Archive for September, 2009
Mortgage Bankers: End Fannie and Freddie
The Mortgage Bankers Association is urging the U.S. government to replace Fannie Mae and Freddie Mac with private companies.
The Obama administration is considering a couple of options, including shutting them down or merging them into another federal agency.
The mortgage bankers would replace Fannie and Freddie with federally regulated private companies that would buy loans, sell them as bonds with their own guarantee, and pay the government for reinsurance.
Jaret Seiberg, an analyst at Washington Research Group, said in a research note that the “odds are high for enactment” for the Mortgage Bankers Association’s proposal because this would create a practical way to keep mortgage rates low.
Source: The Associated Press, Alan Zibel (09/02/2009)
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More Sellers are Turning to Rentals
More people are becoming landlords in an economy where selling a home can be challenging.
The nation’s second-largest home insurer, Allstate Corp., says the number of homeowners converting their homeowners insurance to landlord policies rose 27 percent in the first quarter of 2009.
Jim Bass of Jim Bass Real Estate Group in Frederick, Md., says he has begun offering property-management services for absent owners, many of whom are convinced it will be easier to sell in a couple of years.
Holding on probably isn’t the best answer, says economist Edward Leamer, director of the UCLA Anderson Forecast. Leamer suggests negotiating a short sale instead. “Better to take your losses and move on.”
Another factor to consider is whether renting will reduce or eliminate the value of the capital-gains tax exclusion. Federal tax law requires living in the home at least two of the previous five years to qualify for the full capital-gains tax exclusion when the house is sold. Of course, if there is no profit to be had, then this isn’t a problem.
Source: The Wall Street Journal, M.P. McQueen (09/02/2009)
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IRS Is Scrutinizing Mortgage Deductions
According to published reports, the Internal Revenue Service is more closely examining how taxpayers are reporting mortgage interest deductions.
The IRS is reportedly examining some returns with high deductions for mortgage interest and enforcing obscure rules that most home owners and many accountants could be unfamiliar with.
The calculations are very complex and rely on precise records that some home owners may have trouble producing
Experts advise home buyers who have borrowed more than $1 million in mortgages and home equity loans since 1987, the year deductibility limits were enacted, to consult a tax expert because the newest loan may not be tax deductible.
Source: Investment News Daily, Art Auerbach (08/25/2009)
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Traffic to Real Estate Web Sites Increasing
Home sales rose over the last couple of months–and so did visits to real estate Web sites.
Nielsen Online reports that traffic to real estate Web sites rose 11 percent from 20.7 million visitors in June to 23.1 million in July. Year-over-year growth from July 2008 to July 2009 was 18 percent.
The most likely visitors were people living in two-person households. This demographic was 50 percent more likely than the average Web user to visit a real estate site. Potential homebuyers between the ages of 25 and 34 were 29 percent more likely to look at a real estate site, and people with no children were 32 percent more likely.
Source: Nielsen Wire (09/01/2009)
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Jan 2010 changes are coming to RESPA
RESPA – Real Estate Settlement Procedures Act.
HUD is requiring that loan originators provide borrowers with a standard Good Faith Estimate that clearly discloses key loan terms and closing costs and that closing agents provide borrowers with a new HUD-1 settlement statement. New RESPA regulations were published November 17, 2008 and are scheduled to take full effect on January 1, 2010. The “New RESPA Rule FAQs” were comprised from industry questions and are posted to facilitate implementation of these new requirements.
Consumers
RESPA is about closing costs and settlement procedures. RESPA requires that consumers receive disclosures at various times in the transaction and outlaws kickbacks that increase the cost of settlement services. RESPA is a HUD consumer protection statute designed to help homebuyers be better shoppers in the home buying process, and is enforced by HUD.
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Real Estate Pros See Prices Stabilizing
Real estate professionals say that real estate prices will remain the same for the next six months, according to HomeGain’s quarterly survey of professional opinions.
More than 69 percent of the 1,100 practitioners surveyed by the real estate information service said they were convinced that home prices have hit bottom, down from 71 percent who held that opinion in the second quarter survey.
The survey also shows home sellers and buyers don’t see home values in the same way, a troublesome disconnect for many practitioners.
* 81 percent said the values of their clients’ homes have decreased in the last year.
* 75 percent said their clients believe their homes are worth more than the listing prices they recommended.
* 85 percent said their buyer clients were still convinced that homes for sale are overpriced.
* 71 percent said they persuaded their clients to list a property at less than what the sellers initially believed the property to be worth.
Source: HomeGain Real Estate Blog
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What Every Real Estate Agent Owes You
Who does the Real Estate Agent work for?
You say you? Maybe not! Traditionally, the Real Estate Agent worked for the ’seller’ even though they may spend all their time with you finding you the right home.
Fortunately, the situation has changed. You have a choice. Be sure to make it!
Depot’s first phase nears completion.
Just a few months into construction, the exterior of the Aiken Railroad Depot looks to be nearing completion.
Tim Simmons, chairman of the All Aboard! Campaign, said the project being built along Park Avenue near Union Street is currently in its first phase of construction. During this phase, the depot building will be finished, interactive exhibits will be installed and the exterior of two antique dining cars will be restored.
Simmons said the railroad committee is still planning for the first phase to be completed by May of next year. The depot’s grand opening will coincide with the City’s 175th anniversary celebration. Full story..
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NAR Helps Realtors Make Short Work of Short Sales.
RISMEDIA, September 1, 2009—Nearly one-third of all existing homes sold recently were either short sales or foreclosures, according to National Association of Realtors® data. To help Realtors meet the needs of home buyers and sellers who need these services, NAR has launched a new Short Sales and Foreclosure Certification Program (SFR).
“Foreclosures and short sales can offer opportunities for home buyers, but it’s extremely important to have the help of a real estate professional like a Realtor for these kinds of purchases,” said NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth. “Realtors add value to the real estate transaction with their extensive knowledge and market insights, and this new certification will help them serve a growing need.”
The SFR certification program is offered by the Real Estate Buyer’s Agent Council of NAR. The program includes training on how to manage short-sale, foreclosure, and real-estate owned transactions, and provides resources to help Realtors stay current on national and state-specific information as the market for these distressed properties evolves.
To earn the certification, Realtors must complete a one-day education program, either in-person or online, as well as three one-hour Webinars. The certification program will be offered at the REALTORS Conference & Expo in San Diego, Nov. 13-16.
“As Realtors, we believe that any family that loses their home to foreclosure is one family too many,” said McMillan. “Unfortunately, there are situations in which people just cannot afford to keep their homes. A short sale can help families protect their credit by avoiding a foreclosure. When a foreclosed or REO property is sold, it helps the surrounding community by reducing the impact of those properties on home values in the immediate area.”
For more information, visit www.realtor.org.
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Loan Volume Rises Again, Driven by Refinances
Loan application volume rose again last week, increasing 7.5 percent on a seasonally adjusted basis compared to the previous week, the Mortgage Bankers Association reported.
On an unadjusted basis, the index increased 6.3 percent and was up 34.1 percent compared with the same week a year ago. This is the fourth consecutive week mortgage application volume has risen.
The increase was driven by refinances, with the refinance index increasing 12.7 percent from the previous week. The purchase index rose 1 percent with nearly all the increase coming from applications for government loans.
Mortgage rates rose slightly but the increase didn’t seem to deter applicants:
* 30-year fixed-rate mortgages increased to 5.24 percent from 5.15 percent.
* 15-year fixed-rate mortgages increased to 4.58 percent from 4.52 percent.
* 1-year ARMs increased to 6.74 percent from 6.66 percent.
Source: Mortgage Bankers Association (08/26/2009)
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New Home Sales Surge 9.6% in July
New U.S. home sales surged 9.6 percent in July, rising for the fourth straight month
and beating expectations as the housing market shows continuing signs of rebounding from its historic downturn.
The Commerce Department said Wednesday that sales rose to a seasonally adjusted annual rate of 433,000 from an upwardly revised
June rate of 395,000. Sales are now up 32 percent from the bottom in January, but off 69 percent from the frenzied peak four years ago.
Last month’s sales pace was the strongest since September and exceeded the forecasts of economists surveyed by Thomson Reuters, who
expected a pace of 390,000 units. The last time sales rose so dramatically was in February 2005.
The median sales price of $210,100, however, was still down 11.5 percent from $237,300 compared to the same time a year ago.
There were 271,000 new homes for sale at the end of July, down more than 3 percent from May. At the current sales
pace, that represents 7.5 months of supply, the lowest since April 2007. The decline means builders have scaled back on construction to the point where supply and demand are coming into balance.
Source: Associated Press, Alan Zibel (08/26/09)
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Mortgage Delinquencies Hit Record High
Mortgage delinquencies hit a record high in June with more than 13 percent of homeowners late with at least one mortgage payment or in foreclosure, according to a report released Thursday by the Mortgage Bankers Association.
“As a sign that mortgage performance is once again being driven by unemployment, prime fixed-rate loans now account for one in three foreclosure starts. A year ago, they accounted for one in five,” says Jay Brinkmann, the association’s chief economist.
Florida is at the top of the heap with a total of 22.8 percent of all mortgages delinquent by at least one payment or in the process of foreclosure. That’s twice the national percentage if the Florida numbers are excluded. The next highest states are Nevada, 21.3 percent; Arizona, 16.3 percent; and Michigan, 15.8 percent.
“It is unlikely we will see meaningful reductions in the foreclosure and delinquency rates until the employment situation improves. In addition, in some areas where a number of borrowers have mortgages that are larger than the current value of their homes, any life events such a divorce or loss of a job are likely to translate into foreclosures until prices in those areas recover, not just flatten,” Brinkmann said.
Source: Mortgage Bankers Association (08/20/2009)
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Aiken County, Audubon pair to preserve green space.
Nearly 100 acres in the Silver Bluff Road area will never see any type of development after a deal between the landowner, Aiken County and the Silver Bluff Audubon Center and Sanctuary is finalized next month.
Aiken County Council recently voted to purchase approximately 20 acres located about one mile west from where Silver Bluff Road crosses over the CSX Railroad tracks. The land is adjacent to about 75 acres the Silver Bluff Audubon Center is buying in conjunction with the state office in Harleyville.
“It is a good mix of hardwood bottom lands and upward pine. It provides wildlife habitat,” said Paul Koehler, director of the Silver Bluff Audubon Center and Sanctuary. “This was a good opportunity to leverage a much larger purchase of green space (working together.) Without the County’s $50,000, it probably would not have been possible.”
The County’s share is coming from money set aside for open space from the one cent sales tax.
It is estimated the South Carolina Audubon Society and the Silver Bluff Audubon Center are paying roughly $215,000 total from a land acquisition account for its share.
Koehler said a conservation easement will be placed on the land, meaning it will be protected from future development in perpetuity. “This was a great opportunity for the County to preserve green space.”
The Audubon Center will lease the County’s 20 acres with a few conditions, including the stipulation that hunting not be allowed on the County’s portion.
The Silver Bluff Audubon Center plans to offer bird walks and butterfly counts on the property.
The County has been involved in similar deals before. It bought land at Boyd Park Pond (formerly the Operations Recreation Association site) and deeded land to the Aiken Land Conservancy for preservation as green space.
“This is another step in preserving a county that is growing,” said County Administrator Clay Killian.
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Some Foreclosure Buyers Feel Guilty
Foreclosure guilt is affecting some people who can afford to buy low-cost properties even though friends and family haven’t been so lucky.
As Anya Sanko who bought a foreclosure in Las Vegas says, there’s a hard-to-shake worry that “you’re capitalizing off of somebody else’s misfortune.”
Some people dismiss this as unwarranted drama, but Santa Fe psychologist Sylvia Lafair thinks that “there is a guilt of survivorship that is real.”
Lafair has provided counseling for real estate practitioners who say clients express this concern.
Lafair recommends that people ease their pain by doing something kind for those less fortunate. “My recommendation is that when you’re moving, take (your) old stuff and say, ‘Do I really need this?’ and give it to a shelter or the Salvation Army. One way to balance the guilt is to do something to be gracious,” she says.
Source: USA Today, Steve Friess
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Banks Plan to Keep Lending Tight
Banks tightened standards for all types of loans in the second quarter, the Federal Reserve reported Monday.
About 35 percent of senior loan officials said they tightened standards somewhat and none of the 51 responding banks said they loosened standards for prime mortgages. The rest said their standards for mortgages remained the same or were substantially stronger.
Banks also told the Fed that they expected to maintain strict lending standards until at least the second half of 2010.
“Most banks have woken up to the fact that there is a lot more risk in their loan books than they ever thought possible,” says Joel Conn, president of Lakeshore Capital LLC in Birmingham, Ala. That has caused many banks to reconsider their requirements for future lending, Conn says.
Source: Bloomberg, Craig Torres (08/17/2009)
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New exhibits showcased at museum in September.
September will bring a few fresh looks to the Aiken County Historical Museum as new exhibits go up on Banksia’s walls.
The museum’s main exhibit in the ballroom will be a Ladies of Aiken Polo photography exhibit, on display from Sept. 1-30. A needlepoint exhibit will be on display in the parlor throughout the month, and an art exhibit by local painter Lynn Carlisle will go up on Thursday, Sept. 10, with pieces in the ballroom, the Ladies of Aiken County room and the Winter Colony room, according to museum educator Mary White.
“The Ladies of Aiken Polo is one we wanted to do last September, since September is kind of the kickoff for polo, but we couldn’t get it together in time. So we’ve been working on this exhibit ever since,” said White.
The needlepoint exhibit is being organized by the Aiken chapter of the American Needlepoint Guild and the Aiken Stitchin’ Belles, a chapter of the Embroidery Guild of America.
Carlisle specializes in canine portraiture. The works on display in September will be private commissions on loan from their owners and not for sale, but Carlisle will be available for new portrait commissions through the show, which will remain on display through the end of September, White said.
A joint reception for all three exhibits will be held from 5 to 7 p.m. Thursday, Sept. 10, at the museum. The reception is open to the public.
The museum’s staff is also looking for a few helping hands. A two-day training session for new docents will take place from 10 a.m. to 2 p.m. Thursday and Friday at the museum; lunch will be provided both days. Thursday’s training will feature a lecture on Aiken County history by Owen Clary, while Friday will be an in-depth tour of the museum.
Those interested in signing up for docent training or with questions about the September exhibits can contact the museum staff at 642-2015.
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Strong Gain in Existing-Home Sales
For the first time in five years, existing-home sales have increased for four months in a row, according to the National Association of REALTORS®.
Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 7.2 percent to a seasonally adjusted annual rate of 5.24 million units in July from a level of 4.89 million in June. Sales are 5.0 percent above the 4.99 million-unit pace in July 2008. The last time sales rose for four consecutive months was in June 2004, and the last time sales were higher than a year earlier was November 2005.
Largest Gain in a Decade! Full Story…
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