Thursday, September 29, 2011

Some Good News for Veterans!

by Dean Hartman on September 29, 2011



It appears that (subsequent to my writing of this blog yesterday) that the House has passed a bill which the President is expected to sign which extends the current Funding Fees until November 17th. Despite the fact that the VA’s own website still states that the change is expected October 1st, that information seems to be outdated. The good news is that the change is still, by all extimations coming. It just looks like we will be waiting another six weeks! – Dean Hartman
————————————————————————————————————————————————————-
Effective   November 17, 2011, the costs associated with getting a VA mortgage are going DOWN!
An overview: VA mortgages are bundled, securitized and sold in the secondary market with the backing of the Federal Government. In order to insure these mortgages, the government charges a type of insurance premium, called a VA Funding Fee, which is typically added to the loan amount (thereby financed).
Remember, too, that the VA (subject to some restrictions) will insure loans up to 100% of the purchase price for the home.
What is happening next week? On loans that close effective November 17, that Funding Fee is being reduced. Because it is typical that the fee is financed into the loan, the VA is effectively lowering the monthly cost (because the loan amount is lower) AND the amount that will be paid back when the home is sold (again, because the loan amount is lower). It’s a win/win for the veteran.



If you have any questions about purchasing a home with a VA loan or if you already have one and are considering a refinance of it because of the low interest rates, reach out to your favorite mortgage professional and explore the possibilities. There has never been a better time!


Joe Naccarato, Broker, Realtor
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Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!


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Friday, September 23, 2011

Negative Equity: The Percentage of All Homes

by The KCM Crew on September 23, 2011



Joe Naccarato, Broker, Realtor
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Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!



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Thursday, September 22, 2011

Rates Stay Low, BUT Will Costs Go Up?


by Dean Hartman on September 22, 2011

We are enjoying extremely low interest rates, for sure. With the global economy, the national economy and unemployment where they are, no one is predicting a dramatic change in rates any time soon. BUT, on Monday, the Obama Administration floated out some interesting proposals they are considering through the Acting Director of the Federal Housing Finance Agency (FHFA), Edward DeMarco. It appears that two significant changes in housing financing are on the table.
You should know that FHFA is the new regulator that is overseeing the restoration of viability of Fannie Mae and Freddie Mac. They are charged with reducing the risk on loans delivered to the GSEs in order to protect the U.S. taxpayer.
In a speech this past Monday, Mr. DeMarco mentioned two potential changes:
Increasing the role of the private sector to lessen the risk held by the public sector.
The method mentioned was increasing the insurance coverages assumed by the PMI (Private Mortgage Insurance) companies. One result could be higher insurance rates for loans where customers put less than 20% down. The second wrinkle is potentially more damaging…the idea that PMI coverage may be required on loans with 21%-25% (maybe even 30%) down! Clearly, this is an attempt to get more fee income to the MI companies to entice them to remain viable and continue to serve those with less than 20% down. Regardless, the net result is that more people will have to pay more money for private mortgage insurance. “How much?” and “To what extent?” is yet to be defined; however, more costs to more people is bad.
Adjusting fees.
Recognize that the GSEs charge fees. Explaining what they are and why they exist is a topic for a different day. Suffice to say, today, fees are fairly standard geographically speaking. Mr. DeMarco is talking about adjusting the fees (i.e., increasing them) for areas that have proven more risky. This proposal means the hardest hit areas will have the most difficult time recovering because the increased fees always get passed on to the consumer. Rather than “spread the risk”, FHFA is talking about punishing the defenseless.
The predictable outcome of these “strategies” is higher costs to the consumer which makes buying a home more expensive. As costs go up, desire to buy goes down (as does the borrower’s ability to be approved for a mortgage).

Message: Buy sooner rather than later!


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!

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Friday, September 16, 2011

A Nation’s Strong Belief in Homeownership

by The KCM Crew on September 16, 2011



Joe Naccarato, Broker, Realtor
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Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!

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Thursday, September 15, 2011

Houses Underwater: The Tide Is About to Rise


by The KCM Crew on September 14, 2011

Two separate housing reports came out in the last week which discussed different challenges facing the current real estate market. The first was CoreLogic’s Negative Equity Report and the second was JP Morgan Chase’s Home Price Monitor. Each report delivered some difficult news. However, if you piece both reports together, we can see future challenges are in store for home values.

Negative Equity

When a home’s current value is less than the existing mortgage on that home, the house is said to be in a ‘negative equity’ situation (other terms used to describe this situation are ‘underwater’ and ‘upside down’).  The CoreLogic report stated:
“…that 10.9 million, or 22.5 percent, of all residential properties with a mortgage were in negative equity at the end of the second quarter of 2011… An additional 2.4 million borrowers had less than five percent equity, referred to as near-negative equity, in the second quarter. Together, negative equity and near-negative equity mortgages accounted for 27.5 percent of all residential properties with a mortgage nationwide.”
This is important because studies show that people in a negative equity situation are more likely to default on their mortgage payments than people who have equity in their homes.

Home Prices

Many experts believe that housing prices will soften through this winter. According to an article in HousingWire, analysts from JP Morgan Chase announced in their recent Home Price Monitor:
“Home prices could dip another 6% to 7%, before hitting rock bottom in early 2012.”

Let’s Combine the Information

The CoreLogic report said there are an additional 2.4 million households with less than 5% equity. The JP Morgan Chase report said that prices will drop another 6 to 7% in the next six months. That leaves an additional 2 million+ homes in the near future that will be faced with the decision to pay (or not pay) the mortgage payment on a house no longer worth the amount of that mortgage.

Bottom Line

History has shown that a percentage of those 2 million+ homes will enter the distressed property category as some families decide it no longer makes sense to pay their mortgage. Any increase in short sales or foreclosures will impact prices in an area.


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!

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Sunday, September 11, 2011

We Will Never Forget…

We Will Never Forget…

by Steve Harney on September 10, 2011



Joe Naccarato, Broker, Realtor
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Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!



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Friday, September 9, 2011

Why Do Families Actually Buy a Home?

by The KCM Crew on September 9, 2011



Joe Naccarato, Broker, Realtor
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Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!


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Wednesday, September 7, 2011

5 Great Reasons to Sell Your House Today


by The KCM Crew on September 6, 2011

We are often asked “Is it time to sell my home?” The answer to that question is based on what your families’ goals are. If you don’t need or want to move for a few years it might make sense to wait for the housing industry to recover and prices to appreciate. However, if you wish to move within the next six to eighteen months, it is probably better to sell sooner rather than later. Here are five reasons why:

Your House Will Get More Exposure Now Than the Winter

Housing sales usually level off in the summer and then regain momentum in September and October. The spring buyers’ market has passed. Don’t miss the early fall market. It has consistently outperformed the winter season.

Distressed Properties Will Impact Prices

Distressed properties (foreclosures and short sales) on the market will increase this fall and winter. This will put tremendous downward pressure on prices for at least the next 12-18 months. Get your home sold before they become your competition.

Mortgages Will Become More Difficult to Attain

Lending standards are continuing to tighten. There is legislation currently being considered that will make it even harder for buyers to qualify. Less demand will equate to lower prices.

It is the Perfect Time to Move-Up

With prices where they are and interest rates at all time lows, there may have never been a better time to move-up into your dream home. If you move into a more desirable home now, you will be in position to gain larger equity as prices eventually appreciate.

You Get to Move On with Your Life

Probably the most important reason to sell is so you can get on with your life. You are considering selling for a reason. Do not allow a less-than-stellar housing market prevent you from reaching your goals as an individual or as a family. Think about the reasons you are thinking about moving. Are these reasons really important to you? If you have to take less than you were originally hoping to get for your house, your family has a question to ask each other: Is the dollar difference in sales price worth putting off our plans? Only you and your family know the answer to that question.


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!
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Monday, August 29, 2011


by The KCM Crew on August 29, 2011

Last week, RealtyTrac released its Q2 2011 U.S. Foreclosure Sales Report. The report confirmed what we are hearing in the marketplace – banks are beginning to look more favorably on short sales as option to foreclosure.
The report dissected the sales of distressed properties in the second quarter of 2011. Here are several of their findings:
  • Sales of homes that were in some stage of foreclosure or bank owned accounted for 31 percent of all U.S. residential sales in the second quarter of 2011, down from nearly 36 percent of all sales in the first quarter.
  • A total of 102,407 pre-foreclosure homes (short sales) sold in the second quarter, an increase of 19 percent from the previous quarter.
  • A total of 162,680 REO homes (foreclosures) sold in the second quarter, virtually unchanged from the first quarter.
  • Short sales on average sold for a discount of 21 percent below the average sales price of non-foreclosure homes.
  • REOs on average sold at a discount of nearly 40 percent below the average sales price of non-foreclosure homes.
This could be a great sign that banks are finally realizing the advantages of short sales over foreclosures.
Bloomberg.com quoted Rick Sharga, senior vice president of RealtyTrac, in an article covering the report:
“This is a glimmer of hope that lenders are getting more realistic. It’s a win for borrowers who avoid foreclosure, buyers who get a house in better condition and banks that lose less money, which is also a win for taxpayers.”

Bottom Line

Banks are beginning to do more short sales. It is time for everyone involved to help in this endeavor. Tomorrow, we will have a short sale expert, Christopher Reale, blog on gaining the right mindset to do just that.


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!

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Friday, August 26, 2011

Discounted Competition Is About to Enter the Market

by The KCM Crew on August 26, 2011



Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!

 

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Wednesday, August 24, 2011

Shadow Inventory: Luckily, Here It Comes


by The KCM Crew on August 24, 2011

One of the biggest challenges to the housing industry throughout the rest of the year will be the increase in discounted properties coming unto the market. There is a glut of foreclosures that have been delayed by the court systems in many states while paperwork was corrected. The banks are rectifying their paperwork and processes. Now, more and more states are clearing the way for the banks to resume repossessing these properties.
As these properties find their way to the market, the prices of non-distressed properties in the region will be adversely impacted for two reasons.
  1. There are a finite number of homebuyers in any market. A portion of these buyers will purchase the distressed properties new to the market because they can get them at discounted prices.
  2. As these distressed properties sell, they will become comparable sales used by appraisers to establish value on all homes (both distressed and non-distressed) sold in the future. Since these properties are sold at a discount, they will have a negative impact on other valuations.

A Perfect Example: New Jersey

As an example, let’s look at New Jersey. According to the National Association of Realtors, New Jersey’s percentage of distressed properties to overall home sales (20%) has been less than that of many other states (30-70%). However, the reason for this is the New Jersey court system has prevented banks from foreclosing on many homes for over a year.  During that time, the months’ supply of ‘shadow inventory’ of distressed properties waiting to come to market in New Jersey has climbed to over 50 months, the largest number in the country.
Last week, New Jersey Superior Court Judge Mary Jacobson cleared the way for the top-four banks to resume foreclosures in the state. The impact this will have on the number of distressed properties can be clearly seen in these statistics reported by Housing Wire:
In October, New Jersey had the 24th highest foreclosure rate in the country, with servicers filing roughly 5,200 foreclosures that month, according to RealtyTrac. By July, the Garden State’s foreclosure rate dropped to 42nd with just 1,112 filings last month.
New Jersey serves as an example for many states that will see a dramatic increase in the number of distressed properties coming to the market in the fourth quarter of 2011 and the first quarter of 2012.

The Good News

The housing market will not recover until we clear this shadow inventory. The speed at which these properties come to market and are sold will determine the speed at which the housing market recovers. The latest S&P Shadow Inventory Report shows that the months of shadow inventory already is decreasing. The report explains that the number of families falling 90 days behind on their mortgages has decreased dramatically. That means that as we clear these distressed properties there will be much less of a backfill. The end to the housing crisis is finally within sight.

Bottom Line

If you are thinking of selling your home in the next twelve months, selling sooner rather than later will probably get you the higher price. However, in 18-24 months, the market will return to historic appreciation norms.


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!

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Friday, August 19, 2011

Homeownership: Why Wait?

by The KCM Crew on August 19, 2011




Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!
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Thursday, August 18, 2011

Home Ownership Trumps Renting in 74% of Cities, Survey Says


Daily Real Estate News | Wednesday, August 17, 2011

Low interest rates and falling home values have made home ownership make more financial sense than renting in most major cities, according to Trulia’s Summer Rent vs. Buy Index.
Trulia found that buying a home is cheaper than renting in 74 percent of the country’s 50 largest cities. Trulia compared the cost of buying and renting a two-bedroom apartment, condo, or townhouse in the nation’s 50 largest cities.
Buying a home particularly in cities plagued by foreclosures proves to be much cheaper than renting, according to Trulia. Below are the top five places where buying beats renting by the most, as well as the few cities where renting may make more sense.
Top 5 Cities Where Buying Beats Renting
1. Las Vegas
2. Detroit
3. Mesa, Ariz.
4. Fresno, Calif.
5. Arlington, Texas
Top 5 Cities Where Renting is Cheaper Than Buying
1. New York
2. Fort Worth, Texas
3. Omaha, Neb.
4. Seattle, Wash.
5. San Francisco, Calif.
Source: “Home Ownership Beats Renting in 74 Percent of Major U.S. Cities,” Trulia (Aug. 16, 2011)


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!




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Wednesday, August 17, 2011


by The KCM Crew on August 16, 2011

Yesterday, Fannie Mae released their National Housing Survey for the second quarter of 2011. They survey the American public on a multitude of questions concerning today’s housing market. Each quarter, we like to pull out some of the findings we deem most interesting. Here they are for the most recent report:

Most Important Reasons to Buy a Home

When we talk about homeownership today, it seems that the financial aspects always jump to the front of the discussion. However, the study shows that the four major reasons a person buys a home have nothing to do with money. The top four reasons, in order, are:
  • It means having a good place to raise children and provide them with a good education
  • You have a physical structure where you and your family feel safe
  • It allows you to have more space for your family
  • It gives you control of what you do with your living space (renovations and updates)

The Home as an Investment

Though most people purchase a home for non-financial reasons, everyone realizes there is a money component to homeownership. Here is what they said on this issue:
  • 65% of the general population (and 67% of homeowners) believe that homeownership is a ‘safe’ investment.
  • 56% believe that homeownership has more potential as an investment than any other traditional asset class.
  • 69% think that now is a good time to buy a home (this number has increased in each of the last two quarters)

Rent vs. Buy

We are always interested in the difference people see in renting vs. owning.
  • 63% of renters have aspirations to someday own their own home
  • 72% of renters think that owning is superior to renting
  • 95% of homeowners see homeownership as a positive experience (4% see it as a negative experience) while 82% of renters see renting as a positive experience (17% see it as a negative experience)
  • 96% of homeowners live in a single family residence while 46% of renters live in a multi-unit building

Bottom Line

Even in difficult times, Americans still realize the value of homeownership.


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!

 

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Friday, August 12, 2011

Do What He Did, Not What He Said


by The KCM Crew on August 12, 2011



Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!
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Wednesday, August 10, 2011

House Prices: Explaining the Recent Uptick

by The KCM Crew on August 10, 2011



Several pricing indices have reported that, on a month-over-month basis, home values have ticked up slightly over the last quarter. This has caused some to call the bottom to the housing market – at least from a price standpoint. We must realize that prices are determined by supply and demand.
Demand has indeed shown improvement in many parts of the country. However, the supply side of the formula is being impacted by legal issues. The number of foreclosures coming to market has been slowed dramatically by the courts as the banks still struggle with improperly filed paperwork. This inventory will eventually find its way to the market and again put downward pressure on values.
Here is a chart showing the challenge:

Bottom Line

If you are selling, there currently is a window of opportunity to get your best price before the distressed properties are released.


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!

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Tuesday, August 9, 2011

FSBO a No Go!


by The KCM Crew on August 9, 2011

This blog prides itself on the quality of real estate information we deliver each and every day. We try to gather empirical evidence to validate the positions we take. We do not use just an anecdotal story to make a point. We also do not get caught up in the sensationalism of the moment. However, today will be different.
We can’t resist commenting on the story which recently appeared in the Wall Street Journal regarding Colby Sambrotto, the founder and former CEO of forsalebyowner.com. It seems the founding father and lifelong evangelist of the concept of selling your home without a real estate agent was forced to hire a broker to sell his home after failing at what he preaches others should do.
After failing to sell his NYC apartment on his own as a For Sale By Owner (FSBO), Sambrotto hired a broker and paid a 6% commission in order to get the job done. His personal experience helps refute some of the myths Sambrotto has been espousing for over a decade. Let’s look at two of those myths:

Myth #1 – You Will Pocket More Money Selling on Your Own

Most FSBO sites say you can save the commission by selling on your own. What happened in Sambrotto’s sale?
From the WSJ article:
“The broker, Jesse Buckler, said he told Mr. Sambrotto the apartment in the Lion’s Head building on West 19th Street near Sixth Avenue was priced too low and wasn’t drawing the right buyers.
By May, it went into contract, he said, after attracting multiple offers. It closed in the last few days for $150,000 more than the original asking price.”

Myth #2 – The Internet Alone Can Sell Your Home

Many have said that, with the introduction of home search on the internet, hiring an agent is no longer a necessity. What happened to the FSBO guru when he attempted to only depend on the internet?
From the WSJ article:
“Looking to move his family to the suburbs, [Mr. Sambrotto] said he carefully staged his apartment for sale himself, and put it on the market. But after using a mix of websites to publicize his apartment, he said he had only ‘middling success’ and switched to a broker because many buyers were so reliant on brokers.”

Bottom Line

There is a reason the real estate industry has been around for centuries: it performs a valuable service.


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!
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Monday, August 8, 2011

Will the S&P Downgrade Affect Interest Rates?

Daily Real Estate News | Monday, August 08, 2011

Standard & Poor downgraded the U.S.'s credit rating on Friday, despite Congress reaching a deal in the final hours on the debt ceiling crisis last week. And now many of your customers may be asking: What does this mean for interest rates?
“The impact on your wallet of the Standard & Poor's downgrade of the nation's credit rating is similar to what would happen if your own credit score declined: The cost of borrowing money is likely to go up,” the Washington Post explained in the aftermath of S&P’s decision.
S&P downgraded the U.S.'s top-notch AAA credit rating for the first time in history, moving it down one notch to AA+; the rating reflects a downgrade in S&P’s confidence in the U.S. government’s ability to repay its debts over time. It’s not clear, however, whether S&P’s downgrade will instantly effect rates, analysts say.
The 10-year Treasury note is considered the basis for all other interest rates. And “the downgrade could increase the yields on those bonds, forcing the government to spend more to borrow the same amount of money,” the Washington Post article notes. “Many consumer loans, such as mortgages, are linked to the yield on Treasurys and therefore would also rise.”


Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!
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Saturday, August 6, 2011

The Cycle of Investments

by The KCM Crew on August 5, 2011



Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!
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Friday, July 29, 2011

Why You Need a Good Negotiator in Today’s Market

by The KCM Crew on July 29, 2011





Joe Naccarato, Broker, Realtor
Top Performer Award Recipient 
Allen Tate Realtors
Tel. 704.953.0183
Do you know someone buying or selling anywhere? I can help them! Please give them my phone number!


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