Archive for March, 2010
Evaluate Your Yard for a Patio
Tuesday, March 30th, 2010 | Home Improvements | No Comments
When planning a future patio, make sure to envision furniture and
other amenities so you’ll end up with a patio big enough to enjoy.
(Image: Long® Fence/Washington DC)
If you love the great outdoors, you’re not alone. Outdoor living is one of the fastest-growing segments of the remodeling market. In fact, the entire “outdoor leisure lifestyle” industry is now a $6.2 billion business—up 5.4% since 2002, according to statistics from the Hearth, Patio & Barbecue Association.
One reason that outdoor living is so popular is that it expands living area at minimal cost. Leading the way to this low-cost pursuit of leisure is the patio. With new home construction costs averaging $95 per square foot, and decks coming in around $33 per square foot, an all-brick patio averages only about $15 per square foot.
In addition to helping expand usable square footage, patios add to the salability and curb appeal of your property, according to the American Society of Landscape Professionals. An attractive and functional landscape that complements the home and adds function increases value, too.
Mack Strickland of Strickland Appraisal Services, Inc., in Chester, Va., pegs patio recovery costs at anywhere from 30% to 60%, depending on the region of the country and material choices. “In general, the less elaborate and costly the improvement, the better your return on investment,” he says. (Written by Andrea Nordstrom Caughey)
3 Reasons Why Those Who Don’t Buy Now Might Regret It Later
Friday, March 26th, 2010 | Home Buying, Market News | No Comments
RISMEDIA, March 24, 2010—Buying a home is one of the biggest decisions an individual can make. So it’s understandable that one considering a home purchase may take their time to avoid rushing into such a large financial commitment. However, several factors might leave prospective home buyers who don’t purchase a property now wishing they had taken action sooner.
“Current market conditions have created a perfect storm of sorts that has made it an ideal time to purchase for first-time and trade-up buyers alike,” said James M. Weichert, president and founder of Weichert, Realtors. “Those who have the means and the desire to buy now but don’t, aren’t likely to see such a great opportunity again anytime soon.”
Specifically, Weichert offered three reasons why those who aren’t under contract to purchase a new home by April 30, 2010 might regret it.
1. They won’t receive a sizeable amount of money from Uncle Sam.
For the past two years, the federal government has offered a home buyer tax credit to help stimulate the economy. But that financial incentive is set to expire soon. First-time buyers who aren’t under contract to purchase a home by April 30, 2010 will leave the $8,000 that is available to them through the tax credit on the table. Meanwhile, repeat buyers will miss out on the opportunity to collect up to $6,500 from the government.
2. They might not lock-in on the historically-low interest rates.
Thanks to measures taken by the Federal Reserve including the purchasing of mortgage-backed securities, interest rates have remained historically-low for several years. With the economy beginning to show signs of recovery, it is widely believed that the government will soon put an end to these stimulus efforts.
If that happens, many economists believe we will begin to see a sharp increase in interest rates which could result in a much higher monthly payment for those who wait. For example, an interest rate increase of 1% on a 30-year fixed mortgage of $300,000 could cost a buyer $188 more a month or $67,000 more over the span of the entire loan.
3. They might miss out on record home price affordability.
Home price affordability is at its most optimal level in decades. As a result, those who wait to buy will likely pay more for the home they purchase than what that same home would cost right now. In fact, home prices have already begun to rise slightly in some markets. Instead of getting a better bargain, waiting to buy a home might net buyers a higher purchase price, less appreciation and less house for their buck.
“There is no time to waste for anyone who wants to take advantage of this great buying opportunity. Particularly for those who have a home to sell first,” added Weichert. “If you are prone to saying ‘what if’ and wondering what could have been, you will thank yourself down the road for buying now.”
Housing Market Continues Slow Improvement
Tuesday, March 23rd, 2010 | Home Buying, Home Selling, Market News | No Comments
The Dane County housing market continued its steady improvement in February over the same period in 2009. Combined single family and condo sales in February 2010 were up 21.1% (sales reported as of March 12) from the same period last year, totaling 270 single family and condominium sales, compared to 223 in February of 2009. Taken alone, single family sales were up from 169 to 199, a 17.8% increase, while condo sales were up from 54 to 71, a 31.5% increase. So far this year, total sales are up from 374 to 453, a 21.1% increase. Continuing a trend we’ve seen since the first time home buyer tax credit took effect last year, the February median sales price was down to $197,500 from $208,000 a year ago. However, we should continue to be cautious in reading too much into this, since the first time credit has skewed sales to the lower end of the price spectrum for some time now. Furthermore, the very short time period and small database provided by one month’s worth of sales are a poor guide to price performance, and medians can be volatile from one month to the next.
Interestingly (and somewhat anecdotally), the expanded tax credit which provides a $6500 credit to buyers who are already homeowners seems to be having far less impact than the first time credit did. This makes sense if you think about it. For a current homeowner, the logistics of selling their current home and move in order to receive a $6500 bonus is probably not that appealing. They are already homeowners, so unless they wanted or needed to move anyway, the credit is unlikely to cause them to act. A first time buyer, however, has a much easier time moving quickly, and can realize the dream of home ownership, which is a powerful incentive to move. The credit gives them a reason to do it now. The current homeowner has already realized the dream, and has to sell their current house to boot, so the effort/reward equation is not nearly as compelling.
The current mix of prices that have not risen for the past four years, record low interest rates, and the tax credit, make the affordability equation very attractive right now. We should expect to see accelerating sales throughout the spring. After that, we’ll be able to guage how motivating the tax credit program was this time around.
Realtor Roger ~ The “Spec” House
Friday, March 19th, 2010 | Home Buying, Home Selling, Realtor Roger | No Comments
In real estate, you have to be ready for anything and everything!
Here Roger Stauter shares one of his favorite real estate experiences. Enjoy!
A “spec home” is a new home built without a buyer in mind. The builder hopes to sell it at a profit after it is completed. Marketing of a “spec home” often involves furnishing some rooms so the house looks more attractive. A prospective buyer of a “spec home” may want to meet with the Builder to ask questions before submitting an offer.
Some year ago I had a “spec home” on Madison’s north side listed for sale. It was nicely furnished. An interested prospect wanted to meet with the Builder, so I made an appointment to meet at the house at 1:00 PM. The prospective Buyer arrived on time, we opened the door and walked into the living room…
There on the sofa was the Builder… sleeping soundly and snoring loudly. Arranged around the sofa was a formation of empty beer cans.
The prospective Buyer did not buy the house
Foreclosures drop for 2nd month in February: RealtyTrac
Thursday, March 18th, 2010 | Home Buying, Home Selling, Market News | No Comments
NEW YORK (Reuters) – U.S. mortgage foreclosure filings dropped for a second straight month in February, and notched the smallest annual increase in four years as housing-rescue efforts contained activity, a report released on Thursday showed.
Foreclosures are by far one of the biggest threats to the U.S. housing market, which remains highly vulnerable to setbacks and heavily reliant on government intervention. If foreclosures keep dropping, it will be one of the strongest signals yet the market is on the path to recovery.
Foreclosure filings — including mortgage default notices, house auctions and home repossessions by banks — were reported on 308,524 properties in February, down 2 percent from January, but still up 6 percent from the year-ago month, real estate data firm RealtyTrac said.
“The 6 percent year-over-year increase we saw in February was the smallest annual increase we’ve seen since January 2006, when we began calculating year-over-year increases, but it still marked the 50th consecutive month of year-over-year increases in foreclosure activity,” said James J. Saccacio, chief executive officer of RealtyTrac, in a statement.
Proclaiming an end to rampant foreclosures, however, is premature. Indeed, many say foreclosure prevention programs have fallen short of addressing the trend’s current drivers.
“This leveling of the foreclosure trend is not necessarily evidence that fewer homeowners are in distress and at risk for foreclosure, but rather that foreclosure prevention programs, legislation and other processing delays are in effect capping monthly foreclosure activity — albeit at a historically high level that will likely continue for an extended period,” he said.
While February’s drop may indicate that efforts to prevent foreclosure are gaining traction, the data has been volatile.
“In addition, severe winter weather appears to have temporarily slowed the processing of foreclosure records in some Northeastern and Mid-Atlantic states,” he said.
One in every 418 U.S. housing units received a foreclosure filing in February, Irvine, California-based RealtyTrac said in its February 2010 U.S. Foreclosure Market Report.
Furthermore, more than 300,000 properties received foreclosure filings for a 12th straight month, RealtyTrac said.
REOs, or real estate-owned properties, activity nationwide was down 10 percent from the previous month, but up 6 percent from February 2009; default notices were up 3 percent from the previous month, but down 3 percent from February 2009, and scheduled foreclosure auctions were down 1 percent from the previous month, but still up 16 percent from February 2009, RealtyTrac said.
High unemployment and wage cuts have hurt the ability of many home owners to pay monthly mortgage payments. Unemployment was at 9.7 percent in February, according to the Labor Department.
Many lawmakers, advocacy groups and housing experts say the government’s Home Affordable Modification Program, or HAMP, has fallen short because of its failure to adequately address negative equity or “under water” mortgages.
Negative equity has been one of the biggest banes of many home owners’ lives, making many unqualified for home loan refinancing and preventing some from selling their homes. Borrowers in negative equity are more prone to defaults and foreclosures.
SUNBELT STILL HURTING
The foreclosure rate in Nevada, once one of the hottest U.S. real estate markets, remained highest among U.S. states for the 38th straight month — despite a month-over-month drop in foreclosure activity of nearly 7 percent and a year-over-year fall of 30 percent.
One in every 102 Nevada housing units received a foreclosure filing during the month of February — more than four times the national average.
Arizona and Florida documented nearly identical foreclosure rates, with one in every 163 housing units receiving a foreclosure filing in both states in February.
Despite a nearly 21 percent drop in foreclosure activity from the previous month, Arizona’s rate was statistically slightly higher than Florida’s rate, and ranked second highest among the states. Foreclosure activity in Florida increased nearly 15 percent in February from January.
The foreclosure rate in California, the most populous U.S. state, ranked fourth highest among the states, with one in every 195 housing units receiving a foreclosure filing during the month.
Michigan’s foreclosure rate ranked fifth highest among the states, with one in every 226 housing units receiving a foreclosure filing in February.
Other states with February foreclosure rates among the nation’s top 10 were Utah, Idaho, Illinois, Georgia and Maryland, the report showed.
(Written by Julie Haviv, Reuter)
10 Important Facts about the Extended First-Time Homebuyer Credit
Wednesday, March 17th, 2010 | Home Buying | No Comments
If you are in the market for a new home, you may still be able to claim the First-Time Homebuyer Credit. Congress recently passed The Worker, Homeownership and Business Assistance Act Of 2009, extending the First-Time Homebuyer Credit and expanding who qualifies.
Here are the top 10 things the IRS wants you to know about the expanded credit and the qualifications you must meet in order to qualify for it.
- You must buy – or enter into a binding contract to buy a principal residence – on or before April 30, 2010.
- If you enter into a binding contract by April 30, 2010 you must close on the home on or before June 30, 2010.
- For qualifying purchases in 2010, you will have the option of claiming the credit on either your 2009 or 2010 return.
- A long-time resident of the same home can now qualify for a reduced credit. You can qualify for the credit if you’ve lived in the same principal residence for any five-consecutive year period during the eight-year period that ended on the date the new home is purchased and the settlement date is after November 6, 2009.
- The maximum credit for long-time residents is $6,500. However, married individuals filing separately are limited to $3,250.
- People with higher incomes can now qualify for the credit. The new law raises the income limits for homes purchased after November 6, 2009. The full credit is available to taxpayers with modified adjusted gross incomes up to $125,000, or $225,000 for joint filers.
- The IRS will issue a December 2009 revision of Form 5405 to claim this credit. The December 2009 form must be used for homes purchased after November 6, 2009 – whether the credit is claimed for 2008 or for 2009 – and for all home purchases that are claimed on 2009 returns.
- No credit is available if the purchase price of the home exceeds $800,000.
- The purchaser must be at least 18 years old on the date of purchase. For a married couple, only one spouse must meet this age requirement.
- A dependent is not eligible to claim the credit.
For more information about the expanded First-Time Homebuyer Credit, visit IRS.gov/recovery. (IRS Special Edition Tax Tip 2009-13 – www.NAR.org.)
Look Who is Getting the $8000 Tax Credit!
Friday, March 12th, 2010 | Home Buying | No Comments
Karen & Sean ~ Congrats on the new house!
Home Sales Up Again in January
Wednesday, March 10th, 2010 | Home Buying, Home Selling, Market News | No Comments
Home sales continued their move upward in January. Dane County reported 183 single family and condo sales in January, compared to 151 during January of 2009, an increase of 21%. While this sounds great, there are caveats. It’s down 18% from January of 2008, and down 45% from 2007. So, while improvement is good, we still have a way to go before we see the activity levels we were used to even a couple years ago. Furthermore, the picture is hugely confused by the effect of the federal government’s homebuyer tax credit. Closings spiked in November of 2009 when it was believed the first time credit was about to expire. December closings then plunged to levels similar to a year ago. While January sales improved a little, they were still somewhat subdued. The good news is that offer activity has picked up considerably, in part because we’re heading into the spring market, but also no doubt because the credit was extended to cover offers written by April 30 and closed by June 30 of 2010. It was also expanded to include current homeowners with some restrictions. So, we can expect feverish offer activity through April, and solid closing activity through June. The question then will be, will activity fall again, like it did in December? Only time will tell. We don’t believe there is any chance the credit will be extended again, and that is probably a good thing. The market needs to learn to stand on its own, and the distortions caused by the credit are making it difficult to assess what the true underlying level of demand really is. Our hope is that inventories, which are already getting short in the lower price ranges, will diminish through the period of high activity to the point where the market can continue on its own at a reasonable pace for the balance of the year. For now, we have to be content with the fact that activity is up, and there seems little chance that we will not exceed 2009 when all is said and done. Look for more improvement in 2011
Your Guide to Outdoor Maintenance — Midwest
Monday, March 8th, 2010 | Home Improvements | No Comments
Each spring, check your sprinkler system to make sure all parts of the yard are getting watered evenly. Image: Rain Bird Corporation
If you live in the Midwest, prevent problems & preserve the value
of your property with proactive outdoor maintenance.
http://www.houselogic.com/articles/your-guide-outdoor-maintenance-midwest/
Congrats to Nick & Nicole on their new house!
Friday, March 5th, 2010 | Home Buying | No Comments
Nick & Nicole ~ We just bought a house! 