Landmark Realty Group

According to Gregory Bull with the Associated Press, average fixed-rate mortgages dropped again to record lows, giving more incentive to perspective home buyers.  Freddie Mac says the average rate on a 30-year mortgage loan fell to 3.56%, down from 3.62% two weeks ago.  It hasn’t been this low since long-term mortgages begain in the 1950′s.  Additionally, the average rate on a 15-year mortgage dropped to 2.86%.

The falling interest rates have produced a small uptick in the housing market.  Home sales were up in May from the same month last year and homebuilders started more projects.

In spite of the record low mortgage interest rates and slight increase in home sales, the housing market still remains sluggish and below healthy levels.  This could be due to the fact that the unemployment rate still remains high and many people are having a hard time qualifying for these home loans or can’t afford larger down payments required by the banks.

U.S. employers added only 80,000 jobs in June, a third straight month of weak hiring. The unemployment rate was unchanged at 8.2%, the government reported last week.

Slower job creation has caused consumers to pull back on spending.

Mortgage rates have been dropping because they tend to track the yield on the 10-year Treasury note. A weaker U.S. economy and uncertainty about how Europe will resolve its debt crisis have led investors to buy more Treasury securities, which are considered safe investments. As demand for Treasurys increase, the yield falls.

To calculate average rates, Freddie Mac surveys lenders across the country on Monday through Wednesday of each week.

The average does not include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1% of the loan amount.

The average fee for 30-year loans was 0.7 point, down from 0.8 point last week. The fee for 15-year loans also was 0.7 point, unchanged from the previous week.

The average rate on one-year adjustable rate mortgages rose to 2.69% from 2.68% last week. The fee for one-year adjustable rate loans slipped to 0.4 point, down from 0.5 point.

The average rate on five-year adjustable rate mortgages dropped to 2.74% from 2.79% last week. The fee was unchanged at 0.6 point.

According to David Wessel, at the Wallstreet Journal, Housing has passed a milestone.   David  believes  the housing market has turned and states that  the U.S. finally has moved beyond attention-grabbing predictions from housing “experts” that housing is bottoming. The numbers are now convincing.

Nearly seven years after the housing bubble burst, most indexes of house prices are bending up.  

“We finally saw some rising home prices,” S&P’s David Blitzer said a few weeks ago as he reported the first monthly increase in the slow-moving S&P/Case-Shiller house-price data after seven months of declines.

Nearly 10% more existing homes were sold in May than in the same month a year earlier, many purchased by investors who plan to rent them for now and sell them later, an important sign of an inflection point. In something of a surprise, the inventory of existing homes for sale has fallen close to the normal level of six months’ worth despite all the foreclosed homes that lenders own. The fraction of homes that are vacant is at its lowest level since 2006.

The reduced inventory of unsold homes is key, says Mark Fleming, chief economist at CoreLogic, a housing data-analysis firm. For the past couple of years, house prices have risen in the spring and then slumped; the declining supply of houses for sale is reason to believe that won’t happen again this year, he says.

Builders began work on 26% more single-family homes in May 2012 than the depressed levels of May 2011. The stock of unsold newly built homes is back to 2005 levels. In each of the past four quarters, housing construction has added to economic growth. In the first quarter, it accounted for 0.4 percentage points of the meager 1.9% growth rate.

“Even with the overall economy slowing,” Wells Fargo Securities economists said, cautiously, in a note to clients, “the budding recovery in the housing market appears to be gradually gaining momentum.”

Economists aren’t always right, but on this at least they agree: A new Wall Street Journal survey of forecasters found 44 believe the housing market has reached its bottom; only three don’t. (The full results of the Journal’s July survey will be released at 2pm ET)

Housing is still far from healthy despite the Federal Reserve’s efforts to resuscitate it by helping to push mortgage rates to extraordinary lows: 3.62% for a 30-year loan, according to Freddie Mac’s latest survey. Single-family housing starts, though up, remain 60% below the 2002 pre-bubble pace. Americans’ equity in homes is $2 trillion, or 25%, less than it was in 2002 and half what it was at the peak. More than one in every four mortgage borrowers still has a loan bigger than the value of the house, though rising home prices are reducing that fraction slowly.

Still, the upturn in housing is a milestone, a particularly welcome one amid a distressing dearth of jobs. For some time, housing has been one of the biggest causes of economic weakness. It has now—barely—moved to the plus side. “A little tail wind is a lot better than a headwind,” says economist Chip Case, the “Case” in Case-Shiller.

From here on, housing is unlikely to drag the U.S. economy down further. It will instead reflect the strength or weakness of the overall economy: The more jobs, the more confident Americans are about keeping their jobs, the more they are willing to buy houses. “Manufacturing had led growth and construction had lagged,” JPMorgan Chase economists said last week.”Now the roles are reversed: Manufacturing growth has slowed as private construction comes to life.”

Plenty could go wrong. The biggest threat is a large shadow inventory of unsold homes, homes which owners won’t put on the market because they are underwater, homes that will be foreclosed eventually and homes owned by lenders. They have been trickling onto the market, slowed in part by government efforts to delay foreclosures; a flood could reverse the recent rise in prices. Or the still-dysfunctional mortgage market could get worse. Or overly zealous regulators or a post-election change in government policy could unsettle mortgage lenders or home buyers.

But the housing bust is over.

Landmark Realty Group is proud to announce a new partnership with The Royal Shell Companies of Southwest Florida to provide its clients and customers with an even greater package of real estate services. Landmark will now be offering a full service vacation
rental and property management division to its brokerage and development group.

According to John Gittelsohn and Prashant Gopal with Bloomberg, the U.S. housing market is showing signs of stabilization as price declines ease and home demand improves, spurring several economists to call a bottom to the worst real estate collapse since the 1930s.  This is wonderful news for home sellers and Realtors across the country, but can we believe it?

Bloomberg states that Data released yesterday shows better-than-estimated new home sales and a slowdown in price declines.  However, prices may still have a way to fall because there are over 6 million homes with delinquent mortgages and/or in the foreclosures process about ready to hit the market.  To read more about this article in Bloomberg, click here.

published on Trulia.com on 12/1/2011

Today‟s home sellers have a hard row to hoe, as my Mom would say. Home values have dropped, the market is flooded with competition and even if a buyer does come along, a record high number of deals fall through. On top of that, they face the age-old conundrum of having two seemingly conflicting aims: they want to get their homes sold, fast, but also want – and need – to squeeze every single possible dollar out of it. While it‟s tempting to price your place on the high side and „test the market‟ or „negotiate down,‟ overpricing your home can actually deter buyers, cause your home to lag on the market and eventually even expose you to the risk of being perceived as desperate and receiving lowball offers. Here are 5 „cures‟ to the temptation to overprice your home, all of which can help you max out the chance that your home will sell.

1. Check the Comps! “Comps” is real estate lingo for comparable sales – the nearby, similar homes that have recently sold. You might think that your taste level, aesthetic style and home maintenance practices are vastly superior to those of your neighbors – and you might be right. But this will be the single largest purchase your home‟s eventual buyer will ever make, and trust me – they will be doing the research. The small contingent of urgent and qualified buyers who are active on today‟s market do not want to overpay for a home, and most will view your home as overpriced and not worth the hassle (or the haggle) if it is out of whack with the recent sales prices of similar homes. Similarly, appraisers will use these numbers when figuring out your home‟s value. Even if you do get an offer at a higher-than-justified price, if the buyer‟s appraiser finds that your home is overvalued compared to other nearby recent sales, it can cause major delays in your buyer‟s mortgage process – or derail it altogether. Work with your agent to find and evaluate the recent sales in the area, and to ensure that your home‟s list price makes sense vis-a-vis the comps. 2. Get inside the minds of the local home buyers. The vast majority of buyers – over 90 percent – start their house huntinhg online. And what most of them do is type in a price range, a range of bedrooms and bathrooms and a geographic area, then spend dozens of obsessive hours perusing hundreds of listings. Given the flooded market and buyers‟ busy lives, many will screen your home off their interest list in a New York minute if it seems overpriced from its online listing. If that one-inch picture and the number of beds, baths and square feet either (a) doesn‟t make it into their search results because the price is so much higher than what most local buyers want to spend on a home with those criteria, or (b) seems underwhelming, for the price, compared to the other online listings of similar homes, prospective buyers will never even make it into your home, and all your stunning staging and crave-able curb appeal will never have the opportunity to work their magic. Local agents have an inside track on what local buyers care about and what they will and will not spend. Talk to your agent about it, but don‟t forget to actually listen to and consider what your agent has to say! If you don‟t trust what an agent is telling you about where you should list your home, talk to several agents –

if the consensus is a recommended list price range lower than what you had in mind, that‟s a sign you should reconsider. Also, search for similar homes to yours on Trulia.com (Realtor.com and Zillow.com) , to see how it would stack up against similar listings online at the price range you have in mind. That‟s where local prospective buyers will see it (and screen it in or out) first.

3. Visit competing Open Houses. Buyers do not shop for homes in a vacuum. They‟re out there looking at dozens of homes – or more – to make sure they‟re (a) getting the best deal possible, and (b) not missing „the one.‟ So, while viewing a thumbnail image of your competition and seeing the list prices of other homes online is informative, it is even more useful to walk through the actual properties with which your home is competing, in living color. Before you put your home on the market, take a few hours and visit nearby Open Houses. This exercise is the most vivid way to get a reality check about what you‟re up against and what your home‟s strengths and weaknesses are compared with the other homes buyers will see, which will go a long way in getting you to the right asking price. Even if you are unpleasantly surprised at how nice the neighboring homes are at low prices, taking this information in before you list your home is much less painful than waiting months for the market to give you this education (in the form of no or uber-low offers). 4. Get an inspection – in advance. Home buyers have long used the home inspection as a negotiating tool to get the seller to come down on the sale price mid-stream. Get ahead of the game by getting your own inspection(s) – talk with your agent about which ones are appropriate – and getting the skinny on your home‟s condition before you list it. Keep in mind that you will likely need to provide any written professional inspections you obtain before listing your home to the buyer under your state‟s real estate disclosure laws. You might be able to repair some things at relatively low cost and include the recent improvements in your marketing. Alternatively, you can set and negotiate pricing based on any condition issues or needed repairs you want to pass down to the buyer. This empowers you to get to a final price that aligns with market conditions and the condition of your home without taking massive mid-escrow hits on pricing. It also empowers you to offer a discount for needed fixes up front, when the price break has the most power to help attract bargain-seeking buyers. 5. When in doubt, go low. An overpriced home, in most cases, will cause a lot more problems in your real estate journey than an underpriced one. Think about it: an overpriced home just sits on the market with little or no buyer interest until the seller cuts the price. And many interested buyers just sit, waiting for that price cut, seeing it as a cue to make an even lower offer. Now, consider the opposite end of the pricing spectrum: you start with a lower price than you want, but one that is supported by the comps in your market – or even goes a tad bit lower than recent homes have sold for. Lots of buyers are attracted to your house, in part because it looks like a great value for the price. You end up with multiple offers, which gives you the upper hand in negotiating a higher price. The moral: if you aren‟t sure about what price to place on your home, go a little bit lower than the recent comps sold for. Insiders know from experience that you‟ll sell your home faster this way – and at a better price than if you overprice it out of the gate. These steps can help you get out of your own way, get a bird‟s eye view on the market and see your home as buyers will see it. And that‟s a reality check that can make the difference between selling your home and not.

According to Colleen Hernandez, CEO of HPF – Homeownership Preservation Foundation , mortgage foreclosure scams — which seek to dupe struggling home owners with offers to save them from financial troubles — have soared nearly 60 percent this year. Furthermore, she states that scammers are increasingly using federal programs, like refinance programs such as HARP and HAMP, to try to trick home owners, reports the Homeownership Preservation Foundation (HPF), a nonprofit group that helps home owners avoid foreclosure.

“Every new government initiative spawns a slew of foreclosure avoidance scams, often from the same cast of characters doing business under various names to avoid easy detection and identification,” says Colleen.  Additionally,  “Most of these scams involve individuals supposedly offering mortgage foreclosure avoidance assistance that trained HPF counselors provide at no cost. Sadly, with most scams, no meaningful services are ever provided.”

It appears that about half of the reported scams to HPF tend to involve claims of specialized “legal services” from attorneys or individuals to help home owners avoid foreclosure.

The HPF warns that scammers also are using the HPF logo and brand to try to dupe home owners in foreclosure rescue scams.

“The only way distressed home owners can be certain they are dealing with a trained HPF counselor is by calling 888-995-HOPE,” Hernandez says.  In addition to dealing with a trained HPF counselor, it may be helpful to work with a local Realtor you know and trust when it comes to selling your home; especially if you are in a situation where you may need to have a short sale or bank foreclosure.

Source: Homeownership Preservation Foundation

Are you waiting to buy a home; but have concerns that the housing market hasn’t hit bottom?  What would you think if there was significant, undisputed data to show that buying now could well be the best time to buy?

Let’s start from a “macro-approach” as to the cause and the decline of the housing-bubble.  Without getting into finger-pointing as to “who caused what,”  the bottom line is that from 1990 (base year) to 1999 or 2000, the “gap” between the median selling price of a single family home and the median household income nationwide was relatively the same.  In other words, the trend lines were relatively parallel to each other.  Starting in 2000 the median selling price of single family homes began a dramatic upward trend, until it reached its peak in 2005-2006.  During this same period, Median Household Income Nationwide was plotting along at roughly the same rate of increase, as it did from 1990 to 1999.  This created an astronomical increase in the “gap” of the trend lines between median household income, and the median selling price of homes.

Starting in 2006, there was a gradual decrease in the median selling price of single family homes, followed by a significant drop in the median selling price from 2007 to 2009.  Again, during that period the median household income nationwide was moderately trending upward.

Finally as we entered 2010-2011, we now begin to see that the “gap” between median selling price of single family homes and median household income nationwide, back to the levels of 1993 to 1999.

The following graph depicts the gap analysis described above. 

From a “micro-perspective” the local market also shows signs of being “ripe” for buyers.  A careful look at the “moving average” selling price of all sold homes in Cashiers, S. Cullowhee, Glenville, Lake Toxaway, and Sapphire is about the same in the 4^th quarter of 2011 as it was in the 3^rd quarter of 2004.  This is due to the shift by buyers to lower priced second homes, the overall price correction of homes, and finally the sale of some foreclosed and short-sale properties.

A buyer might ask at this point, why should I buy now before “all those foreclosures and short-sales” come to market.  The fact is that we have never really had a large number of foreclosures and short-sales in our market, relative to both the number of homes listed, and when many other markets throughout the country.  As of the date of this writing, approximately 6% of all residential home listings are either Foreclosures or Short Sales.  This is very small when compared to most other markets.  And 46 of the 68 available Foreclosure and Short Sale homes combined are below the Listed Price of  $500,000.

The following graphs provide a further understanding of this market segment, in which many buyers have a great deal of interest.  However, this segment generally includes a very limited number of properties that satisfy the needs of second home buyers.

Last of all, if you’re waiting for that “special” bank-owned home that meets your needs, keep in mind that there were less than 30 Bank-Owned sales in the in Cashiers, S. Cullowhee, Glenville, Lake Toxaway, and Sapphire area in 2011.  19 homes in this category were properties that sold for $250,000 or less, and an additional 5 homes between $250,001 and $500,000.

As you can see, there is no reason to delay finding your special place in the mountains.  Start enjoying the mountain views, water recreation, golfing and/or tennis in comfortable climates, fishing, or simply becoming one with nature.  The market is right, and the interest rates are at historical lows.

When selecting a REALTOR® be reminded that any real estate agent can provide “information” but they don’t all offer knowledge.  Our goal as REALTORS® is to use our knowledge to help consumers have a positive experience while buying and/or selling real estate.  Let us help you by contacting us today at (828) 342-9972 or Frank@CashiersLife.com. 

Written by Frank J. Pimental, REALTOR®

2011 -2012 President, Highlands-Cashiers Board of REALTORS®