Housing market lifts off from the 'bottom' --If you can pull it off, buy a house

Housing market lifts off from the 'bottom'






WASHINGTON - Aug. 2, 2012 - Recent housing indexes have shown single-family home prices are on the rise, providing more evidence that the "bottom" of the market is already behind.



"We're wiping out just about all of the decline," Joel Naroff, chief economist at Naroff Economic Advisors, told NBC.com about recent housing data showing home prices inching up. "It indicates the market has turned the corner on the pricing side."



Some recent housing indexes suggest that the "bottom" of the market was reached in January 2012. Since that time, housing prices have been picking up in many housing markets.



But "the turnaround in home prices was unexpected," says Patrick Newport, an economist with IHS Global Insight. "The conventional wisdom in February, following that landmark agreement (of the $26 billion mortgage settlement with the nation's five largest banks), was that we would see a surge in foreclosures of some size that would lead to lower home prices. This surge never materialized and home prices have turned."



Newport points to several signs of a housing market on the mend. For one, housing starts are up after reaching a low in the fourth quarter of 2011. Also, he says the Federal Housing Finance Agency's (FHFA) monthly House Price Index shows a 3.7 percent increase in May year-over-year, which he notes is higher than inflation and "means that real housing wealth, a consumer spending driver, was also up."



The increase in home prices is also leading to a fewer number of homeowners underwater on their mortgages. The number of underwater homeowners fell from 12.1 million at the end of 2011 to 11.4 million at the end of the first quarter this year, according to CoreLogic data.



If you can pull it off, buy a house




NEW YORK - Aug. 13, 2012 - Investment opinions are like, um, noses: Everyone has one. Buy stocks, sell bonds? Go long steel and short copper? Buy sheep, sell deer?



It's pretty easy to see both sides of an investment argument. But it's hard to argue against buying a house now, assuming you can get a loan.



The housing cycle is a long one, in part because buying a house moves at a glacial pace, at least compared with the time it takes to buy a stock or bond. If you're not pre-approved for a mortgage, you have to submit to a credit check, which, these days, is only slightly less intrusive than a CIA background check. You have to get the home inspected. You have to figure out the various fees your bank charges, including the one marked "Just because we can."



How long is a housing cycle? Pretty long. A relatively modest housing bubble, by today's standards, occurred in Boston in the late 1980s. Average home prices, adjusted for inflation, hit $310,000 in October 1987. Home prices didn't hit that level again until May of 2000. Someone who bought at the high had a long wait to get even - particularly in light of the broker's commission.



Home prices bottomed, however, in March 1993 - roughly six years after the top. History doesn't repeat itself precisely, but it's interesting to note that the top of the last housing bubble was six years ago, in 2006.



Why be bullish on housing?



Prices. You can always buy low and watch prices go lower. But by many measures, home prices are still cheap. The median single-family home price - half higher, half lower - hit its nadir in January, dropping to $154,600, the lowest since October 2001, according to the National Association of Realtors. That's down from a high of $230,900 in July 2006.



Existing-home prices rose in June to a median $190,100, up 8 percent from June 2011. Those are still 2003 levels.



Supply. The good news is that the enormous supply on the market is shrinking. It takes a wearisome amount of time for supply to shrink, in part because there are people who have wanted to sell their homes for many years, but haven't been able to get the price they want. As prices rise, more homes come on the market.



Nevertheless, Ned Davis Research, a respected institutional research firm, estimates that excess supply of houses on the market should be eliminated by the end of 2013. When excess supply dries up, people start building more new houses, which has the virtuous effect of reducing the unemployment rate and increasing the economy generally.



Mortgage rates. The average 30-year fixed-rate mortgage rate is 3.59 percent, according to mortgage giant Freddie Mac. That's above the all-time low of 3.49 percent the week of July 26, but close enough. It's conceivable that at some point in the next 30 years, your interest rate would be less than the rate of inflation.



Assuming you financed 80 percent of the median single-family home, or $152,080, your mortgage payment would be about $691, excluding taxes and other irritations. About $5,589 of your first year's payments would be tax-deductible mortgage interest.



Thanks mainly to low home prices and interest rates, the NAR's housing affordability index rose to its highest level on record. (The higher the index, the more affordable the average home. The index also takes into account average family income, which has been falling since 2008.)



What could go wrong? All sorts of things. You may not be able get a loan. Bankers are insisting on checking things that seemed far too troublesome during the housing bubble, like whether you have a decent credit rating, a down payment, or a job.



The other problem is that houses are leveraged investments - that is, you borrow money to buy them. Let's consider the example above, where someone buys a $190,100 house and finances $152,080.



Your investment is $38,020. Let's say that the worst happens: Home prices fall, and you have to sell the house for $175,000.



Unfortunately, the bank won't split the loss with you. You'll get back $22,920 from the sale, and wave goodbye to $15,100 of your downpayment. That's a 40 percent loss, even though your house has fallen 8 percent in value.



There are other risks with homeownership, ranging from termites to ghosts in the hall closet. But if you're planning to live in your home for a long time, you have the money, and you can get financing, it's a fine time to buy.

Fla. housing market continues positive track in May

Fla. housing market continues positive track in May

ORLANDO, Fla. - June 21, 2012 -

Pending sales, closed sales and median prices rose, while the inventory of homes and condos for sale dropped in Florida's housing market in May, according to the latest housing data released by Florida Realtors®.

"The recovery in Florida's housing market and economy continues to grow stronger and stronger," said 2012 Florida Realtors President Summer Greene, regional manager of Better Homes and Gardens Real Estate Florida 1st in Fort Lauderdale. "Realtors across the state are reporting increased activity - in May, statewide pending sales were up 43.1 percent for existing single-family homes and up 33.4 percent for townhome-condo properties. In some areas, a shortage of for-sale inventory is resulting in multiple bids from buyers and rising price conditions.

"Now, more than ever, successful buyers and sellers are realizing the value of working with a Realtor who knows their local markets."

Pending sales refer to contracts that are signed but not yet completed or closed; closed sales typically occur 30 to 90 days after sales contracts are written.

The statewide median sales price for single-family existing homes in May was $147,000, up 8.9 percent from the year-ago figure, according to data from Florida Realtors Industry Data and Analysis department and vendor partner 10K Research and Marketing. The statewide median for townhome-condo properties was $112,000, up 14.3 percent over May 2011.

The median is the midpoint; half the homes sold for more, half for less. Housing industry analysts note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes.

Statewide sales of existing single-family homes totaled 18,723 in May, up 7.2 percent, compared to the year-ago figure. Looking at Florida's year-to-year comparison for sales of townhomes/condos, a total of 9,995 units sold statewide last month, up 5.4 percent from those sold in May 2011. NAR reported the national median existing condo price in May 2012 was $180,000.

Last month, the inventory for both single-family homes and for townhome-condo properties stood at a 5.5-month supply, according to Florida Realtors.

"Some very positive trends have been developing in the Florida market, and the May numbers indicate those trends are continuing," said Florida Realtors Chief Economist Dr. John Tuccillo. "Closed sales, pending sales and prices - both average and median - are strongly above where they were a year ago. In fact, average prices have increased in 11 of the past 12 months.

"In addition, home sellers are receiving a higher percentage of their asking price, a trend we've seen for nine months. Perhaps the most striking characteristic of this market has been the dramatic drop in inventories. Now, Florida is in what is generally considered a balanced market - that is, one that favors neither buyers nor sellers."

The interest rate for a 30-year fixed-rate mortgage averaged 3.80 percent in May 2012, down from the 4.64 percent average during the same month a year earlier, according to Freddie Mac.

© 2012 Florida Realtors®

Inventory of unsold homes lowest in 5 years

Inventory of unsold homes lowest in 5 years

CoreLogic's monthly report on home sales, released last week, finds that the level of unsold inventory hit its lowest point in five years.

CoreLogic analysts say negative equity has become a positive force in the real estate marketing. Homeowners who owe more on the mortgage than the currently value of their home choose not to sell right now. That has increased selling prices by limiting the number of homes on the market.

Key findings include:

* The Home Price Index (HPI), including distressed sales, posted two consecutive months of year-over-year increases in April 2012 - the first such increase since the summer of 2010 when the housing market was benefitting from tax credits.

* Single-family construction activity increased 2.3 percent in April, and it's up 25 percent over the last six months.

* Months' supply of unsold homes fell to just more than six months in April 2012 and is currently at the lowest level in more than five years.

* As the flow of REOs has slowed over the last 18 months, negative equity has become a positive force in real estate markets by restricting supply in the face of increasing demand.

* The housing market has transitioned from pricing dynamics driven by economic weakness and high shares of distressed sales to one of restricted supply, which will likely exist for some time to come - a reason for optimism in many hard hit markets.


© 2012 Florida Realtors®

Five questions to ask a lender

Five questions to ask a lender

Prospective homebuyers should interview more than one lender, ask the right questions, and compare the answers. There is no best mortgage. The conditions and rates that work best for one household may not be ideal for another.

LendingTree asked over 300 lenders on the LendingTree Network this question: “In your professional opinion, what is the best questions all borrowers should ask their potential lender?” The top five answers are:

1. What are the total costs involved with the loan?

2. What is the best program for me, based on my financial goals and situation?

3. What documents will be required ahead of time to avoid delays?

4. What are the service ratings for your company, and where can I find them?

5. How long have you (the loan officer and the company) been in the mortgage business?

“Consumers have very little confidence that they will be able to qualify for a mortgage, let alone find a great deal when it comes to a home loan,” says Doug Lebda, chairman and CEO of LendingTree. “But with rates as low as they are, borrowers have the opportunity to tap into substantial savings. If you have the right information, know what to do and what to avoid, there’s no need to be intimidated or shy away from the process.”

© 2012 Florida Realtors®

I can help you find just the right home. Give me a call or send an email with what your looking for and I will get the process started for you.

Rob Skeel , Realtor- e-Pro - Cell --305-393-6300 Email--rob@robskeel.com
Century 21 Schwartz Realty--877-660-4637

SEARCH ALL KEYS HOMES at www.RobSkeel.com

Real Estate Housing Info

Welcome to Century 21 Schwartz Realty

Attached are current articles regarding the housing market for your information.

The Florida Keys is doing well with some properties closing in less than 45 days.

When you need a realtor please think of me, I can assist you with finding just the right property at the right price.

Check out my website for listings, searches and information about the Keys. www.robskeel.com

U.S. housing market finally reaches a turning point NEW YORK - May 16, 2012 - Home values will start to climb again and related consumer industries will grow in 2012 and beyond as the U.S. housing market finally turns the corner, according to a new study released today by The Demand Institute, a new nonprofit, non-advocacy group formed in February by The Conference Board and Nielsen. According to the Institute, the housing market recovery will have "far-reaching impacts in the coming years across the United States and international markets as U.S. consumers increase their spending on buying, renovating, furnishing and maintaining their homes." The Institute's report, The Shifting Nature of U.S. Housing Demand, predicts that average home prices will increase by up to 1 percent in the second half of 2012. By 2014, home prices will increase by as much as 2.5 percent. From 2015 to 2017, the study projects annual increases between 3 and 4 percent, though unevenly nationwide. The strongest markets "could capture average gains of 5 percent or more in the coming years." "In these initial years, the prime driver of recovery won't be new home construction, but rather demand for rental properties," says Louise Keely, chief research officer at The Demand Institute and a co-author of the report. "This is a remarkable change from previous recoveries. It is a measure of just how severe the Great Recession has been that such a wide swath of Americans had to delay, scale back, or put off entirely their dreams of homeownership." Bart van Ark, chief economist at The Conference Board and co-author of the report, says he doesn't expect to see the homeownership rate to change. "Over 80 percent of Americans in recent surveys still agree that buying a home is the best long-term investment they can make," van Ark says. "What will be intriguing to watch is how their aspirations around homeownership are affected by this period of extended austerity." Between 2006 and 2011, some $7 trillion in American wealth was wiped out when home prices dropped 30 percent after dramatic climb in valuations during the housing bubble. Looking forward, the moderate growth expectations for coming years suggest a return to normalcy. As home prices continue to drop and interest rates fall further, first-time buyers and others who remained relatively cautious will be drawn back into the housing market. And, as the market recovers, so too will consumer spending. "As the U.S. housing market strengthens, almost every consumer-facing industry will be impacted in the coming years," said Mark Leiter, chairman of The Demand Institute. "Business and government leaders will benefit by fully understanding the nature of this recovery. In doing so they will be better able to anticipate how consumer demand will evolve, and to formulate critical business and policy

Government: First house price increase since 2007 WASHINGTON - May 23, 2012 - U.S. house prices rose 0.6 percent in the first quarter of 2012 according to the Federal Housing Finance Agency's (FHFA) seasonally adjusted purchase-only house price index (HPI). HPI price changes are generally smaller than other indicators because they're based on same-home selling prices for homes under government-owned Fannie Mae and Freddie Mac. The purchase-only index is based on more than 6 million repeat sales transactions. Comparing year-to-year, the seasonally adjusted house prices rose 0.5 percent compared to first quarter 2011. Comparing month-to-month, FHFA's seasonally adjusted monthly index for March was up 1.8 percent from February. "Consistent with other housing market indicators, the FHFA HPI showed stronger house prices in the first quarter, most notably in March," says FHFA Principal Economist Andrew Leventis. "Increased affordability and a somewhat smaller inventory of homes for sale are positively impacting house prices." Findings: * The seasonally adjusted purchase-only HPI rose in the first quarter in 30 states and the District of Columbia. * The top five annual increases were Hawaii (10.3 percent), Washington, DC (9.8 percent), Iowa (5.7 percent), Florida (4.7 percent) and North Dakota (4.4 percent). © 2012 Florida Realtors®

Real Estate updates

U.S. rate on 30-year mortgage rises to 3.90% Mortgage Rate Trend Index Most mortgage experts (63%) polled by Bankrate.com this week expect little change in rates over the short term. Only 6% predict further declines, while the remaining 31% forecast an increase. WASHINGTON - April 20, 2012 - The average rate on the 30-year fixed mortgage stayed near its lowest level on record, keeping home-buying and refinancing affordable. Mortgage buyer Freddie Mac said Thursday that the rate on the 30-year loan rose to 3.90 percent from 3.88 percent. The rate touched 3.87 percent in February, which was the lowest since long-term mortgages began in the 1950s. The 30-year loan is the most common financing option for homebuyers. The 15-year mortgage, which is popular with those refinancing, rose to 3.13 percent from 3.11 percent, an all-time low.


Low-ball offers don't work anymore WASHINGTON - April 23, 2012 - When the number of home sellers grossly outpaces the number of buyers, no offer can be ignored, even if it's 25 percent or more off the asking price. But in today's rebounding market, those low-ball offers don't often work. Many times, the potential buyer finds that they don't get a counter-offer. And, in many cases, another more realistic buyer gets the home. A low-ball offer - generally 25 or more off the asking price - allows buyers to see if they can land a great deal, even if they're willing to pay more. In a survey last year conducted by the National Association of Realtors® (NAR), one in 10 respondents cited low-ball offers as a concern. According to real estate columnist Kenneth Harney, a NAR survey conducted in March and not yet released found that almost no one complained about low offers. When the number of listings outpaced the number of buyers, many potential homeowners submitted a shockingly low offer on the theory that they had nothing to lose. If the seller balked, most would still counter with something below their asking price. Today, however, offers close to the asking price - or even beating it - will probably come in fairly quickly from someone else if a home is priced correctly in the first place. Even buyers who still want to low-ball an offer on a home many times switch tactics after they lose a property or two to a more aggressive buyer. Florida Realtor Marnie Matarese works with J Wood Realty in Sarasota. She told Harney that fewer buyers want to low-ball an offer in her area, but they still come in - mainly from out-of-state or out-of-the-country people who have read about the state's foreclosures and short sales. That news, however, is old - it has not kept up with reality in many areas. Matarese says some people still insist on making a low-ball offer, but that she doesn't mind. "You can't blame a buyer for trying to get a good deal," she says. In some cases, a seller isn't offended by a low-ball offer, but their counter-offer shaves only a little bit off their original asking price. An Olympia, Wash., real estate agent had a $150,000 offer for a $250,000 listing, according to Harney. But after the dust settled and the seller shook off his irritation, he and the buyer agreed to $230,000. Harney closed his column with this advice: "Rolling low-balls at sellers may have been an effective approach between 2008 and early 2011. But in 2012's environment - at least in rebounding markets - it could be counterproductive if you truly want to buy."

  Rob Skeel e-Pro -- YOUR FLORIDA KEYS REAL ESTATE CONNECTION Century 21 Schwartz Realty 305-393-6300 www.robskeel.com

Low Interest Rates and Low Prices equal Time to Buy!

Buffett: ‘I’d buy up a couple hundred thousand’ homes

WICHITA, Kan. – March 1, 2012 – Warren Buffett, the billionaire investor and Berkshire Hathaway CEO, said on CNBC’s “Squawk Box” recently that he’d “buy up a couple hundred thousand” single-family homes if it was practical.

Buffett said that’s because he believes purchasing a home with ultra-low mortgage rates and holding it for the long-term has become a better investment than stocks right now.

“Housing will come back, you can be sure of that,” Buffett wrote in his annual letter to shareholders recently.

Buffett forecasts an increase in household formations, as more people who moved in with their parents or family members during the recession look to move out and get their own home soon.

Buffett said the recovery in the housing market could vary quite a bit among local housing markets, however.


Investors are making up over 30% of purchases-most are everyday people

Recently it was announced the average investor-cash buyer is not who you think. It is not the Donald Trumps of the world buying properties. The next wave in real estate is coming from everyday investor buyers!

According to NAR, the majority of investor business comes from everyday people. Their average total household income is less than $87,600 a year. Which is basically two people making $43,000 a year.

That means teachers, lifeguards, and even government employee's are buying investment properties.