Real Estate Designers offers totally innovative solutions for your software development, Internet programming, real estate web design and hosting needs. Our service includes domain name registration and real estate web design. Real Estate Designers provides the complete solution including design, application development and marketing.
Sunday, December 23, 2007
Housing Prices Experience Largest Drop In 21-Year History
Prices of new and pre-owned home prices have fallen steadily since July 2006. According to a report released Tuesday by S&P Case/Shiller, aggregate pricina plunged even more steeply in the third quarter of this year.
The housing market could possibly get a lot worse, according to Yale economist and index co-founder, Robert Shiller. Shiller said, “You’re talking about declines of 50 percent, in real terms. That’s not out of the question.” Referring to the latest declines, Shiller said they were notable for two reasons. “First, the third quarter decline, at 1.7%, was the largest quarterly decline in the index’s 21-year history. And, second, the year-over-year decline posted its second consecutive record low at minus 4.5%.”
Of the 20 markets covered, 15 showed negative returns and all 20 had negative returns for September, compared with a month earlier. Worst hit was Tampa, Fla., where prices fell 11.1 percent compared with a year earlier. The second biggest loss was in the Miami real estate market, where prices fell 10 percent from a year earlier. Charlotte, N.C. and Seattle showed the highest year-to-year gain of 4.7 percent each. But Charlotte declined 0.6 percent in September and Seattle prices fell 0.2 percent.
source: sundaymorningtalk.com
The housing market could possibly get a lot worse, according to Yale economist and index co-founder, Robert Shiller. Shiller said, “You’re talking about declines of 50 percent, in real terms. That’s not out of the question.” Referring to the latest declines, Shiller said they were notable for two reasons. “First, the third quarter decline, at 1.7%, was the largest quarterly decline in the index’s 21-year history. And, second, the year-over-year decline posted its second consecutive record low at minus 4.5%.”
Of the 20 markets covered, 15 showed negative returns and all 20 had negative returns for September, compared with a month earlier. Worst hit was Tampa, Fla., where prices fell 11.1 percent compared with a year earlier. The second biggest loss was in the Miami real estate market, where prices fell 10 percent from a year earlier. Charlotte, N.C. and Seattle showed the highest year-to-year gain of 4.7 percent each. But Charlotte declined 0.6 percent in September and Seattle prices fell 0.2 percent.
source: sundaymorningtalk.com
It’s A Rosy Outlook For Real Estate Investors
Economists are suggesting that the next 12 to 18 months could be the best period since the early 1990s to buy property at depressed prices. That’s because the real estate downcycle is close to running its course in many local markets, where prices today are 10 to 25 percent below their peak levels of two and three years ago.
Serious investors understand that real estate is a cyclical business. When times are tough for some owners, the opposite is true for investors with the knowledge, negotiating skills and vision to help distressed owners get out from under burdensome mortgage payments. Real estate consultant Jack McCabe of Deerfield Beach, Florida advises opportunity investors who are now buying waterfront and Boca Raton condo units and single family houses at 30 to 40 percent discounts off last year’s pricing.
The big factor today is financing. In all the earlier down cycles of the seventies, eighties and nineties, money was extremely expensive for investors. This time around, capital is relatively cheap and available, whether from regular lenders or private equity sources. That’s an important point for anyone thinking about whether, and how quickly, to get involved.
source: sundaymorningtalk.com
Serious investors understand that real estate is a cyclical business. When times are tough for some owners, the opposite is true for investors with the knowledge, negotiating skills and vision to help distressed owners get out from under burdensome mortgage payments. Real estate consultant Jack McCabe of Deerfield Beach, Florida advises opportunity investors who are now buying waterfront and Boca Raton condo units and single family houses at 30 to 40 percent discounts off last year’s pricing.
The big factor today is financing. In all the earlier down cycles of the seventies, eighties and nineties, money was extremely expensive for investors. This time around, capital is relatively cheap and available, whether from regular lenders or private equity sources. That’s an important point for anyone thinking about whether, and how quickly, to get involved.
source: sundaymorningtalk.com
Buying A Second Home And Living Your Retirement Dream
More and more people are realizing that with today’s depressed prices of Palm Beach County real estate, it might make more sense than they had originally thought for buying a second home. There are two main reasons why people buy a second home, maybe just to get away from the day-to-day stress and the investment opportunities. Whatever your priority, owning a second home may be the right choice for you and your family.
There are many tax advantages that come with owning a second home. You can write off 100% of the mortgage interest. You can write off property taxes. New IRS rules allow for a capital gain on the principal residence whenever people sell, up to $250,000 for singles, and up to $500,000 for couples. Living in your second home for two years or more entitles you for the same capitol gains break.
If the investment return on your purchase of a second home bears more than the bank interest will pay you, then you have made a smart investment. Another aspect to consider is that you have the option to rent in order to cover your second mortgage. You need to decide if you are going to declare it as a vacation home, or rental property though, because the IRS has different rules for both. Also remember that if you declare it as a rental your mortgage could be slightly higher.
source: sundaymorningtalk.com
There are many tax advantages that come with owning a second home. You can write off 100% of the mortgage interest. You can write off property taxes. New IRS rules allow for a capital gain on the principal residence whenever people sell, up to $250,000 for singles, and up to $500,000 for couples. Living in your second home for two years or more entitles you for the same capitol gains break.
If the investment return on your purchase of a second home bears more than the bank interest will pay you, then you have made a smart investment. Another aspect to consider is that you have the option to rent in order to cover your second mortgage. You need to decide if you are going to declare it as a vacation home, or rental property though, because the IRS has different rules for both. Also remember that if you declare it as a rental your mortgage could be slightly higher.
source: sundaymorningtalk.com
Fannie Mae and Freddie Mac Addressing Mortgage Affordability
Affordability is a huge issue in many parts of the country. Lower conforming loan limits may be good for Fannie and Freddie but it’s bad for homebuyers, considering that credit has tightened for jumbo loans and home prices haven’t dropped but five percent after 100 percent gains since 2000.
Housing sales have dropped over 20 percent to less than a half-million housing units sold year over year. That’s the October report from the National Association of Realtors. The NAR blames less than aggressive lending. If people can’t get loans, they can’t buy houses. The news was worse from states where home values fall within the “jumbo” limits.
The Office of Federal Housing Enterprise Oversight kept 2008 conforming loan limits purchased by Fannie Mae and Freddie Mac at $417,000, but it’s considering lower limits if housing prices continue to fall. Meanwhile, The House is trying to get higher Enterprise loans limits passed, but the Senate won’t cooperate.
source: sundaymorningtalk.com
Housing sales have dropped over 20 percent to less than a half-million housing units sold year over year. That’s the October report from the National Association of Realtors. The NAR blames less than aggressive lending. If people can’t get loans, they can’t buy houses. The news was worse from states where home values fall within the “jumbo” limits.
The Office of Federal Housing Enterprise Oversight kept 2008 conforming loan limits purchased by Fannie Mae and Freddie Mac at $417,000, but it’s considering lower limits if housing prices continue to fall. Meanwhile, The House is trying to get higher Enterprise loans limits passed, but the Senate won’t cooperate.
source: sundaymorningtalk.com
Rate Freeze For ARMs Discussed In Washington
Hope Now Alliance, a coalition of lenders, servicers, investors and community groups, put together by the Treasury Department, is working on a version of a rate freeze to forestall upcoming ARM resets. Details of the Hope Now plan have not been finalized, according to Kurt Pfotenhauer, a senior vice president for government affairs with the Mortgage Bankers Association, which is part of the Alliance.
For a borrower with an adjustable rate mortgage (ARM) at 7 percent on a $200,000 loan, a freeze would mean substantial savings. If the loan were to reset to 10 percent, the monthly payment would jump from $1,331 to $1,755. Judging from other lenders’ plans, a reset freeze would be available only to those borrowers judged unable to make payments at the reset rates.
A freeze was proposed in early October by Sheila Bair, chairwoman of the Federal Deposit Insurance Corporation (FDIC), according to FDIC spokesman, Andrew Gray. It has been well received. Both the Wall Street Journal and the New York Times endorsed it. Bair first had the idea in April, said Gray. But in September, Moody’s revealed that only 1% of ARM borrowers with loans that reset to higher interest rates in 2007 were modified in any way.
source: sundaymorningtalk.com
For a borrower with an adjustable rate mortgage (ARM) at 7 percent on a $200,000 loan, a freeze would mean substantial savings. If the loan were to reset to 10 percent, the monthly payment would jump from $1,331 to $1,755. Judging from other lenders’ plans, a reset freeze would be available only to those borrowers judged unable to make payments at the reset rates.
A freeze was proposed in early October by Sheila Bair, chairwoman of the Federal Deposit Insurance Corporation (FDIC), according to FDIC spokesman, Andrew Gray. It has been well received. Both the Wall Street Journal and the New York Times endorsed it. Bair first had the idea in April, said Gray. But in September, Moody’s revealed that only 1% of ARM borrowers with loans that reset to higher interest rates in 2007 were modified in any way.
source: sundaymorningtalk.com
Subscribe to:
Posts (Atom)