposal on February 25, 2014. The Camp Proposal would repeal Code Section 1031 for like-kind exchanges occurring after 2014. 2. Senate Finance Committee Chairman Max Baucus' tax reform Discussion Draft includes a proposal to repeal Section 1031 in its entirety. The proposed repeal would apply to exchanges made in taxable years beginning after December 31, 2014. 3. President Obama’s 2015 Budget proposal also contains significant changes to IRS Code 1031. The President’s proposal does not eliminate 1031 Exchanges, but limits the amount that can be deferred to $1 million per taxpayer per year.

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