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

Read full story>

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.)

Read more>

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.

Read more>

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.