Sellers Need to Get Practical About Price

Sellers whose homes have lingered on the market for months--or years, in some cases--are banking on this spring to turn the tide.

Foreclosures and short sales are still flooding the market, which means many sellers are still up against big inventories and some big bargains that may pull away buyers.

As such, more real estate pros say it’s time to have tough conversations with sellers about slashing their sales price of their home, particularly if it hasn’t garnered any traffic in recent months or years. After all, spring usually brings out more buyers, as home shoppers look to buy and move before the next school year.

"We have had a problem with sellers who are nostalgic for the way it was," says Ron Phipps, a Warwick, R.I., real estate professional and the president of the National Association of REALTORS®. He says what home owners could fetch for their home during the housing boom is not practical today. "You have to be where the market is, not where it was," Phipps says.

Phipps suggests encouraging sellers to check out the competition by visiting open houses or viewing online virtual tours of similar homes for sale to see how the seller’s house compares in price and appearance.

"You have to be very realistic about what is keeping your home from selling," Phipps says. "Sometimes it may actually be the person in the mirror, if your expectations are not realistic. Ultimately, there is a price at which all things sell."

Foreign buyers are turning to the U.S. to buy “trophy properties

Foreign buyers are turning to the U.S. to buy “trophy properties,” according to a recent Wall Street Journal blog which added that demand is so strong, leading real estate website Realtor.com plans to add features, including a translation service, to help the influx of international buyers find real estate.



“They’re feeling that investing in U.S. real estate right now may be a more stable option than investing in their home countries,” Julie Reynolds, a Realtor.com spokesperson said.



Reynolds cited a National Association of Realtors survey that showed that 55% of foreign buyers paid cash in 2009, compared with about 8% of overall respondents.



In her WSJ blog, S. Mitra Kalita concluded that, “Given the shaky state of some markets and a still-tight lending environment, real-estate agents say the rush to market to foreign buyers only makes good business sense.”



And the National Association of Realtors findings back her up: It reported that between April 2009 and March 31, 2010, $66 billion of residential property — 7 percent of the total U.S. residential market — was sold to foreign nationals, recent immigrants and temporary visa holders.



“We have definitely seen an increase in international clients this year,” said Miami realtor, Ines Hegedus-Garcia. “What’s exciting is the fact that they are not interested in just single residential properties, but multiple properties as well as commercial and industrial. They are savvy cash buyers who do their homework and pull the trigger fast once the numbers make sense.”



On Realtor.com, traffic from countries in Western Europe, the Middle East, South America, and Asia has increased by more than 50% over the past two years with the foreigners targeting properties in Florida, California, Arizona, Texas, Georgia, New York, and Nevada.



At a local level, Realtors have also noticed the surge of interest from abroad: Last year 28% of them reported working with at least one international client in the previous year (2009 – 2010), up from 23% in 2008.



Here’s how the foreign interest in U.S. property breaks down: Canadians have make up the bulk of international buyers during the past 3 years; Mexicans the fastest growing; and buyers from the UK, stung by their own housing market collapse, have posted the steepest decline.



About 50 percent of international homebuyers said they wanted to move here and make the homes their primary residences; 25 percent bought vacation homes for their own use; 14% were bought residential rentals for investment; and another 14% said they wanted their purchases to double as their own vacation home and a rental.







Read more: International Buyers Bullish on U.S. Real Estate
REALTOR.com® Blogs

64% report that they feel housing is a ‘safe investment’

* NAR revised the ‘pending home sales’ data DOWN..2.8% for Jan and 1.5% year over year. This is an important statistic to follow because its a clear indication what direction the market is headed. Few pendings = fewer closings = more price drops = more underwater owners = more distressed sellers who will need to see via a short sale to avoid a foreclosure. Watch the FREE Agent Short Sale Secrets video and download the FREE Short Sale training guide now.



* Fannie Mae reports results from a recent survey: 64% report that they feel housing is a ‘safe investment’….that is actually a slight improvement over this time last year.

http://timandjulieharris.com/2011/02/28/fannie-mae-reports-64-feel-housing-is-a-safe-investment-nar-pending-home-sales-data/

Seven Reasons Why NOW is the Best Time in Years to Buy a Home

Seven  Reasons Why NOW is the Best Time in Years to Buy a Home
1. Home affordability is at an all-time high.
The median mortgage payment on the median priced home as a percentage of the median household income is lower than it's been in a generation.
2. Mortgage rates have reached rock bottom, and may go up soon.
As interest rates start to inch back upwards, monthly payments and total loan costs will spike upwards.
3. Buy Now; Buy Low!
After declining nearly three years, home prices are stabilizing in most markets.
4. Sellers are motivated.
This means that buyers have the upper hand! From banks looking to dispose of foreclosed properties to homeowners who are fiercely competing among an excess of housing inventory, buyers have untold choices and negotiating power.
5. Financing is readily available for qualified buyers!
Banks are getting back in the game and ready to lend to well-qualified buyers.
6. Owning vs. renting is increasingly favorable.
Since 2009, the average principal and interest payment has fallen below the average rental rates, and the gap is now wider than it's been in the past 22 years.
7. Homeownership is at the core of the American Dream!
Owning a home is critical to financial stability and wealth building. It's a forced savings account, a place to live and a fabulous tax deduction.

The American people are tired of how Washington keeps taking away their benefits to help with their over spending.

The American people are tired of how Washington keeps taking away their benefits to help with their over spending. Many national home owners rights groups are starting to mobilize as The Obama administration officially unveiled it's plan to remake the mortgage market and reduce the government's role in housing finance by shutting down government backed mortgages.


The “white paper" outlines steps the Obama says will help draw private money back into the mortgage market.

"We are going to start the process of reform now, but we are going to do it responsibly and carefully so that we support the recovery and the process of repair of the housing market," Treasury Secretary Tim Geithner said in a statement.

The government-sponsored enterprises of Fannie and Freddie backs home loans, and converts them into assets that can be sold to investors. They stand behind the vast majority of mortgages in the United States. In the past these institutions were traded publicly, they were taken over by the government in late 2008.

Part of the white house’s plan is to eliminate home owner tax deductions for what they consider the wealthiest Americans, which is those with adjusted incomes of over $170,000 vs. the $250,000 they had previously spoke about. The fear is that they start here and then whittle away all deductions. It seems simpler that if they are going to do that, than a flat tax or a Universal tax may be fairer. Only time will tell where this issue will end up and how much it will cost the tax payers.

http://money.cnn.com/2011/02/11/news/companies/fannie_mae_freddie_mac_white_house_proposal/index.htm

Home Buyers who need to finance shouldn't wait to long, sadly rates are on the rise.

Buyers who need to finance shouldn't wait to long, rates are on the rise. If you aren't one of lucky ones who have cash to purchase, then it is now time to leap off  the fence. It seems that new money to purchase a home is now rising above the record lows we have enjoyed the last couple of years. As these rates go up the amount in monthly payment go up also. Right now many families are able to purchase a home less than what a similar home can rent for on the same street. It seems the waiting is over. Although we may still see some prices adjust a little lower in some markets the real risk is in inflation and the rise in interest rates which will affect the monhtly payment for 30 YEARS.

http://realestateinvestordaily.com/market-information-news/home-purchase-mortgage-applications-decrease-interest-rates-on-the-rise-2/

Cash sales are on the rise in Florida

We are seeing alot more investors leaving the sidelines and joining in the the greatest buyer opportunity in the last  20 years. Although we have seen some big down turns in many, if not all markets, the investors flush with cash are starting to take advantage of this part of the housing cycle. Usually in a down market there are more cash sales. This is certainly the case this time around.
Cash buyers demand a discount off the listing price, and many times they will get it.

Cities in Florida, Cal, and Las Vegas are seeing the largest increase in cash transactions.

Many Florida Realtors feel this will continue as the market travels through this part of the cycle.

http://www.floridarealtors.org/NewsAndEvents/article.cfm?id=254435

Should You Buy a New or Old House?

 Should You Buy a New or Old House?

One of the biggest decisions that a prospective home buyer must make is the decision of whether to buy a new home or an old home. Both approaches have their advantages and disadvantages, and the decision will be affected by the buyer's personal circumstances.

Buy an old home

On the one hand, an older house is likely to need at least some repairs. Things like the roof, septic system, carpet, woodwork and other items may need to be replaced now or soon in the future. On the other hand, construction quality on a well built older home is often better than it is on a comparable new home.

Of course, it pays to have any home thoroughly examined by a certified home inspector prior to purchase. Even a new home can have problems, and a good, thorough inspection is definitely a must whether you are buying a new or old house. Be sure to get any problems found put in writing immediately and presented to the seller of the home. The problems uncovered by a home inspection can be used as negotiating points when settling on the purchase price of the home. If the seller agrees to repair the items uncovered by the home inspection prior to purchase, be sure to get those promises in writing and to follow up with the seller prior to the closing date.

Buying an old house can allow the home buyer, especially a first time home buyer, to purchase a larger or more luxurious home than he or she may be able to purchase new. In addition, many buyers prefer the distinct character and storied history of an old house to the cookie cutter approach of many new homes.

If you decide to purchase an old house in a historic district, however, there may be local ordinances which limit what you can do to the home. Owners of historic homes are often restricted from changing the outside appearance of the home, including such things as painting, window styles and certain landscaping. A good real estate agent will be able to apprise you of any restrictions that come with your old house.

Buy a new house

If you decide that a new home is the right move, it is imperative to examine the history and reputation of builder and the developer. If you are buying a new home in an existing development, talk to the homeowners who already live their and get their feedback. Honest feedback is your best tool when searching for a new home. If the home you are considering is in a brand new development, seek out other developments that the builder has done. Talk to those homeowners and get their views on the quality of the construction and the nature of the neighborhood. This type of information can be of great assistance when seeking your new home.

Whether you decide to buy a new home or an old house, the decision to purchase a home in the first place is the most important decision of all. A home is a great investment as well as a roof over your head. Finding the best home at the best price will ensure that your investment continues to appreciate year after year.

How to Buy a Foreclosed Home | eHow.com

1. See How to Buy a House and How to Buy and Sell a Fixer-Upper.
    
2. Understand that foreclosure means that because a home owner has become unable to pay the mortgage, the lender takes back the property. The legal steps involved differ from state to state.
   
3. Investigate the advantages. Since a bank or other lender wants to recover as much of its investment as quickly as possible, foreclosed homes are often unloaded at significant discounts-- upwards of 30 percent or more.
   
4. Find an agent experienced in foreclosures. Some sellers won't accept offers from unrepresented buyers.
   
5. Search for foreclosure listings in real estate magazines, newsletters, newspapers and Internet search engines. Call lenders for real estate owned (REO) properties lists of foreclosures. Government agencies such as Fannie Mae (fanniemae.com) and the Department of Housing and Urban Development (hud.gov) also advertise foreclosed homes for sale. Check public records for other leads. A lender deciding to foreclose must file a notice of default in the local county clerk's office.
   
6. Tour the property and inspect it as closely as possible. Some foreclosures--unlike fixer-uppers--are in fairly good shape. Others may be behind in maintenance.
   
7. Have your agent check nearby or comparable homes to see if the asking price for a foreclosed home is, in fact, a bargain.
   
8. Check your credit report and correct any defaults or outdated information. Get prequalified for a mortgage (see How to Shop for a Mortgage). Depending on the agency handling the sale, it may be required.
   
9. Find out if there is a listing broker and make an offer.
   
10. Check to see if a foreclosed home has any liens on it, such as unpaid property taxes. Find out who is liable for those costs.
    
11. Have the home inspected if the seller allows. Some sellers include this as part of the sales agreement, but the buyer still pays for it.
    
12. Be prepared to deal with more paperwork with a foreclosure than you would with a conventional purchase, particularly when a government agency is involved.

Tips & Warnings

• Find out how foreclosure works in your state. Procedures and legal requirements differ, so get a sense of how soon you can go after a home that appeals to you.
• Be particularly aggressive in negotiating with a bank. They're very keen to sell a foreclosed home fast, as it's just sitting on their books doing nothing.
• HUD and other agencies often auction foreclosed homes. However, buyers are frequently unable to inspect any property before making an offer. With so little information, the higher the bid for the property, the higher the risk that you may end up with a money pit. See How to Buy a House at Auction.
• Beware that buying foreclosed property has a very low probability of success for all of the above conditions and because many people try to do it.

Read more: How to Buy a Foreclosed Home | eHow.com http://www.ehow.com/how_111013_buy-foreclosed-home.html#ixzz16jPaLoAm

Why Should I buy a house?

Why should I buy a house?
So often I hear people ask this question. The answer to this question is so personal that one answer won't fit all. The normal thinking is multiplier of monthly rent and total sales price. Usually 12 months rent divided by the total price of the home and a smaller percentage around 6 or so better too buy and higher percentage like 9% not as good an idea to purchase. Well this is true in most cases it doesn't take in consideration things like being stable, pride of ownership planning for the long term and just wanting to raise your children in a certain school district or close to family, etc. I think that even though purchasing a home is certainlly a business decision, it is much more of a lifestyle choice.
Your Landlord will and should raise the rent as soon as the market will allow but, once you have a fixed mortgage you have a steady payment. You can also pay additional on your home and increase your equity with the plan of someday not having a house payment. In my mind we need to go back to the idea of actually owning home to raise your family not as a get rich quick scheme. I think it is time for a fundamental shift back to the way we used to look at a home purchase. The great news is prices are lower, interests are historically low, and choices are up. At this time a family can make a good long term choice and that may or may not be available in the future.