Buying Is a Good Investment, If You Choose Right

Pessimists are implying that the housing market will never get any better and housing will always be a lousy investment.

Are they right? Of course not, say experts at the Motley Fool finance Web site.

In fact, the Fools predict that pretty soon housing will be a great investment because prices will have fallen to the point where homes are cheap.

Then as now, the Fools say the key to buying a home that is a good deal will be:

• Location
• Don’t overpay
• Buy what you can afford

If the price goes up, great, the Fools say. If not, buyers will be OK because they have picked a great place to live.

Source: The Motley Fool (08/23/2010)

Real Estate Titan Dies at 88

Manhattan real estate mogul Paul Milstein died Monday at 88. His empire included 50,000 apartments, 8,000 hotel rooms and 20 million square feet of office space, the New York Times reported.

Many of Milstein’s projects anchored the refurbishment of marginal neighborhoods, including turning around Times Square — an effort that some called “courageous.”

His philanthropy, much of it done with his late brother Seymour, was significant. It included the Milstein Hall of Ocean Life (“The Whale Room”) at the American Museum of Natural History; the building housing the architecture department at Cornell; an endowed professorship at Columbia; and the terrace and pool at Lincoln Center. His medical philanthropy included the Milstein Hospital Building of New York Presbyterian Hospital/Columbia University Medical Center.

Source: The New York Times, Douglas Martin (08/09/2010)

Curious To Know What Home Prices are Doing?

Here is what home prices are doing in your Neck of the woods. For an estimate on your home, call your REALTOR Today...

• Northeast: Regionally, the median existing single-family home price in the Northeast declined 3.2 percent to $238,000 in the second quarter from a year earlier. Existing-home sales in the Northeast jumped 14.9 percent in the second quarter to a level of 980,000 and are 23.6 percent above the second quarter of 2009.
• Midwest: In the Midwest, the median existing single-family home price increased 1.4 percent to $148,500 in the second quarter from the second quarter of last year. Existing-home sales in the Midwest rose 14.5 percent in the second quarter to a pace of 1.30 million and are 20.9 percent above the same period in 2009.
• South: In the South, the median existing single-family home price slipped 2.0 percent to $155,500 in the second quarter from the second quarter of 2009. Existing-home sales in the South increased 10.9 percent in the second quarter to an annual rate of 2.10 million and are 18.8 percent above a year ago.
• West: The median existing single-family home price in the West rose 2.6 percent to $219,700 in the second quarter from a year ago. Existing-home sales in the West fell 2.6 percent in the second quarter to an annual rate of 1.23 million but are 7.6 percent higher than the second quarter of 2009.

-NAR

Five Surprising Reasons to Buy a Home Now

Five good reasons why now is a great time to buy a house:

1. Low mortgage rates serve as an equity shock absorber. When buyers borrow at today's record-low rates, they start building equity as soon as they close. That means they can absorb a few ups and downs as the still-recovering housing market gains traction.
2. Houses are in move-in condition. Home owners have continued to spend on maintenance and repair, according to the Harvard Joint Center on Housing. As these houses enter the market, they are in marked contrast to tattered foreclosures.
3. Terrific houses are coming on the market. Foreclosures are finally starting to clear the system, and they are being replaced by some very attractive properties.
4. Appraisal regulations are finally aligned with market realities. Fannie Mae has adjusted its appraisal guidelines, giving appraisers more flexibility to set values that reflect the current market.
5. Plenty of programs. Many programs that encourage middle-class families to buy homes continue to exist, despite market downturns. Buyers who qualify can get a big boost by combining one of these programs with today's low mortgage rates.

Source: ForSaleByOwner.com (07/29/2010)

Mortgage Rates Fall Under 4.5 % (The Lowest Ever)

Freddie Mac reports that long-term mortgage rates moved south again this week.

Interest on 30-year fixed loans hit a new low of 4.49 percent, compared to 4.54 percent last week and 5.22 percent a year ago; and the 15-year mortgage landed at 3.95 percent, down from 4 percent last week and 4.63 percent a year ago.

Five-year adjustable-rate mortgages reached a new low of 3.63 percent, down from 3.76 percent last week and 4.73 percent a year ago; while one-year ARMs fell to 3.55 percent from 3.64 percent last week and 4.78 percent a year ago.

Source: The Wall Street Journal, Amy Hoak and Nick Timiraos (08/06/10)

20-Year Mortgages Cut Interest Significantly

Buyers with the ability to stretch a little might consider a 20-year fixed-rate mortgage instead of the traditional 30-year, suggests CBS Money Matters’ financial adviser Ray Martin.

Martin points out that a $200,000 mortgage with a 30-year term and an interest rate of 4.75 would have a monthly payment of $1,043 and the total interest over the life of the loan would be $175,600.

The same mortgage with a 20-year term at 4.5 percent would have a monthly payment of $1,265 with total interest over the life of the mortgage of $103,670.

Young home buyers planning to have children will have their 20-year mortgage paid off by the time their kids enter college, a big financial advantage, Martin points out.

Source: CBS, Ray Martin (08/04/2010)

10 Steps to Win Over Sellers

Finding the home of your dream isn't always easy, Here are 10 tips for making sure sellers won’t turn up their nose at your offer:

1. Make sure the you are pre-approved for a mortgage (not to be confused with being pre-qualified) so you can close in about 30 days.

2. Study your market. Have you made an offer on another home or are you working against any other kind of deadline?

3. Make a clean offer – no requests for help with closing costs or other contingencies.

4. Include an automatic escalation clause – say $500 over the highest competing bid. (Insist that seller show the offers in writing.)

5. Sweeten the offer with a bonus if the deal gets done quickly.

6. Offer between 1 - 10 percent of the purchase price in earnest money.

7. Waive the appraisal. You will have to be willing to pay any difference between the selling price and what the bank is willing to lend.

8. Consider waiving the inspection.

9. Offer the full list price, preferably in cash.

10. Write a love letter to the sellers, telling them all the things you love about their home.

Source: MSN Real Estate, Marilyn Lewis (08/03/2010)

Understanding the mindset of a home buyer

August 2nd, 2010 @ 6:00am

By Paul Nelson

SALT LAKE CITY -- While home values have dropped along the Wasatch Front, those trying to sell their homes need any advantage they can use to get their full asking price.

Some real estate agents say it pays to understand the mindset of a potential home buyer.

It's natural for someone to become emotionally attached to a house, especially if they've lived there a long time. A seller could tell plenty of stories about how they've made happy memories living at that home.

But as cold hearted as it sounds, it may be best to leave emotion out of it. Real estate agents say a home buyer is interested in getting the best value for the lowest price. Emotion has no part of it.

"I think most buyers in this marketplace right now, they want a home that they can move right into that they're not going to have to do a lot of upgrading," says Realtor Jallinda Bowers.

Another tip: use a professional, even when you can do it yourself. If you were buying a home, which would you rather hear from the seller: "I painted this room," or "We had this room professionally painted?"

Bowers says if you're like most buyers, the second phrase will sound better. So, if you need to make repairs on your home to make it ready to sell, you should hire someone else.

"Most of the buyers will ask, if there are things that need to be repaired, they'll ask that a professional do it," Bowers says.

Something else to keep in mind is that not all out-of-state buyers are the same. If you're selling a home to someone moving in from out of state, there is a difference between what people from the West Coast may be expecting compared someone from the East Coast.

Bowers says Californians are used to paying more money for smaller homes. But the same isn't true for East Coasters.

"A lot of the back-east clients that come in here are used to paying less for more square footage and acreage," she says.

There is one big upside to selling to someone from out of state. In a recent smartmoney.com article, researchers from BYU were reported as saying people who have just moved into the state may be in more of a rush to buy. That way, they can avoid paying more in travel costs.