February 8th, 2010
New-home buyers responded to the tough times in 2009 by opting for smaller houses, driving down the average size of a house built in the U.S. for the first time in 27 years.
Data recently released by the National Association of Home Builders (NAHB) found the average size of a new home that was completed in 2009 fell to 2,480 squre feet from 2,520 squeare feet in 2008. The last time the average completed-home size fell by a statistically significant amount was in 1982.
Wile the small-house movement in the United States has been gaining steam for a number of years, the recession has accelerated it and home builders have responded.
Although actual square footage of homes did not fall until 2009, the percent of homes with four or more bedrooms in them has been falling since 2007, NAHB data show. And in 2009, the number of homes with three of more bathrooms fell for the first time since 1992.
Two other trends in home construction are contributing to the declining square footage: the prominence of first-time buyers in the housing market and the increasing number of households with members 55 and older who are buying homes.
Are you a buyer ready to make a move? Are you a first-time buyer or a buyer over 55 in Cardiff, Encinitas, or Carlsbad? Contact Marilyn Dashe at Sea Coast Exclusive Properties for advice.
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February 6th, 2010
If you have a good job and good credit, the next few months might be a great time to buy a house. If you wait, you may miss out on the federal tax credit, or interest rates may rise. Before you jump into the housing market, consider the following three factors:
- Low Interest Rates May Not Last: The rate on a 30-year mortgage averaged 5% last week. Rates are low in part because the Federal Reserve has been buying up about $3 trillion in mortgage-backed securities and mortgage agency debt. Their goal is to hold down interest rates and keep mortgage money available. But the Fed is slowly pulling back and has no plans to buy any more securities after March 30, 2010. And the recoverinig economy itself should raise interest rates as the year goes on. Economists at the Mortgage Bankers Association predict a 6.1% interest rate by the end of the year.
- Expiration of Home Buyers Tax Credit on April 30th: At this point, no one knows if Congress will renew this tax credit for the second time. To qualify for the credit, you must sign a purchase contract by April 30, 2010 and close by July 1, 2010. First-time buyers (those who haven’t owned a home in 3 years) get $8000, and move-up buyers get up to $6500.
- Home Prices May Be Rising: There are indications that home prices are near a bottom in some areas and may actually be rising a bit. Conditions vary by neighborhood, and data is tricky to interpret, but potential home buyers should keep an eye on what’s happening with home prices.
If you’re a home buyer on the fence, think carefully about these three factors, and perhaps you’ll get off the fence and go looking for that new home!
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February 5th, 2010
Because of falling home prices, borrowers who always paid their mortgage but who have run into unforeseen conditions, like unemployment or a job transfer, can no longer sell their homes for what they owe on their mortgage. So they are forced to sell their home as a Short Sale or Foreclosure and may get caught in a later Deficiency Judgment.
Whether banks can and will pursue judgments depends on many factors, including what state the borrower lives in and whether there’s a second mortgage or other liens on the property.
Some states, such as California, are non-recourse and don’t allow deficiency judgments. But even in these states, if the original loan was refinanced, some or all of it may be subject to deficiency claims.
Deficiency judgments on Short Sales can happen anywahere. In these cases, extinguishing the debt is often a matter of negotiating with the bank. You must ask for a written release of all debt, or you can still be liable for a judgment to be filed against you.
A real estate attorney in Florida sums it up: “People shouldn’t have a false sense of security that a deficiency judgment may not be later sought.” It’s a ticking time bomb.
Posted in Homes Foreclosure, Short Sales | No Comments »
February 4th, 2010
Mortgage experts from Bills.com, are advising consumers to consider beginning a home refinance process now. Ethan Ewing, President of Bills.com, said “Market conditions have aligned to make this a perfect environment for home refinancing. Low rates and compelling opportunities to refinance into shorter term loans have arrived at the same time as large consumer demand.
The following five factors correspond to favorable market conditions for refinancing:
- Interest rates continue to hover around all-time lows, making it sensible for anyone carrying a higher rate interest loan to consider refinancing. With some exceptions, a one-half point to a one-point drop in rate will generally make refinancing worthwhile.
- Low fixed interest rates make converting from an adjustable rate loan into a fixed 15- or 30- year loan a smart move.
- The current difference between fixed 15-year and 30-year interest rates is significant, making refinancing into a shorter-term loan a great opportunity.
- FHA efficiency mortgages provide consumers with an opportunity to refinance into a loan that will help pay for home efficiency improvements. These loans are meant to provide consumers with a way to make energy efficient improvements to their homes as part of an origination or refinancing.
- Those homeowners whose equity situation has steadily deteriorated, leaving them with little no or negative equity in their homes, should ask their lender or broker for help. Most have some flexibility with government programs aimed at reducing rates for homeowners in weak equity positions.
Ethan Ewing continues, “Anyone considering a home refinance should move quickly to lock in rates now.”
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February 3rd, 2010
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in December, 2009, increased 1% to 96.6 from 95.6 in November, and remains 10.9% above December 2008.
The NAR chief economist said it’s important to recognize how the first-time buyers and repeat-buyers tax credit is skewing market data. “There are easily understood swings in contract activity as buyers respond to a tax credit that was due to expire and was then extended and expanded. These swings are masking the underlying trend which is a broad improvement over year-ago levels. December activity was the fifth highest monthly tally in two years.
Buyers who have a contract in place to purchase a primary residence by April 30,2010 have until June 30,2010 to finalize the transaction to qualify for a tax credit of up to $8000 for first-time buyers and up to $6500 for repeat buyers.
The economist project the extended and expanded tax credit will encourage 2.4 million households to take the credit in 2010. He added that one of the greatest benefits of rising ssales will be firming home prices.
Posted in My Real Estate Blog | No Comments »
February 1st, 2010
Century 21 Sea Coast, a real estate firm serving North County San Diego for 25 years, is leaving the Century 21 franchise on Feb. 1, 2010 and going independent. On February 1st, the company will be renamed Sea Coast Exclusive Properties and will continue serving the North County area.
Broker Mike Evans believes that the new independent status will allow the company to spend all of its marketing dollars locally and be able to provide an even stronger local presence in the area. Sea Coast Exclusive Properties will continue to upgrade its website, www.sdseacoast.com, and will expand its print advertising to include weekly ads in the The Coast News, and weekend advertising in the San Diego Union Tribune.
Marilyn Dashe, realtor with the company for the past 6 years, is excited about the change and the chance to develop and grow the company. The potential for growth into new areas is great.
If you are thinking about buying or selling property in Cardiff, Encinitas, Carlsbad, or Vista, call Sea Coast Exclusive Properties. Their motto is: “Relax…We’ll Handle the Details.” And it works!
Posted in Cardiff Real Estate, Carlsbad Real Estate, Encinitas Real Estate | No Comments »
February 1st, 2010
The Federal Reserve Bank voted to keep interest rates at near zero for an extended period. Even though there was some discord over approving Chairman Ben Bernanke for a second term, Bernanke was finally approved at the end of the week.
But for the first time in a year, the committee had one dissenting vote, Thomas M. Hoenig, President of the Federal Reserve Bank in Kansas City. He voted against keeping the rate at near zero claiming that economic and financial conditions had improved enough that to extend the period was unwarranted.
Analysts are interpreting the “extended period” to be at least six months, but of course, no one knows for sure. Most economists are forecasting that the Fed will probably begin to raise the rate late in 2010 at the earliest.
The Fed funds rate is the basis for the prime rate, currently at 3.25%, which is used for setting credit card rates, home equity rates, and rates for auto loans.
In their recent statement, the Fed removed the language which it had retained for some time that economic activity was likely to remain weak, instead replacint it with a note of cautious optimism that “economic recorety is likely to be moderate for a time.”
Posted in Mortgages | No Comments »
January 29th, 2010
If you are a buyer in Cardiff, Encinitas, Carlsbad, or Vista, you may want to think about moving fast to look for a property while interest rates are still historically low. According to the California Association of Realtors, mortgage rates in 2010 are expected to rise. Early in 2009, the Federal Reserve announced plans to purchase debt and mortgage-backed securities from Fannie Mae and Freddie Mac to help lower interest rates for consumers and spur homebuying. As a result, rates on 30-year fixed rate mortgages fell to the historic lows we are still seeing today. However, the Fed’s asset purchase program is scheduled to expire at the end of the first quarter of 2010, and a lack of private demand for mortgage-backed securities could lead to a rise in rates.
Besides the rise in rates, buyers must also be aware that no-down-payment loans are practically non-existent right now. If not, most lenders require borrowers to put down at least 10 percent, if not more, to secure a loan. These down payments protect the lender and are also beneficial to the buyers. The higher the down payment, the lower the loan amount and the lower the monthly payment.
So, now is the time if you are a buyer who is thinking about buying a property. Interest rates are low, and there is still an $8000 federal tax credit in place for first-time buyers, and a $6500 federal tax credit for move-up buyers. Think about buying now!
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January 28th, 2010
A survey of consumers and builders, conducted in 2009 by the National Association of HomeBuilders, has yielded a new round of data about housing preferences of the 55+ buyers. This data analysis compared the preferences of the 55 to 64-year-old age group to those of the 65+ age group.
The data showed a strong similarity between the two groups with some exceptions. The younger age group were more interested in technology features while the older group was more interested in a single-story floor plan, and a variety of universal design features.
One surprising result was that the younger group said they want services like home maintenance and repair as part of their next home purchase, along with services usually connected with older homeowners such as housekeeping, onsite health care, and transportation.
All of the services mentioned were more important than the desire for organized social activities.
The chair of the National Association of Home Builders commented on the findings: “Most buyers in this market are looking for an easy-living lifestyle. They would like access to services that will free up their time from inside and outside home maintenance.
The share of households looking for lower-maintenance houseing is growinig larger as baby boomers enter the market for these age groups. And the current financial situation in the country has led to sharply decreased construction of communities that serve these older age groups. Without a change in the availability of capital for development and construction. there could be a shortage of housing for these buyers.
Posted in Buyers, Over-55 Buyers | No Comments »
January 26th, 2010
Buildin activity in Ssan Diego County sank to its lowest level on record in 2009, but there was an unexpected increase in December that may signify better things to come in 2010.
According to the San Diego Union Tribune, the Construction Industry Research Board in Burbank reported that 2,989 housing units werre authorized in 2009, down 42 percent from 2008, and a fraction of the boom level of 18,314 in 2003. 2009 was the slowest year on record since the 1940’s.
However, December permits more than doubled to 285 units from a level of 137 units a year ago. This increase was due to more building of single-family homes. It was also an improvement over the 149 units approved in November.
Of all the cities in San Diego County, only three — El Cajon, Oceanside, and San Marcos — issued more permits than in 2008.
The Chief Executive of the San Diego County Building Industry Association said that even if there is improvment this year, it will not represent much of a turnaround. “We have come to the conclusion that the worst is behind us — it can’t get worse,” he said.
Posted in San Diego County | No Comments »