Even though you are not guaranteed to be on the show, you have a pretty good chance to be a HGTV star! Not to mention the publicity your home will receive. The HGTV cameras will be there to capture all the work and excitement of prepping for sale, pricing, negotiating, and ultimately selling a home for the first time.

Ideal candidates will be motivated, financially candid people who want to share the experience and the purchase details with HGTV and their audience. If selected to appear on an episode of My First Sale, home sellers will receive a DVD copy of the episode to enjoy for years to come.

Well, ok, you are not doing it for the DVD, but you should for the FUN of it!

Some key points of interest are:

• Unit sales volume has increased by 9.2% in the first quarter of 2010 over the same time a year ago.
• Prices continue to show signs of a moderate recovery: 1st quarter prices in the metro are up from the same quarter in 2009. This is the second consecutive quarter prices have risen on a trailing 12-month basis, representing the first increases seen since the 4th quarter of 2007.
• An average of 71 days on market, a decline from an average of 110 days one year earlier, and the lowest time on market since 2006.
• The ratio of inventory to sales continues to decline in most jurisdictions from one year ago. The metro-wide ratio of 5.7 months’ worth of listings is below the normal, healthy standard of 6 months, (and compared to 7.7 months a year ago) signaling that demand is beginning to outpace supply.
• The gap between buyer and seller demands is closing with the average sales price in the 1st quarter of 2010 at 93.8% of list price, the highest ratio in more than two years.
• Sales prices posting gains in each of the first three months of the year, with prices in March 2010 increasing 3.3 percent over March 2009, and expected to continue gaining traction throughout 2010.

Even as lower-paying jobs are being lost, higher paying jobs are being added, which fosters housing demand. As the national economy gains traction, the Washington region’ housing market will strengthen even more.

It should be noted that in a similar survey back in 2003, when the market was racing higher, 66 percent of people felt the same way. If anyone subscribes to the theory of the wisdom of the crowds, then it is likely that we will see increasing prices over the next year. To be more accurate, in the D.C. metro area we have already seen prices increase at a reasonable rate.

The majority of the people polled believe they will have a harder time getting a loan than buyers of 5 or 10 years ago. I agree with that and I see it happening, however I also feel that lenders are slowly becoming more reasonable and flexible with their loan offerings. Over the next two years I am hoping that things will be more balanced.

One thing to keep in mind is that this survey, as well as most such surveys, are conducted at a national level. I won’t go on the record saying that the D.C. area is immune, but the D.C. metro sub-markets have been more stable and performed much better than the national average

Keeping in mind that this downturn is considered the worst since the 1930s, we are lucky that the market has started recovering. And I am particularly happy that it is doing so at a slow pace, as I believe that will create a more stable market for the long term.

In the meantime, even with the tax-credit expiring, this still is a great time to buy a home, whether you are a first time home buyer or a repeat buyer. Interest rates are low and prices are low. One word of caution: we have gotten used to low interest rates over the past 5-10 years and we don’t realize that such low rates are not normal. I doubt we’ll ever go back to 10%+ rates, but 6%-8% are to be expected eventually.

So if you are thinking about buying, why not make the move in 2010? Contact me to schedule an informal meeting and see how I can help.

In his State of the Union address, the President called on Congress to pass a program of incentives for homeowners who make energy efficiency investments in their homes. Today, while touring a training facility at Savannah Technical College, the President outlined more details of a new “HOMESTAR” program that would help create jobs by encouraging American families to invest in energy saving home improvements. Consistent with the President’s call for a HOMESTAR program, the Senate Democratic leadership included a proposal of this kind as part of their Jobs Agenda released on February 4, 2010.

Key components of the HOMESTAR Program include:

• Rebates delivered directly to consumers: Like the Cash for Clunkers program, consumers would be eligible for direct HOMESTAR rebates at the point of sale for a variety of energy-saving investments in their homes. A broad array of vendors, from small independent building material dealers, large national home improvement chains, energy efficiency installation professionals and utility energy efficiency programs (including rural utilities) would market the rebates, provide them directly to consumers and then be reimbursed by the federal government.
• $1,000 – $1,500 Silver Star Rebates: Consumers looking to have simple upgrades performed in their homes would be eligible for 50% rebates up to $1,000 – $1,500 for doing any of a straightforward set of upgrades, including: insulation, duct sealing, water heaters, HVAC units, windows, roofing and doors. Under Silver Star, consumers can chose a combination of upgrades for rebates up to a maximum of $3,000 per home. Rebates would be limited to the most energy efficient categories of upgrades-focusing on products made primarily in the United States and installed by certified contractors.
• $3000 Gold Star Rebates: Consumers interested in more comprehensive energy retrofits would be eligible for a $3,000 rebate for a whole home energy audit and subsequent retrofit tailored to achieve a 20% energy savings in their homes. Consumers could receive additional rebate amounts for energy savings in excess of 20%. Gold Star would build on existing whole home retrofit programs, like EPA’s successful Home Performance with Energy Star program.
• Oversight to Ensure Quality Installations: The program would require that contractors be certified to perform efficiency installations. Independent quality assurance providers would conduct field audits after work is completed to ensure proper installation so consumers receive energy savings from their upgrades. States would oversee the implementation of quality assurance to ensure that the program was moving the industry toward more robust standards and comprehensive energy retrofit practices.
• Support for financing: The program would include support to State and local governments to provide financing options for consumers seeking to make efficiency investments in their homes. This will help ensure that consumers can afford to make these investments.

The program’s goal is to create tens of thousands of jobs while achieving substantial reductions in energy use – the equivalent of the entire output of three coal-fired power plants each year. Consumers in the program are anticipated to save between $200 – $500 per year in energy costs, while improving the comfort and value of their homes.

Twenty three percent of local companies interviewed plan to hire more employees, an increase over the first quarter  of 2010 when just 14 percent of companies said they planned to hire more.

Perhaps even more important is the fact that seventy three percent of employers expect to maintain their current staff levels. In the second quarter.

This is certainly good news for the local housing market since job stability gives people the confidence to purchase their first home or upgrade to a bigger home.

At the same time increased hiring certainly helps the unemployed get back on their feet, but it also means more people are moving into the area and will be looking to buy sooner or later.

Read details in the Washington Post

The test program would apply only to loans acquired from banks that failed and were seized by the FDIC, which is less than 1 percent of mortgages currently outstanding. It is estimated that 20 percent of borrowers (about 11 million homeowners) owe much more than their home is worth and if the program is successful there is hop that it will be extended to more home owners.

Check out the full article at the Post.

Well yes. The FHFA report said that average prices in the Washington area were up 10.55 percent in the Q4 2009 compared to Q4 2008 (nationally they fell by 1.2%). Furthermore D.C. area prices were up 5.63 percent over Q3 2009.

It looks like KB Home saw this upward trend in the local market early and they decided to build their first development in the area since 2006. It is a new townhouse community in Alexandria, on Huntington Avenue near the Huntington Metro station, called Huntington Reserve, and it opens this weekend.

Huntington Reserve will include 85 townhouses, all being constructed as Energy Star compliant, with prices start in the high $400,000s and being primarily marketed toward first-time homebuyers.

If you are a first-time home buyer remember, there is still time to take advantage of the tax credit which expires on April 30th. Contact me to get the process started. If you were planning to buy soon it would be a shame to leave $8k on the table.

Home sales were up by an impressive 56% in DC, 47.9% in Maryland and 12.5% in Virginia, compared to the previous year. Obviously record-low mortgage rates and the tax credit were a major contributor to this market performance.

You can read a little more about the local market in the Washington Business Journal and results of NAR’s report for the whole country at NAR’s Website.

]]> http://www.propertylicious.com/prices-home-sales-increase-significantly-q4/feed/ 0 http://www.propertylicious.com/first-time-buyers-can-still-benefit-from-tax-credit/ http://www.propertylicious.com/first-time-buyers-can-still-benefit-from-tax-credit/#comments Tue, 16 Feb 2010 10:46:14 +0000 Theo http://www.propertylicious.com/?p=620 Since February 1st I have been contacted by two first time buyers, who wanted to know whether they still have time to take advantage of the $8,000 tax credit, so I thought I write a post to shed some light. I am sure there are more buyers out there who are wondering the same thing, and it would be a shame to miss the opportunity to buy a home and take advantage of the credit, thinking they don’t have time.

So, is there enough time to take advantage of the tax credit if you start looking for homes now? The short answer is YES!

Let me explain in detail:

Background: As most of you already know, a tax credit of up to $8,000 is available to first-time home buyers who purchase a primary residence by April 30, 2010. To clarify further, you don’t actually need to be in your new home by April 30th. If you have a sales contract by April 30th, and complete the purchase by June 30, 2010, then you qualify.

Timetable: So let’s say you start looking for a home on March 1st. That leaves you with about 8 weeks to find a home that you like. Is that enough time? Again, my answer is, YES it is!

In my experience, I have had clients who found a home in as little as a week, and clients who were looking for something very specific and it took us about six months. In the latter case, it was simply a matter of looking for something so particular, that it just doesn’t come on the market often. But that’s the exception. Generally speaking, in 3-8 weeks one can see enough homes to find one to your liking. I am making one assumption here, which is that the market has a healthy inventory (most areas have a good inventory at this time).

Now, once you find a home you like, and assuming there is agreement in the basic terms between you and the seller, it will take anywhere between one to a few days to get it finalized (or “ratified”). As long as the contract has been ratified by April 30th you will be within the time frame for the tax credit.

Once the contract has been ratified, and for the purpose of this example we will assume it happened on April 30th, we have almost 8 weeks to go to closing. Again, this is plenty of time assuming there are no issues with the property (e.g. home inspection unveils a major problem). It typically takes between 3-6 weeks for the inspections, appraisal, loan processing, title work, and other paperwork to be ready so there is plenty of time to go to settlement (or “closing”) before June 30, 2010.

Before you know it you will be in your new home and will have taken advantage of the $8,000 tax credit!

If you are still thinking about buying a home, you could wait a little longer before you start looking, but why not start today so you don’t feel rushed by the April 30th deadline? Send me a note through my contact form or call me to schedule an appointment to discuss your options in detail. I love working with first-time buyers!

]]> http://www.propertylicious.com/first-time-buyers-can-still-benefit-from-tax-credit/feed/ 0 http://www.propertylicious.com/203k-loans/ http://www.propertylicious.com/203k-loans/#comments Mon, 14 Dec 2009 05:22:25 +0000 Theo http://www.propertylicious.com/?p=510 The Federal Housing Administration (FHA) administers various single family mortgage insurance programs. These programs operate through FHA-approved lending institutions who fund the mortgage loans which the Department insures. The Section 203(k) program is the Department’s primary program for the rehabilitation and repair of single family properties.

How is it different

The 203(k) loan is different from a traditional mortgage loan and it is ideal for properties that need improvement. For example:

When a home buyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage. Often the interim financing (the acquisition and construction loans) involves relatively high interest rates and short amortization periods. The Section 203(k) program was designed to address this situation. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property. To provide funds for the rehabilitation, the mortgage amount is based on the projected value of the property with the work completed, taking into account the cost of the work.

Eligible improvements

There is no minimum requirement for improvements. Improvements may also include a detached garage, a new detached garage, or the addition of an attached unit (if local zoning allows it).

The mortgage must include one or more of the items listed below:

• Structural repairs and alterations.

Includes such items as additions to the structure, repairing any and all structural damage

• Improvements in the functionality or modernization.

Includes such items as remodeled kitchens and bathrooms.

• Changes for aesthetic appeal, and the elimination of obsolescence.

New exterior siding and new doors.

• Repair or replacement of polumbing, heating, air conditioning or electrical systems.

Installation of new plumbing fixtures are acceptable including interior whirlpool bathtubs.

• Replacement of flooring, carpeting or tiling.
• Energy conservation improvement

New double pane windows and doors, storm windows, insulation, solar domestic hot water systems.

• Major landscape work and site improvement

Patios and terraces that improve the value of the property equal to the cost, or that are needed to preserve the property from erosion. Tree removal is also acceptable if the tree presents a hazard to the occupants.

The following items can be included in the work to be completed. There are no minimum requirements:

• New cooking ranges, refrigerators and other standalone appliances.
• Painting and other cosmetic repairs
• Fencing, new walks and driveways, and general landscape work (trees, shrubs, etc)
• Repair of a swimming pool, up to $1,500

Not eligible:

• Items that will not become a permanent part of the property.
• Luxury items, including new swimming pools, exterior hot tubs, sauna, spas, tennis courts and barbecue pits.

You can read about the 203(k) loan program in much more detail in the HUD site.