Statistics show loan modification not a panacea

"I do have a concern about money for loan modifications, particularly with such a high range of re-default," Reich told participants at a conference in Washington organized by the Office of Thrift Supervision. "Focusing on job creation is a better way to focus federal dollars than on a loan modification process may be only partially effective."


Office of Thrift Supervision Director John Reich discusses his thoughts on the best way to use government funds to end the financial crisis. He says government money may be better spent creating jobs than modifying mortgages. (Dec. 9)Reich's statement clashed with Federal Deposit Insurance Corporation chairwoman Sheila Bair over the best way to use government funds to end the financial crisis.

Reich's comments were focused, in part, on Bair's controversial proposal that would use $24.4 billion of a $700 billion government bank bailout program to modify loans. Bair argues that her proposal, which isn't supported by outgoing Treasury Secretary Henry Paulson, could avert 1.5 million foreclosures. Reich also referred to a job creation stimulus proposal put forward by President-elect Barack Obama.

Reich told MarketWatch that use of government capital to buy large minority stakes in U.S. savings and loan banks is working, but that it is too early to get a sense of how much lending participating institutions are doing.

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America's Best Long-Term Real Estate Bets

Drive along Interstate 80, just outside the city of Sacramento, Calif., and scores of gated and planned communities await. Only they're not what developers envisioned. Sidewalks are empty; homes are unoccupied.

Blame the heady days of the real estate boom. Easy-to-acquire mortgages, plenty of open land and generous zoning provided new homes to scores of buyers. Between 2000 and 2005, Sacramento-area builders doubled production.

But as prices dropped and demand dried up, builders cut back. This year, there are expected to be 6,140 new constructions in the Sacramento metro area. That's down from 20,370 in 2005, according to the National Association of Home Builders (NAHB). Median prices are now $212,000, down from $375,000 in 2005. For many residents, this is old news. Sacramento home builders and buyers engaged in the same behavior leading up to, and following, the Savings & Loan crisis. That's when construction doubled and then quartered once prices fell. Indeed, it's a market prone to booms and busts, which not a good sign for long-term investment.

In Depth: America's Best Long-Term Housing Bets

Read more here>

Foreclosures, delinquencies hit record high

But the number of mortgages on which foreclosure proceedings was started actually fell slightly during the third quarter compared with the second quarter, according to the Mortgage Bankers Association's quarterly delinquency survey. That doesn't necessarily indicate a slowdown in foreclosures, said Jay Brinkmann, MBA's chief economist.

"An initial look at the number of foreclosure starts would seem to indicate at least a leveling off of foreclosures. These numbers, however, are being influenced by several factors including various moratoria on foreclosure filings and by mortgage companies holding loans in the 90-plus-day bucket during the modification and workout process," said Jay Brinkmann, MBA's chief economist, in a news release.

Read more here>

Townhomes Markt Update for ZIP Code 75001 - October

Inventory on The Market - 27

Sold - 2

Pended - 6

Months of Inventor on the Market Based on Closed Sales - 13.5

Avg. Sold Price - $271,000

Avg. CDOM - 106

Median Price - $272,000

The townhouse market for ZIP code 75001 on October has improved compare with September. The months of inventory on the market based on closed sales (13.5) indicate typical buyers market. The inventory on the market has decreased with 19%, while sales has been staying the same. Increasing in pended transaction and median price is a positive sign for November.

Home Prices Snowball

The real estate downturn is picking up speed again. After months of slowed-down price drops that hopeful commenters pegged as signs of a bottom, the third quarter saw record year-over-year price decreases of 16.6%, according to the S&P/Case-Shiller Home Price Index.

Case-Shiller calculated that third quarter prices fell -3.5% against the second quarter; the second quarter had fallen -2.2% versus the first quarter. Month-to-month figures do not auger well for those hoping for firmer home markets going forward. Between August and September home prices fell -1.85%, the fastest clip of the past six months. Prices only fell -0.49% between April and May, giving some real estate watchers hope that the declines were declining.

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Fannie Mae, Freddie Mac suspend foreclosure sales

"Freddie Mac is on track to help three out of every five troubled borrowers with Freddie Mac-owned loans avoid foreclosure this year," Freddie Mac Chief Executive David Moffett said in a statement. "Today's announcement builds on this momentum and provides a new measure of certainty to many of these families during the holidays."


The government-controlled mortgage companies said they are ordering a national network of mortgage servicers and foreclosure attorneys to prohibit the sale of foreclosed homes for single-family and two- to four-unit properties with mortgages owned by the two entities.

Freddie Mac's Moffett added he expects that lenders servicing Freddie Mac-owned mortgages will work with borrowers to help people stay in their homes. Freddie Mac plans to approve settlements for mortgage payments with roughly 84,000 homeowners; however, 140,000 mortgages are delinquent on Freddie Mac-owned mortgages.


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Home builders distraught over economic crisis

U.S. home builders have never been as anguished about their industry as they were in early November, with their monthly market index gauge plunging five points to a record low 9, the National Association of Home Builders reported Tuesday.

"We are in a crisis," said Sandy Dunn, chairman of the NAHB, and a builder from Point Pleasant, W.Va. "If there's any hope of turning this economy around, Congress and the administration need to focus on stabilizing housing." See related story on the clash over helping homeowners.

"Worsening problems in the financial markets, job market weakness and overwhelming uncertainty about the economy" were depressing sales, the NAHB said in a release.

Economists surveyed by MarketWatch were expecting the index to be unchanged at 14. See Economic Calendar.

The NAHB/Wells Fargo housing market index shows that fewer than one in 10 builders is optimistic about the market for new single-family homes, with builders particularly discouraged about the pace of sales and the dearth of potential buyers. They are slightly more optimistic that sales could improve over the next six months.
The home builders' index has been falling for nearly three and a half years after peaking at 72 during the height of the housing bubble. The index dates to 1985.

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Pending Home Sales Down on Tight Credit and Economic Slowdown

Pending home sales fell on the heels of a strong gain a month earlier as credit tightened and economic conditions deteriorated, according to the latest survey. The Pending Home Sales Index declined 4.6 percent to 89.2 from an upwardly revised reading of 93.5 in August, but is 1.6 percent higher than September 2007 when it stood at 87.8. Lawrence Yun, NAR chief economist, said pending sales have been above year-ago levels for two months in a row. “The month-to-month weakening in pending home sales is understandable, but because the index remains above year-ago levels it means we’re still in a broad period of stabilization,” he said. “Conditions remain mixed around the country, but markets that are showing annual sales gains include Long Island, N.Y.; Boston; Minneapolis; Denver and Washington, D.C., in addition to consistent solid gains in California and Florida.”

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Public transit Catch-22

More turn to trains and buses even as transit officials struggle with funding

Higher fuel prices over the past two years combined with household fiscal concerns are leading record numbers of Americans to ditch their cars and hop on trains, subways and buses each day, a pattern that if sustained would help the U.S. to reduce fuel consumption and cut tailpipe emissions. But transit agencies are facing a classic Catch-22: Just as public transit is seeing record-breaking levels of users and more cars sitting in the suburbs, state and local governments are struggling to find dollars for transit improvements and expansions needed to bring more riders onboard.

See full story.

Buy Real Estate Now

Is it now a right time to buy?


On Halloween, Radar Logic published a new compendium of housing for the year ending in August.

The results were frightening: House prices have held up in just a precious few cities (Milwaukee, up 3%; Columbus, flat; Charlotte, down 3%). All the big California cities tanked, falling 23% to 28%. Prices in Phoenix and Vegas dropped 29% and 30%. Even prices in resilient New York City are off 7%.

These kinds of price declines in housing are unprecedented. Our friends at Zillow.com reported on Oct. 29 that half of American homeowners believe their residences are worth just as much or even more than they were worth a year ago.

Forbes has assembled a panel of real estate experts to discuss the current markets. A lively e-mail exchange was the result, with picks in both residential real estate and stocks. Joining us were Spencer Rascoff of Zillow.com, Michael Feder of Radar Logic, Donald Trump Jr. of the Trump Organization and Peter Slatin of Real Capital Analytics. The moderator, Stephane Fitch, covers real estate for Forbes magazine.

Click here to read more>

Dallas-Fort Worth pre-owned home sales post 2% gain

A local housing market pining for some good news will get a boost from the latest home sales and inventory numbers.

North Texas pre-owned home sales eked out a 2 percent gain in September – the first such increase in over a year.

And while new-home purchases have continued to plunge, the number of vacant new houses on the market is down sharply, the latest industry report shows.

"Yes, the folks in North Texas should feel somewhat better, but the news should be tempered by what's happening – or not happening – in the capital markets," said economist James Gaines of Texas A&M University's Real Estate Center
Still, the improvement in the local home sales numbers "means the market is in better balance with a reasonable inventory and enough activity to keep prices from falling dramatically," Dr. Gaines said.

September's rise comes after a long string of monthly sales declines. The last time monthly home sales in the area were up from the same time the previous year was in January 2007.

Read more here>

Area Home Sale For 1st Half 2008 - InteractiveMap

Statistics Reveal Housing Market Bottom is Close

How close are we to a bottom in the housing market? If The PMI Group is right, we're closer than you might think. PMI, a mortgage insurance firm, looks at trends in home prices, local wages and employment, and other factors to calculate the likelihood that home prices in a given city will be lower two years from now than they are today. Based on their calculations, about 65% of the nation's housing markets have less than a 10% chance of falling, and 38 of the top 100 have a less than 1% chance.

· In October 2005, near the peak of the boom, the median sales price for a U.S. home reached 7.3 times per capita income; by this May it had fallen to 5.7, in line with historical norms.

· Nationally, the rate of decline in sales is slowing, and in some regions sales numbers have actually perked up. “The indicators are starting to look better,” says Adam York, an economic analyst with Wachovia.

· The national sales figures that get so much attention … are brought down by boom-and-bust markets like Las Vegas, Miami and Phoenix. If hard-hit states like California, Arizona, Nevada and Florida are taken out of the statistical mix, the picture is much more promising.

· The government’s sweeping bailout of the financial sector could boost the housing market by making borrowing easier for buyers.

-- “Home Prices: Now for the Good News,” by Brad Reagan and Elizabeth O'Brien, Smart Money Magazine, Oct. 17, 2008.

Best and Worst Bang for the Buck Cities

The economic storm sweeping the country has left Americans with few places to hide.

But those looking to hunker down might want to head to Texas, where they can get the best value for their dollar.

That's because Austin and San Antonio lead our list of places where your money goes farthest. Residents of both enjoy affordable housing and promising prospects for job growth in coming years. Houston and Dallas also land in the top 10, at Nos. 4 and 7, respectively.

"Texas, as a whole, is one of the few economies that's performing extremely well because of the energy and technology sectors," says Andrew Gledhill, an economist at Moody's Economy.com. Plus, he added, military bases in San Antonio have continued to draw a steady steam of personnel and federal employees to the city, spurring widespread job growth.

Read more>

Townhomes Market Update for 75001 ZIP code - September

According the last trends for ZIP code 75001 Townhomes/Condo market has declined sharply in September. Inventory on the market has slightly increased but sales has decreased drastically as much as pended transactions. Months of inventory on the market based on closed sales are 16.5, the highest for 15 months.

Inventory on the market - 33

Sold - 2

Pended - 2

Months of Inventory on the Market - 16.5

Avg. Active Price - $249,000

Avg. Sold Price - $246,000

Avg. CDOM - $229,000

Median Price - $246,000

Freddie Mac: Fixed-rate mortgages fall in latest survey

NEW YORK (MarketWatch) -- U.S. fixed-rate mortgages declined in the latest week, according to Freddie Mac's survey released Thursday. The national average interest rate on the benchmark 30-year, fixed-rate loan averaged 6.04% in the week ending Thursday, down from last week's 6.46% and the year-ago 6.33%. The 15-year fixed-rate loan averaged 5.72%, down from the week-ago 6.14% and the year-ago 5.99%. The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 6.06%, compared with 6.14% a week ago and 6.03% a year ago. One-year Treasury-indexed ARMs averaged 5.23% this week, up from last week's 5.16% and down from the year-ago 5.66%. "Long-term mortgage rates fell this week amid news of tame inflation and a weaker housing market," said Frank Nothaft, Freddie Mac vice president and chief economist.

NEW YORK (MarketWatch) by Michelle Donley

Focus on foreclosures, liquidity

Under their new government-appointed chief executives, Fannie Mae and Freddie Mac are focused on reducing foreclosures, improving liquidity in the mortgage market and restructuring aspects of their business, according to a panel discussion of the executives and their government regulator at the Mortgage Bankers Association annual conference here Monday.

They're working with lenders and loan servicers to ensure foreclosures are avoided where possible -- including measures such as lengthening loan terms and reducing interest rates -- Fannie Mae's and Freddie Mac's chief executives said, and they're also actively working to improve liquidity in the mortgage markets.


The two government-sponsored enterprises were taken over by the government in September, in the first of several government bailouts recently meant to try to halt the spread of the mortgage-fueled credit crisis. Fannie and Freddie own or guarantee almost half of all home loans in the U.S., making the health of the residential real estate market at least in part tied to their well-being.
"This is a very critical time in the economy and certainly in the mortgage markets and we at Fannie Mae are doing all we possibly can," said Herbert Allison, chief executive of Fannie Mae.

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Some home sellers are lenders too

With mortgage money harder to get, sellers provide financing

The concept of owner financing isn't new, though it wasn't as popular when mortgage money was easier and cheaper to come by through traditional lenders. But in today's tough real estate markets, being able to finance the sale of your home can give a seller an edge.

"There are a lot of good buyers out there that can't get loans," said Dawn Rickabaugh, of Rickabaugh Realty, in Pasadena, Calif. "When you eliminate the hurdle of qualifying for a bank loan, you'll double the amount of buyers interested," she said. Rickabaugh also oversees the Web site NoteQueen.com, which focuses on owner financing.

Loans that are most difficult to get -- including jumbo mortgages and financing for commercial properties -- are ripe for seller carry-back scenarios, Rickabaugh said. But it can be done for any property type, and sellers can finance all or part of the loan, she said.
Seller financing can help buyers who may be having trouble getting a loan because they are self-employed or work on commission, for instance. It can also help someone barred from a traditional mortgage due to scarred credit -- if it can be explained, said Dorcas Helfant-Browning, principal broker and CEO of Coldwell Banker Professional, Realtors in Virginia Beach, Va.

Read more >

Market Update for 75001 ZIP code - September

The overall housing market in ZIP code 75001 has been slowing down consistently since July. The inventory has decreased, but on the other hand the number of sales and pended transactions has decreased drastically. The months of inventory on the market based on closed sales are 12.3, the longest for 15 months.

• Inventory for Sale - 46
• Sold - 4
• Pended Transactions - 5
• Months of Inventory Based on Closed Sales - 12.3
• Avg. Active Price - $255,000
• Avg. Sold Price - $293,000
• Avg. CDOM - 135
• Median Price - $296,000

U.S. Foreclosure Pace Slows

The subprime mortgage crisis seemed to ebb a bit on Main Street America as foreclosures ebbed a bit in part due to efforts made by state governments and lenders.

On Friday, real estate data firm RealtyTrac reported Friday that the number of Americans in some stage of foreclosure increased by 12.0% in August from July and 27.0% from a year earlier. Though the firm said that 1 in every 416 U.S. homeowners are on the verge of losing their abodes, the year-over-year increase was was actually substantially lower than in previous months, when it was hovering around 50-65%.

“Over the past few months, we’ve seen annual increases in default activity and auction activity moderating, and that trend continued in August, with default activity up just 10.0% from a year ago and auction activity up 7.0% from a year ago,” said James J. Saccacio, chief executive of RealtyTrac.

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Market Update for Addison / Far North Dalls - September

Compare with August the housing market in Addison / Far North Dallas area has been slowing down. The inventory on the marked has decreased but the number of sold and pended houses has been decreasing since May. The days of inventory on the market based on closed transactions is 8 months which shows typical buyers market.

• Homes for sale - 509
• Homes sold - 64
• Homes pended - 68
• Months of inventory based on closed sales - 8.0
• Avg. Active Price - $578,000
• Avg. Sold Price - $332,000
• Avg CDOM - 53
• Median Price - $270,000

Pending Home Sales Up Sharply

A little light in the dark. According "Realtor Magazine" pending home sales are up, but I would say the free falling will continue.

Pending home sales activity surged as buyers took advantage of low home prices and affordable interest rates, according to the NATIONAL ASSOCIATION OF REALTORS®.

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in August, jumped 7.4 percent to 93.4 from an upwardly revised reading of 87.0 in July, and is 8.8 percent higher than August 2007 when it stood at 85.8. The index is at the highest level since June 2007 when it stood at 101.4.

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Home prices falling faster in July, Case-Shiller says

WASHINGTON (MarketWatch) -- Home prices in 20 major U.S. cities fell at a faster pace in July, sending home values down a record 16.3% in the past year, according to the Case-Shiller home price index released Tuesday by Standard & Poor's.


July's prices fell 0.9%, an uptick from a 0.5% drop in June, and "may be the beginning of a renewed acceleration in the depreciation of U.S. house prices," said Harm Bandholz, economist for UniCredit Markets.

Read the whole story here>

Housing Sector On Shaky Ground

Home improvement retailers are continuing to feel the squeeze in the dismal market. Since the sector doesn't expect a turnaround anytime soon, it has no choice but to take precautions.

Lowe's (nyse: LOW - news - people ), the second largest U.S. home improvement retailer behind Home Depot (nyse: HD - news - people ), announced at an analyst conference Wednesday that it won't be expanding as much next year. The company, which plans to open a total of 120 new stores in 2008, only plans to open another 75 to 85 new stores in 2009 due to the rough conditions affecting the housing market.

Read whole article here>

Market Conditions

According "Realty times" article, the existing home sales are down. The latest report from the National Association of Realtors is reporting that existing-home sales were down in month of August by 2.2 percent.

The reason for this slight stall? NAR President Richard F. Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif., said the pendulum in the mortgage market has swung too far. "The difficulty in obtaining a mortgage increased over past couple months, making it more challenging for creditworthy borrowers to find financing," he said. "Our hope is that overly tight lending criteria can be loosened with reasonable standards and credit so that sales activity can catch up with demand.

Read entire article here>

Now May Be the Best Time for First Time Homebuyers

“If you've been watching for the fleeting, best time to buy a home, this fall may be it, especially if you're a first-timer. There are signs that things are starting to stabilize. Pair that with limited-time-only offers from the government, and this fall's market looks awfully tempting for buyers.

• The Federal Housing Administration recently boosted its loan limits to $729,750 in expensive areas such as Washington, but it's going to take some of that back come Jan. 1, when the loan limit will shrink to $625,500. If you're going to need a FHA mortgage from $625,500 to $729,750, start touring homes now, and make sure to close by the end of the year.
  
• Keep an eye on the expiration date for the new tax credit of up to $7,500 for first-time home buyers. It requires that you close on the home no later than June 30, 2009. That may seem like a long way off, but it will loom larger come spring, traditionally the busiest time for real estate sales.”
  

-- “Plenty to Coax Home Buyers Back To the Market,” by Elizabeth Razzi , Washington Post, Sept. 7, 2008 .

Townhomes Markt Update for ZIP Code 75001

Inventory on the market - 31

Sold - 7

Pended - 6

Months of inventory on the market based on closed sales - 4.4

Avg. sold price - $225,000

Median price -$245,000

Click on the graph to enlarge it

According the statistics above the Condos/Townhomes market on August has improved compare with the last month. The months of inventory based on closed sales are 4.4 vs. 9.8 in August, which is a typical for a buyers market. There were more inventories sold than inventory came on the market which drove the Avg. sold price ($150,000 vs. $225,000 in August) and Median price ($120,000 vs. $245,000 in August).

Townhomes Market Update for Addison / Far North Dallas - August

Townhomes Market Update for Addison/Far North Dallas.

Inventory on the Market - 241

Sold - 36

Pended - 19

Months of Inventory on the Market Based on Close Sales - 5.7

Avg. Sold Price - $183,000

Median Price - $152,000

Click on the graph to enlarg it

Market update for Addison / Far North Dallas - August

Last trends for Far North Dallas/Addison including single family homes and Townhouse.

Inventory on the market - 789

Sold - 116

Pended - 81

Months of inventory on the market based on closed sales - 6.8

Avg. sold price - $270,000

Median price - $241,000

Click on the graph to enlarg it

U.S. Foreclosure Pace Slows

August rate declines, possibly presaging an end to the housing crisis.


The subprime mortgage crisis seemed to ebb a bit on Main Street America as foreclosures ebbed a bit in part due to efforts made by state governments and lenders.

On Friday, real estate data firm RealtyTrac reported Friday that the number of Americans in some stage of foreclosure increased by 12.0% in August from July and 27.0% from a year earlier. Though the firm said that 1 in every 416 U.S. homeowners are on the verge of losing their abodes, the year-over-year increase was was actually substantially lower than in previous months, when it was hovering around 50-65%.

“Over the past few months, we’ve seen annual increases in default activity and auction activity moderating, and that trend continued in August, with default activity up just 10.0% from a year ago and auction activity up 7.0% from a year ago,” said James J. Saccacio, chief executive of RealtyTrac.

Read whole story here>

Market Update for Dallas County - August

Inventory on the market - 13692

Sold - 1883

Pended - 1793

Months of inventory on the market based on closed sales - 7.3

Avg. sold price - $223,000

Avg. CDOM - 79

Median price - $127,000

Click on the graph to enlarge it.

Is It Realy Real Estate Market Bouncing

According the Realty Times article in Real Estate Outlook: Positive Trends In Housing Studies the housing market has positive tendency.

Increased sales for new construction and resale and that are good. Is that the only measure for improving market? They also mentioned that the prices, because of the foreclosures are going down, but is that the only bad think? I did not see what inventory is coming on the market. If the inventory is coming on the market faster than the inventory going of the market I would not say that the market is improving.

The falling of the price is not caused from the foreclosures only, but it comes from a lot of the inventory out. The simple law of the economics, demand vs. supply. Moreover I haven’t seen the months of inventory on the market based on closed sales, not on pended.

Glimmers Of Hope In Housing, Consumer Confidence

Moderating declines in home sales offered a measure of hope to Wall Street on Tuesday, as did a rise in consumer confidence in August.

The S&P/Case-Shiller 20-city home price index fell fell 0.5% from May to June, while the 10-city index fell 0.6% over the month. That's a slower pace than the 2.0% to 2.5% monthly drops seen earlier in 2008.
Still, the latest reading offers little hope the slumping housing market will firm up in the near term.

"While there is no national turnaround in residential real estate prices, it is possible that we are seeing some regions struggling to come back, which has resulted in some moderation in price declines at the national level," says David M. Blitzer, chairman of the index committee at Standard & Poor's.

Read full story here>

Townhomes Market Update For ZIP Code 75001 - July

Inventory on the market - 39

Sold - 4

Pended - 5

Months of inventory on the market based on closed sales - 9.8

Avg. active price - $259,000

Avg. sold price - $150,000

Median price - $120,000

So according the last trend graph townhouse market is back down compare with the last month. The inventory has increased 11.3% June while sales drooped 307%. 9.8 months of inventory on the market shows that we are in typical depreciating market.

Market update for Addison / Far North Dallas - Julay

According the last trend graphic the housing market in Addison / Far North Dallas area is slowing down consistently since December. The there has been more inventory coming on the market than inventory going off the market.

Inventory On The Market - 809

Sold Inventory - 131

Pended transactions - 108

Months Of Inventory On The Market Based On Closed Sales - 6.2

Avg. Sold Price - $114,000

Avg. Active Price - $260,000

Median Price - $238,000

Market Update for ZIP Code 75001

Trend graph for July:

Inventory on the market - 63

Pended sales - 10

Sales - 10

Months of inventory on the market based on closed sales - 6.3

Median price - $280,000

Investors Fret Over Financials

Financials were falling off of weak economic reports and game-changing plans at a few major U.S. financials both of which pointed to more pain in the pipeline for investors.



Morning trading in the perceived safety of government debt was mixed, as the inflation reading (see "PPI: Pretty Painful Inflation") and disappointing home building figures sent the yield on the 10-year Treasury note up to 3.83%, from 3.82% Monday, and the 2-year note yield fell to 2.30%, from 2.35%. The divergent yields pointed to confidence in long-term stock prospects, but a short-term flee to safety.

Read entire article here>

Market update for Addison / Far North Dallas - June

According the last trend graphs for June, the inventory on the market for Addison / Far North Dallas continue to be high, while the sales compare with the same time last year are 10% less. The months of inventory on the market based on closed sales is 5.7, while the same time last year was 4.5.

The situation for Zip code 75001 is the same. The good news for townhomes and condo sellers is that the inventory on the market for the same ZIP code, compare with the same time last year for townhomes and condos, has decreased significantly with 48% while the sales are relatively the same. The inventory on the market based on closed sales is 2.7 vs. 5.2 last year.

Compare with the last month the inventory on the market is the same, while the sales has increased three times and the time of inventory on the market based on closed sales is 2.7 vs. 8.8.

Investor Report: New Housing Bill and Tax Benefits

Foreclosure relief for home owners may be getting all the press on the new housing bill signed into law by the President this Wednesday. But there's plenty of tax-related goodies sprinkled through the bill's nearly 700 pages for sharp-eyed real estate investors.

Start with the low-income housing tax credit program -- the federal government's biggest source of support for affordable rental complexes -- driven mainly by tax shelter offerings.

The bill basically increases the size of the program, at least temporarily, by raising the current state-by-state volume limitations on tax credits. Put another way, the bill expands the number of potential deals supported by credits that developers and investors can do through the year 2009.

What do you think? Will the housing bill help to the housing market?

Read full story>

Summary of Key Provisions of H.R. 3221 - The Housing Stimulus Bill (as of 7/30/08)

H.R. 3221, the “Housing and Economic Recovery Act of 2008,” passed the House on July 23, 2008, by a vote of 272-152. On Saturday, July 26, 2008, the Senate passed the bill by a vote of 72-13. The President signed the bill on July 30, 2008. The bill includes the following provisions

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Investor Report: Where to Buy Low, Sell High

According "Realty Times" article, Dallas and Fort Worth are in top five cities to buy house below market price and flip it.

HomeVestors -- whose 230 franchisees in 35 states have bought and turned around more than 35,000 houses during the past 12 years -- has just come out with its top ten list for the second quarter of 2008.


Four are in Texas (Dallas, Houston, Fort Worth and San Antonio), along with Denver, Colorado, Charlotte, North Carolina, St. Louis, Missouri, Milwaukee, Wisconsin, and Chicago, Illinois and Kansas City, Kansas.

Read full story>

NAR Strongly Supports Downpayment Assistance Programs

The Housing bill being considered in Congress this week does NOT eliminate all downpayment assistance programs from eligibility for FHA insurance. The legislation would only prohibit seller-funded downpayment assistance, or assistance from someone who financially benefits from the transaction. Other forms of assistance - such as family members, government-sponsored programs, or gifts from non-profits would still be permitted. The Housing bill also contains many reforms that we believe are critical to housing markets. The bill includes FHA reform, GSE reform, a homebuyer tax credit, and permanent increases to the FHA and GSE loan limits. This bill will help millions of American families avoid foreclosure and safely and affordably achieve the dream of homeownership.

FHA is the only mortgage program that has allowed seller-funded downpayment assistance. However, FHA’s recent default rate is troubling. Due to the current performance of its loans, FHA must receive a federal subsidy for the first time in its history, or raise it premiums on borrowers in order to remain solvent. This is primarily due to loans with seller-funded downpayment assistance, which have a default rate 3X higher than other FHA loans. Loans that receive downpayment assistance perform less well than loans without downpayment assistance. A recent GAO study found that loans with seller-funded downpayment assistance experienced more than double the risk of delinquency than loans with other types of downpayment assistance, and almost three-times the risk of loans with no downpayment assistance. (Additional Action Needed to Manage Risks of FHA-Insurance Loans with Downpayment Assistance, United States Government Accountability Office, November 2005.)

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Top 10 Cities to Buy a Home

Financially, at least, the best places to buy houses are those where buying costs less than renting, tax incentives are attractive, and there’s an opportunity to build equity.

Forbes magazine surveyed the 40 largest metropolitan area housing metrics looking for cities where home prices have appreciated over the last two years. It also measured vacancy rates. And it gave extra points to cities where rents are significantly higher than a buyer would pay for the same home.

Texas dominated the magazine’s list because of its healthy job market and growing tax revenues.

Here are the 10 cities that topped Forbes’ best-places-to-buy list:

1. Houston
2. Austin, Texas
3. St. Louis
4. Philadelphia
5. San Antonio, Texas
6. Dallas
7. Charlotte, N.C.
8. San Francisco
9. Jacksonville, Fla.
10. Atlanta

Source Forbes, Maurna Desmond (07/14/08)

Investors Still Shy Of Fannie & Freddie

With friends like these how can you fail?

Fannie Mae (nyse: FNM - news - people ) and Freddie Mac (nyse: FRE - news - people ) surged Monday morning, but then cooled after news that the Federal Government announced a three-pronged plan on Sunday to ensure that the two government-backed lenders, which own or guarantee roughly $5.3 trillion or half of all outstanding U.S. mortgage debt, are able to continue operating.

The government's action turns an implicit government guarantor into an explicit one, and boosted investor confidence, at least initially. Freddie was down 1.4%, or 11 cents, to $7.64 and Fannie added 2.8%, or 29 cents, to $10.54 by noon in New York.

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On Buyer’s market Inventory sells at its highest price

The first 14 days are the most critical in the marketing of your home. Creating a perception of value in this initial marketing stage is imperative in order for you to net top dollar.

This graph shows the traffic that will be previewing your home in the first 21 days on market.

When the home is first introduced to the marketplace and perception of value has been created, seller will see the heaviest traffic. These buyers are the best buyers. Why? Because they are already working with the broker population, they are seasoned buyers, they have seen all of the inventory, they may have lost other homes in multiple bid situations, and they are prepared to step up to the plate and make an offer. If the positioning has created a sense of urgency where more than one buyer wants the property, they will be asking the question, “what will it take to get this house.” “What do I have to do to take it off market?”

After the first week seller will begin to see the traffic taper off. These buyers do not have that same sense of urgency the first wave of buyers had. They are not as excited, and these buyers are asking the question, “I wonder what this property is worth.”

During third week of marketing, the showings will have dropped off dramatically. These are buyers just entering the market and not ready to make decisions – they are not educated, nor experienced in the process. They have just started their home search adventure.

It is important to understand that the buyers visiting your home in the first days on market were not attracted to the home by an ad. These are the buyers who answered ads 60-90 days ago in order to be today’s seasoned purchaser. The buyers we see coming in after three weeks are buyers new to market and not prepared to buy for another 60-90 days. As confirmed in the product vs commodity concept - THERE IS NO DIRECT RELATIONSHIP TO ADVERTISING AND SELLING YOUR HOME – IN GOOD MARKETS INVENTORY FLIES OFF THE MARKET WITHOUT ADVERTISING, AND IN BAD MARKETS, WE ADVERTISE IN VOLUME AND INVENTORY SITS.

The power of interenet marketing in Real Estate

For years sellers have confused advertising with marketing. In real estate advertising only does not sell homes - it’s Realtors way of shifting the buyer pool from one company to another. It’s a fishing expedition to make the phone ring and get buyers. Homes on the market acts as bait so that when a buyer answers an ad it is the agent’s job to reel them in, get the appointment, and show them all the inventory within the price range. Statistically 50% of the buyers who respond to an ad can afford to spend more, and 50% are unqualified.

In real estate advertising does not sell homes. In the past, the main advertising venues in real estate were classified newspaper advertising and limited print display ads. There were no photos, and advertisements only appeared once a week resulting in limited exposure. A great deal of money was spent to enable a consumer to visualize your property.

According to National Association of Realtors statistics, only 5% of today’s buyers find the house they bought through print advertising.

In the past lead generator #1 for the Realtor were singes, today lead generator #1 has become Internet. Today, more than 80% of home buyers use the Internet when looking for a home. Through the power of the Internet, your house is always open to tour. Home buyers using the Internet will be able to view customized listing information, a photo gallery, school and community information, and even maps specific to your property. When online buyers inquire about your house, they have already completed the first step of the home buying process and come to your property as an informed buyer.

When you are interviewing a broker, always ask what kind of Internet exposure they offer.

Buyer's Market, Also 'Buyers Beware' Market

Here is an article in "Realty Times" which advise buyershow to behave in Buyer's market. Is it time to buy or not? Has the market hit the bottom? I think you will find thr answer in this article.

More home buyers have a better chance now than at any other time in nearly a half decade to negotiate a home-buying deal that costs less and comes with some concessions thrown in.

In many locations, buyers will find a glut of new homes, more motivated sellers, foreclosures, auctions, short sales and other market conditions that can make it a really good time to buy.
That doesn't mean throw caution to the wind.

The same conditions that lure buyers to market also lure misfits looking to cash in on your unfettered haste and the waste left from a boom market gone bust.

No matter what the market conditions, it's also always a buyers beware market, now perhaps more than ever.

Here's how to begin to navigate today's housing market, step-by-step, and make a good deal without getting taken.

Begin with making a personal "right-time-to-buy" decision. If you stretch financially beyond your means to go after lower-priced homes, foreclosures or short sales, you could be setting yourself up for failure. Today's housing market is littered with home owners who borrowed more than they could afford.

Reed full story>

Market Conditions

According to the most recent news from the Hope Now alliance -- a new set of procedures and guidelines have been set that will help homeowners quickly receive the help they need -- before they go into foreclosure.

Full story here

10 Best Cities to Live, Work, Play

Where are the best cities in the country to live, work, and play? Kiplinger Personal Finance magazine did its best to answer that question in its 2008 Best Cities report.

Kiplinger says it looked for strong economies and abundant jobs, a reasonable cost of living, and lots of fun things to do.

Kevin Stolarick, research director at the Martin Prosperity Institute, a think tank that studies economic prosperity, worked with the magazine to make the top 10 selections. "Our formula highlights cities not just with strong past performance, but also with all the ingredients for future success," he says.

Read entire article here>

Real Estate Outlook: Pending Home Sales Rise in April - What Realty time does not say?

According Realty times article pending sales rose 6.3 percent during April. "Be thankful for even small nuggets of good news. A rise in pending home sales is a positive and encouraging sign for sellers, buyers and real estate professionals" - author said.

Is that really a reason to see a light in the dark? What the author did not say?

1. Have the inventory on the market increased and with how many percent?
2. How long is the inventory on the market staying?
3. Pending does not mean closed sales, especially in this mortgage market.

It is the simple low of economics - supply vs. demand. When the inventory comes on the market faster than coming off, we have depreciating market and prices needs to stabilizing or going down. Conversely , if the inventory going of the market faster than coming in, we are in appreciating market and prices need to going up.

To read the entire article click here>

Foreclosure Casualties High In GI Households

You think your town's real estate market is under siege?

Families of our nation's fighting forces are struggling much more against the scourge of foreclosures.
The rate of foreclosures in towns where soldiers and sailors live is increasing at nearly four times the pace of the national average.
That's more than during the Vietnam War, the Korean War and World War II, according to data from Realtytrac.com.
Realtytrac.com says foreclosure filings in 10 towns and cities within 10 miles of military facilities, rose by an average 217 percent from January through April this year, compared to last year. Nationwide, the overall rate during the same period was only 59 percent

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CREEKVIEW LENDING

Creekview Lending is going to build a new subdivision just minutes from downtown McKinney. There are lots available between 1 1/2 t0 5-acre. .

Creekview Lending providing cosy enviroment with all of the conviniance for a big city. The planning, enginiring, and restrictions such that customers are usually have in thei current neighborhood.

All utilities and extras from the roads, internet, cable TV etc. have been put in to place at Creekview Landing.

It is something that you will love.

Auctions

After the is evicted the house is going to the auction. There are two different auctions:

1. Delinquent Mortgages, known as "Trustee Sale".

2. Delinquent Taxes, Known as "Constable Sale".

Whit "Trustee sale" when the entity (county sheriff) auctions a foreclosed property the note holder may set the starting price as the remaining balance on the mortgage loan. However, there are a number of issues that affect how pricing for properties is considered, including bankruptcy rulings. In a weak market the foreclosing party may set the starting price at a lower amount if it believes the real estate securing the loan is worth less than the remaining principal of the loan.

In the case where the remaining mortgage balance is higher than the actual home value the foreclosing party is unlikely to attract auction bids at this price level. Only cash and cashier checks are accepted on the auction.

A house that went through a foreclosure auction and failed to attract any acceptable bids may remain the property of the owner of the mortgage. That inventory is called REO (real estate owned). In these situations the owner/servicer will try to sell it through standard real estate channels. Under this auction is HUD auction as well and the only difference is that a HUD auction is a form of foreclosure auction except the original lender was a federal agency instead of a private lender. The United States Department of Housing and Urban Development (HUD), is the insurer of loans made through a variety of government programs, particularly FHA loans. When a lender forecloses on a government insured loan, HUD takes possession of the property.

The Tax deliquesce auctions are hold bay he counties. Different counties has different rules.
The profitability of Tax Foreclosure Sales is heavily dependent on the property condition, the outstanding liens, and the popularity of the tax sales. In Texas the tax delinquency foreclosure has a redemption, the homeowner has a chance to have his property back with in two years.

30-Year Mortgage Rates Drop

After four weeks in an upward trajectory, Freddie Mac reports that long-term mortgage rates are falling again.

The average interest on a 30-year fixed loan settled at 5.98 percent this week, down 0.03 percent from the prior week. Rates on 15-year fixed mortgages, meanwhile, slipped 0.5 percent for the week to an average of 5.55 percent.

Borrowing costs drifted slightly higher, however, on adjustable-rate products.

Five-year ARMs bumped up 0.04 percent to 5.61 percent, while one-year ARMs moved up 0.06 percent to 5.24 percent.

Source: Chicago Sun-Times (05/23/08)

Real Estate Outlook: Worst is Over

Don't break out the champagne glasses quite yet, but there are more economic signs this week that the worst is over for the three year real estate correction cycle.

One of the country's most prestigious groups of market forecasters, the National Association of Business Economists, says housing and consumer credit conditions will stabilize and begin improving as the year moves on. Equally important, said Ellen Hughes-Cromwick, chief economist at Ford Motor and president of the association: The entire U.S. economy will "slowly return to health" this year.

The housing market offered some immediate hints of that recovery with new home starts up by 8.2 percent last month and building permits up by 5 percent. Even in hard-hit southern California, home sales in April were up 22 percent compared to March, according to DataQuick Information Systems.

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What sellers don't have to forget if they were buyers of their own homes.

Remember that although people can be different in personality they tend to be the same when it comes to expectations at someone else's expense. In other words, a prospective buyer would probably like to see a perfect home from top to bottom, inside and out, when it comes to your home. Try to do as many of the following items as possible to improve the likelihood of an expedient home sell.

On the inside

1) Sweep front walkway.
2) Remove newspapers, toys and bikes.
3) Park extra cars away from the property.
4) Trim back the shrubs.
5) Apply fresh, clean paint throughout.
6) Clean windows and window covering throughout.

7) Keep plumbing and all appliances in working order.
8) Maintain all sealant in good condition.
9) Make sure roof and gutters are clean and in good condition.
10) Mow the lawn frequently and plant flowers.
11) Keep pet areas clean.

On the inside

1) The kitchen and bathroom should shine.
2) Quick once - over with vacuum; carpets should be clean.
3) Place fresh flowers in the main rooms.
4) Put dishes away, unless setting a formal display for decoration.
5) Make all beds and but all clothes away.
6) Open drapes and turn on lights for a brighter feel.
7) Straighten closets.
8) Put toys away.
9) Turn off television.
10) Play soft music on the radio/stereo.
11) Keep pets out of the way and pet areas clean and clean-odor free.
12) Secure jewelry , cash, prescription medication and other valuables.
13) Enhance the spaciousness of the each room.

Auoctions

Foreclosure auctions are arranged to attract a large pool of professional real estate investors who are interested to investment in the foreclosure properties. Foreclosure is the process of selling off a borrower’s property by the lender to accumulate the amount lender to the borrower. According to the legal parameters set by the Federal government, the highest bidder is eligible to buy the property and all the foreclosure taxes and the liens associated to the house should be paid by him. The buyers are required to pay the entire price of the property in cash and the price must be paid on spot. A buyer must be aware about the particular property before purchasing it.

Buying a foreclosure home from the foreclosure auctions is not a job for the initial investors. An investor must have cash as the entire amount needs to be in cash. With a large credit line it is possible to be a part of the foreclosure auctions. There are different investors who keep a track of the auctions. These foreclosure auctions usually occur in the public places. Information about these auctions is provided in the legal newspaper or in the legal section of the local newspapers, community newspapers and tabloids. There are several online information service providers that informs through e-mails and faxes regularly. In case of any specific property it is best to communicate with the lender’s attorney or the trustee.

To read more click here>

Taking for granted the "curb appeal" of your home

When you're preparing your house for sale, remember the importance of first impressions. A buyer's first impression can make or break whether they even want to go inside for a look . It estimated that more than half of all houses are sold before the buyers even get out of their cars. With that in mind, be sure to stand outside of your home, and take a realistic "fresh look and then ask yourself what can be done to make the "curb appeal" improve. Also ask your Realtor opinion as to how to improve the curb appeal. It could make a huge difference in your final sales price.

Be upfront and disclose to your Realtor any problems with the property. The problems are going to be discovered anyway. A decade ago , health and safety issue were really a part of most sales contacts. Moreover, in many states as Texas, the seller must disclose t the buyer any knowledge o existing property problems. In many cases, these issues have been or can be factored in to the home,s listing price. Do not try brake a deal because after the inspection some structural problems were found (foundation, roof etc.), because regarding the law in TX you need to disclose it anyway. Your Realtor is the person who needs to walk you trough the negotiating the inspection issues. Negotiating process is where Realtors needs to earn their fee. A good negotiator could net you as much as 10% more and bad negotiator could cost you as much as 10% less, it could be as much as 20% spread.

The foreclosure process

The foreclosure process is not very difficult to understand. There are several stages during which the homeowner has an opportunity to bring the loan current and avoid foreclosure.

There are several stages during which the homeowner has an opportunity to bring the loan current and avoid foreclosure. In Texas the usual time is three months of default. After the third month of default your lender evokes the acceleration clause in your mortgage and requires you to pay the entire amount... immediately.

In this letter they give you notice that you have 20 days to cure the delinquency before foreclosure will begin. At this point they're not fooling around and your alternatives drop significantly...not to mention the fact that your credit is seriously damaged.

The next step after 20 days of no payments or contact from you in the foreclosure process, your lender will then publish a legal notice of the pending foreclosure auction (sale) to be held at least 21 days later - on the first Tuesday of the following month on the county court house steps.

Your lender also files a notice with the county clerk and mails a certified copy of the notice to you – called a Notice of Default (N.O.D.).

This is when the dreaded FORECLOSURE PROCESS technically begins

Once the Notice of Default is filed, the foreclosure is imminent.

Then the auction date arrives. This is often called an auction, sheriff's sale or foreclosure sale. The auction is literally held on the county courthouse steps and anyone can bid. Anyone who can pay cash (or cashier's check) that is.

During the process homeowner has fore options.

1. Declare bankruptcy.

2. Reinstate the loan.

3. Sell the property (Short sale)

4. Let the property go to auction.

40% of homeowners choose #4!

Of the remaining 60% here is what they do:

55% choose to declare bankruptcy

5% go after reinstating the loan

40% choose to sell the property

Realty Viewpoint: Why Buy Now? Media Is Wrong About Housing Slump

I want to share with you an article in Realty Times focusing on why the public should buy now and the media’s inaccuracies about the current real estate market. The article emphasizes that real estate consumers are not getting the full picture and how housing indexes can be very misleading. Enjoy reading.

Why buy a house now? You've been getting bad information. Here's why.

The financial press is worried that they might have gone too far -- paralyzing the nation into recession by piling on housing. So they're finally beginning to question the indexes where they get their data, and whether the news is really as bad as it seems. Slowly but surely, headlines are changing from Don't Buy A Home Now to Is It Time To Buy?
We said it here first on Realty Times -- that consumers aren't getting the full story. Indexes can be misleading because of the locations, prices, types of housing, and rates of increase they track.

Click here to read more>

Complacent marketing when selling a home

When selling your home there are no guarantees that the ultimate buyer of your home will simply walked through the front door. In many cases you have to bring your home to the buyer. Effective marketing will help ensure that your property receives maximum exposure to attract a ready, willing and able buyer in the shortest period of time.

Years ago the signs were the best broker's lead generator, today Internet has become the lead generator number one for them. Over 80% of the buyers start their search on Internet and they will know every thing about the area, schools and properties before contact a broker. When you are interviewing Realtors ask what is going to be the Internet exposure of your home. A lot of sellers still emphasise on news paper advertising but according the National Association of Realtors statistics only 5% of the buyers bought their home through printing add.

Moreover ask if your home will be posted on Realtor.com as a showcase enhanced listing which will allow your home to be exposed with more photos and description. Today's buyer wants to see as many photos as possible before a personal inspection. If your home will be displayed as a Featured, it will be seen 20 times more often than those that are non - featured.

Deed of trust

Texas is a Deed of trust state. Lets talk about the deed of trust do understand the foreclosure process better. There are three parties involved in deed of trust - Borrower, Lender and Trustee.

A mortgage is the pledging of a property to a lender as a security for a mortgage loan. While a mortgage in itself is not a debt, it is evidence of a debt. It is a transfer of an interest in land, from the owner to the mortgage lender, on the condition that this interest will be returned to the owner of the real estate when the terms of the mortgage have been satisfied or performed. In other words, the mortgage is a security for the loan that the lender makes to the borrower.

The term comes from the Old French "dead pledge," apparently meaning that the pledge ends (dies) either when the obligation is fulfilled or the property is taken through foreclosure.

In most jurisdictions mortgages are strongly associated with loans secured on real estate rather than other property (such as ships) and in some cases only land may be mortgaged. Arranging a mortgage is seen as the standard method by which individuals and businesses can purchase residential and commercial real estate without the need to pay the full value immediately. See mortgage loan for residential mortgage lending, and commercial mortgage for lending against commercial property.

In many countries it is normal for home purchases to be funded by a mortgage. In countries where the demand for home ownership is highest, strong domestic markets have developed, notably in Spain, the United Kingdom and the United States.

March Collin County housing market update

Based on last trends report the housing market in Plano is stable. The supply of inventory on the market is much higher than the sales. The months of inventory on the market is 5.3 which is higher than the last month but under the average of 6.9 months for Collin county. Rely on the data below I would say that the market in Plano is stable with tendency for prices staying flat or slightly appreciating.

However the Real estate is local and there are areas in Plano where the price is going up and some where the prices have been declining., so if you intend to put your home on the market make sure to analyze the market in your subdivision very carefully.

The picture is not the same in some different areas in Collin county as McKinney and Frisco for example., where that supply of inventory is much higher because of the new constructions. Buyers will need definitely more time to see some appreciation on their hoses and sellers will need more time and lower the prices to sell their properties. Just for example the months of inventory on the market in McKinney is 9.1, almost twice higher than Plano.

Click on the graph to enlarge it.

Mistatkes Home Sellers Make

Since today in several consequent articles every Monday I will start discussing what are the main mistakes that Sellers make.

Using a real estate agent instead of Realtor.

When you are looking for help buying or selling property, it is important to remember that the terms: real estate agent” and “Realtor” are not synonymous. Realtor’s can provide an extra level of service, and to be a Realtor you must be a member National Association of Realtors /NAR/. The equivalent organization in Canada is the Canadian Real Estate Association /CREA/. Both are non-profit trade organizations that promote real estate information, education, and professional standards. The national Association of Realtors also has earned a strong reputation for actively championing private property rights and working to make home ownership affordable and accessible.

The NAR and CREA members adhere to strict code ethics founded on the principle of providing fair and honest service to all consumers. Realtor business practices are monitored at local board levels. Arbitration and disciplinary systems are in place to address complaints from the public or board members. This local monitoring keeps Realtors directly accountable to the individual consumer they serve and therefore the consumer is more likely to find better service and accountability by using a Realtor.

Foreclosures

A lot of buyers and investors want to buy a foreclosure for a good deal, but most of them don't know almost anything about the foreclosure process.

On my next few articles every Saturday I will discuss foreclosures, short sales and foreclosing process. I will be appreciate on any questions or comments.

The first you need to know about foreclosures that could be judicial and non - judicial.

Foreclosure by judicial sale, more commonly known as Judicial Foreclosure is available in every state and required in many, involves the sale of the mortgaged property under the supervision of a court, with the proceeds going first to satisfy the mortgage; then other lien holders; and, finally, the mortgagor/borrower if any proceeds are left. As with all other legal actions, all parties must be notified of the foreclosure, but notification requirements vary significantly from state to state. A judicial decision is announced after pleadings at a (usually short) hearing in a state or local court. In some fairly rare instances, foreclosures are filed in Federal courts.

Foreclosure by power of sale, which is also allowed by many states if a power of sale clause is included in the mortgage. This process involves the sale of the property by the mortgage holder without court supervision. It is generally more expedient than foreclosure by judicial sale. As in judicial sale, the mortgage holder and other lien holders are respectively first and second claimants to the proceeds from the sale.

Texas is a state with non - judicial (power of sale) foreclosures.

U.S. Home Prices Tumble

Joseph A. LaVorgna, chief economist at Standard & Poor's said in a note to investors Tuesday that falling home prices aren't such a bad thing, "On one hand they are causing negative wealth effects and forcing some new mortgages underwater; but on the other hand, this is a necessary, albeit unpleasant, prescription for restimulating housing demand," he said.

What do you think about this statment?

Click on the link to read more>

Chasing The Market

I am publishing an article written by Paul Pastore. I think it is very interesting and shows the main mistake the sellers make on today's market. I just only disagree that the 10% below apply to the all areas. I think that the housing in some areas in DFW just going flat or even appreciate. The real estate market is local, so this percent should be different for the different areas and sellers have to use this technique very carefully , after detailed analyze on the local market.

Enjoy reading:


Have you ever seen a dog chasing after a car? No matter how fast the dog runs, it will never catch the car. The dog will never slow the car down. And, the dog will never bite a moving tire. What must the dog be thinking?

Today, many sellers are running after the market, the same way dogs chase vehicles.
What are these sellers thinking? Their home is the only castle for sale? Buyers will love the scent of their lilac bushes so much that it will temporarily cause them to forget the competition? Is it possible the smell of fresh baked bread will cause a buyer to pay yesterday's price in today's market?

It is imperative for a seller to price their property 10% below market in order to sell promptly and avoid being left in the long line of expired listings. With such a high number of homes on the market, it will be a long wait for the inventory levels to decrease to a balanced market.

There is a Turkish proverb that says, "No matter how long you are traveling down the wrong road, when you figure it out, turn around." Overpricing is a two-edge sword. If a property is receiving little activity, it is overpriced. Or, if a property is receiving adequate activity, but no offers; it is also overpriced. The latter problem is called 'always the bridesmaid, never the bride.'

By suggesting a seller has an overpriced property, the real estate agent runs the risk of being the messenger that gets shot. Courageous agents tell the truth. Cowardly agents hope the overpriced property will generate sign or ad calls while the seller slowly reduces the price and stigmatizes the property with additional days on the market.
Say's law says, "No good or service will remain chronically unsold, as long as prices remain flexible." The next time you see a dog chasing a car, hopefully, it will remind you of the futility of chasing a declining real estate market.

Top 10 Best Cities for Home Sellers

1. San Jose, Calif. Because of a tough regulatory environment, new home construction dropped 63 percent last year.

2. San Francisco. When the conforming loan limit recently jumped from $417,000 to the maximum $729,750, that made credit much easier to get for many of the city's home buyers.

3. Salt Lake City. The 3 percent annual job growth rate, paired with a declining inventory of existing homes and one of the nation’s sharpest declines in construction made this market a good one for sellers.

4. Austin, Texas. Texas is very affordable, plus the city has the nation’s fastest job growth at 4.1 percent.

5. Kansas City, Mo. The number of unsold, vacant houses dropped by 40 percent last year.

6. San Antonio, Texas. Jobs are growing by 3 percent and construction starts have dropped by 42 percent.

7. Denver. The 49 percent drop in construction starts paired with the 2 percent rise in new jobs are good news for sellers.

8. Providence, R.I. Vacancy rates at 1.6 percent combined with a 42 percent cut in inventory help sellers.

9. Charlotte, N.C. Moderate prices and strong job growth bode well for sellers.

10. Seattle, Wash. Strong job growth and a 42 percent decrease in new home construction are good news for sellers.

Source: Forbes, Matt Woolsey (04/07/08)