Affordability Reaches Highest Level in 20 Years

Homes are more affordable to more families, according to the latest index for the first quarter of 2011 that shows affordability reaching its highest level in more than 20 years.

Nearly 75 percent of all new and existing homes sold in the first quarter of 2011 were affordable to families earning the national median income of $64,400, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index. The previous high was set in the fourth quarter of 2010 with 73.9 percent.

"With interest rates remaining at historically low levels, today's report indicates that home ownership is within reach of more households than it has been for more than two decades," says Bob Nielsen, chairman of the National Association of Home Builders.

The most affordable metro housing market in the nation? Syracuse, N.Y., in which 94.5 percent of all homes sold were affordable to households earning the area's median family income of $64,300.

Other metro cities ranking high on the affordability index were Youngstown-Warren-Boardman, Ohio-Pa.; Indianapolis-Carmel, Ind.; Warren-Troy-Farmington Hills, Mich.; and Toledo, Ohio.

Meanwhile, the least affordable major housing market for the first quarter of 2011 was New York-White Plains-Wayne, N.Y.-N.J.

Source: “Housing Affordability Rises to Record Level, Tight Financing Continues to Constrain Sales,” National Association of Home Builders (May 25, 2011)

HOW TO IMPROVE THE ODDS OF AN OFFER

1. Price it right. Set a price at the lower end of your property’s realistic price range.

2. Prepare for visitors. Get your house market ready at least two weeks before you     begin showing it.

3. Be flexible about showings. It’s often disruptive to have a house ready to show at the spur of the moment. But the more amenable you can be about letting people see your home, the sooner you’ll find a buyer.

4. Anticipate the offers. Decide in advance what price and terms you’ll find acceptable.

5. Don’t refuse to drop the price. If your home has been on the market for more than 30 days without an offer, you should be prepared to at least consider lowering your asking price.

Source REALTOR Magazine

10 Questions to Ask the Condo Board

Before you buy, contact the condo board with the following questions. In the process, you’ll learn how responsive — and organized — its members are. You’ll also be alerted to potential problems with the property.
1. What percentage of units is owner-occupied? What percentage is tenant-occupied? Generally, the higher the percentage of owner-occupied units, the more marketable the units will be at resale.
2. What covenants, bylaws, and restrictions govern the property? What grandfather clauses are in place? You may find, for instance, that those who buy a property after a certain date can’t rent out their units, but buyers who bought earlier can. Ask for a copy of the bylaws to determine if you can live within them. And have an attorney review property docs, including the master deed, for you.
3. How much does the association keep in reserve? Plus, find out how that money is being invested.
4. Are association assessments keeping pace with the annual rate of inflation? Smart boards raise assessments a certain percentage each year to build reserves to fund future repairs.To determine if the assessment is reasonable, compare the rate to others in the area.
5. What does and doesn’t the assessment cover? Does the assessment include common-area maintenance, recreational facilities, trash collection, and snow removal?
6. What special assessments have been mandated in the past five years? How much was each owner responsible for? Some special assessments are unavoidable. But repeated, expensive assessments could be a red flag about the condition of the building or the board’s fiscal policy.
7. How much turnover occurs in the building? This will tell you if residents are generally happy with the building. According to research by the NATIONAL ASSOCIATION OF REALTORS®, owners of condos in two-to-four unit buildings stay for a median of five years, and owners of condos in a building with five or more units stay for a median of four years.
8. Is the condo building in litigation? This is never a good sign. If the builders or home owners are involved in a lawsuit, reserves can be depleted quickly.
9. Is the developer reputable? Find out what other projects the developer has built and visit one if you can. Ask residents about their perceptions. Request an engineer’s report for developments that have been reconverted from other uses to determine what shape the building is in. If the roof, windows, and bricks aren’t in good repair, they become your problem once you buy.
10. Are multiple associations involved in the property? In very large developments, umbrella associations, as well as the smaller association into which you’re buying, may require separate assessments.

8 Reasons Why You Should Work With a REALTOR®

Not all real estate practitioners are REALTORS®. The term REALTOR® is a registered trademark that identifies a real estate professional who is a member of the NATIONAL ASSOCIATION of REALTORS® and subscribes to its strict Code of Ethics. Here’s why it pays to work with a REALTOR®. 

1. Navigate a complicated process. Buying or selling a home usually requires disclosure forms, inspection reports, mortgage documents, insurance policies, deeds, and multipage settlement statements. A knowledgeable expert will help you prepare the best deal, and avoid delays or costly mistakes.

2. Information and opinions. REALTORS® can provide local community information on utilities, zoning, schools, and more. They’ll also be able to provide objective information about each property. A professional will be able to help you answer these two important questions: Will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?

3. Help finding the best property out there. Sometimes the property you are seeking is available but not actively advertised in the market, and it will take some investigation by your REALTOR® to find all available properties.

4. Negotiating skills. There are many negotiating factors, including but not limited to price, financing, terms, date of possession, and inclusion or exclusion of repairs, furnishings, or equipment. In addition, the purchase agreement should provide a period of time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you as to which investigations and inspections are recommended or required.

5.  Property marketing power. Real estate doesn’t sell due to advertising alone. In fact, a large share of real estate sales comes as the result of a practitioner’s contacts through previous clients, referrals, friends, and family. When a property is marketed with the help of a REALTOR®, you do not have to allow strangers into your home. Your REALTOR® will generally prescreen and accompany qualified prospects through your property.

6. Someone who speaks the language. If you don’t know a CMA from a PUD, you can understand why it’s important to work with a professional who is immersed in the industry and knows the real estate language.

7. Experience. Most people buy and sell only a few homes in a lifetime, usually with quite a few years in between each purchase. Even if you have done it before, laws and regulations change. REALTORS®, on the other hand, handle hundreds of real estate transactions over the course of their career. Having an expert on your side is critical.

8. Objective voice. A home often symbolizes family, rest, and security — it’s not just four walls and a roof. Because of this, homebuying and selling can be an emotional undertaking. And for most people, a home is the biggest purchase they’ll every make. Having a concerned, but objective, third party helps you stay focused on both the emotional and financial issues most important to you.

Hey, College Grads-Let the Homeownership Adventure Begin!!!

Ok, so the market pretty dismal for most but, for young people who are lucky enough to be getting the first post college job in their field,  this can be a very opportune time to consider buying, over renting, your first home.
Let's say you are ready to leave your parents place and you are looking to rent closer to your brand-new office cubicle.  You begin your search and quickly learn that $600.00 to $800.00 per month will get you in the door of some complexes with a few amenities and all the glow of freedom from prying parents!  Sounds pretty good but then you begin to realize that today with a right sized/priced home or condo available in almost every town, $800.00 becomes an investment in you rather than simply a payment to a property management companies coffers.

 A home or condo is an investment rather than just a "place to crash", that yields no return for your hard earned dollars.  When you are ready to move up and out, you will have a proven financial track record for a bigger mortgage and options.  If the market value will not yield the price you desire, but you can forsee that getting better given time, consider making it an income property by renting it for a year and reevaluating at lease renewal time.

So as you look around for your new "nest" use real estate websites with lots of options for calculating what your payments might be, ideas for mortgage lenders and real estate professionals you can contact to help you find just the right place for you! HINT: Start at http://www.remerica.com/ :)

Downsizing

Your kids moved out. You hate yard work. Your utility bills are outrageous. You got divorced. Whatever the reason, you've got too much home to handle. It's time to downsize.
Just like when you bought your first home, evaluate your situation and crunch the numbers to see what you can afford. If you have less income or need to save some cash, figure out whether it's the right time for you to buy a new home.

                Step 1: Consider all your optionsYou've been a homeowner, so you already know the benefits of homeownership, like equity and tax breaks. But if you're faced with decreased income or a tough life transition like divorce or a death in the family, buying a new home may not be your best move. Here are some options:

• • Go green. If your main concern is your skyrocketing energy bills, making green updates may cost less than selling the house, moving and buying another one.
  • Rent out extra space. Supplement your income by renting out a room, the garage or guest/pool house. Or turn a large home into a duplex by dividing it into two separate residences. Research local zoning laws and consult with a real estate attorney. Get tips and advice on how to be a landlord.
  • Compare the pros and cons of renting versus buying. Don't feel bad about being a renter again. It may make more financial sense for you as you regain stability in your life. Compare costs with our Rent vs. Buy Calculator.
  • Consider sharing ownership of a house. You can buy a bigger house if you pool your resources with other cash-strapped homebuyers. Research co-ownership options, such as a "tenancy-in-common" or "joint tenancy." If you don't feel comfortable dealing with strangers, buy with a family member or friend.
  • Consider buying a condo. They tend to be less expensive than single family homes and require little to no home maintenance. But remember, you're subject to homeowners association fees and rules.
  • If you're 62 years old or older, consider a reverse mortgage. If you have enough equity, you can stay in the home.
• Source frondoor.com

Are you a property pro or a real estate rookie?

With today's real estate market, it's important to stay sharp and play it smart. Take this quiz and bone up on everything from mortgages to staging. We'll tell you how your knowledge stacks up and give you tips on how to increase your expertise.

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