Selling your home in 2011? Tips to add value during late winter/early spring months

 Major home renovations can be overwhelming, but there are a few fundamental repairs that can update your home's appearance and increase its value. If you're planning to sell your home in 2011, take advantage of the colder winter months to prepare your home for a spring sale by focusing on a few key projects:

Make a first impression.
The entryway is the first up-close encounter a potential homebuyer will have with your home. Manicure your front yard and update or even replace your front door to complement your home's exterior. Select a rich, dark stained wood or bold white door to draw attention to the main entry and add personality to your home. If your door is already in great shape, consider a simple replacement of weak or older-looking hardware that will impress buyers at first sight.

Get cookin' in the kitchen.
Experts agree that a kitchen can significantly impact a home's perceived value. An outdated kitchen can be a deal breaker for many homebuyers. Naturally, then, it's the place you might spend the most amount of time updating. To increase the appeal of your kitchen, consider investing in updated, matching appliances that match the style of your kitchen. Some manufacturers even offer replacement panels to update the exteriors of older appliances.

Next, if you can't afford to add new cabinetry, change out the hardware so the knobs, drawer pulls and handles match your decor and add a modern flair. Adding technology-driven fixtures, including built-in water filtration systems, garbage disposals and high-tech faucets is another great way to increase the room's appeal. Delta Faucet's Touch2O Technology will impress homebuyers and add a sense of luxury to the room. The technology enables users to turn the faucet on and off with just a touch anywhere on the spout or handle, and is available on a variety of models.

Update and upgrade light fixtures.
Lighting is key. It can drastically change the look and feel of a room, and lighting fixtures are affordable and relatively simple to install on your own. Shop discount stores and home improvement depots to find a statement piece to add spice to your living room. A beautiful ceiling fan with lighting can serve double-duty to update your family room. Remember, well-lit and bright rooms appear larger and more open.

Step on it.
Flooring is one of the first things that potential homebuyers notice. Make sure you dust, vacuum and clean so that you show off the flooring to its best advantage. If you have carpet, consider replacing it with wood floors or wood alternatives. If you already have hardwood floors, polish and protect your flooring so that it gleams when potential buyers step into the home.

Whether you're trying to sell your home this winter or simply want to update its look, you don't have to wait until the spring thaws. When the cold weather drives you inside, take advantage of the time to make attractive upgrades that can increase the appeal and value to your home.




Reprinted with permission from:
www.aracontent.com

Why You Should Not Buy a Car

When you get a raise or accumulate some savings, you may find yourself confronted by an innate instinct of modern civilized men and women: The desire to spend money. It begins simply, by going out to restaurants, then accelerates to purchasing clothing, electronic gadgets, and since North Americans have a special fondness for the automobile, you may even buy a "brand new car." If you're married or ambitious, a few months later your thoughts eventually turn toward buying your own home.  Or a move-up home, if you are already a homeowner.  Next, you contact a loan officer to get prequalified for a mortgage loan.  You state your desired price and how much you can put down.  You provide your income and may even supply pay stubs and W2 forms.  The loan officer methodically crunches the numbers (by telephone, in person, or even over the internet).   "If only you didn't have this car payment... Debt-to-Income Ratios and Car Payments You see, when determining your ability to qualify for a mortgage, a lender looks at what is called your "debt-to-income" ratio. A debt-to-income ratio is the percentage of your gross monthly income (before taxes) that you spend on debt. This will include your monthly housing costs, including principal, interest, taxes, insurance, and homeowner's association fees, if any. It will also include your monthly consumer debt, including credit cards, student loans, installment debt, and... ...car payments. How a New Car Payment Reduces Your Purchase Price For example, suppose you earn $5000 a month and you have a car payment of $400. At current interest rates (approximately 8% on a thirty-year fixed rate loan), you would qualify for approximately $55,000 less than if you did not have the car payment.   Even if you feel you can afford the car payment, mortgage companies approve your mortgage based on their guidelines, not yours. Do not get discouraged, however. You should still take the time to get pre-qualified by a lender. However, if you have not already bought a car, remember one thing. Whenever the thought of buying a car enters your mind, think ahead. Think about buying a home first. Buying a home is a much more important purchase when considering your future financial well being. Do not buy the car.  Buy the house first.

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		More Home Buying Articles and Advice

Home Buyer Workshop Will Show Home Affordabilty - Salem, MA - 51 - AmericanTowns.com

Home Buyer Workshop Will Show Home Affordabilty

A Home Buyer Workshop will be held on March 16, 2011 in Salem, MA. The Wall Street Journal said that with the combination of lower home prices and historically low mortgage interest rates, home affordability is the best it has been in decades.

The workshop will be presented by a Realtor, a mortgage consultant, a real estate attorney, and a home inspector. Each will give pointers on how you can make the best of the current real estate market, and how to avoid any pitfalls along the way.

The workshop is Free, and will be held at the offices of Armstrong Field Real Estate located at 281 Essex Street in Salem, Mass. Preregistration is required. For more information, call 978-740-8700 or go to www.ArmstrongField.com.

Some Common Questions About Buying a Home

If a person is a first time buyer, what are the best steps to take to become a home owner?
The absolute first step to take is to talk with a mortgage person. There are a few reasons for this. First of all, you want to know where you stand financially in regards to qualifying for a mortgage. You will find out how much of a mortgage you qualify for, and how much you can really afford. Many times a bank will qualify you for more than you are comfortable paying each month. We do not want you to be what we call "house poor", meaning, yes, you now have a home, but you don't have enough money left over after paying the mortgage to enjoy life.

The second reason is that if your credit score is a little low, a good mortgage person will explain how you can improve your score... sometimes dramatically. It does take at least a couple of months for any changes you make to trickle down to your credit score. But it could mean paying a lower interest rate, and therefore have a lower mortgage payment, so the wait may well be worth it.

The last reason is that you cannot make an offer without a mortgage pre-approval. No seller will consider your offer if you can't prove you can pay for it. Also, you don't want to waste your time looking at $300,000 homes if you would only qualify for a $250,000 one.

Is there a different pre-qualification process when you are considering a foreclosed home?
No, the qualification is the same, but you may want to look into an FHA 203K rehab loan. This is a specialized mortgage that gives you extra money above what you are paying for the property that you can use for repairs and upgrades. Many foreclosed properties will need work.

What percentage of the purchase price is usually required?
With an FHA mortgage the minimum down payment is 3 1/2% of the purchase price. You will also need around 2% (roughly depending on the mortgage) for closing costs, but we can almost always get the seller to pay for most of that. The are other loans available through Mass Housing and the VA that have low or even no down payment requirements. Again, it depends on your particular financial situation. There are also matching down payment programs in many cities that I can help you with.

Would all these things apply to a short sale as well?
Everything here also applies to a short sale. The major difference is the length of time needed to close. With a regular home sale, including bank owned properties, the closing is typically 4-7 weeks after the offer is accepted. With a short sale you are looking at a minimum of 8 weeks, with 3 to 4 months more common, and 4 plus months not uncommonly seen. The saving you can make is usually worth the wait.

If you have any questions regarding real estate or financing, please contact Jim Armstrong

Take Advantage of the VA Home Loan Program

Today we have a guest blogger, Matt Polsky, with some information on VA loans (which also happens to be the type of mortgage I have) - Jim Armstrong

Take Advantage of the VA Home Loan Program

            The credit crunch and housing market collapse did not make financing a home any easier. However, a loan program for veterans and active-duty service members still allows these men and women to buy the home of their dreams. For almost seventy years, the VA Home Loan Guaranty program has helped service members become homeowners.
 
            Taking advantage of your VA loan benefit is rather simple. First, you need to complete a Certificate of Eligibility (COE), a no nonsense form that ensures you meet the initial qualifications for the program. This form is available from VA-approved lenders and the VA website, and takes little time to complete. 

            The Department of Veterans Affairs may take several weeks to process your certificate whereas a VA-approved lender can get your COE processed in minutes. Using the Automated Certificate of Eligibility (ACE) system, lenders can get your COE online. Although the VA Home Loan program aims to abet all military personnel, not every service member qualifies. Military homebuyers who may qualify typically are in one of the three groups:

            -Military members who served on active duty for 181 days during peacetime or 90 days during wartime.
            -Members of the National Guard and Reserves who served for at least six years.
            -Surviving spouses—who have not remarried—of a service member who died in the line of duty or because of a service-related injury.

            Once you earn a VA loan, you’ll be entitled to its arsenal of benefits. Unlike conventional loans, VA loans in Massachusetts come with next-to-nothing down payments. Most VA loan borrowers pay nothing down, while the rest won’t be charged more than 5 percent down. Most of the time, military homebuyers say the tiny down payment is the program’s best perk.

            Other advantages to the program save military homebuyers’ money in the long run, notably the negotiable interest rates. Since the VA backs up to 25 percent of each loan rather than issue them, VA-approved lenders lower the interest rates in return for assuming less risk. The program sweetens the deal for active-duty borrowers, who have interest rate caps.

            Monthly savings further accrue because there is no private mortgage insurance in the VA Home Loan program. Also, closing costs are often lower than other loan types, and sellers may end up covering some of those costs.

Matt Polsky
Mortgage Commentator
mpolsky@vamortgagecenter.com
http://www.vamortgagecenter.com/

Fielding a Lowball Purchase Offer on Your Home

Article From BuyAndSell.HouseLogic.com

By: Marcie Geffner
Published: June 10, 2010

Consider before you ignore or outright refuse a very low purchase offer for your home. A counteroffer and negotiation could turn that low purchase offer into a sale.

You just received a purchase offer from someone who wants to buy your home. You're excited and relieved, until you realize the purchase offer is much lower than your asking price. How should you respond? Set aside your emotions, focus on the facts, and prepare a counteroffer that keeps the buyers involved in the deal.

Check your emotions

A purchase offer, even a very low one, means someone wants to purchase your home. Unless the offer is laughably low, it deserves a cordial response, whether that's a counteroffer or an outright rejection. Remain calm and discuss with your real estate agent the many ways you can respond to a lowball purchase offer.

Counter the purchase offer

Unless you've received multiple purchase offers, the best response is to counter the low offer with a price and terms you're willing to accept. Some buyers make a low offer because they think that's customary, they're afraid they'll overpay, or they want to test your limits.

A counteroffer signals that you're willing to negotiate. One strategy for your counteroffer is to lower your price, but remove any concessions such as seller assistance with closing costs, or features such as kitchen appliances that you'd like to take with you.

Consider the terms

Price is paramount for most buyers and sellers, but it's not the only deal point. A low purchase offer might make sense if the contingencies are reasonable, the closing date meets your needs, and the buyer is preapproved for a mortgage. Consider what terms you might change in a counteroffer to make the deal work.

Review your comps

Ask your REALTOR® whether any homes that are comparable to yours (known as "comps") have been sold or put on the market since your home was listed for sale. If those new comps are at lower prices, you might have to lower your price to match them if you want to sell.

Consider the buyer's comps

Buyers sometimes attach comps to a low offer to try to convince the seller to accept a lower purchase offer. Take a look at those comps. Are the homes similar to yours? If so, your asking price might be unrealistic. If not, you might want to include in your counteroffer information about those homes and your own comps that justify your asking price.

If the buyers don't include comps to justify their low purchase offer, have your real estate agent ask the buyers' agent for those comps.

Get the agents together

If the purchase offer is too low to counter, but you don't have a better option, ask your real estate agent to call the buyer's agent and try to narrow the price gap so that a counteroffer would make sense. Also, ask your real estate agent whether the buyer (or buyer's agent) has a reputation for lowball purchase offers. If that's the case, you might feel freer to reject the offer.

Don't signal desperation

Buyers are sensitive to signs that a seller may be receptive to a low purchase offer. If your home is vacant or your home's listing describes you as a "motivated" seller, you're signaling you're open to a low offer.

If you can remedy the situation, maybe by renting furniture or asking your agent not to mention in your home listing that you're motivated, the next purchase offer you get might be more to your liking.

Marcie Geffner is a freelance reporter who has been writing about real estate, homeownership and mortgages for 20 years. She owns a ranch-style house built in 1941 and updated in the 1990s, in Los Angeles.

Visit houselogic.com for more articles like this. Reprinted from HouseLogic with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2011.  All rights reserved.

Existing-Home Sales Rise Again in January

Washington, DC, February 23, 2011
The uptrend in existing-home sales continues, with January sales rising for the third consecutive month with a pace that is now above year-ago levels, according to the National Association of REALTORS®.
Existing-home sales¹, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 2.7 percent to a seasonally adjusted annual rate of 5.36 million in January from a downwardly revised 5.22 million in December, and are 5.3 percent above the 5.09 million level in January 2010. This is the first time in seven months that sales activity was higher than a year earlier.
Lawrence Yun, NAR chief economist, said the improvement is good but could be better. “The uptrend in home sales is consistent with improvements in the economy and jobs, which are helping boost consumer confidence,” Yun said. “The extremely favorable housing affordability conditions are a big factor, but buyers have been constrained by unnecessarily tight credit. As a result, there are abnormally high levels of all-cash purchases, along with rising investor activity.”
A parallel NAR practitioner survey² shows first-time buyers purchased 29 percent of homes in January, down from 33 percent in December and 40 percent in January 2010 when an extended tax credit was in place.
Investors accounted for 23 percent of purchases in January, up from 20 percent in December and 17 percent in January 2010; the balance of sales were to repeat buyers. All-cash sales rose to 32 percent in January from 29 percent in December and 26 percent in January 2010.
“Increases in all-cash transactions, the investor market share and distressed home sales all go hand-in-hand. With tight credit standards, it’s not surprising to see so much activity where cash is king and investors are taking advantage of conditions to purchase undervalued homes,” Yun said.
All-cash purchases are at the highest level since NAR started measuring these purchases monthly in October 2008, when they accounted for 15 percent of the market. The average of all-cash deals was 20 percent in 2009, rising to 28 percent last year.
The national median existing-home price³ for all housing types was $158,800 in January, down 3.7 percent from January 2010. Distressed homes edged up to a 37 percent market share in January from 36 percent in December; it was 38 percent in January 2010.
NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said the median price is being dampened by unusual market factors. “Unprecedented levels of all-cash purchases, primarily of distressed homes sold at deep discounts, undoubtedly pulls the median price downward,” Phipps said. “Given the levels of inventory we see today, we believe that traditional homes in good condition have held their value.”
Total housing inventory at the end of January fell 5.1 percent to 3.38 million existing homes available for sale, which represents a 7.6-month supply⁴ at the current sales pace, down from an 8.2-month supply in December. The inventory supply is at the lowest level since December 2009 when there was a 7.3-month supply.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.76 percent in January from 4.71 percent in December; the rate was 5.03 percent in January 2010.
Single-family home sales rose 2.4 percent to a seasonally adjusted annual rate of 4.69 million in January from 4.58 million in December, and are 4.9 percent higher than the 4.47 million level in January 2010. The median existing single-family home price was $159,400 in January, down 2.7 percent from a year ago.
Existing condominium and co-op sales increased 4.7 percent to a seasonally adjusted annual rate of 670,000 in January from 640,000 in December, and are 7.9 percent above the 621,000-unit pace one year ago. The median existing condo price⁵ was $154,900 in January, which is 10.2 percent below January 2010.

http://www.realtor.org/press_room/news_releases/2011/02/january_above

Selling Your House? 5 Reasons To Do It NOW!

The conventional wisdom when selling a home has always been to wait until the ‘Spring Buying Season’. Over the years, that has seemed to make sense and is now accepted as a good strategy for those who want to sell their house and receive the best possible price. This real estate market has shattered many previously held beliefs. The wisdom of waiting for a spring market is another belief that is about to fall. Here are five reasons why?
See the rest of the article at:
Selling Your House? 5 Reasons To Do It NOW!

The Cost of Waiting For Home Prices to Fall

The Cost of Waiting

For Home Prices to Fall

 The are numerous people out there who want to buy a home, but are waiting for home prices to hit bottom. They want a guarantee that they are purchasing at the best possible price. In some markets, you may see a little more dropping of prices, especially in areas really hit by the foreclosure market (of which Massachusetts has one of the lower rates). But waiting may not be in your best financial interest. You should be concerned with the cost of buying a house, which is quite different from the price of a house.

The real cost of a house is made up of the price and the interest rate you will be paying.

The National Association of Realtors just reported that the average home price in the 4th quarter of 2010 rose .2%. In other words, price remained steady. A buyer who delayed a purchase might find solace in the fact that prices have not increased. However, the other news released the other day paints a different picture. Mortgage interest rates now average 5.05%, up from 4.17% from the middle of the last quarter.

By sitting on the sidelines for the last 90 days a purchaser lost:

    - $89.44 a month

    - $1,073.28 a year

    - $32,198.40 over the thirty year life of the mortgage

If you buy a $340,000 home, double all these numbers.

It also means that if you qualified for a $300,000 mortgage three months ago, today you would only qualify for a $272,000 mortgage.  The longer you wait, the less you will be able to afford if the interest rates keep rising. That means you either have to buy a home with less of the amenities you want or maybe located in a less desirable neighborhood, or you have to come up with a larger down payment.

Bottom Line

Even if prices fall another 10% this year, the cost of a home will increase if interest rates go up more than 1%. If you are in the market for a home, you should not worry about where prices are going. You should be more concerned about where the interest rates are going, and what the cost of buying a home will be later this year or in 2012.

Jim Armstrong

The chart and some of the details are from kmcblog.com. For more details, please go to:

http://kcmblog.com/2011/02/11/the-cost-of-waiting-for-prices-to-fall/

The First Question You Should Ask Your Listing Agent

The First Question You Should Ask Your Listing Agent

What is the most important thing a seller should look for when hiring a real estate agent to sell their house? We are often asked this question. Is it the size of the company they are licensed with? Is it their marketing program? Their years experience in the business? Should you choose the agent who suggests the highest listing price?
There are many things that should be taken into consideration when hiring someone and giving them the responsibility for selling your home. In our opinion, the most important question you can ask a potential listing agent is a simple one:

Do you truly believe that now is a good time to buy a home?

Why should this matter when hiring someone to SELL your home? Buyers are nervous about purchasing right now. They want to know they are making an intelligent choice. We believe, especially in today’s market, you need to hire someone who realizes that this is one of the best times in American real estate history to buy. If an agent doesn’t believe that, how will they be able to convince a potential buyer to buy your home?
When interviewing a real estate professional, ask them to explain why purchasing a home makes sense today. They should be able to explain it simply and effectively. See how many of the following facts (which should be shared with every potential purchaser) the agent knows:
The Wall Street Journal last week stated:

“With home sales starting to improve, and with prices now possibly forming a bottom, real estate could well be the asset class that represents the best low-risk buying opportunity out there today.”

Donald Trump was just quoted saying:

“I’m pretty sure this is a great time to go out and buy a house. And if you do, in 10 years you’re going to look back and say, ‘You know, I‘m glad I listened to Donald Trump’.”

John Paulson, a multibillionaire hedge fund operator and the investment genius who made a killing betting against housing a few years ago, is now bullish on residential real estate market. He recently said:

“If you don’t own a home, buy one. If you own one home, buy another one. If you own two homes, buy a third. And, lend your relatives the money to buy a home.”

A recent Gallup Poll showed that 67% of American’s think that now is a ‘good time’ to buy a home. The Gallup Organization went on to say:

“Overall, there is good reason for most Americans to think now is a good time to buy a house. Interest rates remain near historic lows. Home prices are down sharply, providing many incredible buys.”

The iconic financial paper in this country, the country’s most famous real estate investor, the most successful prognosticator of the housing market and 2/3 of all Americans say now is the time to buy a home. Shouldn’t your agent agree?

Bottom Line

Selling is nothing more than the transference of conviction. How can agents transfer that conviction if they themselves are not convinced? Find a listing agent who truly believes that someone should buy your home – TODAY! This is the single most important thing you should look for in a potential listing agent.

Owners and Renters Agree That Owning a Home is a Smart Decision

Washington, January 19, 2011

A substantial majority of both home owners and current renters agree that owning a home is a smart decision over the long term. That’s according to the results of a National Association of Realtors® survey of 3,793 adults conducted online by Harris Interactive.
The American Attitudes About Homeownership survey found that in today’s challenging economy, 95 percent of owners and 72 percent of renters believe that over a period of several years, it makes more sense to own a home. In addition, an overwhelming majority of home owners are happy with their decision to own a home – 93 percent of owners surveyed would buy again.
“Home owners and renters agree that home ownership benefits individuals and families, strengthens our communities, and is integral to our nation’s economy,” said National Association of Realtors® President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “The results of this survey illustrate just how important issues related to home ownership are to people in this country.” Read the rest of the article at:
http://www.realtor.org/press_room/news_releases/2011/01/owning_home

Short-sale incentives revamped again | Inman News

Short-sale incentives revamped again | Inman News

A new directive from the Treasury Department, which administers the Home Affordable Foreclosure Alternatives Program (HAFA), lifts a cap that had restricted loan servicers to paying second-lien holders no more than 6 percent of outstanding loan balance in exchange for releasing subordinate liens.

See the entire article at Inman News

SJC ruling may void thousands of foreclosures

January 7, 2011 01:08 PM

By Jenifer B. McKim, Globe Staff

The Massachusetts Supreme Judicial Court today upheld a contentious land court ruling that puts in question the ownership of hundreds, possibly thousands, of foreclosed properties in the state.

The ruling challenges the way lenders have traditionally foreclosed on properties -- without having all the paperwork in place at the time a home is seized. It affirms a 2009 lower court decision that invalidated foreclosures on two Springfield homes because the lenders did not hold clear titles to the properties at the time of the proceedings.

Cambridge attorney Paul Collier, who represented one of the homeowners in the case, said the supreme court ruling invalidates thousands of foreclosures, reverting ownership back to the homeowners who lost the homes, at least temporarily. In most cases, those property takings will have to be redone, further clogging an already bogged down foreclosure process than many real estate specialists say has contributed to the stagnant housing market.

"The banks and the investors are going to have to deal with those homeowners as to what happens to those properties," Collier said.

During the housing boom, millions of mortgages were packaged into bonds and sold to investors, a process that resulted in lengthy and tangled paper trails that can obscure ownership. Many lenders believed they could complete foreclosure transactions and later produce formal proof they held a mortgage. Today's ruling makes it clear that the practice will not be allowed in Massachusetts.

"We agree with the [land court] judge that the plaintiffs who were not the original mortgagees, failed to make the required showing that they were the holders of the mortgages at the time of foreclosure,'' the justices said in their opinion.

The decision will also have national implications at a time when lenders' foreclosure practices are being scrutinized by federal regulators and state attorneys general.

http://www.boston.com/business/ticker/2011/01/sjc_ruling_may.html

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.
From: www.realtor.org

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.

Unemployment

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.

Prices

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: http://kcmblog.com/2010/12/29/2011-the-year-a-house-again-becomes-a-home/

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.

From Boston.com

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 Realtor.org

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: http://www.inman.com/news/2010/12/20/top-10-real-estate-stories-2010

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 Boston.com

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