Don Leske - Real Estate Agent | Puyallup, WA (Seattle Area)

Foreclosure Fairness Act forces dialogue between lenders and distressed homeowners

2011-07-29T12:26:00.001-07:00

There’s a new law in Town… to help you stay in your home.

Under a new Foreclosure Fairness Law beginning July 22, 2011, if you are in trouble with your mortgage on the home you occupy and you are facing a possible foreclosure, you may have the right to meet with your lender and even demand mediation to attempt a modification of your loan terms. Here is what you can expect:

If the foreclosure of your home started after July 22, you will receive a letter from your bank/lender. Before certain banks^* can foreclosure on your property, they will send you a letter inviting you to talk with them to discuss possible solutions. If you don’t get back with them, they must also try to reach you by phone.
The bank letter or phone call will advise you to call a housing counselor or attorney. You should consult your lawyer. If you do not have a lawyer or prefer to a consult a housing counselor, you may do so at no cost. You can reach a housing counselor by calling: 1-800-894-HOME (4663) If you choose not to consult a housing counselor or lawyer, you can still meet with your lender, but you cannot demand mediation. Whatever you choose, you must act quickly after you receive the letter and/or phone call from your lender. Your time to demand a meeting or mediation is very short.
A housing counselor or attorney can demand mediation.^* Mediation forces your lender to discuss your options for staying in the home. You may bring your lawyer or housing counselor to the mediation. A third party, the mediator, insures a fair discussion. You will have to share a $400 mediation fee with your bank/lender.
If a foreclosure of your property has already begun by July 22, 2011, you will not receive a letter or phone call from your bank or lender. However, you may still have a right to demand a meeting with your lender and if you contact a housing counselor or lawyer, they may still be able to demand mediation. Time is short to make the necessary demands so you should contact your lawyer or housing counselor immediately if you have already received foreclosure paperwork from your lawyer.

^*This only applies to banks or lenders that have filed at least 250 notices of default in the prior year. A list of those banks/lenders that are exempt from the law is available on the Department of Commerce website.

Find out more at the Department of Commerce website.

Quick Homeowner Updates

2011-07-21T18:37:00.000-07:00

It happens to all homeowners. Rooms that once looked fresh and contemporary have aged themselves into drabness.

For some it's an excuse to redecorate. For others it's a chore. Either way homeownership is an ever-evolving process. As one project ends, another peaks its head around the corner.

To bring your rooms current, as well as to update worn and disheveled items, consider these five room freshening tips.

1. Paint: Paint is number one on the list because it is relatively cheap and easy to do yourself. Getting a professional finish is simple, thanks to the myriad of products now on the market for do-it-yourselfers. From tape to edgers to color changing paint, you're sure to get a quality finished product. "In" colors change every few years, so be sure to do some homework on what hues are happening.

While you're at it, research zero-voc (volatile organic compound) paint before starting your project. Traditional paint leaches fumes into your home for years. Zero-voc paint, however, exposes you to fewer odors during the painting process and fewer risky fumes in the years to come. This is well worth the effort of searching out zero-voc. Olympic brand paint offers their full line of colors in zero-voc. Plus, the cost difference per gallon is minimal.

Paint does wonders for hiding dirt, wear, and tear. Bring your home into the new decade with a fresh coat!

2. Trim: The current trend is for trim to be white instead of natural wood. It is contemporary and clean. If your trimwork is in good repair, simply puttying holes, sanding scuffs, and painting can update the look. Dated trim that is too thin for your large rooms can be replaced with new baseboards. Amateur handyman can tackle this task with table and coping saws. Trim is all about getting the angle cut correctly. Already have current looking trim? Upgrade your room with crown molding. These beauties can be real show-stoppers!

3. Cabinet Hardware: From oil-rubbed bronze to beautiful vintage pieces, old is in. Hardware can easily be added to any existing cabinetry or changed to bring a new feel to a tired room. Shop in your local home improvement stores, online, and at local auctions to find the pieces that speak to you.

4. Decorative Accents: Curtains are the frame to any well-designed room. Choose colors and patterns that fit the scale of your room. Heavy curtains made from chenille or jacquard work best in large rooms with tall ceilings. Lighter weight fabrics, such as silk and chiffon, are great choices for small or airy rooms. Decorative pillows and throws are also an inexpensive way to change the accents of your room. Have a teal room but want to go contemporary? Bright is in. Don't be afraid to play with color!

5. Flooring: While flooring is not a simple fix and may require the help of a professional, it can make all the difference in a dated room. Scratched and worn wood floors should be sanded and refinished to show the natural beauty of the wood that lies beneath. Laminate wood flooring is a cheap and easy solution for budget conscious homeowners who want a clean and modern update. It can be a wonderful solution for worn out carpet.

If your rooms are looking tired, be sure to wake them up with a few new colors, paints, or accents!

Landscape Appeal Helps Sell Homes

2011-07-08T19:38:00.000-07:00

If you're like many sellers, listing your home for sale creates a challenge to keep the home show-ready at all times. That can be difficult enough.

Consider this notion, though. No matter how nice the inside is, if the outside isn't inviting, you're likely to lose prospective buyers before they ever set foot in your home. That's because in real estate, buyers often do "judge a book by its cover".

Take a good look at your home from the outside. Step across the street and decide if you think buyers would want to see more based on your home's "cover".

If you answered "yes," then your job is easy. Make sure the inside won't be disappointing to those same buyers. If your answer was "no," then you have some work to do. While many sellers may think that only interior pictures of their home posted on the Multiple Listing Service are what buyers really care about, there's more to it.

The outside can be a huge roadblock for buyers. If potential buyers pass by your home while cruising through a neighborhood and see your for sale sign, but also see a broken down gate, leaky sprinklers, cracked driveways, a lousy exterior paint job, and kids' old toys strewn across a brown lawn, they'll keep on cruising to the next home on the market.

Chances are you're busy getting the kids ready for the move, squaring away all the details for your new housing arrangement, trying to work, care for family, and still have some sort of personal time. That's a lot to handle. However, it's no excuse for not making your landscape appealing, especially when you think of the consequences. That could be not selling your home at all.

Here's a quick and tidy plan to help give your home a beautiful "cover". Remember, buyers are well-read. They will judge a home by it's exterior. And, if they're really interested in your home but the outside is a mess, they'll make sure that becomes a negotiating tool in the home-buying process.

Here are a few tips on the big exterior influencers.

Do not have unkempt lawn. It shows a lack of care for the home. If the lawn is beyond repair, pull it up and try drought-resistant landscaping. If there's a chance to revive it, a fresh-cut lawn is one way to showcase the appreciation the homeowner has had for his property. Also, note this tip from HGTV. Don't cut your lawn too short. You want to remove only a third of the blade of grass. Any lower than that "and you start stunting the grass," according to HGTV.

Clear the clutter from the porch. Sometimes the porch becomes an extension of the garage or tool shed. Kids' bicycles, toys, and people's shoes accumulates there. When buyers come to view the home, they often feel like they are intruding instead of viewing a property that they might be purchasing.

Pull the weeds and ditch the empty planter boxes. A lot of times homeowners will leave an empty planter box, intending to get some flowers for it, but somehow that doesn't happen.

Paint and fix any hardware that looks extremely worn. Nothing beats a fresh coat of paint. Yes, it's work and it costs money. That's exactly what buyers will think, which is good news for you! They'll think, "This homeowner put some TLC into this home." When you're selling your home, fresh paint is always recommended for the inside. If the outside needs it, you'll be doing yourself a huge favor and increase the chance of a higher sales price.

- Phoebe Chongchua, Realty Times

3 Types of Homes on the Market: Your Questions Answered

2011-06-17T15:47:00.001-07:00

I want to take a minute to explain that today there are 3 types of homes for sale:

1. Organic

2. Short Sale

3. REO/Bank Owned

The type makes a difference to you the buyer because each sale has a different closing time frame and closing probability. The first think you must determine is HOW SOON WOULD YOU LIKE TO BE MOVED INTO YOU HOME?

Based on your answer to the above question will determine which properties you should look at.

Let’s go over each Seller “type” of home and discuss them each.

1. Organic. This is a normal equity seller. They are typically not financially distressed. They typically are not late on their mortgage and are not facing foreclosure. This is where the current home owner wants to sell their home and they are either breaking even or they may have equity. BENEFIT: We can close the sale in typically 30-45 days. No bank approval delay. We can get an answer on your offer immediately (24hours). The condition is typically better than Short Sales or Bank owned homes.

2. Short Sale. This is where the home seller is late on their payments and may be facing Foreclosure. The listing agent lists the home at an aggressive price hoping to secure an offer. If the seller accepts the offer, the offer then has to be sent to the bank or banks and or trustee for approval. CHALLENGE: This can take 3-6 months (sometimes up to a year) to close a sale. You will have an answer from the seller immediately but the banks may take several months to approve the sale. Also the seller actually has to qualify to Short Sale their home. If the seller has too much money in the bank or makes too much money monthly at their job, they may not qualify. The condition can vary but is typically poor.

3. REO/Bank Owned. The original home owner defaulted on their loan. The bank Forecloses on the home and lists it for sale at a discounted price. BENEFITS: Typically the best buy on the block. Fast closing 15-30 days. The condition can vary but typically the homes need some work.

So I hope that helps you out in looking at homes. You must first determine when you would like to be moved in. If you have lots of time you have more options. If you have a short period of time you should consider the property types carefully.

Momentum building as home buyers respond to lower prices, favorable financing

2011-06-17T15:33:00.000-07:00

Northwest Multiple Listing Service members reported a 43 percent increase in pending sales of single family homes and condominiums during May compared to the same month a year ago. Sellers accepted offers from 7,509 buyers last month, up from the year-ago total of 5,242 pending sales.

Year-to-date pending sales are slightly under the total for the first five months of 2010 when sales were boosted by a federal tax credit. Through May 2010, Northwest MLS members had reported 35,454 mutually accepted offers; this year's total for five months is 33,612 (down about 5.5 percent).

"We're seeing a definite shift in the market – especially in the areas closer to Seattle and Bellevue," remarked OB Jacobi, president of Windermere Real Estate and a member of the Northwest MLS board of directors. "Homes that are priced aggressively are seeing a lot of competition and we're even getting reports of some homes selling before buyers can act," he stated.

Members reported 5,015 closed sales during May, about 5 percent fewer than the year-ago total of 5,290 completed transactions. For the first five months of this year, a total of 20,473 transactions have closed, which compares to 21,861 for the same five months of 2010 (down about 6.8 percent).

For the four-county Puget Sound region (King, Kitsap, Pierce and Snohomish counties), pending sales through five months are at 97.6 percent of year-ago levels, while closed sales are at 95.6 percent of year-to-date totals for 2010.

Northwest MLS reports both pending sales (mutually accepted offers) as a barometer of the most recent sales activity, and closed sales (completed transactions).

Matt Deasy, the general manager of Windermere Real Estate/East, considers the small differences between year-to-date figures for 2011 and the "tax incentive fueled market" of 2010 to be "good news."

Mike Grady, president and COO of Coldwell Banker Bain, was also upbeat in his comments about the current market. "The substantial jump in pending home sales reported today won't be surprising to the brokers working in the core urban markets of Seattle and West Bellevue," observed Grady. He also noted the increasingly strong demand for homes and falling inventory "is making for a very competitive market in those areas, with multiple offers on the best properties becoming more common."

"Low interest rates, low down payment requirements, and lower adjusted prices are attracting buyers into the market," reported J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. "We are seeing healthy sales activity close to the job centers of Seattle and Bellevue, creating a low inventory of homes for sale," he noted.

Members added 10,293 new listings to inventory during May, about 900 more than the same month a year ago for a 9.7 percent increase. Despite those additions, the selection is smaller than 12 months ago. At month end, there were 36,261 active listings of single family homes and condos in the MLS system. That's about 5,400 fewer than a year ago when inventory totaled 41,690 listings, a shrinkage of 13 percent.

"On King County's Eastside, we are seeing a decrease in the number of listings that are short sales or bank-owned properties," said Kathy Estey, managing broker of John L. Scott Bellevue Main. "Inventory of quality homes in median price ranges is low and we see multiple offers in most price ranges, including homes in the higher prices ranges. Some of the old, stale inventory has sold. However, the majority of homes are still selling for less than full price."

Jacobi said a recent review of Windermere's sales data shows that 40 percent of homes in the median price range are selling at list price and many of these buyers are paying cash. "With that being said, the market is still very price sensitive, so sellers need to continue to be realistic about the value of their home," he stated.

The median price for last month's sales system-wide was $239,999, about 11 percent less than a year ago when it was $269,950. Brokers attribute much of that price decline to the fairly high ratio (estimated at 30-40 percent in many markets) of foreclosed homes and short sales that are being sold at deep discounts.

In King County, prices slipped 8.4 percent, from $346,000 a year ago to $316,750 for last month's closed sales of single family homes and condominiums. For single family homes only (excluding condominiums), the median selling price was $345,000, down about 9 percent from the May 2010 figure of $379,000.

Grady is encouraged by the momentum. "The last few years, home sales haven't sustained much momentum without government support," he noted, adding, "This year, however, the momentum is continuing to build naturally, as we would normally expect in the spring and summer months. Remember, by this time last year we had already experienced all of the benefit of the homebuyer tax credit, and sales began to wane after that credit had expired. We see an entirely different dynamic this year."

It's obvious not all local markets are improving equally, Grady acknowledged, suggesting, "It's also obvious that the basic market forces of low supply and high demand are beginning to shift buyer or seller attitudes in many neighborhoods. That's good news for sellers, and perhaps a cautionary message to buyers as well."

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 22,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.

Curious about QR codes?

2011-06-09T14:26:00.001-07:00

A few statistics underscore the skyrocketing popularity of QR (Quick Response) codes, with real estate professionals being among those who are embracing this nifty tool.

The Nielsen Company estimates U.S. smartphone penetration will hit 50 percent by the end of 2011. New York-based eMarketer, an authority on digital marketing, media and commerce, reports there are currently 73.3 million smartphone users.

According to the new site Mashable and JumpScan:

52% of mobile users have seen or heard of QR codes; of those,
28% have scanned one. iPhone users scan by far the most, at 68% (versus 26% of Android users and 4% of Blackberry users).
QR-code scanning rose a whopping 1,200% from July to December 2010.
Companies like Starbucks are already using QR codes (as well as barcodes) to enable users to pay for their purchases via mobile. A whopping 3 million customers have already tried it.

Many of the major airlines are now using 2D codes as digital boarding passes, and by the end of 2011 all carriers will be required to provide this service for international flights, notes Jeff Korhan, an online marketing consultant/blogger, professional speaker and coach. "I tried this myself and it works like a charm," he reported, adding, "My only suggestion is to not rely on the link, but rather to save a copy of the image on your phone. You don't want to risk not being able to find a good signal when you need it most!"

SunMaid, a 99-year-old company, hopes to leverage the technology in a promotional tie-in with DreamWorks Studios and last month's debut of its animated movie Kung Fu Panda 2. Packages of its raisins are adorned with the QR code. Upon scanning it, consumers land on a mobile website where they can enter a contest for a chance to win prizes, including the grand prize VIP trip for four to the Giant Panda center at the Atlanta Zoo.

QR codes have been in use in Japan, where they were invented, for more than a decade. Denso Wave, a subsidiary of Toyota, holds the trademark, but that company is not exercising its patent rights in order to encourage widespread use. (The codes were initially used for tracking parts in automobile manufacturing.)

In some ways, QR codes are similar to barcodes. Unlike the linear one-dimension barcodes, which have a capacity of 20 numerical digits, QR codes are two-dimension matrix codes with the ability to hold thousands of alphanumeric characters of information. The information encoded can be text, URLs or other data and digital content, and the codes may appear in magazines, on signs, buses, business cards or other objects that consumers can scan to access more information.

QR codes can be scanned or read with a number of mobile devices, including iPhones, Android, BlackBerry or other camera-enabled smartphones. (See box for links to download readers and code generators.)

In an article Korhan authored on practical uses of QR Codes, his list of current and anticipated applications include:

Business cards and other stationery
Brochures and other marketing materials
Advertisements
Vehicles
Product tags and packaging
Name badges
Event ticket stubs
Point of sale displays
Coupons and special offers
Signs
Recommendations for complementary products and services
Purchase receipts
Links to installation and assembly instructions and demonstrations
Customer feedback forms
Warranties (e.g., sources for replacement parts and services)

A review of govloop.com, a social network for the government community, indicates rising use of QR codes in the public sector. Examples range from tourism (Manor, Tex., Long Beach, Wash., and Michigan Dept. of Transportation), to GSA campaigns and events, building permits (New York City), and conferences (Baltimore).

Real estate professionals are also adding the codes to their marketing arsenals. Rose Harris, a Realtor at ONE Sotheby's International Realty in Miami, told "Biz Byte" columnist Tasha Cunningham that she has been using QR codes to educate clients about the properties she sells. "We use them to drive traffic to our single listing websites," said Harris. "Our clients love them because they can simply scan the code and find out everything they need to know about a property without having to go to a computer to search for it. It's right there in the palm of their hand."

(Editor's note: Northwest Multiple Listing Service has rules governing two dimension barcodes, such as QR codes and Microsoft Tags. In general, they may be added to signs or fliers, but cannot be uploaded as listing photos.)

In an interview with Media Life Magazine, the publisher of Entertainment Weekly was asked about the future of QR codes. "They're definitely getting more traction," replied Jason Wagenheim, noting Microsoft's recent announcement that five billion of its MS Tags have been printed since their January 2009 launch. The same report indicated the number of product scans had doubled in just the past three months.

"I really feel that it's a technology that's here to stay and it will only get better, faster and allow for more interactivity, especially as we see adoption rates continue to increase," Wagenheim stated. "Like every other piece of new technology in this fast-changing market, we need more and more consumer adoption for it to be meaningful for our advertising partners, and we need our advertising partnershttp://www.blogger.com/img/blank.gif to deliver strong messaging and rewards that makes it all worth it for our consumers."

Wagenheim expects the next phase of QR code technology for Entertainment Weekly will include building out a more robust destination that includes an opportunity for users to share just-scanned codes with their social network.

READ MORE
http://www.blogger.com/img/blank.gifhttp://www.blogger.com/img/blank.gif
http://www.blogger.com/img/blank.gif
List of recommended QR-Code reading software, available for download: http://www.mobile-barcodes.com/qr-code-software/
Code generators: http://www.mobile-barcodes.com/qr-code-generator/http://www.blogger.com/img/blank.gif
"Who is Scanning QR Codes?" Considerations when producing a mobile strahttp://www.blogger.com/img/blank.giftegy. The Po!nt: Mind your QR P's and Q's: http://www.marketingprofs.com/short-articles/2271/who-is-scanning-qr-codes-heres-a-quick-update#ixzz1LCxMdWa1
20 page white paper titled "Harnessing the Power of the Mobile Web. http:http://www.blogger.com/img/blank.gif//www.knotice.com
How QR Codes Can Grow Your Business. http://www.socialmediaexaminer.com/how-qr-codes-can-grow-your-business/
10 Ways to Use QR Codes and Microsoft Tags to Attract New Customers. http://www.bizbytes101.com/
QR codes and Microsoft Tags can boost your bottom line. http://www.miamiherald.com/2011/05/30/2241785/qr-codes-and-microsoft-tags-can.html
Microsoft Tags (works on various devices). MS tags can incorporate logos and images, but require a Microsoft Tag Reader, available at: http://tag.microsoft.com/download.aspx

Copyright © 2011, Northwest Multiple Listing Service

Home sales to rise 5% in 2011, according to Freddie Mac

2011-06-09T08:15:00.001-07:00

Freddie Mac released its U.S. Economic and Housing Market Outlook showing a pick-up in economic growth in the second half of 2011 and a projected 5 percent increase in 2011 home sales over 2010, on a calendar year basis.

Other key findings from the report:

Over 250,000 new jobs are needed monthly, on a sustained basis, to reabsorb the jobs lost since the recession.
Average unemployment duration was 38.3 weeks in April, down slightly from the record of 39 weeks in March.
The rate of seriously delinquent mortgages (8.6 percent average) will likely trend lower during 2011, but will continue to remain at extraordinarily high levels for an extended period.
During the first quarter of 2011, home prices decreased by 2.8 percent nationwide.
Home buyer affordability remains extraordinarily high, mortgage rates low, house prices are well off their cyclic peak, and contract signings for existing home sales are up.

For the full report, visit: http://www.freddiemac.com/news/finance/docs/May_2011_public_outlook.pdf.

Foreclosure activity reached 40-month low in April, according to Realty Trac

2011-06-09T08:12:00.000-07:00

Foreclosure activity dropped 9 percent from March 2011 and 34 percent from April 2010, according to RealtyTrac's latest U.S. Foreclosure Market Report. Foreclosure filings, which include default notices, scheduled auctions, and bank repossessions, were reported on 219,258 U.S. properties in April, the lowest level in more than three years.

The report also shows one in every 593 U.S. housing units received a foreclosure filing during April 2011.

RealtyTrac CEO James J. Saccacio said that the slowdown in foreclosure activity has more to do with ongoing delays in processing foreclosures than the result of a housing recovery.

“The first delay occurs between delinquency and foreclosure, when lenders and services are no longer automatically pushing loans that are more than 90 days delinquent into foreclosure but are waiting longer to allow for loan modifications, short sales and possibly other disposition alternatives,” said Saccacio. “Data from the Mortgage Bankers Association shows that about 3.7 million properties are in this seriously delinquent stage. The second delay occurs after foreclosure has started, when lenders are taking much longer than they were just a few years ago to complete the foreclosure process.”

Nationwide, foreclosures completed (REOs) in the first quarter of 2011 took an average of 400 days from the initial default notice to the REO, up from 340 days in the first quarter of 2010 and more than double the average 151 days it took to foreclose in the first quarter of 2007.

The foreclosure process took much longer in some states. The average timeframe from initial default notice to REO in New Jersey and New York was more than 900 days in the first quarter of 2011, more than three times the average timeline in the http://www.blogger.com/img/blank.giffirst quarter of 2007 for both states.

The average foreclosure process in Florida took 619 days for foreclosures completed in the first quarter, up from 470 days in the first quarter of 2010 and nearly four times the average of 169 days it took in the first quarter of 2007.

The average foreclosure process in California took 330 days for foreclosures completed in the first quarter, up from 262 days in the first quarter of 2010 and more than double the average of 134 days in took in the first quarter of 2007.

For the full report, visit: http://www.realtytrac.com/content/press-releases/foreclosure-activity-at-40-month-low-6578

10 Markets Set for Biggest Housing Rise in 2011-- and Washington has 5 of the 10!!

2011-06-04T09:41:00.000-07:00

Despite U.S. housing markets being generally dreary since 2008, there are a few promising patches across the country, according to 24/7 Wall St. Review . 24/7 Wall St. looked at data from Fiserve Case Shiller, which gathers and analyzes housing information, and compiled a list of ten markets that will rebound the most in 2011.

The list indicates that two kinds of real estate markets are on the rise: one that was generally stable, but was hurt by the recession; and one that will rise because lower housing costs are making it affordable for residents to buy a home for the first time in decades.

The twelve cities in which homes prices will increase the most in 2011 are divided into two categories. One comprises cities in the Northwest with mostly white populations, stable middle classes andone or two major industries that dominate employment. Some of these cities are removed from larger metropolises like Chicago or L.A., meaning they serve geographic areas that might stretch several hundred miles, making them business and agricultural hubs.

The second category of cities is composed of cities that have not been as economically prosperous, but have made the list because lower housing prices have changed the residents’ ability to purchase homes that were previously unaffordable.

10. Great Falls, Montana
9. (three-way tie) - Cheyenne, Wyoming; Kennewick-Pasco-Richland, Washington; Myrtle Beach-Conway, South Carolina
8. Idaho Falls, Idaho
7. Bremerton-Silverdale, Washington
6. Grand Junction, Colorado
5. Bellingham, Washington
4. Spokane, Washington
3. Tacoma, Washington
2. Madera-Chowchilla, California
1. Mobile, Alabama

Top Ten Tips for saving money in today's economy..

2011-05-10T10:01:00.000-07:00

One good outcome of the economic recovery is that people are becoming more careful with how they spend their money. For many of us, this means acquiring new financial habits. Here are our Top Ten Tips for stretching a dollar today. The first four are good overall things to do:

1. Create a budget. Drawing up a budget may not be anyone's favorite way to pass the time, but it sure pays off when it comes to saving money. You can't cut expenses without knowing what you have coming in and how it's going out. Making a budget instantly highlights the places where you might make some cuts. Without a budget, it's hard to keep saving money over a long period of time, because you don't see where your expenses may be going up.

2. Trim your debt. Credit cards are certainly convenient. But you want to minimize what you owe, as credit cards usually carry the highest interest rates. Watch what you spend with these cards--this is where that budget comes in--and make it a rule to pay off your outstanding balances each month. This can save you big money by eliminating those monthly interest charges.

3. Spend less. Review what you spend on everything, and look for opportunities to save money. For example, check with your phone company for cheaper rates and cellular calling plans. Think about cutting out newspaper delivery or magazine subscriptions you don't really need. Bring coffee to work in a thermos. Use the public library instead of buying books and renting movies. These things all add up--and the more you look for opportunities to save, the more you'll uncover.

4. Save more. Get into the habit of regularly putting money away each week or each month. It doesn't matter how small the amount, you can always increase it once you find yourself with more on hand from your other money saving efforts. Saving itself motivates you to keep at it, as you watch your nest egg grow. You might want to have a regular amount deducted from your paycheck and deposited directly into your savings account. Many people find this a painless way to quickly build up cash assets.

These next six tips give you some great specifics:

5. Buy in bulk. Plan meals in advance so you can take advantage of bulk savings. Cook in bulk so you have leftovers you can re-heat quickly when you're in a hurry instead of using more expensive convenience foods. Buy fresh ingredients and generics for any prepared foods you need. But make sure what you buy in bulk will be used before it goes bad. Throwing food away doesn't save you money.

6. Compare places to shop. Don't assume big box superstores have the best prices. Check out farmer's markets where buying direct from the producer can save money. Bulk buying can also work well here, letting you save on staples like corn, potatoes and rice. Local shops and smaller markets can also run specials that offer outstanding value--you just have to watch for ads and signs in windows.

7. Check sales carefully. Many "huge" mark downs are just creative marketing ploys--the items aren't selling at the lowest price out there. Try to check out "sale" prices from a range of different sources. Especially with high ticket items, make sure the price you're paying isn't lower somewhere else.

8. Eat in. Have your beverages at home too. A take out cup of coffee can cost twenty times what it does to make at home. So think before you buy a soda or coffee or grab that fast food you don't really need. Have something more nutritious at home and save money. Enjoy that nice meal out, of course, but that's a special event, not an impulse purchase.

9. Consider buying used. Cars on average lose a third of their value in the first two years, so buying a car that's twenty-four months old can save big money. Many items can be found "as good as new" in consignment shops, thrift shops and on the internet. The list is extensive: clothes, electronics, kitchen appliances, pots and pans, toys, gardening tools, musical instruments, outdoor sheds, to name a few. And you not only save money, you're also preventing perfectly useful items from packing our landfills.

10. Reduce your consumption. In addition to buying used items, think about using fewer things overall. If we could all consume less, we'd create less waste, use less energy AND save money. Turn down the thermostat and turn off lights around the house. Don't waste food. Don't use more shampoo, detergent and household cleaners than you need to get the job done. You'll be good to your wallet while being good to our planet.

Trendgraphix Market Report, Puget Sound Market Facts & Trends

2011-05-10T09:45:00.000-07:00

Number of Homes For Sale vs. Sold vs. Pended (Apr. 2010 - Apr. 2011)

Average Price per SQFT (Apr. 2010 - Apr. 2011)

Avg CDOM & SP/Orig LP % (Apr. 2010 - Apr. 2011)

Average Price of For Sale and Sold (Apr. 2010 - Apr. 2011)

Months of Inventory Based on Closed Sales (Apr. 2010 - Apr. 2011)

11 Tips for "Going Green" in 2011

2011-05-10T09:06:00.000-07:00

An up-and-coming green-living blogger whose goal is help others "be the best green they can be" marked the New Year by posting 11 tips for going green in 2011.

Lynn Stone, founder of SmilingGreenMom.com who aspires to own an eco-friendly log cabin, boasts 3,000 monthly visitors to her year-old blog, with more fans added each month. She credits the idea to the changes her family made in search of more natural treatments for her son’s severe eczema. As she sought alternatives to chemicals and additives, she began sharing her tips.

Stone's site continues to evolve, but currently includes sections on product reviews, healthy recipes, raising green kids, health and wellness, coupons, and archives featuring experts and their beauty, fitness and nutrition advice.

The "Smiling Green Mom's" 11 Tips for Going Green in 2011

1. Composting: Building a compost pile is an easy way to add many beneficial ingredients to the soil while reducing garbage volume. It also benefits the community by reducing the nearly 25 percent of compostable landfill waste, according the Environmental Protection Agency (EPA).
2. Recycle paper and electronics: Anything from paper and plastics to metals and electronics can be recycled. Doing so can preserve resources, the amount of landfill space being used and energy use. The EPA estimates that only 15-20 percent of e-waste is recycled. The remainder goes directly into landfills and incinerators, causing dangerous heavy metals and toxins to accumulate, along with serious environmental risks. For more info on recycling your electronics, see http://www.digitaltips.org/green/default.asp (searchable by zip code) and http://www.terracycle.net/, which provides free waste collection programs for hard to recycle materials that are then turned into green products
3. Go Plastic Free: Eliminate plastics by switching to reusable whenever possible. Start by using reusable stainless steel water bottles and carrying cloth grocery bags anytime you are shopping.
4. Plant a garden: Even with limited outdoor space, a garden can produce a wide variety of nutritious foods. If space is very limited, consider a container garden or small herb garden to enhance your culinary experience.
5. Laundry: Whenever doing laundry, make sure it is a full load and wash clothes in cold water using safe non-toxic laundry soap. Hang clothes to dry.
6. Support local farmers and eat in season: Most food in grocery stores has been picked in the fields, sent to distribution centers, and then shipped thousands of miles before ever hitting store shelves. In contrast, when you purchase from local farmers, you can put a face with your food, and know your food has been picked within a day or two of purchasing. Buying fresh local food has many other advantages including reduced vehicle pollution, little or no and packaging. It may also be organic and pesticide-free. (Editor’s note: Visit LocalHarvest.org to find farmers' markets, family farms, and other sources of sustainably grown food around the state, http://www.localharvest.org/search.jsp?st=51&ty=-1&nm=)
7. Unplug and upgrade appliances and electronics: Unplug electronics and appliances when not needed or in use. Replace broken products with new energy efficient models that have an Energy Star label. Sponsored by the Department of Energy and the EPA, the Energy Star label program denotes compliance with specified energy efficiency requirements. Products with this label offer substantial savings and now include major appliances, office equipment, lighting, home electronics, and more.
8. Turn it off! Turn the water off while brushing teeth and turn off lights every time you leave the room. Consider purchasing low-flow showerheads, faucet aerators and energy efficient CFL or LED light bulbs.
9. Use eco-friendly cleaning products: With just a few common household items, you can make your own cleaning products as needed. (Search the web for recipes.) Homemade cleaning products using ingredients such as vinegar, baking soda, lemon and tea tree oil can save money, time and the packaging required for store-bought brands. Toxic-free homemade cleaners are also safer and healthier.
10. Never purchase paper towels or napkins again: Instead, use old washcloths cut into smaller squares, old socks for dusting, old t-shirts cut up for cleaning and reusable cloth napkins and hand-towels.
11. Borrow or Buy Used: Borrow your books, music and movies from your local library to save money while cutting down on resources needed to manufacture new. Set up online accounts with EBay, freecycle.org or shop thrift stores and garage sales when looking for anything from clothing to furniture.

Housing market "warming" with multiple offers in some areas

2011-05-10T09:00:00.000-07:00

Home sellers around Washington state are starting to see something that had all but vanished in recent months: multiple offers. Several directors of Northwest Multiple Listing Service noted they are encountering more bidding wars in certain neighborhoods and price ranges, even though the latest figures show fewer sales and lower prices than a year ago. Shrinking inventory is spurring activity, with some brokers reporting a "shortage of good listings" and "signs of normality."

Northwest MLS members reported 7,154 pending sales during April, a 24 percent drop from a year ago when buyers were scrambling to take advantage of a federal tax credit that expired April 30, 2010. Going back two years, pending sales rose by a modest 3.4 percent; when compared to the same month in 2008, last month's pending sales (mutually accepted offers) jumped 15.2 percent.

"With healthy sales activity over the last several months, a shortage of homes coming on the market and low foreclosure activity, the stage has been set for a multiple offer market," observed J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. Scott believes buyer confidence around job centers is back, noting one office had multiple offer situations on 82 percent of recent transactions in North Seattle. Northwest MLS directors in King County, along with representatives from Whatcom and Kitsap counties, also commented on the uptick in multiple offers.

The new report from Northwest MLS shows members in the 21 counties it serves added 10,083 new listings during April, down 20 percent from the same month a year ago. Through the first four months of 2011, nearly 11,000 fewer new listings have been added to inventory when compared to the cumulative total for the same period a year ago, a drop of 23.5 percent. Total inventory is down nearly 13 percent from a year ago.

Fewer buyers are making low-ball offers and sellers are being more proactive about pricing their homes to be competitive in today's environment. Both buyers and sellers are beginning to get the message of today's market, which is ‘be realistic'.

Brokers reported 4,581 closed sales during the month, of which 3,994 were single family homes. That's a drop of about 12.6 percent from the year-ago figure of 5,243 closings. The median price on the 4,581 completed sales for April was $237,000, a decline of 9.2 percent from the year-ago median price of $261,000. In King County, prices are down about 4.6 percent, from $340,000 to $324,500. The dips reflect a significant number of foreclosed homes and short sales that are in the mix.

An analysis by Windermere Real Estate shows distressed properties accounted for about 35 percent of home sales in King County in April, up from 21 percent a year ago. Bank owned properties account for much of the growth, according to Windermere's research. The analysis shows the median price of bank-owned homes that sold in King County in April was 49 percent lower than the median price of non-distressed homes. Short sales prices were 23 percent lower.

Many of today's buyers are not seeking loans that stretch their budgets as in the past, prompting banks and the secondary market to regain confidence, and eventually loosen their credit guidelines and roll out new loan programs. Buyers will have to look at making their first offer their best offer, even on bank-owned homes. The days of lowball offers will soon fade and short sales losses will tighten. As prices stabilize and inventories drop, many buyers will feel the chance at home ownership at bargain prices slipping from their grip.

Statistical Summary by Counties: Market Activity Summary - April 2011

4-County Puget Sound Region Pending Sales (SFH + Condo combined)
(Totals include King, Snohomish, Pierce & Kitsap counties)

King County ranked No. 7 in the country last year for counties spending the most money on remodeling

2011-05-05T15:59:00.001-07:00

According a National Association of Home Builders survey released on March 15, King County homeowners spent an estimated $2,295 million on their projects, averaging $4,914. Neighboring Snohomish County was ranked No. 64 with $665 million and an average of $3,768, while Pierce County checked in at No. 73 with $615 million and an average of $3,323. A total of 3,143 counties were surveyed. Total remodeling spending in a particular county is obviously related to the number of homeowners in the county. Los Angeles County led the country at $9.4 billion. Rounding out the top five list is Cook County in Illinois, Orange and San Diego counties in California, and Maricopa County in Arizona. The NAHB model uses data from the American Housing Survey - which is funded by the U.S. Department of Housing and Urban Development and conducted by the U.S. Census Bureau - to estimate local remodeling based on home and homeowner characteristics. It is then applied to the information on every county's homes and home owners that the Census Bureau released late last year from its American Community Survey. The new NAHB estimates include remodeling spending per owner-occupied home. Nantucket County Massachusetts leads the nation on remodeling spending per home at $9,369. Other counties in the top five include New York County (Manhattan) and three counties in the San Francisco Metropolitan area. In each of these counties, remodeling is over $8,000 per owner-occupied home. In comparison, the average across all counties nationwide is $2,085.

Legislation Introduced to Speed Lender Response to Short Sales

2011-04-29T16:09:00.001-07:00

Two lawmakers, one Republican and one Democrat, have joined forces to push federal legislation through that would facilitate wider use and shorter transaction timelines for a foreclosure alternative that some say could be a lifeline for millions of underwater homeowners while drastically reducing the number of empty, repossessed homes lining U.S. neighborhoods – the short sale.

The bill, introduced by Reps. Tom Rooney (R-Florida) and Robert Andrews (D-New Jersey), would impose a deadline of 45 days on lenders to give an approval, disapproval, or status of a decision on an offer for a short sale.

According to a statement from the congressmen, consumers have had difficulty executing short sales as lenders have taken months to decide whether to accept proposed short sale prices, which can often derail the sale altogether and send the homeowner into foreclosure.

Rooney and Andrews say their legislation, the Prompt Decision for Qualification for Short Sale Act of 2011, will bring the processing time for short sale price approvals in line with the home-buying and home-selling consumer’s expectations – at most 45 days after submitting the request for short sale approval.

A similar bill – in fact, by the same name – was introduced last September but never came up for debate before a House committee before the legislative session ended.

The National Association of Realtors (NAR) is throwing its support behind the new bill. The trade group has been actively pushing the lending industry to improve the process for approving short sales, which represent about 13 percent of recent home sales according to NAR data.

“Realtors want to help more homeowners avoid foreclosure by facilitating a short sale when a family is absolutely unable to keep their home; however, that can only happen if lenders and servicers approve short sale offers in a reasonable amount of time,” said Ron Phipps, president of NAR and broker-president of Phipps Realty in Warwick, Rhode Island.

Phipps says a short sale not only minimizes the negative impact on the borrower, but in most cases costs the lender less than a foreclosure. He praised Reps. Rooney and Andrews for their efforts on a bill that he says could soon bring relief to distressed homeowners who hope to avoid foreclosure.

Some market participants, though, aren’t so optimistic, arguing that the government has a host of requirements in place for the banks when it comes to certain housing and mortgage issues that aren’t enforced.

The Prompt Decision for Qualification for Short Sale Act of 2011 has not yet been referred to a committee.

Jobs, Demographic Forces Key to Housing Recovery

2011-04-22T15:11:00.001-07:00

"Things are positive for the long run, though clearly there's going to be a period of turmoil," remarked Eric Belsky, managing director of the Joint Center for Housing Studies, in an interview coinciding with the release of the Center's 2010 report titled "The State of the Nation's Housing."

Among factors causing concern are elevated vacancy rates, record foreclosures, and continued high unemployment.

Over the coming decade and once employment stages a convincing comeback, demographic forces should lift currently depressed levels of household growth and spur increased construction and sales, according to JCHS representatives. The annual report analyzes current home ownership trends and examines how federal government policies are affecting the marketplace.

Bolstered by immigrants, the echo-boom generation is already larger than the baby boom generation, and the baby-bust generation (born 1966-1985) is nearly as large. If immigration matches the pace projected by the Census Bureau and headship rates (ratio of households to the population) by age and race hold steady, household growth should come close to 15 million from 2010 to 2020, the researchers reported. Even if it falls to half the projected pace, household growth should equal the 12.5 million growth from 1995-2005.

Both housing policy challenges and opportunities will abound in the years ahead, the report concludes.

A brightening personal-income picture, a willingness by more local banks to make home loans, reports that investors are returning to the housing market and that housing is the most affordable it has been in decades are encouraging signs of a real estate rebound. Nevertheless, the Harvard researchers say big changes are afoot in residential real estate, pointing to shifting demographics.

Among six demographic drivers with implications for housing are:

1.

Slowdown in household growth
A sharp drop in immigration, attributed to broad job losses, and a doubling up among economically stressed families have played major parts in decelerating household growth. During the first half of the decade, household growth was 1.2-1.4 million annually, but fell to less than 1.0 million per year in the subsequent years (2005-2009).
2.

Reduced mobility
Overall mobility rates fell by about 12.6 percent in the period 2005-2008 before stabilizing in 2009. Homeowners experienced the steepest declines, "likely because the housing crash left so many underwater (or nearly so) on the mortgages, making it difficult to move," the researchers suggested. Mobility rates among older owners posted the sharpest drop as many seniors deferred retiring and moving to a different home because the financial crisis depressed their home equity and reduced their retirement accounts.
3.

A lost decade for household income
For the first time since at least 1970, median household incomes for all age groups in each income quartile are likely to end the decade lower than they began. Households under age 25 in the lowest income quartile were hardest hit, but no group was spared from the declines.

"These dismal figures predate the heavy employment losses in 2009," the report cautions, noting housing demand must therefore build upon a lower real income base than a decade ago. If incomes do not bounce back quickly, "Americans will have to choose whether to cut back on the size and features of their homes or allocate larger shares of their incomes to housing."
4.

Household wealth reversals
Household wealth went through a sharp boom-and-bust cycle over the last decade, while household mortgage debt exploded. On a per household basis, in the span of a decade, real household wealth actually fell from $526,000 in 1999 to $486,600 in 2009. Mortgage debt soared, rising from less than $6 trillion to more than $10 trillion in inflation-adjusted dollars. A resulting drop in home equity was described as "startling" in the JCHS report, which noted, "Aggregate real home equity has not been this low since 1985 when there were far fewer homeowners than today."
5.

Growing diversity of demand
"Regardless of what happens in the future, immigration since 1980 has already reshaped the nation's demographic profile, particularly in terms of racial and ethnic diversity," wrote the authors of The State of the Nation's Housing 2010.

Throughout the current housing cycle, the numbers of immigrant and minority households outgrew those of native-born white households, accounting for 74 percent of net household growth between 2003 and 2009. Those rising numbers mean an increased presence of these sectors in home buying, remodeling, and rental markets. "Future expansion of housing investment and the growth in the broader economy will depend on reducing the significant income and wealth disparities between whites and minorities," the authors advised.
6.

Residential development and the environment
Acknowledging a "growing chorus" is calling for more compact forms of residential development to reduce vehicle miles traveled (VMT), and consequently, carbon emissions and energy consumption, the researchers reviewed various studies and arguments by proponents. They observed:
1. In most communities, achieving compact development would require changes to local zoning laws, which today often discourage higher densities along with mixed commercial and residential land uses.
2. Compact development would, at best, reduce VMT and related carbon emissions relative to a 2000 baseline between 11 percent (as estimated by the National Research Council) and 18 percent (the Urban Land Institutes estimate) by 2050.
3. More compact development patterns would help make public transportation more economical.
4. While having public transit in the area increases the share of commuters that use it, access does not necessarily mean high ridership. In fact, less than 25 percent of households with at least one commuter report using public transport regularly.

The Outlook

The aging echo-boom generation, augmented by immigration, will increasingly drive household growth over the next 15 years. The number of echo boomers is expected to swell to 92.9 million by 2025. Immigration is expected to grow to 86.5 million. "This highly diverse generation will give demand for apartments and smaller start homes a lift over the next 15 years," the report stated.

Second-generation Americans (children born in the US to immigrant parents) among the echo boomers will be important in shaping the characteristics of future households since those aged 25-64 typically have higher household incomes than both foreign-born and other native-born households of all races and ethnicities.

Baby boomers will boost demand for senior housing. JCHS researchers say the units built over the next 10-20 years that intentionally cater to older Americans will be the housing available for generations to come. They expect senior housing issues will gain more urgency during the coming decade as a result of limited federal support for senior housing and the current funding system that encourages expensive trips to skilled nursing facilities rather than lower-cost, less institutional assisted living options and programs.

The State of the Nation's Housing, released annually by the Joint Center for Housing Studies, provides a periodic assessment of the nation's housing outlook and summarizes important trends in the economics and demographics of housing. The report continues to earn national recognition as a source of information regularly utilized by housing researchers, industry analysts, policy makers, and the business community.

The complete 44-page report on The State of the Nation's Housing 2010 may be viewed and downloaded at http://www.jchs.harvard.edu/publications/markets/son2010/

New Rules for First-Time Homebuyers

2011-04-14T17:52:00.000-07:00

Without a house to sell , first-time home buyers have had a field day in the depressed housing market. Until recently, anyway. A series of new rules, regulations and policies have changed the landscape, making buying that new home harder and more expensive.

Not long ago, first-time buyers accounted for 40% of home sales. Now they're down to 29% and falling, experts say, as first-time buyers confront a steady accumulation of rising fees, costs, and rates. This month, fees on most new mortgages will rise by up to 0.50%. In April, fees on small-down-payment mortgages, a first-time buyer favorite, will spike. Meanwhile, more lenders are requiring larger down payments, and new proposals from the Obama administration call for mortgages to become more expensive and limited in size.

The new fees and higher barriers to entry are all a response to the sweeping mortgage losses of the last several years. Banks and other lenders lost billions of dollars on subprime and other risky mortgages, and some must now buy back bad loans they sold to Fannie Mae and Freddie Mac. To cover those losses, banks and the agencies are raising fees on new mortgages, says Keith Gumbinger, a vice president at HSH Associates, which tracks the mortgage market. Also, from the perspective of lenders and the government, making it harder and more expensive to get a mortgage will deter or cull the riskiest borrowers and minimize defaults.

But taken in total, all this reform means the window of opportunity for first-time buyers may be closing. Home prices still seem to be near the bottom, mortgages are still cheap and, though they have increased over the past five months, interest rates are still low. Of course, there are still reasons to wait to buy: The changes to the mortgage market could depress home sales and prices further. But for those who don't want to wait, here are the new rules for first-time home buyers.

New rule: Put more money down.

As housing prices drop, mortgage lenders are requiring larger downpayments on homes.

Not because you'll have to -- it's still possible to make a down payment of less than 5% -- but because you want to. Insurance fees on the government-insured mortgages that require just 3.5% down have doubled in seven months, to up to 1.15% (as of April). On a 30-year, $300,000 mortgage, a buyer would pay $30,000 more in fees than if he had signed up for the mortgage in September. Also, between new lender requirements and cash-flush buyers, down payments have been rising since the last half of 2010 and now average 34% of the purchase price, according to the latest data by mortgage-data firm CoreLogic.

It's unlikely that a first-time home buyer can save so much money for a down payment, especially in high-priced markets like New York and San Francisco, says Cameron Findlay, chief economist at LendingTree.com, which tracks mortgage rates. Instead, first timers might need to consider alternative options to get cash , like grants offered by individual states. And most lenders still permit buyers to use cash gifts from family with a notarized letter from the donor stating that the money doesn't need to be paid back, says Gumbinger. Or, a buyer who's open to co-owning a home can sign up for a mortgage with a co-applicant who has extra cash to put down but wants a stake in the property.

New rule: Stay for a decade.

Not only are the days of flip-and-move long gone, but buying a house has become truly a long-term investment. In many cases, 10 years long, says Paul Bishop, vice president of research at the National Association of Realtors -- if buyers are hoping to make a profit or just break even. As mortgage fees rise, buyers have to recoup larger costs, which takes a longer time. Also, experts predict very slow growth in home prices over the next 10 years, which means it will take a long time before sellers can make a profit, says Findlay. Of course, buying a home may still make financial sense, but buyers' focus should shift from rising prices to building equity.

For first-time buyers, this means avoiding homes that require renovations, if it's possible -- it will only take longer to recoup the costs of a new kitchen or deck, says Findlay. Instead, stick to a home that requires few major projects, which builds equity with the passing of time. Also, a bigger down payment can cushion the blow for buyers who end up having to sell in a hurry, because it lessens the chances of owing more money on the home than it's worth should values drop.

New rule: Brace for competition.

Following the housing downturn, desperate sellers were often eager to accept an offer – any offer. But now, first-time buyers looking for discounted prices may be disappointed. Over the past few months, investors, international buyers, and downsizing retirees have made a noticeable impact on the market, because they're paying with cash. In January, about 32% of purchases were made with all cash, up from 26% a year ago, according to the NAR. Sellers are often more inclined to accept these offers since they don't need to wait for a lender to approve financing.

To stand out, first-time buyers can present an offer with few contingencies. At this point, given growing competition among buyers, there's little reason for a seller to work with someone who requests repairs or asks them to cover the closing costs. But offers from buyers who ask strictly for a home inspection and appraisal – two requirements they shouldn't give up – are more likely to get accepted than all-cash bids with a long list of requirements.

Housing market doing “surprisingly well” without a stimulus

2011-04-07T12:39:00.000-07:00

Last month’s pending sales fell below year-ago totals in Western Washington, but brokers say the market is faring quite well, considering last year’s activity was boosted by federal tax credits.

The latest report from Northwest Multiple Listing Service shows 7,570 pending sales of single family homes and condominiums during March. That’s down about 12 percent from a year ago when members reported 8,605 pending transactions (mutually accepted offers) across the 21 counties in the Northwest MLS service area.

“The market is doing surprisingly well without a stimulus,” observed Northwest MLS director OB Jacobi, president of Windermere Real Estate Company. “Considering that this time last year there was a rush of buyers trying to beat the tax credit deadline, to have the number of sales off just slightly points towards a strengthening market,” he added.

A comparison to two years ago reveals a double-digit jump in pending sales. Area-wide, the volume is up nearly 33 percent, rising from 5,701 pending sales in March 2009 to 7,570 for last month. For the four-county Puget Sound region, pending sales spiked nearly 42 percent compared to two years ago (from 4,266 to 6,049). “The glass is starting to look more half full than half empty,” Jacobi commented.

Mike Grady, president and COO of Coldwell Banker Bain, agreed. “Most real estate professionals will be happy to move past the year-over-year comparisons that have been made the first few months of 2011, as they reflect the boost given home sales by last year’s Homebuyer Tax Credit,” he noted, adding, “Home sales are now standing on their own -- without the benefit of incentives -- and the market is actually behaving quite typically.”

Buyers have plenty of choices, although the selection is smaller than a year ago, reflecting fewer new listings being added to inventory. Members added 9,812 new listings to inventory last month, which compares to 12,994 additions for the same month a year ago. At month end, the Northwest MLS database included 33,444 active listings, including 28,146 single family homes and 5,298 condominiums. That’s a drop of 5,272 properties, a decline of 13.6 percent.

“In fact, some urban core neighborhoods, such as Greenlake, Queen Anne and West Bellevue, are seeing very strong demand, and a waning supply of desirable homes for sale,” Grady reported. Many buyers looking in these neighborhoods are beginning to express frustration over the lack of available homes, according to Grady. “As a result, Realtors are beginning to report multiple offers, with contracts settling over the list price on the best homes.”

While this certainly isn’t the norm in most areas served by the NWMLS, Grady said it is encouraging that in some areas homes are selling briskly, and distressed and bank-owned properties are still in the minority.

Distressed properties continue to drag down prices. According to research by the National Association of REALTORS®, nearly one of every four home sales (24 percent) in Washington is classified as a short sale or foreclosure.

Northwest MLS members reported 4,590 closed sales of single family homes and condominiums last month. That total represents a drop of 7.7 percent from twelve months ago when members notched 4,972 closings.

Prices on last month’s closed sales system-wide declined about 8 percent compared to a year ago. The area-wide median sales price was $242,925; a year ago it was $264,475. In King County, prices dipped about 7 percent ($319,950 last month versus $343,950 for March 2010), although the gap was much narrower in some areas. In the Northwest MLS map areas comprising the Eastside, prices were off about 2 percent ($435,000 versus 444,000), while in the Seattle area, the year-over-year drop was only about 1 percent ($357,500 versus $361,500).

“We saw a lot of qualified buyers making offers in March,” Windermere’s Jacobi remarked. “They're out of the tire-kicking mode and ready to buy now. Inventory is low in general, and there is a particular shortage of move-in ready homes,” he stated, noting properties that are selling look like model homes. “Sellers realize if they remove any buyer objections ahead of time, their house will sell, and sell quickly.”

Jacobi said one of his company’s brokers wrote a cash offer for a client on a $1.1 million home in Bridle Trails the first day it was on the market. “The house was in perfect shape and newly painted. The sellers did a pre-inspection and spent several thousand dollars on minor repairs. The property got multiple offers,” he reported. The sellers accepted the cash offer for just under their asking price.

Grady senses some neighborhoods appear to be close to recovery, citing remarks by a broker who likened the market to a space capsule re-entering the atmosphere. “While it might appear to be burning out of control, the heat is actually beneficial, providing the friction necessary to slow the descent and allow a safe landing. Perhaps our broader market appears to be smoldering now, but some neighborhoods also appear to be close to recovery. With ‘Spaceship Seattle’ currently offering fewer than two single family homes for sale for every buyer currently under contract, it could be an interesting summer around the real estate launch pad,” he suggested.

Commenting on the latest nationwide report on pending sales, Lawrence Yun, NAR chief economist, said “We may not see notable gains in existing-home sales in the near term, but they’re expected to rise 5 to 10 percent this year with the economic recovery, job creation and excellent affordability conditions providing confidence to buyers who’ve been on the sidelines.”

Yun also emphasized the importance of looking at the broader trend, citing the unusually bad weather in the Northeast as having a negative impact on February’s data. “Month-to-month movements can be instructive, but in this uneven recovery it’s important to look at the longer term performance,” he said. “Pending home sales have trended up very nicely since bottoming out last June, even with periodic monthly declines.”

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 22,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.

Statistical Summary by Counties: Market Activity Summary - March 2011

Copyright © 2011 Northwest Multiple Listing Service

Financial concerns becoming more important to "mature movers"

2011-04-05T09:08:00.001-07:00

Buyers in the 55+ segment are becoming more practical when searching for a new home in the wake of the recession, with design considerations becoming less important. Instead, according to a recent study, financial concerns are becoming more prominent among "mature movers."

While design, amenities and appearance of both the residence and the community remain important, those considerations are diminishing in the post-recession era.

The evolving preferences of the growing 55+ demographic were revealed in a joint study by the 50+ Housing Council of the National Association of Home Builders (NAHB) and the MetLife Mature Market Institute.

In contrast to previous studies, fewer 55+ buyers are depending on home sale proceeds to finance a new purchase.

The study, "Housing Trends Update for the 55+ Market," explores housing data from the Census Bureau’s 2009 American Housing Survey (AHS). Researchers focused on households living in active adult communities, either age-qualified active adult communities where at least one resident must be age 55+, other non-age-qualified 55+ owner-occupied communities (not explicitly restricted to 55+ households but nevertheless occupied primarily by people age 55+), or age-restricted rental communities.

In 2009, only 55 percent of new age-qualified active adult home buyers reported their down payment came from a previous home sale, significantly down from 100 percent of respondents in 2005 and 92 percent in 2007. In 2005 and 2007, no active adult community buyers reported having to tap cash or savings for a down payment. That changed significantly in 2009 when 45 percent of the average buyer’s down payment came from cash or savings.

"By the year 2020, as Baby Boomers move into this age bracket, almost 45 percent of all U.S. households will include someone at least 55 years old," said David Crowe, NAHB’s chief economist. That translates to a dramatic rise in the number of households seeking housing better suited to changing, he noted.

Relatively modest production of such housing is on the horizon, according to NAHB data. Abut 54,000 housing starts are projected in 55+ communities this year. That reflects a 30 percent jump from estimated 2010 levels. A more robust 79,000 housing starts in 55+ communities are anticipated in 2012.

Prices remain lower than 2005, when prices peaked. The analysis showed a big difference between buyers in age-qualified active adult communities and other 55+ community buyers. Average prices for 55+ homes dropped in 2007, but partially rebounded in 2009. Prices for age-qualified communities more than bounced back: they set a record with an average price of $319,000. Researchers found buyers in this group were more affluent, with average annual incomes of more than $80,000. More than one-fourth (27 percent) reported earning at least $100,000, a jump from fewer than 5 percent of such buyers in 2001.

"Most 55+ consumers—those who chose to move and those who stay in their homes—report they are happy with their homes and communities," said Sandra Timmermann, Ed.D., director of the MetLife Mature Market Institute. She said those who moved to an age-qualified community reported the greatest satisfaction, rating their homes and communities at nine on a 10-point scale.

The desire to be near family and friends is the mature mover’s overwhelming motivation, the report noted. Buyers who fall into the 55+ age range that are moving into rental homes, both multi-family and single-family, cited a desire for less expensive housing as second in importance to living near friends and family.

Those who are able to buy are getting much more for less. In 2009, more than half the 55+ buyers said they were moving into better homes, but fewer than half reported their new homes cost more than the old ones.

"Proximity to work" was more important than in the past for those relocating to age-qualified, active adult communities. In 2009, twelve percent underscored the trend toward delayed retirement in this age group, up from 2 percent in 2001. There was also a reported increase in the share of 55+ single-family homeowners who say they work at home, a trend the researchers suggested is noteworthy for home designers.

A small, but growing share of older households is taking advantage of the ability to convert some of their home equity into a reverse mortgage or home equity conversion mortgage. They tend to be older, single-person households with lower household income and longer housing tenure. Those with reverse or home equity conversion mortgages represented more than 241,000 households in 2009, a 54 percent increase since 2007.

The report reflects trends in the American Housing Survey between 2001 and 2009. Characteristics are tabulated by the age of the occupants and structure type, as well as by community type.

"Housing Trends Update for the 55+ Market" can be downloaded from www.MatureMarketInstitute.com or from www.nahb.org/55PlusResearch.

Real Estate Outlook: Good News Across the Nation

2011-04-01T16:51:00.000-07:00

The market is changing out there, and the latest reports are showing that when it comes to buyers, less is more in some cases.

A recent study from the National Association of Home Builders (NAHB) indicates that the recent housing slump has meant buyers are looking for smaller houses. The McMansions of the boom era are quickly losing their style.

The NAHB reports that the builders they "surveyed expect homes to average 2,152 square feet in 2015, 10 percent smaller than the average size of single-family homes started in the first three quarters of 2010. To save on square footage, the living room is high on the endangered list – 52 percent of builders expect it to be merged with other spaces in the home by 2015 and 30 percent said it will vanish entirely."

Also a heavy influence on the housing front are green and eco-friendly features. The NAHB reports that "in addition to floor plan changes, 68 percent of builders surveyed say that homes in 2015 will also include more green features and technology, including low-E windows; engineered wood beams, joists or tresses; water-efficient features such as dual-flush toilets or low-flow faucets; and an Energy Star rating for the whole house."

This is great news for eco-activists across the nation. The other great news this week? The Mortgage Bankers Association (MBA) reports that mortgage applications are at the highest level in months. They rose by 17.2 percent, that being the biggest increase since June 11th.

Michael Fratantoni, MBA's vice president of research and economics, reports, "An improving job market is beginning to pave the way for an improving housing market. Additionally, mortgage interest rates remained below 5 percent for a second week, maintaining affordability for buyers and leading to an increase in refinance applications."

The U.S. Department of Housing and Urban Development (HUD) had their own good news. Their latest February edition of the Obama Administration's Housing Scorecard revealed that existing home sales are on the rise thanks in part to high home affordability levels.

And since April of 2009, record low mortgage rates have helped more than 9.5 million homeowners to refinance, resulting in $18.1 billion in total borrower savings.

They did report, however, that the "housing market remains fragile as data through January paint a mixed picture of recovery. Existing home sales ticked upward in January, but remained below levels seen in the first half of 2010. Mortgage delinquencies continued a downward trend compared to early 2010 and foreclosure starts and completions remain below peak."

But not everyone is in agreement about what foreclosures mean for today's homeowner. According to the New York Times, "All 50 state attorneys general, as well as a host of federal agencies, are pushing for a settlement over investigations into foreclosure abuses by major mortgage servicers that could cost the industry $20 billion or more. Much of that money would be earmarked to reduce principal owed by homeowners facing foreclosure."

Many homeowners have weathered the storm, however, taking on heavy burdens in order to avoid foreclosure. Bank of America argues that by helping some and not helping others, we create an unfair system.

"There's a core problem that if you start to help certain people and don't help other people, it's going to be very hard to explain the difference,” said Brian T. Moynihan, the chief executive of Bank of America. "Our duty is to have a fair modification process.”

Home Affordability Returns to Pre-Bubble Levels

2011-03-24T19:22:00.001-07:00

Home affordability has returned to pre-housing-bubble levels in a growing number of U.S. markets over the past year, buoyed by several years of sustained price declines, according to data from Moody's Analytics.

The data track the ratio of median home prices to annual household incomes in 74 housing markets. By that measure, housing affordability at the end of September had returned to or surpassed the average reached between 1989-2003 in 47 of those markets. Most economists believe the housing boom began in 2003.

"Based on incomes, this is as affordable as it gets," said Mark Zandi, chief economist at Moody's Analytics. "If you can get a loan, these are pretty good times to buy."

But the bad news is that those price declines are leaving more borrowers underwater or in homes worth less than the amount owed.

During the housing boom, lax lending and speculation pushed house-price inflation far beyond the modest rise in household income. Nationally, the ratio of home prices to annual household income reached a peak of 2.3 in late 2005. But by last September, it had fallen to 1.6, well below the historical average of 1.9 between 1989 and 2003.

Most economists and housing analysts anticipate another 5% to 10% decline in prices before they reach bottom later this year or early next year. Housing demand remains weak because buyers are skittish about the economy and lending standards are tight.

Markets that now appear to be undervalued include Detroit, Las Vegas, Atlanta, and Phoenix. Even in such markets, high rates of foreclosure and underwater borrowers should keep downward pressure on prices. "They're undervalued, but they're going to get even more undervalued," said Mr. Zandi.

Home prices still remain overvalued by both measures in several markets, including Seattle, Charlotte, New York and Portland, Ore.Measuring home prices to income is not the only way economists measure housing affordability. They also examine the relationship between house prices and rents. By the price -to-rent ratio, or the price of a typical home divided by the annual cost of renting that home, prices are fairly valued—or undervalued—in around 20 markets. Nationally, the price-to-rent ratio stood at 14.85 at the end of September, above the 1989-2003 average of 12. The data suggests pockets of the country have further to fall.

Based on rents, "it's still not a slam dunk to buy" in those markets, said Mr. Zandi. He said housing markets appear to be most overvalued in the Pacific Northwest, a region that was among the last to enter the housing downturn. Historical measures also show prices are still high along the Northeast corridor from Baltimore to Boston.

The cost of owning a home looks less affordable based on rents than it does on incomes, in part, because rents also fell throughout 2009 and the first half of 2010. As rents rise, that could tip the scale back in favor of owning in some areas.

Of the 74 markets, Baltimore appears to be the most overvalued housing market. By contrast, prices in Cleveland, the most undervalued market, have returned to 1991 levels based on the price-to-rent ratio.

Historical measures comparing rents and incomes to home prices provide a useful gauge of affordability, but they can be imperfect at measuring how close different markets are to recovering from a bubble. After a severe housing downturn, home prices rarely stop falling once they reach equilibrium level.

Some areas will stay undervalued for years as they deal with a glut of foreclosures and a paucity of demand. Historical trends show that housing could remain undervalued in many markets for six to seven years, according to housing economists at Capital Economics.

"It's become cheaper to buy than to rent" in Phoenix, said Jon Mirmelli, a real-estate investor in Scottsdale, Ariz., who is renting out foreclosed homes. "But the question is: can you qualify for a loan?"

At the same time, some areas that appear to be overvalued relative to historic norms, such as Washington, D.C., may not completely return to pre-crisis levels thanks to structural changes in the economy that support higher prices.

New Foreclosure Statistics for Washington

2011-03-18T13:59:00.001-07:00

Foreclosure Filings—Notice of Default filings are the first step in the foreclosure process. Notice of Trustee Sale filings set the date and time of an auction, and serve as the homeowner's final notice before sale.

WA - Foreclosure Filings

Foreclosure Outcomes—After the filing of a Notice of Trustee Sale, there are only three possible outcomes. First, the sale can be Cancelled for reasons that include a successful loan modification or short sale, a filing error, or a legal requirement to re-file the notice after extended postponements. Alternatively, if the property is taken to sale, the bank will place the opening bid. If a 3rd party, typically an investor, bids more than the bank's opening bid, the property will be Sold to 3rd Party; if not, it will go Back to the Bank and become part of that bank's REO inventory.

WA - Foreclosure Outcomes

Foreclosure Inventories—Preforeclosure inventory is an estimate of the number of properties that have had a Notice of Default filed against the property, but have not yet been Scheduled for Sale. The Scheduled for Sale inventory indicates those properties that have had a Notice of Trustee Sale filed, but have not yet been sold or had the sale cancelled. The Bank Owned (REO) inventory indicates the number of properties that have been sold Back to the Bank at the trustee sale, and which the bank has not yet resold to another party.

WA - Foreclosure Inventories

Foreclosure Bids—The Published Bid is the amount listed in the Notice of Trustee Sale and is typically the balance due at the original date of sale. The Opening Bid is the bank's starting bid at auction, and is often discounted from the Published Bid. The Winning Bid is the highest bid received at auction and reflects the amount at which the bank or 3rd party purchased the foreclosure.

WA - Foreclosure Bids

Foreclosure Discounting—This chart compares the winning Bid Amount of properties sold at trustee sale to both the outstanding Loan Amount, and the current Market Value. Banks place an Opening Bid for each property and if a 3rd Party does not make a higher bid, the property will be sold Back to Bank (REO) for the Opening Bid amount. Properties Sold to 3rd Parties will typically have Winning Bids with deeper discounts to both Loan Amount and Market Value as only low Opening Bids will attract investor interest.

WA - Foreclosure Discounting

Time to Foreclose—The average number of days between the filing of the Notice of Default and the final sale at auction for foreclosure sales that occurred during the specified month. Time to Resell—The average number of days between the final sale at auction and when the property was resold by the bank or 3rd party.

WA - Time to Foreclose

Filings By Est. Market Value—The number of foreclosures that have received either a Notice of Default or Notice of Sale, shown in columns arranged by the estimated market value of the property in foreclosure.

WA - By Est. Market Value

Filings By Year Built—The number of foreclosures that have received either a Notice of Default or Notice of Sale, shown in columns arranged by when the property was built.

WA - Filings per Year Built

Seattle Metro Area Market Report

2011-03-18T13:51:00.001-07:00

The Puget Sound is seeing a slow decline in prices, but it continues to be better than many areas of the country.

Washington Zillow Home Value Index

Washington Home Values - Interactive chart

HOUSING ACTIVITY DURING FEBRUARY GIVES GOOD REASON FOR OPTIMISM

2011-03-08T12:16:00.000-08:00

Housing activity during February continued to reflect the downside of distressed properties with fewer sales and lower prices than a year ago. Nevertheless, brokers believe there are reasons for optimism when taking a closer look at the numbers in the latest report from Northwest Multiple Listing Service.

NWMLS members reported 5,986 pending sales of single family homes and condominiums in its market area, which covers 21 counties in Western and Central Washington. That total is down about 9.2 percent from a year ago, but it rose 11 percent from January. Last month’s volume of pending sales (mutually accepted offers) was the highest in six months, falling slightly below the August 2010 total of 6,037.

“I'm anticipating sales to be soft through April as compared to last year when a rush of buyers came into the market to take advantage of the tax credit, which expired April 30, 2010,” said OB Jacobi, president of Windermere Real Estate Company and a member of the Northwest MLS board of directors.

Noting a new year usually means new inventory, Jacobi commented on the smaller selection. Both the total number of new listings added to inventory and the total number of active listings are down from year-ago figures.

The number of new listings shrunk nearly 27 percent from a year ago, while the total number of active listings at month end was off 9.4 percent compared to twelve months ago.

Jacobi attributes the drops to distressed properties and the influence they are having on sellers. Sellers are reluctant to compete with the prices of distressed properties, he explained, and are holding off on putting their homes on the market. As a result, buyer choices have shrunk. That could bode well for some.

(Note: A distressed property is a dwelling that is in danger of foreclosure or that is in the process of being foreclosed due to a default under the terms of a mortgage.)

Some sellers of non-distressed properties are experiencing a stronger demand. “It’s not unusual for sellers in neighborhoods close to the city to get multiple offers,” Jacobi remarked. He cited the example of a home in Ballard with an asking price of more than $800,000 that drew seven offers last month, and sold for more than the asking price.

Overall, the median price for homes and condos that sold last month was $240,000, down about 7.7 percent from a year ago when the median selling price was $260,000. Five counties reported increases, with three of them – Grant, Kittitas and Jefferson – reporting double-digit gains.

In King County, the median selling price for last month’s completed transactions was $320,000, down about 6.8 percent from a year ago. For the four-county Puget Sound region, last month’s median price for single family homes and condos that sold during February was $262,250.

Brokers point to distressed properties as a major reason for depressed prices.

Jacobi said his company’s tracking showed distressed properties accounted for 37 percent of single family home sales in King County in February as compared to 30 percent a year ago. Most of that growth was from sales of bank owned properties, he noted.

Distressed properties continue to drag down home prices, Jacobi remarked. “Since they can sell for 30-to-40 percent less than non-distressed homes, we expected a price drop. In Windermere’s analysis, if you take out the distressed sales for February, the median home price jumps from $334,000 to $390,000.”

Copyright © 2011 Northwest Multiple Listing Service

Motivated buyers returning to the housing market

2011-03-04T11:04:00.000-08:00

Dramatic increases in open house activity and shrinking inventory are fueling optimism among members of the Northwest Multiple Listing Service. Commenting on the just-released MLS report on January's housing activity, one director stated, "There is a strong belief in the industry that the worst is behind us and we can look forward with confidence."

Darin Stenvers, managing broker at John L. Scott in Bellingham, who made that comment, also noted consumers are gaining confidence and buyers may be seeing what they believe is the bottoming of the market. "I'm very optimistic about the housing market for 2011 and the buyers and sellers should be as well," he exclaimed.

Year-over-year pending sales were down somewhat, the volume of new listings declined more than 23 percent, sales prices continued to slip, but the number of closed sales increased slightly across the 21 counties in the Northwest MLS service area.

Last month's pending sales lagged totals for the same month a year ago, but only by 186 units system- wide, a decline of about 3.3 percent. Northwest MLS director Matt Deasy, the broker at Windermere Real Estate/East in Bellevue, said he considered anything within 5 percent of a year ago when tax incentives were boosting sales a "home run."

Members reported 5,393 pending sales (mutually accepted offers) of single family homes and condominiums during January. That compares to 5,579 pending sales for the same period a year ago, and marked a big gain from both January 2009 (4,353 pending sales) and January 2008 (4,499 pending sales).

"I expect sales to be soft through April when compared to last year since first quarter sales volume was artificially inflated by the rush to take advantage of the tax credit that expired on April 30," said OB Jacobi, president of Windermere Real Estate Company. "A more apples-to-apples assessment of sales will be to compare first quarter this year with first quarter 2009," he suggested.

Closed sales rose a modest 2.1 percent from a year ago, increasing from 3,142 transactions to 3,207 sales. Prices on those completed sales were down about 6.3 percent. The overall median price for last month's closed sales of single family homes and condominiums was $243,500, which compares to the year-ago selling price of $259,903. For single family homes (excluding condominiums) the median selling price was $250,000, down about 5 percent from a year ago; for condos, last month's sales had a median price of $200,000, down 16.7 percent from twelve months ago.

Only four counties (Clallam, Cowlitz, Kitsap, and Okanogan) reported year-over-year price gains.

In King County, the median sales price on last month's sales was $333,500, a drop of 4.7 percent from twelve months ago when it was $350,000.

Brokers attribute part of the price drop to sales of distressed homes (in general, meaning homes under foreclosure or impending foreclosure).

"Distressed properties are making up an increasingly greater share of sales than a year ago, and that trend is expected to continue," observed Jacobi. Noting the sales price for distressed properties could be 20-to-30 percent less than for normal sales, he said "it's no surprise that a greater percentage of low-priced distressed properties is pulling down the median price."

Whether considering a property classified as distressed or a conventional listing, house-hunters can choose from 32,647 active listings in the Northwest MLS system at the end of January. That selection is 4.7 percent smaller than a year ago when there were 34,256 properties listed with member-brokers.

Not nearly as many newly listed homes were offered for sale last month compared to twelve months ago. MLS members recorded 8,556 new listings, which included 7,167 single family homes and 1,389 condominiums. The combined total is down nearly 24 percent from the same month a year ago when members added 11,206 new listings to inventory.

MLS director Bobbie Petrone Chipman said overall, January was a positive month around Pierce County, where her office is located. Noting that area experienced a 27 percent reduction of new listings, a 2.4 percent increase in pending sales and a 10.8 percent jump in closed sales, Petrone Chipman, co-managing principal broker at Coldwell Banker Bain Tacoma/Puyallup, said the month reflected "a bit more balance as we dip our toe into the new year."

Deasy also expects more balance, with sales more evenly distributed during the year, unlike 2010 when sixty percent of their sales occurred in the first half of the year. He also predicts closed sales will increase year over year, while at the same time pending sales might decrease year over year. This is the result of a higher percentage of pending sales actually closing, he explained, citing various factors. "Banks are better at short sales, brokers are better at short sales, appraisal issues are less frequent, and lending standards are becoming more stable."

Based on anecdotal reports of open house traffic, brokers are hopeful of upticks in sales.

"The buyer activity at open houses in the close in Seattle neighborhoods has increased dramatically in the past month, said Northwest MLS director Mike Skahen. "If there were more good new listings coming on the market there would be more sales," he suggested.

Skahen, the owner/broker at Lake & Co. Real Estate in Seattle, believes the shortage of new listings is causing an increase in multiple offers. As an example, he said a small Green Lake townhouse project that had been on the market for more than four months with no offers finally had one unit sell a few weeks ago. Last weekend four offers came in on another unit. "I have not seen buyers this motivated in three years," he remarked, adding, "Sellers should not wait for spring flowers to bloom to put their homes on the market as they usually do because there is much less competition now than there will be soon."

Industry leaders have recommendations to benefit both sellers and buyers.

Accurate pricing is paramount. "Sellers are learning there is a small window of opportunity to have consumers sees their home before ruling it out and moving on," suggested Stenvers.

"My advice to buyers in today's market is to get pre-approved prior to starting their home search in order to avoid any delays that might result from the new lending standards process," said J. Lennox Scott, chairman and CEO of John L. Scott Real Estate." This way," he explained, "buyers are ready to act quickly when they do find a home on which to make an offer."

As for sellers, Scott said pricing and presentation have never been more important. "Pricing must be comparable with the other properties that have recently sold in their local area and the home must be in pristine show condition from day one."

MLS director Pat Grimm, owner/broker at Windermere Real Estate/Capitol Hill, detected some hesitancy to list properties now. Distressed properties sell for less, but buyers face uncertainty and a long timeframe, he explained, noting the large percentage of distressed properties on the market has resulted in an interesting side effect: sellers of non-distressed properties are having an advantage.

"On one hand, I'm seeing sellers that are hesitant to bring their listings onto the market and compete with the price of short sale properties," Grimm commented. On the other hand, he said buyers are looking at all the inventory and, because of the complications of purchasing distressed properties, are favoring properties that are not short sales or bank owned.

In Seattle, Grimm said the sweet spot is homes priced $400,000-500,000, in good shape that are not distressed. "They appeal to both first-time buyers and downsizers," he reported, citing two examples:
A Capitol Hill home went on the market at $450,000, received seven offers and sold in a week for significantly more than asking price. In the second example, a View Ridge listing priced at $499,000 had 25 groups through an open house in a two-hour span. It has a view and a great location above the Burke-Gilman trail. "Both homes were in the $400-$500,000 price range, well maintained, and not distressed."

Several other NWMLS directors commented on the impact of distressed properties:

* "We still have the better part of the next five years to work through short sales and bank owned property but this is a start," commented Frank Wilson, branch managing broker at John L. Scott Real Estate in Poulsbo. He described January 2010 as an anomaly due to the tax credit, and said even though last month was down in many respects compared to last year, it better reflects the true market. "It is good to start a new year off without any government incentives and is hopefully the start of returning to normal."
* Some owners are opting to rent their homes as the market recovers. As demand increases and rents rise, investors are returning, said Stenvers. Also emerging is a new group of renters – past owners who lost their home to foreclosure or short sale, he noted, adding, "These renters are willing to sign long-term contracts so they can get their credit rating repaired." For example, Stenvers said his office recently listed a rental. The renters were a professional couple in the midst of a short sale in Florida. "They are looking at a very long term commitment to renting to help them save money and recover from their loss."
* "Buyers are reluctant to look at distressed properties not because of the characteristics of the property, but because of the process," said Grimm. He called the long delays with lenders regarding the sale of distressed properties "a major choke point." Grimm acknowledged there has been significant progress with the banks trying to figure out the situation, but stated, "We're still a long way from making it buyer-friendly."

Figures from the National Association of Realtors® show distressed homes rose to 36 percent of sales of existing homes in December, up from 33 percent in November and 32 percent a year ago. Such homes are typically discounted by 10 to 15 percent, according to NAR research.

Commenting on the volume of distressed homes on the market, Windermere's Jacobi said, "Hopefully new regulations requiring banks to speed up the sales process for distressed homes will help move that inventory more quickly."

Statistical Summary by Counties: Market Activity Summary - January 2011

Home Builders Forecast Improving Market

2011-02-24T15:55:00.000-08:00

Housing will see gradual improvements in activity this year as the nation's economy and job market continue to move to higher ground, according to representatives of the National Association of Home Builders. Speaking at the NAHB International Builders' Show in Orlando last month, economists said they expect the momentum will lead to more considerable gains in 2012

"This year's spring selling season will be better than last year's," said NAHB Chief Economist David Crowe, who noted job growth is providing a stronger stimulus in the housing market than last year's tax credits for home buyers.

Crowe forecasted 575,000 single-family home starts in 2011, a 21 percent climb over an estimated 475,000 units started in 2010, which in turn showed a 7 percent gain from the 442,000 homes started in 2009.

Multifamily, which is poised to profit from a disproportionate number of Gen Y members moving into the housing market, has seen the bottom of the cycle, Crowe stated. NAHB expects starts will rise 16 percent this year to 133,000 units, with a further 53 percent increase in 2012 to 203,000 units.

Builders' access to the credit they need to start new homes remains the fragile component of the NAHB forecast, Crowe said. So far, small builders have experienced extreme difficulty in obtaining financing, and rectifying the situation as soon as possible is the top priority of the association.

More encouraging is a rebound in the confidence of consumers, who in mid-2010 "froze in place, faced with a lot of uncertainty," he reported. A recent pickup in durable purchases for such items as automobiles and furniture indicates that consumers are less afraid today of losing jobs and income.

The U.S. economy will receive a boost from the massive tax package enacted at the end of last year, including more income going into the pockets of wage earners thanks to a one-year 2 percent reduction in Social Security taxes. Crowe expects this will contribute to the gross domestic product strengthening from the 2.5 percent range to 3.5 percent to 3.8 percent by year's end.

New-home sales, Crowe projected, "will struggle" but begin following employment gains, reaching 405,000 for the year, up from an estimate of about 320,000 for 2010.

The housing recovery will start up slowly this year, he said, because it will be driven by the relatively low housing production Plains states, with Texas the most powerful of the bunch. Traditional bulwarks of housing activity such as California and Florida, on the other hand, will not be among the states whose housing markets recover the fastest.

In addition to stimulative fiscal and monetary policy, Freddie Mac Chief Economist Frank Nothaft said that housing affordability and demographic trends will help support growing housing demand

.

Citing research from the Harvard Joint Center for Housing Studies, Nothaft said that households should be growing at an average annual rate of 1.2 million to 1.5 million over the next five to 10 years, suggesting the need for a sharp increase in housing production; half of the 500,000 to 600,000 starts of the past two years were needed just to replace the number of homes being removed from the housing stock.

While there will continue to be supply overhangs in some important large markets, by and large the housing price slump should bottom out by the middle of this year, Nothaft said, noting price increases are already occurring in some local areas. He believes that should attract prospective buyers who have been procrastinating until they see prices hit bottom.

"Potential buyers who have resources to buy but want to buy at the bottom are likely to start coming into the market in the springtime," he said, which for fence sitters will be "the time to come into the market."

Freddie Mac's chief economist expects fixed-rate mortgages will move up from their current 4.75 percent to the 5.75 percent range by the end of this year. This will push total single-family mortgage originations down about 30 percent below the 2010 level as efinancing fall sharply in the face of rising mortgage rates.

While a 20 percent increase in housing production in 2011 is good news for housing, to put things in perspective, Nothaft said that this gain is from an extremely low level, with single-family production declining about 80 percent from peak to trough.

NAHB is a Washington, DC-based trade association representing more than 160,000 members involved in home building, remodeling, multifamily construction, property management, subcontracting, design, housing finance, building product manufacturing and other aspects of residential and light commercial construction.

Reforming America's Housing Finance Market

2011-02-18T10:08:00.000-08:00

A just-released report issued by the US Treasury and Housing and Urban Development outlines a recommendation to Congress and the President for winding down Fannie Mae and Freddie Mac, the largest purchasers of mortgages in this country.

http://www.treasury.gov/initiatives/Documents/Reforming%20America's%20Housing%20Finance%20Market.pdf

Real estate market activity for Pierce, King, Snohomish, and Kitsap counties from Trendgraphix

2011-02-10T12:51:00.001-08:00

As you can see from these graphs charting the market trends, we are seeing improvements in sales activity in our local real estate market but there is still a lot of standing inventory to sell

Number of Homes For Sale vs. Sold vs. Pended (Nov. 2009 - Jan. 2011)

Average Price per SQFT (Nov. 2009 - Jan. 2011)

Avg CDOM & SP/Orig LP % (Nov. 2009 - Jan. 2011)

Average Price of For Sale and Sold (Nov. 2009 - Jan. 2011)

Months of Inventory Based on Closed Sales (Nov. 2009 - Jan. 2011)

Motivated buyers returning to the housing market

2011-02-09T14:11:00.001-08:00

Darin Stenvers, managing broker at John L. Scott in Bellingham, who made that comment, also noted consumers are gaining confidence and buyers may be seeing what they believe is the bottoming of the market. "I'm very optimistic about the housing market for 2011 and the buyers and sellers should be as well," he exclaimed.

Year-over-year pending sales were down somewhat, the volume of new listings declined more than 23 percent, sales prices continued to slip, but the number of closed sales increased slightly across the 21 counties in the Northwest MLS service area.

Last month's pending sales lagged totals for the same month a year ago, but only by 186 units system- wide, a decline of about 3.3 percent. Northwest MLS director Matt Deasy, the broker at Windermere Real Estate/East in Bellevue, said he considered anything within 5 percent of a year ago when tax incentives were boosting sales a "home run."

Members reported 5,393 pending sales (mutually accepted offers) of single family homes and condominiums during January. That compares to 5,579 pending sales for the same period a year ago, and marked a big gain from both January 2009 (4,353 pending sales) and January 2008 (4,499 pending sales).

"I expect sales to be soft through April when compared to last year since first quarter sales volume was artificially inflated by the rush to take advantage of the tax credit that expired on April 30," said OB Jacobi, president of Windermere Real Estate Company. "A more apples-to-apples assessment of sales will be to compare first quarter this year with first quarter 2009," he suggested.

Closed sales rose a modest 2.1 percent from a year ago, increasing from 3,142 transactions to 3,207 sales. Prices on those completed sales were down about 6.3 percent. The overall median price for last month's closed sales of single family homes and condominiums was $243,500, which compares to the year-ago selling price of $259,903. For single family homes (excluding condominiums) the median selling price was $250,000, down about 5 percent from a year ago; for condos, last month's sales had a median price of $200,000, down 16.7 percent from twelve months ago.

Only four counties (Clallam, Cowlitz, Kitsap, and Okanogan) reported year-over-year price gains.

In King County, the median sales price on last month's sales was $333,500, a drop of 4.7 percent from twelve months ago when it was $350,000.

Brokers attribute part of the price drop to sales of distressed homes (in general, meaning homes under foreclosure or impending foreclosure).

"Distressed properties are making up an increasingly greater share of sales than a year ago, and that trend is expected to continue," observed Jacobi. Noting the sales price for distressed properties could be 20-to-30 percent less than for normal sales, he said "it's no surprise that a greater percentage of low-priced distressed properties is pulling down the median price."

Whether considering a property classified as distressed or a conventional listing, house-hunters can choose from 32,647 active listings in the Northwest MLS system at the end of January. That selection is 4.7 percent smaller than a year ago when there were 34,256 properties listed with member-brokers.

Not nearly as many newly listed homes were offered for sale last month compared to twelve months ago. MLS members recorded 8,556 new listings, which included 7,167 single family homes and 1,389 condominiums. The combined total is down nearly 24 percent from the same month a year ago when members added 11,206 new listings to inventory.

MLS director Bobbie Petrone Chipman said overall, January was a positive month around Pierce County, where her office is located. Noting that area experienced a 27 percent reduction of new listings, a 2.4 percent increase in pending sales and a 10.8 percent jump in closed sales, Petrone Chipman, co-managing principal broker at Coldwell Banker Bain Tacoma/Puyallup, said the month reflected "a bit more balance as we dip our toe into the new year."

Deasy also expects more balance, with sales more evenly distributed during the year, unlike 2010 when sixty percent of their sales occurred in the first half of the year. He also predicts closed sales will increase year over year, while at the same time pending sales might decrease year over year. This is the result of a higher percentage of pending sales actually closing, he explained, citing various factors. "Banks are better at short sales, brokers are better at short sales, appraisal issues are less frequent, and lending standards are becoming more stable."

Based on anecdotal reports of open house traffic, brokers are hopeful of upticks in sales.

"The buyer activity at open houses in the close in Seattle neighborhoods has increased dramatically in the past month, said Northwest MLS director Mike Skahen. "If there were more good new listings coming on the market there would be more sales," he suggested.

Skahen, the owner/broker at Lake & Co. Real Estate in Seattle, believes the shortage of new listings is causing an increase in multiple offers. As an example, he said a small Green Lake townhouse project that had been on the market for more than four months with no offers finally had one unit sell a few weeks ago. Last weekend four offers came in on another unit. "I have not seen buyers this motivated in three years," he remarked, adding, "Sellers should not wait for spring flowers to bloom to put their homes on the market as they usually do because there is much less competition now than there will be soon."

Industry leaders have recommendations to benefit both sellers and buyers.

Accurate pricing is paramount. "Sellers are learning there is a small window of opportunity to have consumers sees their home before ruling it out and moving on," suggested Stenvers.

"My advice to buyers in today's market is to get pre-approved prior to starting their home search in order to avoid any delays that might result from the new lending standards process," said J. Lennox Scott, chairman and CEO of John L. Scott Real Estate." This way," he explained, "buyers are ready to act quickly when they do find a home on which to make an offer."

As for sellers, Scott said pricing and presentation have never been more important. "Pricing must be comparable with the other properties that have recently sold in their local area and the home must be in pristine show condition from day one."

MLS director Pat Grimm, owner/broker at Windermere Real Estate/Capitol Hill, detected some hesitancy to list properties now. Distressed properties sell for less, but buyers face uncertainty and a long timeframe, he explained, noting the large percentage of distressed properties on the market has resulted in an interesting side effect: sellers of non-distressed properties are having an advantage.

"On one hand, I'm seeing sellers that are hesitant to bring their listings onto the market and compete with the price of short sale properties," Grimm commented. On the other hand, he said buyers are looking at all the inventory and, because of the complications of purchasing distressed properties, are favoring properties that are not short sales or bank owned.

In Seattle, Grimm said the sweet spot is homes priced $400,000-500,000, in good shape that are not distressed. "They appeal to both first-time buyers and downsizers," he reported, citing two examples:

A Capitol Hill home went on the market at $450,000, received seven offers and sold in a week for significantly more than asking price. In the second example, a View Ridge listing priced at $499,000 had 25 groups through an open house in a two-hour span. It has a view and a great location above the Burke-Gilman trail. "Both homes were in the $400-$500,000 price range, well maintained, and not distressed."

Several other NWMLS directors commented on the impact of distressed properties:

"We still have the better part of the next five years to work through short sales and bank owned property but this is a start," commented Frank Wilson, branch managing broker at John L. Scott Real Estate in Poulsbo. He described January 2010 as an anomaly due to the tax credit, and said even though last month was down in many respects compared to last year, it better reflects the true market. "It is good to start a new year off without any government incentives and is hopefully the start of returning to normal."
Some owners are opting to rent their homes as the market recovers. As demand increases and rents rise, investors are returning, said Stenvers. Also emerging is a new group of renters – past owners who lost their home to foreclosure or short sale, he noted, adding, "These renters are willing to sign long-term contracts so they can get their credit rating repaired." For example, Stenvers said his office recently listed a rental. The renters were a professional couple in the midst of a short sale in Florida. "They are looking at a very long term commitment to renting to help them save money and recover from their loss."
"Buyers are reluctant to look at distressed properties not because of the characteristics of the property, but because of the process," said Grimm. He called the long delays with lenders regarding the sale of distressed properties "a major choke point." Grimm acknowledged there has been significant progress with the banks trying to figure out the situation, but stated, "We're still a long way from making it buyer-friendly."

Figures from the National Association of Realtors® show distressed homes rose to 36 percent of sales of existing homes in December, up from 33 percent in November and 32 percent a year ago. Such homes are typically discounted by 10 to 15 percent, according to NAR research.

Commenting on the volume of distressed homes on the market, Windermere's Jacobi said, "Hopefully new regulations requiring banks to speed up the sales process for distressed homes will help move that inventory more quickly."

Distressed Inventory to Step Out of the Shadows

2011-02-04T09:41:00.000-08:00

We are beginning 2011 with much more positive news about real estate than we have had in several years. The pending sales numbers (houses going into contract) have been climbing for several months. Last month’s Existing Homes Sales Report from the National Association of Realtors showed an increase of over 12%. Demand definitely seems to be increasing. Does that mean prices will begin to appreciate? Probably not. Though buyers have finally come out of hiding and started to purchase homes again, an increased inventory of distressed properties is also emerging from the shadows. These houses will impact prices.

Prices are determined not by demand alone but instead by the relationship of demand to the supply of inventory available. We are talking about the ‘shadow inventory’ of homes that will come to market at discounted prices when they are sold as short sales or foreclosures. This inventory has swelled to several million units.

When will this begin and what impact will it have on prices?

Over the last year, banks have been slowly releasing this inventory to the market being careful not to release too great a number in fear of driving down house values even further. Over 25% of all sales in 2010 involved a distressed property. The numbers increased as the year went on with 33% of all sales in November being in this category. In December, that number jumped to 36%! It now seems that banks are preparing to increase the flow of such properties to the market.

Last month, CNBC reported on economist Nouriel Roubini’s predictions on this issue:

“There has been an effective moratorium on foreclosure,” said Roubini.

And the beginning of the end of that moratorium means more housing supply is about to become available on the market.

“The shadow inventory of not-yet-foreclosed homes—due to the moratorium—will surge in the next year,” Roubini says.

Bank of America said:

…it resumed foreclosure sales in most states that have a non-judicial process, but the bank won’t restart sales in judicial states until sometime in the first quarter.

And Housing Wire reported last week that Fannie Mae “directed its mortgage servicers to delay scheduled foreclosure sales 45 days” for borrowers trying to get assistance through certain government programs.

What impact will this have on prices? Wells Fargo projected that house prices will drop 8% by mid-year. Fannie Mae and Bank of America have also predicted price depreciation for the first half of 2011.

Should I wait to purchase?

Not necessarily. Remember, sellers should sell now before prices do begin to fall. However, as a purchaser, you should look at cost. With interest rates on the rise, waiting may result in a higher monthly mortgage payment even with a lower sales price.

Bottom Line

If you are looking to sell, you probably want to do it before this ‘surge’ of discounted competition comes to market.

Western Washington home sales during December nearly equals year-ago levels

2011-01-06T10:58:00.000-08:00

KIRKLAND, WA, January 5, 2011. December's volume of pending sales around Western Washington nearly matched the total for the same month a year ago, which was the best December since 2006.

Sellers accepted offers from 4,359 buyers last month, only 40 fewer than a year ago when members of Northwest Multiple Listing Service reported 4,399 pending sales of single family homes and condominiums. In 2008, members notched 3,255 pending sales, down from 2007's total of 3,950 pendings and the 2006 figure of 5,744 mutually accepted offers.

Eight counties had year-over-year increases in pending sales for December, with two others equaling the year-ago totals.

"If you were in any mall in Washington state in December, you got the feeling that the economy is headed in the right direction," said OB Jacobi, president of Windermere Real Estate Company and a member of the board of directors of Northwest Multiple Listing Service. "That increase in consumer confidence is the boost the real estate market needs," he suggested.

Closed sales, another barometer of activity, improved on November's volume, but dipped about 6 percent when compared to figures from twelve months ago. MLS members reported 4,430 closings across its 21-county service area during December. A year ago, brokers logged 4,711 completed transactions.

For 2010, Northwest MLS members tallied 52,408 closed sales of single family homes and condos (combined), up slightly from the previous year when there were 52,105 completed transactions.

"Despite the expiration of the tax credit, King County saw about 3 percent more home sales in 2010 than in 2009," Jacobi noted.

The area-wide median price for last month's closed sales of homes and condos was $255,000, up slightly from November's figure of $250,000, but down about 3.8 percent from a year ago when the median selling price was $265,000. In King County, where 40 percent of last month's closings occurred, the median sales price was $342,400, about 2.2 percent lower than a year ago when it was $350,000.

Listing activity tapered off last month compared to 12 months ago. Northwest MLS members added 5,460 new listings of single family homes and condominiums during December. That's down 7 percent from a year ago when 5,873 sellers listed their homes with a member-broker.

Last month's additions boosted system-wide inventory to 32,171 at month end. That number nearly equals the selection of a year ago when the NWMLS database encompassed 32,152 active listings, although thirteen counties have fewer properties for sale than at this time a year ago.

Measured by months supply (the time, in months, that it would take to sell existing inventory at the current rate of sales), there is a supply of less than 7.4 months across the NWMLS market area. (A market with a supply of approximately six months is considered balanced, favoring neither buyers nor sellers.)

Nationwide, the National Association of REALTORS® reported a 9.5-month supply. Both King and Snohomish counties have less than a 6-month supply.

"Buyers are taking their time and looking for the 'perfect' house," Jacobi observed. "One of our agents worked with a couple for over a year before a higher-end home they'd been eying for months had a price drop and they jumped on it," he noted, adding, "Whether it's a starter home or a luxury property, to sell in today's market a great home also needs to have a great price."

Lawrence Yun, NAR chief economist, described continuing gains in home sales as encouraging and believes all the indicator trends are pointing to a gradual housing recovery. "In addition to exceptional affordability conditions, steady improvements in the economy are helping bring buyers into the market," he commented. However, he cautioned, further gains are needed to reach normal levels of sales activity, and home price prospects will vary depending largely upon local job market conditions.

NAR president Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., expects good buying opportunities to continue. The third generation real estate professional noted serious buyers have a lot of opportunities during the winter months since "traditionally there are far fewer buyers competing for properties at this time of year." He believes buyers will enjoy favorable affordability conditions into the new year, even though he expects mortgage rates will gradually rise as 2011 progresses.

Northwest Multiple Listing Service, owned by its member brokers, is the largest full-service MLS in the Northwest. Its membership includes more than 24,000 brokers and agents. The organization, based in Kirkland, currently serves 21 counties in Western and Central Washington.

Statistical Summary by Counties: Market Activity Summary - December 2010

DEC 2010 Single Family Homes + Condos	LISTINGS		PENDING SALES	CLOSED SALES
DEC 2010 Single Family Homes + Condos	New Listings	Total Active	#Pending Sales	# Closings	Average Price	Median Price
King	1,896	10,049	1,719	1,776	$422,008	$342,400
Snohomish	923	4,538	787	684	$273,727	$245,700
Pierce	1,035	5,118	760	701	$234,974	$215,450
Kitsap	241	1,500	208	239	$296,056	$235,000
Mason	76	623	44	46	$204,811	$164,650
Skagit	156	1,023	87	96	$285,461	$228,750
GraysHarbor	86	872	54	53	$166,451	$148,000
Lewis	83	679	53	52	$139,692	$125,250
Cowlitz	89	582	56	58	$159,957	$147,500
Grant	58	480	35	47	$162,040	$151,400
Thurston	244	1,446	201	217	$235,596	$229,000
San Juan	23	336	12	14	$586,929	$562,500
Island	107	836	67	87	$244,823	$230,000
Kittitas	31	374	25	43	$256,454	$205,000
Jefferson	49	437	23	19	$253,448	$218,000
Okanogan	19	337	12	22	$205,523	$189,000
Whatcom	170	1,486	121	162	$307,572	$255,000
Clark	37	243	26	28	$194,437	$187,000
Pacific	22	349	14	15	$110,145	$75,000
Ferry	5	57	0	4	$148,061	$152,000
Clallam	27	370	30	42	$215,380	$205,000
Others	83	436	25	25	$226,093	$189,900
MLS TOTAL	5,460	32,171	4,359	4,430	$319,461	$255,000

4-County Puget Sound Region Pending Sales (SFH + Condo combined)
(Totals include King, Snohomish, Pierce & Kitsap counties)

	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec
2000	3706	4778	5903	5116	5490	5079	4928	5432	4569	4675	4126	3166
2001	4334	5056	5722	5399	5631	5568	5434	5544	4040	4387	4155	3430
2002	4293	4735	5569	5436	6131	5212	5525	6215	5394	5777	4966	4153
2003	4746	5290	6889	6837	7148	7202	7673	7135	6698	6552	4904	4454
2004	4521	6284	8073	7910	7888	8186	7583	7464	6984	6761	6228	5195
2005	5426	6833	8801	8420	8610	8896	8207	8784	7561	7157	6188	4837
2006	5275	6032	8174	7651	8411	8094	7121	7692	6216	6403	5292	4346
2007	4869	6239	7192	6974	7311	6876	6371	5580	4153	4447	3896	2975
2008	3291	4167	4520	4624	4526	4765	4580	4584	4445	3346	2841	2432
2009	3250	3407	4262	5372	5498	5963	5551	5764	5825	5702	3829	3440
2010	4381	5211	6821	7368	4058	4239	4306	4520	4350	4376	3938	3474

How to Be a Wise House-Shopper in a Great Buyer’s Market!

2010-12-09T07:26:00.000-08:00

There’s no doubt about it – there are a great many bargains in the real estate market today if you’re a person looking for a new home. However, we highly recommend that you don’t get dazzled by all the opportunities and make a potentially expensive and poor decision. To that end, I’d like to offer you some common-sense guidelines to follow.

Guideline 1: Pay Attention to Your Budget
Before beginning your search for that new home, sit down and come up with a monthly payment you can handle with ease and then look for the house that fits that budget.

Guideline 2: Save Up for a Down Payment
Due to the “mortgage meltdown,” lenders are currently much more cautious about giving out money. Depending on the situation, they may insist on a minimum down payment of 10% or one that’s all the way up to 25%. So, start saving!

Guideline 3: Improve Your Credit Score
A good credit score is a great way to make the whole process easier when you apply for a loan. Today’s lenders scrutinize such scores more closely today than in the past. If you don’t have a good score, work hard to get it up into an acceptable range. It’ll save you money on interest charges and down payments in the long run!

Guideline 4: Get a Pre-Approved Mortgage Loan
If you’re a first-time home buyer or simply a buyer who wants to make sure you stay within your means, it’s a wise idea to get a pre-approved mortgage.This is simply the process of applying for a mortgage and getting approval for the loan prior to buying a home.

A “pre-approval” is an indication that the lender is ready to extend a mortgage to you once you’ve located the right property. And it has several benefits. First of all, it saves time and energy. Once you have a pre-approved loan amount, you’re required to stay within the limits of that loan in terms of the price you’ll pay for a house.

First, when working with a realtor, ask him or her to limit the choices to those stated in the loan. This prevents the agent from showing you properties which are out of your range. By the way, they’ll really appreciate those parameters because it’ll help them zero in on properties with the best chance of sale!

Second, you can spend more time looking at homes you really like and, simultaneously, not wasting time on houses that aren’t within your budget. This allows you to focus on the details of the homes you do like in order to make sure you select the right one; for example, kitchens, baths, garages, etc.

Third, you can bargain more effectively with sellers once they know you’re pre-approved. In the current market, that’s a great relief for many sellers because they realize they have a reasonable certainty of selling their property when working with a pre-approved buyer.

Fourth, you can close faster with a pre-approved loan because there’s no time lost in the usual processing period for loans. For example, an appraisal can be ordered right away, and you have the potential to cut a 30-day closing to two or three weeks.

Finally, the seller will prefer to deal with you, particularly if he or she needs to move quickly.

Now, you have some common-sense guidelines to follow when seeking a new home in today’s market! You can learn even more by contacting us today.