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DEC
8

Mortgage rates for 30-year U.S. loans fell for a fourth week, reducing borrowing costs to the lowest level in a year and a half.

 The average rate for a 30-year fixed mortgage was 3.89 percent, down from 3.97 percent last week, Freddie Mac said in a statement today. That was the lowest since May 2013. The average 15-year rate dropped to 3.10 percent from 3.17 percent, the McLean, Virginia-based mortgage-finance company said.

 Lower borrowing costs are helping to make housing purchases more affordable as values rise across much of the country. Home prices rose 6.1 percent in October, the 32nd straight year-over-year increase, CoreLogic Inc. said this week.

 “Lower mortgage rates would be a net positive for the U.S. housing market and the economic recovery more generally,” Millan Mulraine, deputy head of U.S. research and strategy at TD Securities USA LLC in New York, said in a phone interview. “It improves affordability and provides a greater incentive for people on the sidelines, waiting for rates to fall.”


source: Bloomberg

Starting on Dec. 13, Fannie Mae will allow the lower down payments for first-time home buyers and permit refinancing borrowers to reduce equity to 3 percent to cover closing costs, the company said today in a statement. Freddie Mac will begin a program in March giving breaks to lower-income buyers and first-time borrowers who get housing counseling.

 “These underwriting guidelines provide a responsible approach to improving access to credit while ensuring safe and sound lending practices,” Melvin L. Watt, who oversees the two U.S.-owned companies as head of the Federal Housing Finance Agency, said in a statement.

Watt encouraged the move as part of a broader effort to spur lending to minorities, young adults and first-time buyers. Lenders have tightened standards after paying tens of billions of dollars to settle lawsuits over mortgage-underwriting flaws.

“It’s an example of the government taking a step toward expanding the credit box,” said Isaac Boltansky, an analyst at Compass Point Research & Trading LLC in Washington.

Source: Bloomberg

 Diana Walton

Diana Walton Properties

Champion Real Estate Group

First Time Home Buyer & VA Specialist

281.923.1118

New Down Payment Programs What You Need to Know

 When: Saturday, August 23rd

Where: Kendall Neighborhood Library

609 N Eldridge Pkwy, Houston, TX 77077

Time: 10:30 am.  - Noon

 

Step by step home buying process

Types of down payment programs

How to qualify

Which Program is Right for You?

What you need to know about Escrow & closing cost

Getting pre-approved

Free Credit Analysis

Move into your new home before the end of the year

When preparing to go on a listing appointment do you take the time to screen the seller to make sure he/she is really serious about selling their home? Yesterday I went on what I though was a listing appointment. It turned out to be anything but. I called the seller from my expired list and after briefly discussing my reason for calling, I ask for the appointment and received it.

 I thought I had taken all the necessary steps by providing the seller with a prelisting package before our schedule appointment. I went over my pricing strategy to make sure the home would be priced fair and effective.  I took the necessary steps to preview other homes within the area and within his price range.

 In addition, I had all the necessary documents, including tax records, past sales, and comps, as part of my presentation on my Ipad. I also had a fully prepared market analysis to give to the seller. I arrived eight minutes early, ready to sell myself and my services. I knocked on the door, the owner came out, I introduce myself and was invited in. It was a stunning home, one of which the owner, it turned out had no intension of allowing anyone to sell.

 The owner was very upset with the first agent that listed his home because it did not sell.  I was not aware of this. For the six months the home was on the market, he said only two people came to view the home. The comps I did show the home was overpriced by $80,000.

 He wanted to sell the house himself, and decided that he would interview as many agents as possible within a given time, to collect data on how each would market the home, then used what he thought was the best marketing ideas to market and sell the home himself. Of course he did not share this information with me voluntarily.

 Something did not seem right based on the type of questions he was asking. I asked him if he had met with any other agents, he said yes, 15 of them.  I then ask what was it that he was looking for in an agent that none of the 15 had, that’s when he told me what he was doing.  I smiled, thanked him for his time, retrieved all my data, including the prelisting packet and walked out.

 Were there any way I could have avoided being number 16?  Once I got home I spend the rest of the evening making modification to my phone screening process. While I may not be able to eliminate all, I am pretty sure I can make it less likely to go on another appointment like that again.

FEB
17

The average annual increase of 3.9% is outpacing inflation and income growth. Will renters be priced out of many cities?  It's no secret renters have been feeling the crunch of a competitive rental market for a few years now. If it seems like rent increases have been unusually high this year, though, that's because they have been.

 In June, the real-estate data firm Trulia analyzed the rent prices in 25 of the largest rental markets in the United States. What Trulia found is an average annual increase of 3.9%. This is a huge increase when compared with inflation. And, generally speaking, incomes are not keeping pace with rent increases, putting renters in an even tighter position.

 According to Trulia, the five least-affordable rental markets in the country are New York City, Miami, Los Angeles, San Francisco and Boston. In these cities, rents often make up half or more of a renter's average monthly wage.

 The cities that experienced the highest rent hikes for 2012-13 were Houston, Miami, Boston, Tampa-St. Petersburg, Fla., and San Diego. Some cities, such as Houston, already had lower rents than the national average for major cities, whereas in others the increases came on top of already higher-than-average rates. For instance, Boston — already one of the most expensive cities in the country — saw a 5.5% increase in rents this year.

 It would seem the recent rent increases are an enduring ripple effect of the foreclosure epidemic that catalyzed the Great Recession, flooding the market with prospective renters. At the same time, the gradual economic recovery has resulted in rising employment rates. With a shortage of available rentals, landlords are in the enviable position of being able to name their price and have their pick among tenants willing to pay it.

 In their most recent survey, the apartment-research firm RealFacts found not only that rents are up nationwide in 39 of the 41 markets analyzed but that these increases also occurred even in cities that are building rental units at a precipitous pace.

In particular, Seattle experienced a large rent increase this past year despite a projection that 12,000 rental units will be added to the market by the end of the year. Portland, which also experienced an impressive increase in average annual rents, did so even as 4,000 units were added in the city. In fact, Portland saw its occupancy rate jump a full percent this past year. San Francisco, which has also added thousands of units recently, saw an occupancy rate increase of 1.2%.

 "So far, it appears aggressive rent hikes and new construction hasn't had a negative impact on occupancy rates," according to the RealFacts report.

 Though there seem to be no signs of rent increases slowing down, the report warned that the market will soon become oversupplied: The increased availability of new rentals, coupled with the rise in interest rates, will eventually lead to a downturn in the rental market.

 Additionally, more people will turn to buying as an affordable alternative. That's because even though home prices rose 7% in the past year, outpacing rent increases, the gap between buying and renting is still quite large.

 Forbes reported this year that buying is much more affordable than renting in all of the 100 largest metro areas in the nation. According to mortgage lender Freddie Mac, buying is an average of 41% cheaper than renting nationwide.

 But buying is only slightly cheaper in some cities and drastically cheaper in others. For example, buying is 19% cheaper than renting in San Francisco but 70% cheaper in Detroit. In New York, buying has remained 26% cheaper for the past couple of years.

 Despite the regional fluctuations in price, though, it looks as though buying will be the cheaper option for some time to come no matter where you live. That is because 30-year fixed rates on home purchases would need to reach 10.5% to become the more expensive option. The rate is at 4.4%, as of the week of Aug. 14.

  RealFacts predicts that in 2014 or 2015, rent rates will begin to stall as the rate of homeowners rise and renters decline.

 Until then, renters will have to grit their teeth and wait it out — or start shopping around for their own home.

 source:mainst

JAN
28

Trap #1: Line 6 - real estate taxes

 Your monthly mortgage payment often includes money for a tax escrow, from which the lender pays your local real estate taxes. The money you send the bank may be more than what the bank pays for your taxes, says Julian Block, a tax attorney and author of Julian Block’s Home Seller’s Guide to Tax Savings. That will lead you to putting the wrong number on Schedule A.

 Example:

Your monthly payment to the lender: $2,000 for mortgage + $500 escrow for taxes

Your annual property tax bill: $5,500

 Now do the math:

Your bank received $6,000 for real estate taxes, but only paid $5,500. It may keep the extra $500 to apply to the next tax bill or refund it to you at some point, but meanwhile, you’re making a mistake if you enter $6,000 on Schedule A.

Instead, take the number from Form 1098—which your bank sends you each year—that shows the actual taxes paid.

 Trap #2: Line 6 - tax calculations for recent buyers and sellers

 If you bought or sold a home in the middle of 2012, figuring out what to put on line 6 of your Schedule A Form is tricky.

 Don’t simply enter the number from your property tax bill on line 6 as you would if you owned the house the whole year. If you bought or sold a house in midyear, you should instead use the property tax amount listed on your HUD-1 closing statement, says Phil Marti, a retired IRS official.

 Here’s why: Generally, depending on the local tax cycle, either the seller gives the buyer money to pay the taxes when they come due or, if the seller has already paid taxes, the buyer reimburses the seller at closing. Those taxes are deductible that year, but won’t be reflected on your property tax bill

 Trap #3: Line 10 - properly deducting points

 You can deduct points paid on a refinance, but not all at once, says David Sands, a CPA with Buchbinder Tunick & Co LLP. Rather, you deduct them over the life of your loan. So if you paid $1,000 in points for a 10-year refinance, you’re entitled to deduct only $100 per year on your Schedule A Form

 Trap #4: Line 10 - HELOC limits

 If you took out a home equity line of credit (HELOC), you can generally deduct the interest on it only up to $100,000 of debt each year, says Matthew Lender, a CPA with EisnerLubin LLP.

 For example, if you have a HELOC for $200,000, the bank will send you Form 1098 for interest paid on $200,000. But you can deduct only the interest paid on $100,000. If you just pull the number off Form 1098, you’ll deduct more than you’re entitled to

 Trap #5: line 13 - Private mortgage insurance

 You can deduct PMI on your Schedule A Form, as long as you started paying the insurance after Dec. 31, 2006. Congress renewed the PMI deduction for 2012 and 2013 for people making less than $110,000.

 Since you’re thinking about it, this is also a good time to review your PMI: You might be able to cancel your PMI altogether because you’ve had a change in loan-to-value status.

 Trap #6: line 20 - casualty and theft losses

 You can deduct part or all of losses caused by theft, vandalism, fire, or similar causes, as well as corrosive drywall, but the process isn’t always obvious or simple:

Only deduct losses that are greater than 10% of your adjusted gross income (line 38 of Form 1040).

Fill out Form 4684, which involves complex calculations for the cost basis and fair market value.  This form gives you the number you need for line 20.

 Bottom line on line 20: If you’ve got extensive losses, it’s best to consult a tax pro. “I wouldn’t do it myself, and I’ve been dealing with taxes for 40 years,” says former IRS official Marti.

 

This article provides general information about tax laws and consequences, but shouldn’t be relied upon as tax or legal advice applicable to particular transactions or circumstances. Consult a tax professional for such advice

source:houselogic

Diana Walton

Diana Walton Properties

Champion Real Estate Group

First Time Home Buyer & VA Specialist

www.dianawaltonproperties.com

281.923.1118