Thursday, December 30, 2010

Pending Home Sales Continue Recovery, Improvement Seen in 2011

Pending Home Sales Continue Recovery,
Gradual Improvement Seen in 2011

 Washington, DC, December 30, 2010 - Pending home sales rose again in November, with the broad trend over the past five months indicating a gradual recovery into 2011, according to the National Association of Realtors®.
The Pending Home Sales Index,* a forward-looking indicator, rose 3.5 percent to 92.2 based on contracts signed in November from a downwardly revised 89.1 in October. The index is 5.0 percent below a reading of 97.0 in November 2009. The data reflects contracts and not closings, which normally occur with a lag time of one or two months.
Lawrence Yun, NAR chief economist, said historically high housing affordability is boosting sales activity. “In addition to exceptional affordability conditions, steady improvements in the economy are helping bring buyers into the market,” he said. “But further gains are needed to reach normal levels of sales activity.”
The PHSI in the Northeast increased 1.8 percent to 72.6 in November but is 6.2 percent below November 2009. In the Midwest the index declined 4.2 percent in November to 78.3 and is 7.7 percent below a year ago. Pending home sales in the South slipped 1.8 percent to an index of 91.4 and are 7.2 percent below November 2009. In the West the index jumped 18.2 percent to 123.3 and is 0.4 percent above a year ago.
“If we add 2 million jobs as expected in 2011, and mortgage rates rise only moderately, we should see existing-home sales rise to a higher, sustainable volume,” Yun said. “Credit remains tight, but if lenders return to more normal, safe underwriting standards for creditworthy buyers, there would be a bigger boost to the housing market and spillover benefits for the broader economy.”
The 30-year fixed-rate mortgage is forecast to rise gradually to 5.3 percent around the end of 2011; at the same time, unemployment should drop to 9.2 percent.
For perspective, Yun said that the U.S. has added 27 million people over the past 10 years. “However, the number of jobs is roughly the same as it was in 2000 when existing-home sales totaled 5.2 million, which appears to be a sustainable figure given the current level of employment,” he explained.
“All the indicator trends are pointing to a gradual housing recovery,” Yun said. “Home price prospects will vary depending largely upon local job market conditions. The national median home price, however, is expected to remain stable even with a continuing flow of distressed properties coming onto the market, as long as there is a steady demand of financially healthy home buyers.”
Existing-home sales are projected to rise about 8 percent to 5.2 million in 2011 from 4.8 million in 2010, with an additional gain of 4 percent in 2012. The median existing-home price could rise 0.6 percent to $173,700 in 2011 from $172,700 in 2010, which was essentially unchanged from 2009.
“As we gradually work off the excess housing inventory, supply levels will eventually come more in-line with historic averages, and could allow home prices to rise modestly in the range of 2 to 3 percent in 2012,” Yun said.
New-home sales are estimated to rise 24 percent to 392,000 in 2011, but would remain well below historic averages, while housing starts are forecast to rise 21 percent to 716,000.
Yun sees Gross Domestic Product growing 2.5 percent in 2011, and the Consumer Price Index rising 2.3 percent.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

Wednesday, December 29, 2010

2011: The Year a House Again Becomes a Home

2011: The Year a House Again Becomes a Home

by The KCM Crew on December 29, 2010

For almost a decade now, every time we talked about real estate we immediately discussed money. We didn’t talk about the value of a home but instead about the price of the house. We didn’t worry about a roof over our heads but instead the ceiling on our interest rate. We didn’t care as much about where we raised our family as we cared about how much we increased our family’s net worth.

That will change in 2011. The KCM Crew believes very strongly that real estate will return to what it has been for the 200+ year history of this country: a place for us and our families to live comfortably. It will also prove to be a great long term investment as it always has been.

Our parents and our grandparents didn’t buy their homes as a short term financial investment. They bought it so they had a place of their own to come home to at the end of the day; a place to raise their family; a place they could feel safe.

Sure they dreamed of a ‘mortgage-burning’ party. They realized it was a form of forced savings. They were taught that, if they paid their mortgage every month, they would wind up with a little retirement account decades later.

And, they realized that wouldn’t happen if they rented.

However, in the last decade, we somehow forgot that the financial aspect was the serendipity not the major reason to buy. We believe that 2011 will be the year that people return to the historic reasons families purchased a home. This is the year when we again remember that homeownership is a major part of the American Dream.

What about the challenges to a housing recovery? Let’s look at them.

The Economy

Most reports are showing that the economy is doing better than expected. This shopping season provided additional proof of this point. As the economy recovers, so will consumer confidence. This will be great news for housing.


There is much talk about a ‘jobless recovery’. We agree that unemployment will continue to be a challenge. However, when you talk about housing, it is not the unemployment rate that is all telling. Instead, it is the change in the rate. As unemployment skyrocketed, people started to worry about their own job. Any change creates concern. Unabated concern turns to fear. Fear causes paralysis. The spike in unemployment has plateaued. People no longer have the feeling that ‘they are next’. The fear will diminish and people will start moving on with their lives. This too will be great news for housing.

Interest Rates

It seems the bottomless pit in which rates have been falling does have a floor after all. And it seems we have found it. Those purchasers who had been waiting for the best interest rate may have already missed it.


Economists are projecting that prices will not see any appreciation in 2011. Sellers who had been waiting for 2006 to return will come to the realization that waiting any longer makes little sense. They will instead decide to get on with their lives and sell this year.

Prices probably will soften further. However, the possible savings to potential buyers will be minimized by a rise in interest rates.

Bottom Line

This is the year that normalcy returns to real estate. People will buy and sell based on the desire for a better life for themselves and their families. They will realize that is the true value of homeownership and they will be willing to pay for that value.

See the original post at the KMC Blog:

Foreclosures in Massachusetts plunge in November

Foreclosures in Massachusetts plunge in November

By Jenifer McKim, Globe Staff

Foreclosures plunged in November in Massachusetts as lenders suspended home seizures following increased scrutiny of their procedures, new data showed today.

Foreclosure deeds fell to 416 in November, dropping more than 40 percent from the number of foreclosures recorded during the same month last year and marking the lowest recorded number of foreclosures in the state in November since 2007, according to the Warren Group, a Boston company that tracks local real estate.

Petitions, the first step in a foreclosure process, fell to 1,109 in November, down almost 43 percent from November last year. November is only the third month in 2010 that foreclosure starts dropped below 2,000.

Timothy M. Warren Jr., cq chief executive of the Warren Group, said he'd expected foreclosures to fall because lenders temporarily suspended activity following increasing concerns across the US about sloppy and fraudulent procedures. Issues include admissions from bank workers now known as robosigners that they signed legal documents without reading them.

"With federal and state governments taking an even closer look at how banks are going about the foreclosure process, I suspect that petitions to foreclose will remain at low levels,'' he said.

To see town-by-town data, click here.


Thursday, December 23, 2010

Homes Sales Resume Upward Trend With Stable Prices

Existing-home sales got back on an upward path in November, resuming a growth trend since bottoming in July, according to the National Association of Realtors®.

Existing-home sales across the U.S., which are completed transactions that include single-family, townhomes, condominiums and co-ops, rose 5.6 percent to a seasonally adjusted annual rate of 4.68 million in November from 4.43 million in October, but are 27.9 percent below the cyclical peak of 6.49 million in November 2009, which was the initial deadline for the first-time buyer tax credit.

Lawrence Yun, NAR chief economist, is hopeful for 2011. “Continuing gains in home sales are encouraging, and the positive impact of steady job creation will more than trump some negative impact from a modest rise in mortgage interest rates, which remain historically favorable,” he said.
Yun added that home buyers are responding to improved affordability conditions. “The relationship recently between mortgage interest rates, home prices and family income has been the most favorable on record for buying a home since we started measuring in 1970,” he said. “Therefore, the market is recovering and we should trend up to a healthy, sustainable level in 2011.”

In the Northeast where we live, existing-home sales rose 2.7 percent to an annual pace of 770,000 in November but are 33.0 percent below the cyclical peak in November 2009. The median price in the Northeast was $242,500, which is 9.2 percent higher than a year ago.

See the full story at

Monday, December 20, 2010

Top 10 Real Estate Stories of 2010 | Inman News

Top 10 Real Estate Stories of 2010

The health of the national and global economy figured prominently in the state of the housing market in 2010. Still hobbled by high unemployment and millions of distressed owners and foreclosed homes, real estate sales are expected to come in lower this year than the 2009 level, with prices roughly flat. This report highlights the major issues impacting the business of real estate in 2010.

1. All eyes on the economy
2. Goodbye, tax credits
3. Robo-signing complicates foreclosure crisis
4. FHA grows role in lending, tightens underwriting
5. Mobile market matures
6. A year of data deals
7. Congress approves face-lift for financial system
8. Major franchise firms push for growth
9. Zeroing in on location, neighborhood
10. Election 2010: The people have spoken

The full article and details on each story can be seen at:

New law clarifies Mass. homestead protections - The Boston Globe

New law clarifies Mass. homestead protections

Protecting your home against creditors will be easier now that Governor Deval Patrick signed into law a bill that automatically provides Massachusetts homeowners with a $125,000 cushion against debt collectors... if they hold that much equity in their properties.

The legislation, signed on December 16, 2010, clarifies ambiguities in a law first enacted in 1851. The statute, amended a number of times in ensuing years, provided $500,000 in protection from creditors — but only for homeowners who file a so-called homestead declaration with a county registry of deeds, a process that can cost between $35 and $100. Under the new law, homeowners do not have to make such a filing unless they hold more than $125,000 in equity in their homes. They can still get $500,000 in protection if they file a homestead declaration.

“It is an important piece of consumer protection,’’ said Michael Goldberg, co-chairman of the legislation committee for the Real Estate Bar Association for Massachusetts. “It ensures that homeowners in the Commonwealth have the protection of a modernized, understandable homestead law.’’

Read the entire article at

Thursday, December 16, 2010

Home Owners Recoup More with Exterior Replacement Projects, REALTORS® Report

Home Owners Recoup More with Exterior Replacement Projects

December 16, 2010 - The latest cost vs. value report on remodeling a home is now out. What will get you the biggest bang for your buck? A steel entry replacement door averaged a return of 102% of what you spend. Most of the other projects will return you less than 100% of what it costs you, according to this report.

 This report comes out each year and gives the average return on investment for many common home remodeling projects across the US, and is broken down by region. This year, remodeling projects done in New England don't return as much as project done in some other parts of the country, such as the west coast and south Atlantic coast. Lower labor costs seem to make the difference in the southeast, while higher return values is the reason that the west coast's remodeling projects net more money at resale.

Now the problem I have with the report is not so much the value returned, but with the costs of the projects. Maybe that's because I do the majority of my own remodeling projects, or maybe because I get more than one estimate when it comes to hiring a contractor.

For example, I had an exterior fiberglass door installed in my home last year, replacing the original cracked wooden one. According to the report, for the New England area, I should have paid $3,662 for the project. I purchased a good quality door for $349.00 at Home Depot, and the labor to remove the old door and install the new one was $500. I got 3 estimates for labor and this was the middle one. So the total cost for the job was $849, a far cry from $3,662. The value of replacing my front door is $2,079, a figure I would agree with. That means my return on investment (or cost vs. value) is 245%! Quite a difference from the 56% return that the Cost vs. Value report states. 

I believe that many of the cost estimates are overstated. The cost for replacing a roof is put at $23,232. That is around the estimate I got for replacing my roof...but included adding on a full dormer in the rear and 2 doghouse dormers in the front of the house! Just replacing my roof (admittedly, not a large job because it is a cape) was $4,500 to $7,000 (4 estimates received) including removing the existing 2 layers. I did have one client pay over $20,000 for a new roof, but that included removing and disposing of the existing clay tile roof - not an easy job. Yes their are roof out there on McMansions that will easily run in excess of $20,000, but that is not the norm. Most roof replacements I have seen have been in the neighborhood of $5,000 to $15,000. Then again, replacing your roofing isn't really an upgrade. But in a home buyer's mind your home is significantly less valuable if the roof has to be replace within the next few years. They just expect to buy a home with a good roof that will last for years.

Some of the biggest returns are changes made on the exterior of the house. First impressions are extremely important when selling a property, and if you have pealing paint, a cracked front door, shingles falling off the roof and a rotted garage door, the buyers may never go inside to see your beautiful newly remodeled kitchen and bath.

If your home needs some updating, read the Cost vs. Value Report. It contains some good information. But remember that you can probably do better than what is claimed by doing the work yourself, or by making sure you get multiple bids/estimates for any remodeling project.

 Jim Armstrong

Saturday, November 20, 2010

Mortgage Rates Back on the Rise

Mortgage Rates Back on the Rise
Rates for 30-year fixed mortgages rose to 4.39 percent this week from 4.17 percent a week ago, and average interest on 15-year loans moved to 3.76 percent from 3.57 percent, said Freddie Mac.

Interest for five-year adjustable-rate mortgages jumped to 3.4 percent from 3.25 percent, meanwhile, and one-year ARMs held at 3.26 percent. Rates have climbed along with long-term Treasury yields as traders unloaded Treasurys purchased before the Federal Reserve announced a $600 billion bond purchase program.

Source: Chicago Sun-Times (11/19/10)

Wednesday, November 17, 2010

September Home Prices Declined 2.79 Percent Year Over Year

September Home Prices Declined 2.79 Percent Year Over Year

CoreLogic (NYSE: CLGX), a leading provider of information, analytics and business services, today released its September Home Price Index (HPI) that shows that home prices in the U.S. declined for the second month in a row after rising slightly for the first seven months of the year. According to the CoreLogic HPI, national home prices, including distressed sales, declined 2.79 percent in September 2010 compared to September 2009 and declined by 1.08 percent* in August 2010 compared to August 2009. Excluding distressed sales, year-over-year prices declined .73 percent in September 2010.
Highlights as of September 2010
  • The top five states with the highest appreciation, including distressed sales, were: New York (+2.67 percent), North Dakota (+1.73 percent), California (+.86 percent), Nebraska (+.78 percent), and Virginia (+.77percent).
  • The five states with the greatest depreciation, including distressed sales, were Idaho (-14.04 percent), Alabama (-8.9 percent), Mississippi (-8.3 percent), Florida (-7.68 percent) and New Mexico (-7.47 percent).
  • Excluding distressed sales, the top five states with the highest appreciation were: New York (+3.82 percent), North Dakota (+3.19 percent), Rhode Island (+1.71 percent), Vermont (+1.64 percent), and Alaska (+1.53 percent).
  • Excluding distressed sales, the five states with the greatest depreciation were: Idaho (-11.06 percent), Nevada (-6.86 percent), Arizona (-6.01 percent), Michigan (-5.67 percent) and Oregon (-4.61 percent).
  • Including distressed transactions, the peak-to-current change in the national HPI (from April 2006 to September 2010) is -29.13 percent. Excluding distressed properties, the peak-to-current change in the HPI for the same period is -19.96 percent.
“We’re continuing to see price declines across the board with all but seven states seeing a decrease in home prices,” said Mark Fleming, chief economist for CoreLogic. “This continued and widespread decline will put further pressure on negative equity and stall the housing recovery.” Full-month September 2010 national, state-level and top CBSA-level data can be found at
About CoreLogic
CoreLogic (NYSE: CLGX) is a leading provider of consumer, financial and property information, analytics and services to business and government. The company combines public, contributory and proprietary data to develop predictive decision analytics and provide business services that bring dynamic insight and transparency to the markets it serves. CoreLogic has built the largest U.S. real estate, mortgage application, fraud, and loan performance databases and is a recognized leading provider of mortgage and automotive credit reporting, property tax, valuation, flood determination, and geospatial analytics and services. More than one million users rely on CoreLogic to assess risk, support underwriting, investment and marketing decisions, prevent fraud, and improve business performance in their daily operations. Formerly the information solutions group of The First American Corporation, CoreLogic began trading under the ticker CLGX on the NYSE on June 2, 2010. The company, headquartered in Santa Ana, Calif., has more than 10,000 employees globally with 2009 revenues of $2 billion. For more information visit

Will Your House Be Worth More in the Spring?

Will Your House Be Worth More in the Spring?

This is a question anyone thinking about selling must ask. Should they sell now or should they wait for the spring? Most years that would be an interesting question. There is a belief that many buyers come out in the spring and, with that increase in demand for housing, prices may appreciate. This year is unlike any year in recent memory. Most experts believe there will be continuing depreciation of home values throughout the next 18 months.

See the rest of the article:

Tuesday, November 16, 2010

5 Reasons You Should Sell Your House TODAY!

5 Reasons You Should Sell Your House TODAY!

Selling your house in today’s market can be extremely difficult. It is for that reason that every seller should take advantage of each and every opportunity that appears. Each fall, such an opportunity presents itself. This fall, that opportunity may be just too good to pass up.

Below are five reasons you should consider when pricing your house to sell in the next 90 days. Meet with your real estate agent and mortgage professional today and see whether it is the right move for you and your family.

Read the rest of the article at:

Thursday, October 21, 2010

Unemployment/Foreclosure Petitions Drop in Massachusetts

The Massachusetts unemployment rate dropped from 8.8 percent in August to 8.4 percent in September, the steepest drop since January 1976, state labor officials said this morning.
"The rate, which has been trending downward from the 9.5 percent rate in January and February, remains below the 9.6 percent national rate," the state's Executive Office of Labor and Workforce Development said in a press release.

Also, the number of Massachusetts foreclosures started by lenders last month dropped about 23 percent from August 2010, and nearly 7 percent from a year ago said the Warren Group, a Boston firm that tracks local real estate activity.

In recent weeks, several big lenders, including Bank of America Corp. and GMAC, temporarily halted foreclosure proceedings in various states over allegations that they erred in processing documents, but now they have restarted the foreclosure process. (Click here to read an AP story on that subject that appeared in this morning's Boston Globe.)
"We will have to wait until the October statistics are tabulated to see the impact from Bank of America's decision to halt foreclosures in Massachusetts, pending a review of its paperwork and procedures," Warren Group chief executive Timothy M. Warren Jr. said in a statement. "From what we can see at the present time, Bank of America is involved in about 2,000 pending foreclosure cases in the Bay State."

Tuesday, October 12, 2010

Title companies want promises from 'robo signing' lenders

In addition to satisfying federal and state regulators that they're following the letter of the law, lenders embroiled in the "robo signing" scandal may soon have to provide warranties to title insurers in order to continue selling foreclosed homes.

Bank of America has already agreed to provide warranties to Fidelity National Financial Inc. that cover the title insurer's costs if employees processing foreclosure documents for the bank make mistakes, Bloomberg News reports, and is in talks with other title insurers to do the same.

See the rest of the article at Inman News

Friday, October 08, 2010

Mortgage Rates Continue to Fall According to Freddie Mac's Weekly Survey

Mortgage Rates Continue to Fall According to Freddie Mac's Weekly Survey

October 8, 2010, McLean, VA – Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), which found that the 30-year fixed-rate mortgage rate dropped yet again to break the survey's all-time low; the 15-year fixed-rate did the same. The 5-year ARM also set an all-time survey low.
30-year fixed-rate mortgage (FRM) averaged 4.27 percent with an average 0.8 point for the week ending October 7, 2010, down from last week when it averaged 4.32 percent. Last year at this time, the 30-year FRM averaged 4.87 percent.
15-year FRM this week averaged a record low of 3.72 percent with an average 0.7 point, down from last week when it averaged 3.75 percent. A year ago at this time, the 15-year FRM averaged 4.33 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.47 percent this week, with an average 0.6 point, down from last week when it averaged 3.52 percent. A year ago, the 5-year ARM averaged 4.35 percent.
1-year Treasury-indexed ARM averaged 3.40 percent this week with an average 0.7 point, down from last week when it averaged 3.48 percent. At this time last year, the 1-year ARM averaged 4.53 percent.
Frank Nothaft, vice president and chief economist at Freddie Mac report, "The 12-month growth rate in the core price index for personal consumption , which the Federal Reserve closely tracks, has been drifting lower over the past six months ending in August and suggests inflation is running at a tepid pace at best. This allowed mortgage rates to ease to new or near record lows this week."
"Housing affordability increased for the second month in a row in August to tie April's level, according to the National Association of Realtors® (NAR). As a result, pending existing home sales also rose for the second consecutive month in August to the strongest pace in four months, the NAR also reported. Furthermore, since the end of August, mortgage applications for home purchases were up over 14 percent for the week ended October 1st."

Wednesday, October 06, 2010

Beware of Resale Fees on Home Purchases

Resale Fees
If you haven't heard about resale fees, then it's time you did. They are making headlines across the nation, and for good reason.

When you buy a house, how often do you read every line of your sales contract? If new legislation fails to pass, you'll need to read before signing anything.

Resale fees, also known as capital recovery fees or private transfer fees, are fees that a seller pays to the developer, each and every time the home sells for a specified period of time.
A recent article by the New York Times, detailed the story of one family who bought their dream home, only to find that resale fees allowed the developer to collect 1 percent of the sales price from the seller every time the property changes hands -- for the next 99 years.

This particular detail is typically hidden deep inside the sales contract. And homebuyers simply sign away their rights to that 1 percent, without ever having knowledge of it. Why would a builder or developer want to use this questionable practice?

The New York Times explains it this way, "Many developers see the resale fee as a creative way to get new financing. They are hoping to one day use the trickle of cash from these fees as collateral for a loan, or to get cash up front if pools of the fees are packaged into securities to be bought and sold on Wall Street." As they see it, developers are desperate.

How are resale fees legal? They may not be for long.

In September of 2010, US House Representatives Maxine Waters and Albio Sires introduced a bill called the "Home Equity Protection Act of 2010." The bill seeks to amend the Real Estate Settlement Procedures Act (RESPA) by prohibiting the collection of resale fees.
Proponents of the bill and changes to the legality of resale fees, believe the fee robs homeowners of their equity when they sell their property.

In addition, the Federal Housing Finance Agency proposed a similar rule to curb use of resale fees. Their proposal would keep Fannie Mae and Freddie Mac from insuring or purchasing mortgages that include such fees.

These fees have been such a point of contention, that The Coalition to Stop Wall Street Home Resale Fees has been formed. They responded to the news of the proposed legislation, saying, "This bill is an important step in enhancing consumer protections against these for-profit fees and safeguarding our already fragile real estate market from further abuse." They continued, "These fees add no benefit or value to a property, and are little more than a predatory scheme meant to take advantage of unsuspecting homeowners. Our Coalition thanks Congresswoman Waters and the bill's co-sponsors for recognizing the danger that these fees pose to homeowners and the real estate market."

Evan Fuguet, Senior Policy Counsel at the Center for Responsible Lending, noted, "The Home Equity Protection Act of 2010 is a strong step forward that would help consumers across the country, preventing unwarranted and spurious increases in the costs of homeownership. Unlike conveyances that support the community, affordable housing or the environment, these private transfer fees have no added benefit for homeowners and home buyers, and are reminiscent of the irresponsible fee-packing behavior we witnessed during the heyday of abusive subprime home lending ."

Though I have not run into resale fees so far on the north shore. be sure to talk to your agent about your contract and if resale fees could be an issue for you.    

Monday, October 04, 2010

30-Year Mortgage Rate Ties Low While 15-Year Sets New Record

30-Year Mortgage Rate Ties Low While 15-Year Sets New Record
McLean, VA – Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®). The 30-year fixed-rate mortgage rate dropped to tie the survey’s all-time low and the 15-year fixed-rate set another record low. 

30-year fixed-rate mortgage (FRM) averaged 4.32 percent with an average 0.8 point for the week ending September 30, 2010, down from last week when it averaged 4.37 percent. Last year at this time, the 30-year FRM averaged 4.94 percent. 

15-year FRM this week averaged a record low of 3.75 percent with an average 0.7 point, down from last week when it averaged 3.82 percent. A year ago at this time, the 15-year FRM averaged 4.36 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.52 percent this week, with an average 0.6 point, down from last week when it averaged 3.54 percent. A year ago, the 5-year ARM averaged 4.42 percent. 

1-year Treasury-indexed ARM averaged 3.48 percent this week with an average 0.7 point, up from last week when it averaged 3.46 percent. At this time last year, the 1-year ARM averaged 4.49 percent.
Frank Nothaft, vice president and chief economist at Freddie Mac, says, "Confidence in the state of the economy fell among consumers and businesses, which led to a decline in long-term bond yields and brought many mortgage rates to record lows this week. The September Consumer Confidence Index by the Conference Board fell to the lowest level since February of this year, while the Business Roundtable CEO Business Outlook for the third quarter was the weakest in the past four quarters. Consequently, rates for the 15-year fixed mortgage and the 5-year hybrid ARM reached new all-time lows and rates for 30-year fixed mortgages tied its record set just four weeks ago." 

"Homeowners have regained $1.0 trillion in home equity as of the second quarter of 2010 after losing more than $7.5 trillion over the three-year period ending in the first quarter of 2009, the Federal Reserve Board reported. This, in part, strengthened household balance sheets and reduced serious mortgage delinquencies. For instance, first mortgages 90-days delinquent or worse fell to 3.16 percent in August from 4.76 percent a year prior and was the lowest rate since June 2008, according to the S&P/Experian Consumer Credit Default Indices ."

Friday, October 01, 2010

September Real Estate Round Up

September Round Up: Rates Back Down
In Freddie Mac's results of its Primary Mortgage Market Survey. The 30-year fixed-rate mortgage rate dropped to tie the survey’s all-time low and the 15-year fixed-rate set another record low.
30-year fixed-rate mortgage (FRM) averaged 4.32 percent with an average 0.8 point for the week ending September 30, 2010, down from the previous week when it averaged 4.37 percent. Last year at this time, the 30-year FRM averaged 4.94 percent.
15-year FRM this week averaged a record low of 3.75 percent with an average 0.7 point, down from the previous week when it averaged 3.82 percent. A year ago at this time, the 15-year FRM averaged 4.36 percent. 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.52 percent this week, with an average 0.6 point, down from the previous week when it averaged 3.54 percent. A year ago, the 5-year ARM averaged 4.42 percent.
1-year Treasury-indexed ARM averaged 3.48 percent this week with an average 0.7 point, up from the previous week when it averaged 3.46 percent. At this time last year, the 1-year ARM averaged 4.49 percent.
According to Frank Nothaft, vice president and chief economist, Freddie Mac: "Confidence in the state of the economy fell among consumers and businesses, which led to a decline in long-term bond yields and brought many mortgage rates to record lows this week. The September Consumer Confidence Index by the Conference Board fell to the lowest level since February of this year, while the Business Roundtable CEO Business Outlook for the third quarter was the weakest in the past four quarters. Consequently, rates for the 15-year fixed mortgage and the 5-year hybrid ARM reached new all-time lows and rates for 30-year fixed mortgages tied its record set just four weeks ago."
"Homeowners have regained $1.0 trillion in home equity as of the second quarter of 2010 after losing more than $7.5 trillion over the three-year period ending in the first quarter of 2009, the Federal Reserve Board reported. This, in part, strengthened household balance sheets and reduced serious mortgage delinquencies. For instance, first mortgages 90-days delinquent or worse fell to 3.16 percent in August from 4.76 percent a year prior and was the lowest rate since June 2008, according to the S&P/Experian Consumer Credit Default Indices."
Four Tips for Setting the Right Sales Price
Sellers think their homes are worth more than their real estate professional recommends, and buyers think these same homes are worth less.
It’s a difficult disconnect that makes selling properties a challenge. Successfully marketing a home requires that the price be set carefully -- or it will languish on the market. Among the considerations:

  • How many homes are for sale in the neighborhood? The more homes on the market, the more important it is to list at the lower end of the scale. "I want buyers to ask why is this house priced so competitively," said NAR President-elect Ron Phipps. "I want the answer to be an offer."

  • Take short sales and foreclosures into consideration when pricing. If the competing properties are in lousy condition, they are less of an issue, but if they are well taken care of, yet priced 25 percent below market, they can be a serious factor.

  • Negotiate decisively. "Buyers are not interested in back-and-forth negotiations these days," Phipps said. "They are less emotional and more disciplined. They will walk away."

  • Cut the price when you have to. If no one shows up for an open house, if no one calls and if there are no offers, then the price is too high. That means it's time to make a meaningful price cut. What's New in New Housing Design Below are the products grabbing the attention of the home building and remodeling industries:

  • Appliance Drawers. Small warning drawers, modest-sized dishwasher drawers for small loads, refrigerator drawers and microwave drawers.

  • Counter-depth refrigerators. Some are only 24 inches deep.

  • Motion-detecting faucets. Like you'd find in the restrooms of businesses.

  • LED lighting. These are used under cabinets and in ceiling fixtures as a longer-lasting, more efficient alternative to compact fluorescent lamps and incandescent bulbs.

  • Electric heated floors. A nice touch in bathrooms,

  • Showers with multiple heads and body sprays. Bathtubs are out. Sellers Quickly Transform Property with Paint
    The best way to update a property is to paint it. It’s a job that many sellers can do themselves. Here are six suggestions for making the work go quickly.
    1. Move the furniture. Get as much furniture as possible out of the way, and then cover what’s left with plastic drop cloths held in place with masking tape.
    2. Buy good paint. Top-quality latex interior paint will hide what’s underneath and make the job go faster.
    3. Tape the edges. Taping the edges with painters tape will speed up the job and make the results more professional.
    4. Work top down. Paint the ceiling first, then the walls, then the windows and trim and finally the baseboards. This will cut down on time spent repairing drips and splatter marks.
    5. Cut in the corners. Applying a three-inch band of paint around the edges will allow you to fill in the middle with a paint roller.
    6. Apply paint generously. Trying to stretch the paint won’t save sellers any money if they have to repaint.

  • How Buyers Compete in a Sellers' Market

    How Buyers Compete in a Sellers' Market
    No matter the market, sellers can find a competitive edge, whether it be through pricing, staging, or even negotiating closing costs.
    What about buyers? Do they have any hope for an edge during a sellers market?
    A sellers market is one which favors the seller. Perhaps you find yourself in a hot area where homes garner multiple offers and bidding wars. Or perhaps you live in an area where prices are appreciating or there is only a small inventory of homes for sale. No matter the situation, buyers can still find ways to gain an advantage.
    Here are a few tips that might do just that.
    1. Pre-approval: Be sure to start your home buying process by getting pre-approved for a mortgage. This will prove to your potential seller that you are ready, willing, and able to buy their home. A pre-approval will also give you an exact number of how much money you can borrow, and thus spend.
    2. Be ready to buy: There can be no hesitation during a sellers market. There will be other buyers waiting to to grab up the same deal you just found. If the numbers work out in your favor for a home you like, then be ready to put in a strong offer.
    3. Know your budget: You may be approved for a loan of up to $300,000, but you only want to spend $250,000 as your max. Be sure to know ahead of time what your budget really is.
    4. Make a strong offer: In a sellers market, homes can expect to receive nearly if not all of their asking price. And in many cases, you may even find a home sells for more than the asking price. So, in order to make both a good impression on the seller so they take your interest seriously, as well as to beat out the competition, be sure to present a strong first offer.
    5. Be willing to negotiate terms: This means if a seller needs 60 days until closing, do what you can do accommodate them. Or maybe they are unwilling to make a repair before you move in, but are willing to pay you the repair costs instead. Be willing to work with a seller, if it means getting the home you desire.
    These simple tips can make a big difference when it comes to buying in a sellers market.

    New Short Sale Bill Submitted to Congress

    New Short Sale Bill Submitted to Congress
    U.S. Representative Robert Andrews (D-N.J.) and Tom Rooney (R-Fla) offered up new legislation to Congress last week. H.R. 6133, "Prompt Decision for Qualification of Short Sale Act of 2010," is an effort from Congress to help keep potential buyers from walking away from short sales, simply because lenders take months to respond to their offers.
    The National Association of REALTORS are a strong supporter of the bill. Their President, Vicki Cox Golder, said, "The short sale, which requires lender approval, is an important instrument for homeowners who owe more than their home is worth. While the lending community has worked to improve the size and training of their short sales staffs, they still have a long way to go on improving response times."
    And in a sticky financial situation such as a short sale, where time really counts, this bill comes as welcome news to many homeowners and buyers.
    This legislation aims to "require the lender or servicer of a home mortgage, upon a request by the homeowner for a short sale, to make a prompt decision whether to allow the sale." (Library of Congress)
    In this bill, the terms "short sale" means the sale of the dwelling or residential real property that is subject to the mortgage, deed or trust, or other security interest that secures a residential mortgage loan that:
    • will result in proceeds in an amount that is less than the remaining amount due under the mortgage loan; and
    • requires authorization by the securitization vehicle or other investment vehicle or holder of the mortgage loan, or the servicer acting on behalf of such a vehicle or holder.
    Ms. Golder continued, "Unfortunately, homeowners who need to execute a short sale are severely hampered because lenders (loan servicers) are unable to decide whether to approve a short sale within a reasonable amount of time. Potential homebuyers are walking away from purchasing short sale property because the lender has taken many months and still not responded to their request for an approval of a proposed short sale price. Many consumers have mentioned that the delay in short sale price approval exceeds 90 days, and in many cases never arrives."
    Hopefully, if this bill passes into law, homeowners will find relief from their mortgage woes, and will be able to sell their home without having to be foreclosed upon.

    Written by Carla Hill

    Friday, September 10, 2010

    Pay Extra Attention To Mortgage Financing Contingency Clauses During Today’s Credit Crunch

    Pay Extra Attention To Mortgage Financing Contingency Clauses During Today’s Credit Crunch

    by Rich Vetstein 
    Today’s strict lending and underwriting environment has resulted in quite a few delays and even losses of buyers’ financing for home purchases. Loan commitment deadlines are being pushed back due to underwriting delays, regulatory compliance and appraisal issues, among other delays. The worst case scenario for any borrower is the wholesale rejection of financing in the middle of a transaction.
    What Is The Typical Mortgage Contingency Clause?
    The Massachusetts “standard” form purchase and sale agreement contains a mortgage contingency clause which protects the buyer (and his deposit) for the period of time until he can obtain a firm loan commitment. The date is negotiated by the buyer and seller, and is usually around 30 days from the execution of the purchase and sale agreement, depending on the closing date. If the buyer cannot get a firm loan commitment by the deadline, he can opt out of agreement with a full refund of his deposit. Here is how a typical Massachusetts mortgage financing contingency clause operates:
    In order to help finance the acquisition of said premises, the BUYER shall apply for a conven­tional bank or other institutional mortgage loan of $300,500.00 at prevailing rates, terms and conditions. If despite the BUYER’S diligent efforts, a commitment for such a loan cannot be obtained on or before October 15, 2010, the BUYER may terminate this agreement by written notice to the SELLER in accordance with the term of the rider, prior to the expiration of such time, whereupon any payments made under this agreement shall be forthwith refunded and all other obligations of the parties hereto shall cease and this agreements shall be void without recourse to the parties hereto. In no event will the BUYER be deemed to have used diligent efforts to obtain such commitment unless the BUYER submits a complete mortgage loan application conforming to the foregoing provisions on or before 3 days from the execution of this Agreement.
    What If There Are Delays In Obtaining My Loan Commitment?
    The buyer really has only two choices if the lender cannot deliver a firm loan commitment by the mortgage contingency deadline: (1) ask the seller for an extension of the loan commitment deadline, or (b) terminate the transaction. There is, however, a smart way to handle this situation.
    I always couple a request for a loan commitment extension with notice that if the seller does not agree, then the buyer will exercise his right to terminate the agreement. That way, the seller has to make a tough choice: grant an extension or lose the deal. If the seller does not want to grant an extension, the buyer really has no other choice but to move on to the next home for sale.
    Parties need to make mortgage contingency deadlines workable and don’t wait until the last minute to ask for extensions. See this post about a recent case for what happens when you don’t do this.
    What If There Are Conditions In My Loan Commitment That I Cannot Control or Meet?
    Loan commitments are often riddled with conditions which must be reviewed carefully with counsel. Sometimes, there are conditions that a buyer simply cannot meet or control. To account for this I always insert this clause in my Massachusetts purchase and sale agreement rider:
    Application to one such bank or mortgage lender by such date shall constitute “diligent efforts.”  If the written loan commitment contains terms and conditions that are beyond BUYER’S reasonable ability to control or achieve, or if the commitment requires BUYER to encumber property other than the subject property, BUYER may terminate this agreement, whereupon any payments made under this agreement shall be forthwith refunded and all other obligations of the parties hereto shall cease and this agreement shall be void without recourse to the parties hereto.
    This protects the buyer in case there are those uncontrollable conditions, and also limits the buyer’s efforts in applying for a mortgage to 1 application.
    What If There Are Title Defects Which Delay The Transaction And My Rate Lock Expires?
    Under paragraph 10 of the Massachusetts standard form purchase and sale agreement, the seller has the option (or the requirement, depending on the negotiation of the agreement) to cure any title defects, and has up to 30 days to do so. Sometimes, during this 30 day cure period, the buyer’s rate lock will expire. In this situation, I insert the following clause into the purchase and sale agreement:
    MODIFICATION TO PARAGRAPH 10: Notwithstanding anything to the contrary contained in this Agreement, if SELLER extends this Agreement to perfect title or make the Premises conform as provided in Paragraph 10, and if BUYER’S mortgage commitment or rate lock would expire prior to the expiration of said extension, then such extension shall continue, at BUYER’S option, only until the date of expiration of BUYER’S mortgage commitment or rate lock.  BUYER may elect, at its sole option, to obtain an extension of its mortgage commitment or rate lock.
    This gives the buyer an “out” of the transaction if his rate lock expires.

    Reprinted with permission.

    Tuesday, August 31, 2010

    5 Reasons Why Massachusetts Home Sales Will Continue To Rise

     Debunking The July 2010 Housing Report: 5 Reasons Why Massachusetts Home Sales Will Continue To Rise
    by Marc Canner on August 27, 2010

    A National Association of Realtor’s report released Wednesday indicated that home purchases fell 27% in July, a drop that jolted the real estate industry, according to the Wall Street Journal, and sent shock waves through the broader economy. As a result, a number of economists provided dire warnings of a continued down slide in real estate prices.
    At first blush, this news could have the “echo chamber” effect of  turning the purported downturn into a self-fulfilling prophecy, discourage consumer confidence, and sidelining a number of prospective Massachusetts home buyers from the fall housing market.  Here are 5 reasons why the national housing report won’t impact the Massachusetts real estate market.
    1.  Massachusetts Has a Strong Housing Market.
    Massachusetts has bucked the national trend as its housing market has remained strong. Indeed, parts of the Massachusetts housing market actually saw a surge in activity in July 2010:
    • From July ’09 to July ’10, these towns had an increase in sales:
    1. Norwood (+117%)
    2. Bedford  (+78%)
    3. Easton (+27%)
    4. Brookline (+20%)
    5. Melrose (+20%)
    • Several towns saw an  increase in year-to-date median home prices in July, including:
    1. Cohasset (+25%)
    2. Marblehead (+12%)
    3. Dennis (+6%)
    4. Norwood (+5.9%)
    5. Melrose (+4%)
    2.  The June 1st Time Tax Buyer Credit Caused An Artificial Decrease in July Purchases.
    The government stimulus program brought out the seasonal first time buyer’s in full force during June. Thus, the normal sales cycle was altered which skewed the July numbers
    3.  Massachusetts Is Always Out In Front Of The National Numbers
    The national housing report gives equal weight to markets blighted with foreclosures and economically hard hit areas like Detroit, Las Vegas, Florida, Arizona and parts of Southern California. Greater Boston has historically been a unique “inelastic” market along the lines of Washington, D.C. and San Francisco. Negative national trends do not necessarily correlate to the Massachusetts real estate market.
    4.  “It’s the Economy, Stupid.”
    Massachusetts has a strong and diverse economy, a number of high paying jobs (no, I’m not running for governor), a very limited number of new housing starts, and several industries that have constant employment turnover- a tried and true recipe for a hot housing market.
    5.  Historically Low Interest Rates
    The average rate for a 30 year mortgage has fallen to 4.5%, a 50 year low! Prospective borrowers who pass on this- caveat emptor “buyer beware.” A number of economists predict that the Fed will gradually ease rates back up to counter inflation.

    Reprinted with permission from The Massachusetts Real Estate Blog

    Tuesday, August 10, 2010

    Fewer Home Owners Are Under Water

    Fewer Home Owners Are Under Water
    In the second quarter of 2010, 21.5 percent of borrowers owed more than their homes were worth. That’s down 7.7 percent from the first quarter of the year when 23.3 percent of home owner with mortgages were under water.

    Much of the improvement came from homes falling into foreclosure, wiping away negative equity. Rising home values also improved the situation in 45 of the metropolitan statistical areas, including the northeast region of the United States.

    Monday, August 09, 2010

    Mortgage Rates for Massachusetts at All-Time Lows...Again!

    Mortgage Rates are at all-time lows right now; 30 year fixed, 20 year fixed, 15 year fixed and even Jumbo Rates, and they're showing no signs of rising! I don’t see them going any lower, but staying down at these levels for a while.

    What’s moving Mortgage Rates? No one really knows right now but this is usually what happens, bonds go up, stocks go down.  Stocks go up, bonds go down. It’s really pretty easy to understand. However this mortgage market that we are in  is no where near normal.  In fact, it’s the total opposite, it’s like nothing we’ve ever experienced.

    Refinance loans account for the majority of all present loan production, but home buyers are getting these incredible rates, too! What I don't understand is why there are not more home buyers placing offers, and why some properties just languish on the market when they are priced competitively. I have to think that the home buying consumer just does not have enough confidence in the overall economic outlook yet. I'm just afraid these same people may miss out on a rare real estate buying opportunity...low home prices and rock bottom mortgage interest rates.

    30 year fixed mortgage rates remain in the 4.375% to 4.625% range.  The 30 year fixed rate mortgage is 4.375% for a qualified borrower.

    Friday, July 16, 2010

    Do I Need a Buyer’s Agent for Home Purchase?

     Do I Need a Buyer’s Agent for Home Purchase?
    Q: We own a home now in town for 14 years. We’ve done a drive-by and are interested in a different home in a rural setting. We have made an appointment with the listing agent to see the house on our own. If we are still interested after seeing the house, we will need to sell ours in order to buy it. We may or may not continue looking if that one is not “the one.” A friend is urging us to have our own REALTOR® now to represent our interests before our appointment next week. I don’t see the need until we’ve decided that we’re ready to give up our current home for another. What do you advise?
    ~ Brenda
    A: Brenda, there are a couple of problems with looking at homes without your own Realtor (working as a Buyer’s Agent). First, the listing agent is representing the seller, and cannot give you any information on the property other than what the seller would allow.

    The other issue is that the compensation for representing a buyer typically goes to the agent who first showed the property to the buyer. So, if you go to see a home with the listing agent, then your agent could possibly be cut out of receiving any compensation from the transaction if you decide that you want to make an offer. Your agent may not even want to represent you because of that fact, or you may have to pay your agent out of your own pocket.
    If you want to see homes without your agent, then you could go to open houses. If you need to make an appointment to see a property, then you should go through your own Realtor. As a Realtor, this is part of our job. So don’t hesitate to give him/her a call.
    ~ Jim Armstrong
    Jim Armstrong-thumb

    Jim Armstrong is a Realtor-Broker with Armstrong Field Real Estate in Essex County, MA.
    Are you interested in having a qualified REALTOR® answer your questions? Click through to Ask a REALTOR® now.

    Thursday, July 15, 2010

    June 2010 REALTOR® Market Index Down but Price Index is Up

    June 2010 REALTOR® Market Index Down
    but Price Index is Up

    The June 2010 REALTOR® Market Index Down Compared to the Same Time Last Year.
    REALTOR® Price Index up for the 11th time in the past 12 months.
    WALTHAM, Mass. – The Massachusetts Association of REALTORS® (MAR) announced that after 16 straight months of annual increases, the June REALTOR® Market Index (RMI) is down for the first time since February 2009.  Despite the drop, the June REALTOR® Price Index was up compared to the same time last year.
    “The combination of the post-tax credit lull and buyers who may have moved up their plans for a summertime purchase to take advantage of the tax credit which expired in April, is having an impact on how REALTORS® are feeling about the current market as reflected in the low Market Index number,” said 2010 MAR President Kevin Sears, broker/co-owner of Sears Real Estate in Springfield.  “Despite this combination of events, REALTORS® do see home prices starting to move up over the next 12 months, which indicates to me that members believe the market will continue to improve.”
    In June 2010, the REALTOR® Market Index was 28.36, which was 24.8 percent lower than the 37.70 score recorded in June 2009.  On a month-to-month basis, the June 2010 RMI was down 28.19 percent from the May 2010 score of 39.49.  Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition.    
    The REALTOR® Price Index was up 6.34 percent in June 2010 compared to the same time last year (44.06 in 2009 to 46.85 in 2010).  On a month-to-month basis the June index number was up 22.07 percent from the Home Sales Price Index number in May 2010 (38.38).
    When REALTOR® members were asked how they would describe their clients’ ability secure financing in the current lending environment, 60 percent of respondents reported that it was either “somewhat” more difficult (37 percent) or “significantly” more difficult (23 percent).  Thirty-two percent of respondents reported that securing financing had “remained the same”, while 11 percent reported that financing was “somewhat” easier to secure.  Zero percent of the respondents reported that financing was “significantly” easier to obtain.
    About the REALTOR® Index Methodology:
    The Massachusetts REALTOR® Market Index (RMI) and Price Index (RPI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market.  More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.
    1. How would you describe the current housing market?
    2. What are your expectations of home prices over the next year?
    In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.
    The RMI is calculated in the following way.  Respondents indicate whether conditions are, or are expected to be “strong” (100 points), “moderate” (50 points), and “weak” (0 points).  The results are the average score for each question.  A score of 50 is the threshold between a “strong” and a “weak” condition.  Similarly, the question about home prices over the next year (REALTOR® Price Index) is calculated using five categories: “Rise 0-5%” (75 points), “Rise 5%+” (100 points), “Level” (50 points), “Fall 0-5%” (25 points), and “Fall >5%” (0 points).

    Thursday, July 01, 2010

    Closing Deadline Extended for Tax Credit

    July 1, 2010 - Last night, Congress passed an extension of the closing deadline for the Homebuyer Tax Credit, the Homebuyer Assistance and Improvement Act (H.R. 5623). The extension applies only to transactions that have ratified contracts in place as of April 30, 2010, that have not yet closed. The legislation is designed to create a seamless extension; the new closing deadline for eligible transactions is now September 30, 2010. There will be no gap between June 30 and the date the President signs the bill into law. Extending the tax credit closing deadline will help provide additional stability to real estate markets across the nation.
    Our Government Affairs team worked closely with Congressional leaders on both sides of the aisle to enact this important legislation.
    NAR is still working on restoring the 502 single-family rural housing loan guarantee program. Language is included in H.R. 4899, the Emergency Supplemental Appropriations bill, that is currently in conference between the House and Senate.  We expect the House to pass that bill shortly and are hopeful the Senate will do the same when they return the week of July 12. When that bill passes, the program will be restored through the end of the fiscal year.

    Additionally, the Senate passed the National Flood Insurance Program Extension Act of 2010 (H.R. 5569), an extension of the National Flood Insurance Program until September 30, 2010. This will allow transactions to move forward. The bill is retroactive and covers the lapse period from June 1, 2010, to the date of enactment of the extension. The National Association of REALTORS (NAR) members sent more than 250,000 letters to Members of Congress encouraging them to extend the program.

    For additional information on the tax credit extension, the flood insurance program and rural housing, please visit

    Thursday, June 24, 2010

    Senate approves extension to qualify for homebuyer tax credit

    Senate approves extension to qualify for homebuyer tax credit

    The proposal pushes the closing deadline back to Sept. 30, 2010, from the previous June 30 deadline.
    By a 60-37 vote, the Senate on Wednesday approved a measure extending the closing deadline for qualifying for the homebuyer tax credit. The proposal is expected to be added to a slimmed-down tax extenders bill that Senate Democratic leaders are expected to unveil Wednesday.

    To qualify for the credit, homebuyers have until June 30 to close on the purchase. The proposal pushes the closing deadline back to Sept. 30, 2010.
      Senate Majority Leader Harry Reid (D-Nev.), Senate Banking Chairman Chris Dodd (D-Conn.) and Sen. Johnny Isakson (R-Ga.) authored the proposal. The senator from Georgia tried but failed to offset the amendment's cost with unspent stimulus dollars. His proposal failed by a 45-52 vote. The proposal that is expected to be added to the extender bill is offset by denying the tax deduction for certain punitive damages, which raises $315 million over 10 years. The cost for extending the closing date is $140 million, which means the provision reduces the deficit by $175 million over 10 years.

    Congress originally passed an $8,000 tax credit for first-time homebuyers as part of the stimulus bill President Barack Obama signed into law in February of 2009 (In fact, the original tax credit was in 2007 for $7,500, but had to be paid back). Lawmakers extended and expanded the measure last November to include a $6,500 tax credit for buyers who have already owned a home. Both of these measures expired at the end of April for buyers that enter into a contract to purchase a home. Wednesday's measure only extends the cut off date for closing on the property.

    If You Missed Out on the Tax Credit - Don't Complain!

    To all of you who are complaining that you don't qualify because you haven't place a home under contract yet or went under contract after April 30, 2010:

    You have had over 2 years to take advantage of the tax credit. The 1st deadline was in 2008, then 2009 and finally April 30, 2010. We all knew that it wouldn't be extended forever. There were many, many great bargains on homes out there, and we had dozens and dozens of clients buy them and take advantage of the credit. We had many other buyers who didn't take advantage of it because they procrastinated too long.

    But as the final April 30th deadline approached, I told my buyers that it made no sense to buy a property they weren't happy with just for the sake of getting the tax credit. By waiting they have the opportunity to purchase the home they really want and, with all the short sale/bank owned properties on the market, save much more than the $8,000 they would have received.

    Yes, the tax credit is over, but the savings are still here. Buyers are picking up short sale properties and with a little work they are getting instant equity.

    Jim Armstrong

    Friday, May 14, 2010

    Real Estate Economic Report for 1st Quarter 2010

    The Economic and Market Watch Report was just released by MLS Property Information Network - the largest real estate multiple listing service in Massachusetts.

    For Essex County, it is still a buyer's market, but it is moving towards the neutral zone. The average sale price is steady, with the number of homes on the market predicted to rise giving buyers more to choose from. The average number of days that a home is on the market before going under contract has risen to 119, and is expected to rise more from there as more seller place their homes up for sale.

    Though the tax credit incentives are over, there is still strong activity as buyer take advantage of prices that have bottomed out, and the excellent mortgage rates. For people who are thinking about moving up to a larger, higher priced home there are significant price reductions happening every day.

    Here is a link to the complete report:

    Jim Armstrong
    Armstrong Field Real Estate

    Monday, May 10, 2010

    Zillow Reports that Boston Area Home Values Up Reports that Boston Area Home Values are Up

    The Boston metro area is one of the few places in the United States that have year over year home home value increases for the 1st quarter of 2010. Some other areas that had increases are Santa Barbara, Santa Cruz, Green Bay, San Diego, San Francisco, Tulsa, Dayton, Denver and New Orleans. Of the 135 areas tracked by Zillow, only 29 had increases in home values.

    See the full stats at:

    Jim Armstrong

    Monday, May 03, 2010

    Too Late for the Tax Credit!

    Too Late for the Tax Credit!

    The April 30th deadline for placing a property under agreement in order to qualify for the Fed's $8,000 tax credit has come and gone. If you did not have an offer accepted in time, does that mean you should stop looking for your first home?

    Of course not! There are so many good deals out there right now there it makes no sense to discontinue your home search. Just in Essex County there are 400 single family homes priced under $250,000. Three years ago you would be hard pressed to find 25 homes in that price range. If you are looking for a condo there are 285 priced under $150,000 in Essex County.

    t overlook short sale properties now that you don't have the tax rebate deadline looming over you anymore. You can get some fantastic deals on all types of properties. Don't let the asking price stop you from placing an offer significantly lower. When making an offer, you do have to consider what the property is really worth in today's market, and how long it has been on the market. A newly listed short sale property with aggressive (low) pricing could get offers for more than the list price. Your buyer agent is the best person to help you determine an offer price.

    You do have to be a
    little patient when waiting for a response to your offer, but in the end it could be worth it. The good news is that many lenders are working on cutting the response time down for replying to short sale offers.

    Jim Armstrong

    Friday, April 16, 2010

    Jobless Rate Falls. First Time since 2007

    The state unemployment rate fell last month for the first time in nearly three years as Massachusetts employers added thousands of jobs, the clearest sign yet that the economic recovery is gaining strength, the state reported yesterday.

    The job gains were broad based, spreading across sectors from retail to technology to financial services, and apparently strong enough to bring down the unemployment rate even as thousands more residents entered the labor market in search of work.

    “It is hard to see anything bad in this,’’ Alan Clayton-Matthews, an economics professor at Northeastern University, said of the report.

    See the rest of the article at

    Posted using ShareThis

    Thursday, April 15, 2010

    Pending Homes Sales up 9th Month in a Row.

    WALTHAM, MA. – April 6, 2010 – The Massachusetts Association of REALTORS® (MAR) reported the number of single-family homes placed under agreement in March 2010 was up 27 percent over March 2009, and condominiums were up 38 percent. March is the ninth straight month that the number of both single-family homes and condominiums placed under agreement had increased over the year before.
    “It appears that the record rains in March didn’t keep buyers from taking advantage of the market conditions and making offers on homes,” said 2010 MAR President Kevin Sears, broker/co-owner of Sears Real Estate in Springfield. “Whether the rain will impact how many of these deals close is still a question, but the buyers are out there and that is a good sign for the market.”
    There were 4,808 single family homes put under contract in March 2010, compared to 3,783 in March 2009. On a month-to-month basis (which really doesn't mean squat because of seasonal & monthly fluctuations), single-family homes put under agreement were up 37.8 percent from 3,489 homes in February.

    The number of condos put under agreement in March was 2,1222 compared to March 2009 with 1,543 units.

    Jim Armstrong

    Friday, March 26, 2010

    Boston in the Top Ten Cities for Borrowers

    Top 10 Best Cities for Borrowers
    Some cities are better than others for borrowers.

    The best cities have the lowest percentage of foreclosures and delinquencies, including a low percentage of bank-owned homes. In most of the cities on this best list, home prices are actually rising. Boston ranks 6th in the list of the top ten.

    This kind of solid housing market motivates banks to offer lower rates and better terms.

    Here are the 10 cities that Forbes ranks as the best for borrowers:
    1. Kansas City, Mo.
    2. Houston
    3. Dallas
    4. Virginia Beach, Va.
    5. San Antonio, Texas
    6. Boston
    7. Pittsburgh
    8. Denver
    9. Seattle
    10. Portland, Ore.

    Saturday, March 13, 2010

    Time to Spring Ahead...and Check Those Smoke Detectors!

    Tonight is the night (actually, tomorrow morning at 2am) that we turn our clocks ahead by one hour, and when we should be replacing the batteries in our smoke detectors (and carbon monoxide). This year, with the change in the smoke detector regulations, you should consider replacing any of your smoke detectors that are near (within 20ft) a kitchen or a bathroom with a shower with a photoelectric model.

    Most smoke detectors that are currently installed in homes are of the ionization type. They work very well, but are prone to going off due to cooking vapors and steam from a shower. When this happens, people tend to remove the batteries to shut them off, and ultimately forget to put them back in leaving everyone in the home vulnerable to a fire. The photoelectric type is not as sensitive to false alarms, therefore the batteries won't be taken out, leaving them ready to do their job at all times.

    Though the new law that goes into effect in April only applies to new construction and homes that are being sold, you should take the initiative and install the photoelectric detectors now.

    Jim Armstrong

    Tuesday, March 09, 2010

    New Massachusetts Smoke Detector Requirements

    New State Smoke Detector Requirements

    A new regulation regarding the installation and maintenance of smoke detectors goes into effect April 5, 2010.

    These new regulations were enacted by the Massachusetts Department of Fire Services and will apply to single and multi-family homes built or most recently substantially altered prior to Jan. 1, 1975 and sold on or after April 5, 2010. Homes built or substantially altered on or after Jan. 1, 1975 are governed by the State Building Code, which already imposes the same requirements & restrictions.

    See the rest of the article Here: Massachusetts REALTOR News

    Thursday, March 04, 2010

    Will Congress Extend the Home Buyer Tax Credit?

    It’s that time of year again: time for lobbyists to convince Congress to extend the home buyer tax credit.

    The National Association of Realtors and other industry groups are beginning to make the rounds on Capitol Hill to press their case, which goes something like this: We know you’ve extended the tax credit two times already, but the housing market is still fragile, the tax credit is working, and don’t forget– you’re up for re-election soon. In other words, do you really want to own the next leg down in home prices?

    See the rest of the article at the Wall Street Journal online:

    Monday, February 15, 2010

    For Sale, But Not For Long

    Karen Daly headed out Sunday to tour a renovated Natick house, confident she would be one of the few home hunters on a cold afternoon during which people were prepping for Super Bowl parties.

    But when Daly arrived at the three-bedroom, $449,000 Cape, she found herself among a half-dozen other disappointed prospective buyers who learned that the seller had already accepted an offer. It wasn’t Daly’s first real estate letdown. Last month, she bid more than $20,000 above the asking price for a house in Framingham -- and lost out.

    “If you are a buyer, you have to be very decisive, you can’t hesitate,’’ said Daly, 55, who sold her house in two days last summer and has been renting in Newton. “You are looking at very low inventory and very steep competition.’’

    See the entire article at

    Saturday, February 13, 2010

    Homeownership: Still the American Dream

    There seems to be a long held American belief currently under attack. For over two hundred years, homeownership in this country was a desire of almost every American family. Recently however, more and more people have been pontificating on the fact that owning your own home should never have been held in such high regard.

    I don’t want to overstate my concern as I know that the majority of Americans still hold homeownership sacred. Trulia just did a survey showing seventy seven percent of those questioned still believe that owning a home is a part of the American dream. Yet, it does concern me that, while people are being forced from their home due to economic difficulties, some are claiming that homeownership never should have been the goal anyway.

    See the whole article here: Homeownership: Still the American Dream

    Thursday, January 28, 2010

    Massachusetts Home Prices Increase in December 2009

    The sale prices of single family homes and condominiums in Massachusetts increase by double digit percentages in December 2009 over the same period in 2008. With help from the home buyer tax credit incentive, the average sale price increased 10.9 percent. This was the first double digit increase in home prices in over 4 years.

    The number of units sold in December was also up over the previous year. There were 3007 single family homes sold in Massachusetts, a 14.6% increase over 2008. Condominiums had even higher numbers, with a 31.7% increase in units sold year over year.

    Inventory levels have gone done for the 21st month in a row. A year ago we had 9.6 months supply of single family homes and 11.3 months supply of condos. Last month we had 7.2 months supply of singles families and only 5.6 months supply of condos.

    Monthly numbers don't mean as much as yearly figures do because of short term fluctuations in the market. But the yearly figures look pretty good also. Sales of single family homes for 2009 were up by 4.1% over 2008. Although the median sale price was down 6.8%, much of the drop in price came from the beginning of the year. The number of homes on the market was down almost 16% over 2008.

    Jim Armstrong