Daily Real Estate News | October 29, 2009
Homebuyer Credit Gets New Life
Key lawmakers in the Senate have tentatively agreed to extend the existing $8,000 tax credit for first-time home buyers and also offer a new $6,500 credit for existing homeowners who have lived in their current residence for a consecutive five-year period in the past eight years.
Home buyers must be under contract by April 30, 2010, and close before July 1. House Democrats have expressed concern about the cost of the tax credit for the government, and allegations of abuse have resulted in an IRS probe of the program.
Source: Wall Street Journal, Corey Boles and John D. McKinnon (10/29/09)
Friday, October 30, 2009
Wednesday, October 28, 2009
Senate Dems on Board with Credit Extension
Daily Real Estate News | October 28, 2009
Senate Dems on Board with Credit Extension
Senate Banking Committee Chairman Chris Dodd (D-Conn.) says Senate Democrats have agreed to extend the first-time home buyer tax credit. The latest version extends the program to home sales signed — not closed — by April 30. Purchasers would have another 60 days to close the sale. The credit will also be expanded to include so-called step-up buyers who have lived in their current home for at least five years.
The credit would be cut nearly 10 percent to a $7,290 cap. Income eligibility for first-time home buyers would stay the same, but it would rise for step-up buyers to $125,000 for individuals and $250,000 for couples.
Source: Bloomberg News, Dawn Kopecki and Ryan Donmoyer (10/27/2009)
Senate Dems on Board with Credit Extension
Senate Banking Committee Chairman Chris Dodd (D-Conn.) says Senate Democrats have agreed to extend the first-time home buyer tax credit. The latest version extends the program to home sales signed — not closed — by April 30. Purchasers would have another 60 days to close the sale. The credit will also be expanded to include so-called step-up buyers who have lived in their current home for at least five years.
The credit would be cut nearly 10 percent to a $7,290 cap. Income eligibility for first-time home buyers would stay the same, but it would rise for step-up buyers to $125,000 for individuals and $250,000 for couples.
Source: Bloomberg News, Dawn Kopecki and Ryan Donmoyer (10/27/2009)
Tuesday, September 8, 2009
Pending Home Sales on a Record Roll
Daily Real Estate News September 1, 2009
Contract activity for pending home sales has risen for six straight months, a pattern not seen in the history of the index since it began in 2001, according to the National Association of REALTORS®.
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in July, increased 3.2 percent to 97.6 from a reading of 94.6 in June. It is 12 percent higher than July 2008 when it was 87.1. The index is at the highest level since June 2007, when it was 100.7.
Affordability at Record High
Lawrence Yun, NAR chief economist, says the housing market momentum has clearly turned for the better. “The recovery is broad-based across many parts of the country. Housing affordability has been at record highs this year with the added stimulus of a first-time buyer tax credit,” he says.
“Other buyers are taking advantage of low home values before prices turn higher," Yun says. "Nationally, the typical mortgage payment now takes less than 25 percent of a middle-income family’s monthly income to buy a median priced home, with payment percentages so far in 2009 being the lowest on record dating back to 1970. As long as home buyers stay within their budget, mortgage payments will be very manageable."
First-Time Buyers
NAR estimates that about 1.8 to 2 million first-time buyers will take advantage of the $8,000 tax credit this year, with approximately 350,000 additional sales that would not have taken place without the credit. Buyers have little time to act because they must complete the transaction by Nov. 30 to qualify for the credit. Unless extended, contracts signed but not completed by that date will not be eligible – it is taking approximately two months to complete home sales in the current market.
By Region
Northeast: The Pending Home Sales Index declined 3 percent to 78.8 in July but is 4.7 percent higher than July 2008.
Midwest: The index slipped 2 percent to 88.1 but is 8.1 percent above a year ago.
South: Pending home sales activity rose 3.1 percent to an index of 103.8 in July and is 12 percent above July 2008.
West: The index jumped 12.1 percent to 112.5 and is 20 percent above a year ago.Keep the Momentum Going"
NAR President Charles McMillan says Congress needs to keep the momentum going. “Even with a good recovery taking place, the market is not yet back to normal. With a gradual absorption of inventory, we are on the cusp of a general stabilization in home prices,” he says. “To ensure that housing has a broad stimulus to the overall economy and stays on sound footing, we’re encouraging Congress to extend the tax credit into 2010, and to expand it to all buyers of primary residences. The faster we stabilize home prices, the fewer families will face foreclosure and the quicker credit can be extended to other sectors of the economy.” NAR’s Housing Affordability Index stood at 158.5 in July, below the peak set in April but is still 36 percentage points higher than a year ago. The HAI is a broad measure of housing affordability using consistent values and assumptions over time, which examines the relationship between home prices, mortgage interest rates, and family income.
Yun expects existing-home sales to rise through the fourth quarter. “Unless the tax credit is extended, no one should be surprised to see home sales drop in the first quarter of next year,” he says. “However, the fundamentals of the housing market and the economy are trending up, and we expect home sales to generally pick up in the second quarter of 2010. The buyer psychology may be shifting from, ‘Why buy now when I can purchase later?’ to ‘I don’t want to miss out on a recovery.’”
Source: NAR
Contract activity for pending home sales has risen for six straight months, a pattern not seen in the history of the index since it began in 2001, according to the National Association of REALTORS®.
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in July, increased 3.2 percent to 97.6 from a reading of 94.6 in June. It is 12 percent higher than July 2008 when it was 87.1. The index is at the highest level since June 2007, when it was 100.7.
Affordability at Record High
Lawrence Yun, NAR chief economist, says the housing market momentum has clearly turned for the better. “The recovery is broad-based across many parts of the country. Housing affordability has been at record highs this year with the added stimulus of a first-time buyer tax credit,” he says.
“Other buyers are taking advantage of low home values before prices turn higher," Yun says. "Nationally, the typical mortgage payment now takes less than 25 percent of a middle-income family’s monthly income to buy a median priced home, with payment percentages so far in 2009 being the lowest on record dating back to 1970. As long as home buyers stay within their budget, mortgage payments will be very manageable."
First-Time Buyers
NAR estimates that about 1.8 to 2 million first-time buyers will take advantage of the $8,000 tax credit this year, with approximately 350,000 additional sales that would not have taken place without the credit. Buyers have little time to act because they must complete the transaction by Nov. 30 to qualify for the credit. Unless extended, contracts signed but not completed by that date will not be eligible – it is taking approximately two months to complete home sales in the current market.
By Region
Northeast: The Pending Home Sales Index declined 3 percent to 78.8 in July but is 4.7 percent higher than July 2008.
Midwest: The index slipped 2 percent to 88.1 but is 8.1 percent above a year ago.
South: Pending home sales activity rose 3.1 percent to an index of 103.8 in July and is 12 percent above July 2008.
West: The index jumped 12.1 percent to 112.5 and is 20 percent above a year ago.Keep the Momentum Going"
NAR President Charles McMillan says Congress needs to keep the momentum going. “Even with a good recovery taking place, the market is not yet back to normal. With a gradual absorption of inventory, we are on the cusp of a general stabilization in home prices,” he says. “To ensure that housing has a broad stimulus to the overall economy and stays on sound footing, we’re encouraging Congress to extend the tax credit into 2010, and to expand it to all buyers of primary residences. The faster we stabilize home prices, the fewer families will face foreclosure and the quicker credit can be extended to other sectors of the economy.” NAR’s Housing Affordability Index stood at 158.5 in July, below the peak set in April but is still 36 percentage points higher than a year ago. The HAI is a broad measure of housing affordability using consistent values and assumptions over time, which examines the relationship between home prices, mortgage interest rates, and family income.
Yun expects existing-home sales to rise through the fourth quarter. “Unless the tax credit is extended, no one should be surprised to see home sales drop in the first quarter of next year,” he says. “However, the fundamentals of the housing market and the economy are trending up, and we expect home sales to generally pick up in the second quarter of 2010. The buyer psychology may be shifting from, ‘Why buy now when I can purchase later?’ to ‘I don’t want to miss out on a recovery.’”
Source: NAR
Sunday, August 23, 2009
Banks Plan to Keep Lending Tight
Daily Real Estate News August 18, 2009
Banks tightened standards for all types of loans in the second quarter, the Federal Reserve reported Monday.
About 35 percent of senior loan officials said they tightened standards somewhat and none of the 51 responding banks said they loosened standards for prime mortgages. The rest said their standards for mortgages remained the same or were substantially stronger. Banks also told the Fed that they expected to maintain strict lending standards until at least the second half of 2010.
“Most banks have woken up to the fact that there is a lot more risk in their loan books than they ever thought possible,” says Joel Conn, president of Lakeshore Capital LLC in Birmingham, Ala. That has caused many banks to reconsider their requirements for future lending, Conn says.
Source: Bloomberg, Craig Torres (08/17/2009)
Banks tightened standards for all types of loans in the second quarter, the Federal Reserve reported Monday.
About 35 percent of senior loan officials said they tightened standards somewhat and none of the 51 responding banks said they loosened standards for prime mortgages. The rest said their standards for mortgages remained the same or were substantially stronger. Banks also told the Fed that they expected to maintain strict lending standards until at least the second half of 2010.
“Most banks have woken up to the fact that there is a lot more risk in their loan books than they ever thought possible,” says Joel Conn, president of Lakeshore Capital LLC in Birmingham, Ala. That has caused many banks to reconsider their requirements for future lending, Conn says.
Source: Bloomberg, Craig Torres (08/17/2009)
NAR: Commercial Market Decline Slowing
Daily Real Estate News August 19, 2009
The decline in commercial real estate activity caused by a severe credit crunch, sustained job losses, and weak consumer spending appears to be slowing, according to the National Association of REALTORS®' latest report. A forward-looking indicator shows commercial real estate will remain weak into 2010, but recent actions by the Federal Reserve should improve some flow of capital into commercial lending, NAR reports.
The decline in commercial real estate activity caused by a severe credit crunch, sustained job losses, and weak consumer spending appears to be slowing, according to the National Association of REALTORS®' latest report. A forward-looking indicator shows commercial real estate will remain weak into 2010, but recent actions by the Federal Reserve should improve some flow of capital into commercial lending, NAR reports.
Average Buyers Can Afford Most Homes
Daily Real Estate News August 20, 2009
Housing is remarkably affordable these days.A family earning the nation’s median income of $64,000 a year could afford to buy 72.3 percent of all homes sold in the United States during the second quarter of 2009, according to the National Association of Home Builders and Wells Fargo.
Sellers are the ones who are paying the price. More than 30 percent of all homes sold during the second quarter sold for less than the sellers paid originally, according to Zillow.com.
A significant percentage of owners who bought within the past five years and sold during the quarter lost money on the deal, according to Stan Humphries, Zillow's vice president in charge of data and analytics.
[Editor's note: Although discussion of trends on a national level can be useful, conditions in a local market can be vastly different from what's happening statistically on a national level. For that reason, conditions for owners who've bought in the last five years might or might not resemble what analysts are seeing statistically on a national basis.]
Source: CNNMoney.com (08/19/2009)
Housing is remarkably affordable these days.A family earning the nation’s median income of $64,000 a year could afford to buy 72.3 percent of all homes sold in the United States during the second quarter of 2009, according to the National Association of Home Builders and Wells Fargo.
Sellers are the ones who are paying the price. More than 30 percent of all homes sold during the second quarter sold for less than the sellers paid originally, according to Zillow.com.
A significant percentage of owners who bought within the past five years and sold during the quarter lost money on the deal, according to Stan Humphries, Zillow's vice president in charge of data and analytics.
[Editor's note: Although discussion of trends on a national level can be useful, conditions in a local market can be vastly different from what's happening statistically on a national level. For that reason, conditions for owners who've bought in the last five years might or might not resemble what analysts are seeing statistically on a national basis.]
Source: CNNMoney.com (08/19/2009)
Strong Gain in Existing-Home Sales
Daily Real Estate News August 21, 2009
For the first time in five years, existing-home sales have increased for four months in a row, according to the National Association of REALTORS®.Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 7.2 percent to a seasonally adjusted annual rate of 5.24 million units in July from a level of 4.89 million in June. Sales are 5.0 percent above the 4.99 million-unit pace in July 2008. The last time sales rose for four consecutive months was in June 2004, and the last time sales were higher than a year earlier was November 2005.
Largest Gain in a Decade
Lawrence Yun, NAR chief economist, said he is encouraged. “The housing market has decisively turned for the better. A combination of first-time buyers taking advantage of the housing stimulus tax credit and greatly improved affordability conditions are contributing to higher sales,” he said. The monthly sales gain was the largest on record for the total existing-home sales series dating back to 1999.
“Because price-to-income ratios have fallen below historical trends, there are more all-cash offers. In some recovering markets like San Diego, Las Vegas, Phoenix, and Orlando, the demand for foreclosed and lower-priced homes has spiked, and a lack of inventory is becoming a common complaint,” Yun said.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 5.22 percent in July from 5.42 percent in June. The rate was 6.43 percent in July 2008.
"First-Time Buyer Tax Credit is Working"
An NAR practitioner survey showed first-time buyers purchased 30 percent of homes in July, and that distressed homes accounted for 31 percent of transactions. NAR President Charles McMillan said the first-time buyer tax credit is working. “In addition to first-time buyers, we’re also seeing increased activity by repeat buyers. While many entry-level buyers are focused on the discounted prices of distressed homes, they’re also freeing some existing owners to sell and make a move,” he said. “Realtors are the best resource for consumers in these changing market conditions because the transaction process has become more complex. Since it’s now taking longer to complete a home sale, first-time buyers who want to take advantage of the $8,000 tax credit should try to make contract offers by the end of September,” McMillan said. “Otherwise, they may miss the November 30 closing deadline.”
Inventory Up, Prices Down
Total housing inventory at the end of July rose 7.3 percent to 4.09 million existing homes available for sale, which represents a 9.4-month supply at the current sales pace, which was unchanged from June because of the strong sales gain. Raw inventory totals are 10.6 percent lower than a year ago when the number of unsold homes was at a record. The national median existing-home price for all housing types was $178,400 in July, which is 15.1 percent lower than July 2008. Distressed properties continue to weigh down the median price because they typically sell for 15 to 20 percent less than traditional homes.
Single-Family Homes and Condos
Single-family home sales increased 6.5 percent to a seasonally adjusted annual rate of 4.61 million in July from a pace of 4.33 million in June, and are 5.0 percent higher than the 4.39 million-unit level in July 2008. The median existing single-family home price was $178,300 in July, which is 14.6 percent below a year ago.
Existing condominium and co-op sales jumped 12.5 percent to a seasonally adjusted annual rate of 630,000 units in July from 560,000 in June, and are 5.9 percent above the 595,000-unit level a year ago. The median existing condo price was $178,800 in July, down 18.9 percent from July 2008.
By Region:
The Northeast surged 13.4 percent to an annual pace of 930,000 in July, and are 3.3 percent higher than July 2008. The median price in the Northeast was $236,700, down 15.0 percent from a year ago.
Existing-home sales in the Midwest jumped 10.9 percent in July to a level of 1.22 million and are 8.0 percent above a year ago. The median price in the Midwest was $157,200, which is 5.9 percent less than July 2008.
In the South, existing-home sales rose 7.1 percent to an annual pace of 1.95 million in July and are 5.4 percent higher than July 2008. The median price in the South was $164,500, down 7.1 percent from a year ago.
Existing-home sales in the West slipped 1.7 percent to an annual rate of 1.13 million in July, but are 1.8 percent above a year ago. The median price in the West was $202,300, which is 28.0 percent below July 2008.
Source: NAR
For the first time in five years, existing-home sales have increased for four months in a row, according to the National Association of REALTORS®.Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 7.2 percent to a seasonally adjusted annual rate of 5.24 million units in July from a level of 4.89 million in June. Sales are 5.0 percent above the 4.99 million-unit pace in July 2008. The last time sales rose for four consecutive months was in June 2004, and the last time sales were higher than a year earlier was November 2005.
Largest Gain in a Decade
Lawrence Yun, NAR chief economist, said he is encouraged. “The housing market has decisively turned for the better. A combination of first-time buyers taking advantage of the housing stimulus tax credit and greatly improved affordability conditions are contributing to higher sales,” he said. The monthly sales gain was the largest on record for the total existing-home sales series dating back to 1999.
“Because price-to-income ratios have fallen below historical trends, there are more all-cash offers. In some recovering markets like San Diego, Las Vegas, Phoenix, and Orlando, the demand for foreclosed and lower-priced homes has spiked, and a lack of inventory is becoming a common complaint,” Yun said.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 5.22 percent in July from 5.42 percent in June. The rate was 6.43 percent in July 2008.
"First-Time Buyer Tax Credit is Working"
An NAR practitioner survey showed first-time buyers purchased 30 percent of homes in July, and that distressed homes accounted for 31 percent of transactions. NAR President Charles McMillan said the first-time buyer tax credit is working. “In addition to first-time buyers, we’re also seeing increased activity by repeat buyers. While many entry-level buyers are focused on the discounted prices of distressed homes, they’re also freeing some existing owners to sell and make a move,” he said. “Realtors are the best resource for consumers in these changing market conditions because the transaction process has become more complex. Since it’s now taking longer to complete a home sale, first-time buyers who want to take advantage of the $8,000 tax credit should try to make contract offers by the end of September,” McMillan said. “Otherwise, they may miss the November 30 closing deadline.”
Inventory Up, Prices Down
Total housing inventory at the end of July rose 7.3 percent to 4.09 million existing homes available for sale, which represents a 9.4-month supply at the current sales pace, which was unchanged from June because of the strong sales gain. Raw inventory totals are 10.6 percent lower than a year ago when the number of unsold homes was at a record. The national median existing-home price for all housing types was $178,400 in July, which is 15.1 percent lower than July 2008. Distressed properties continue to weigh down the median price because they typically sell for 15 to 20 percent less than traditional homes.
Single-Family Homes and Condos
Single-family home sales increased 6.5 percent to a seasonally adjusted annual rate of 4.61 million in July from a pace of 4.33 million in June, and are 5.0 percent higher than the 4.39 million-unit level in July 2008. The median existing single-family home price was $178,300 in July, which is 14.6 percent below a year ago.
Existing condominium and co-op sales jumped 12.5 percent to a seasonally adjusted annual rate of 630,000 units in July from 560,000 in June, and are 5.9 percent above the 595,000-unit level a year ago. The median existing condo price was $178,800 in July, down 18.9 percent from July 2008.
By Region:
The Northeast surged 13.4 percent to an annual pace of 930,000 in July, and are 3.3 percent higher than July 2008. The median price in the Northeast was $236,700, down 15.0 percent from a year ago.
Existing-home sales in the Midwest jumped 10.9 percent in July to a level of 1.22 million and are 8.0 percent above a year ago. The median price in the Midwest was $157,200, which is 5.9 percent less than July 2008.
In the South, existing-home sales rose 7.1 percent to an annual pace of 1.95 million in July and are 5.4 percent higher than July 2008. The median price in the South was $164,500, down 7.1 percent from a year ago.
Existing-home sales in the West slipped 1.7 percent to an annual rate of 1.13 million in July, but are 1.8 percent above a year ago. The median price in the West was $202,300, which is 28.0 percent below July 2008.
Source: NAR
Monday, August 17, 2009
Yearsley building to be demolished
West Chester Borough Council is poised to give McCool Properties permission to complete demolition of the former M.S. Yearsley building, a blighted structure that sits at 124 E. Market St. Once demolition is complete, the site may temporarily be converted into a parking lot, which the borough may opt to lease. McCool Properties acquired the Yearsley building in 2005 and has obtained permission to replace it with a seven-story structure which will contain 64 condominiums and 24,000 square feet of retail space. Andrew McCool said that the down economy has slowed pre-sales of the condo units, which means that construction has not proceeded as quickly as intended. Councilman Jim Jones explained that, in order to cut down on empty lots, the borough typically forbids developers from demolishing buildings too far in advance of when they plan to construct new ones in their places.
Source: Daily Local; 8/14/09
Source: Daily Local; 8/14/09
Monday, August 10, 2009
PA To Fund Solar Initiatives for Homeowners
Check out this latest news on the Pennsylvania residential solar initiative on my website: http://www.calljohncap.com/remaxpaaction/modules/agent/agent.asp?p=text&id=1692
Saturday, August 8, 2009
Foreclosure Bargains Are Disappearing
Daily Real Estate News August 7, 2009
Buyers of foreclosure have to be quick these days. Some houses go under contract fewer than 90 minutes after they are put on the market, says Brad Geisen, founder of Foreclosure.com.
"For every listing that comes out, we have 10 buyers," says Cesar Dias, an associate with Approved Real Estate Group in Stockton, Calif.
Dias had 15 minutes of fame after introducing foreclosure sales tours last year. Now the tours are defunct because there are not enough homes to show. "We had a lot of inventory last summer. Now we're down to 1,500 listings — from more than 5,000," Dias says.
In Florida, real-estate investment companies, buying in bulk and paying cash, face competition.
Even in the hard-hit Detroit area, bargains are disappearing. "For a good house that's not too beat up, in a good neighborhood, there's no lack of buyers in this market," says Andy Sakmar, founder of Century 21 Sakmar in Rochester, 20 miles north of the city. "There are a lot fewer of these properties than a year ago, and the super buys get multiple offers."
Source: CNNMoney.com, Les Christie (08/06/2009)
Buyers of foreclosure have to be quick these days. Some houses go under contract fewer than 90 minutes after they are put on the market, says Brad Geisen, founder of Foreclosure.com.
"For every listing that comes out, we have 10 buyers," says Cesar Dias, an associate with Approved Real Estate Group in Stockton, Calif.
Dias had 15 minutes of fame after introducing foreclosure sales tours last year. Now the tours are defunct because there are not enough homes to show. "We had a lot of inventory last summer. Now we're down to 1,500 listings — from more than 5,000," Dias says.
In Florida, real-estate investment companies, buying in bulk and paying cash, face competition.
Even in the hard-hit Detroit area, bargains are disappearing. "For a good house that's not too beat up, in a good neighborhood, there's no lack of buyers in this market," says Andy Sakmar, founder of Century 21 Sakmar in Rochester, 20 miles north of the city. "There are a lot fewer of these properties than a year ago, and the super buys get multiple offers."
Source: CNNMoney.com, Les Christie (08/06/2009)
Friday, July 31, 2009
Economists Optimistic That Market Is Upward Bound
Daily Real Estate News July 27, 2009
Economic recovery is still a few months away, say economists surveyed by USA Today, but two-thirds of them think existing-home sales have bottomed out. Both housing and automotive markets “have the potential to generate some quite large percentage increases,” says Bill Cheney, chief economist at MFC Global Investment.
Overall, economists say unemployment won’t peak until the first half of next year and credit markets will remain tight.
Source: USA Today, Paul Davidson; Barbara Hansen (07/27/2009)
Economic recovery is still a few months away, say economists surveyed by USA Today, but two-thirds of them think existing-home sales have bottomed out. Both housing and automotive markets “have the potential to generate some quite large percentage increases,” says Bill Cheney, chief economist at MFC Global Investment.
Overall, economists say unemployment won’t peak until the first half of next year and credit markets will remain tight.
Source: USA Today, Paul Davidson; Barbara Hansen (07/27/2009)
Friday, July 24, 2009
Housing Experts: Now Is a Perfect Time to Buy
Daily Real Estate News July 20, 2009
Don’t forget to remind potential buyers of something that is obvious to real estate professionals: Now is the time to buy, but that opportunity may be slipping away. For people who have a job and money, a dream house is within reach, writes Marc Roth, founder of Home Warranty of America and a columnist for BusinessWeek. He points out that mortgage rates remain low, prices are still at historic lows, and the government is offering incentives for first-time homebuyers.
He also adds that the inventory of homes to buy is still large, but it is shrinking. According to the NATIONAL ASSOCIATION OF REALTORS®, the housing inventory peaked in November 2008 at an 11-month supply. At the end of May 2009, it had fallen to a 9.6-month supply.
Roth says anyone who dallies will miss a good opportunity to buy a first home at a terrific price or go shopping for a move-up property that is a great buy.
Source: BusinessWeek.com, Marc Roth (11/17/2009)
Don’t forget to remind potential buyers of something that is obvious to real estate professionals: Now is the time to buy, but that opportunity may be slipping away. For people who have a job and money, a dream house is within reach, writes Marc Roth, founder of Home Warranty of America and a columnist for BusinessWeek. He points out that mortgage rates remain low, prices are still at historic lows, and the government is offering incentives for first-time homebuyers.
He also adds that the inventory of homes to buy is still large, but it is shrinking. According to the NATIONAL ASSOCIATION OF REALTORS®, the housing inventory peaked in November 2008 at an 11-month supply. At the end of May 2009, it had fallen to a 9.6-month supply.
Roth says anyone who dallies will miss a good opportunity to buy a first home at a terrific price or go shopping for a move-up property that is a great buy.
Source: BusinessWeek.com, Marc Roth (11/17/2009)
Real Estate Pro Killed in Foreclosed Home
Daily Real Estate News July 20, 2009
A real estate practitioner showing a foreclosed home in a community outside Los Angeles discovered the body of a second real estate professional, identified as Ricardo Contreras, 45 of Lakewood, Calif.
Family members identified Contreras, 45, as a real estate professional and father of five who had gone missing on July 14. Officer Karen Rayner said the practitioner who found the body had been unable to locate a key to the three-bedroom home in the 8900 block of Kittyhawk Avenue near the Los Angeles International Airport. He apparently called the listing company, Modern Realty Co., which sent someone to help open the door. Rayner said that together they discovered the body of Contreras, who was lying on the living room floor. According to news reports, he was believed to have been stabbed several times.
Source: The Associated Press and KABC (07/19/2009)
A real estate practitioner showing a foreclosed home in a community outside Los Angeles discovered the body of a second real estate professional, identified as Ricardo Contreras, 45 of Lakewood, Calif.
Family members identified Contreras, 45, as a real estate professional and father of five who had gone missing on July 14. Officer Karen Rayner said the practitioner who found the body had been unable to locate a key to the three-bedroom home in the 8900 block of Kittyhawk Avenue near the Los Angeles International Airport. He apparently called the listing company, Modern Realty Co., which sent someone to help open the door. Rayner said that together they discovered the body of Contreras, who was lying on the living room floor. According to news reports, he was believed to have been stabbed several times.
Source: The Associated Press and KABC (07/19/2009)
Monday, July 20, 2009
Report: New-Home Construction Increasing
Daily Real Estate News July 17, 2009
Despite high unemployment and general concerns of too much existing inventory, new-home construction appears to be rising.
According to Friday’s report from the U.S. Commerce Department, construction of new homes rose 3.6 percent in June compared to May. Building permits climbed 8.7 percent, and single-family home starts jumped 14.4 percent to 470,000, after rising 5.9 percent in May.
In real numbers, ground was broken for an estimated 58,300 houses nationwide in June, and an estimated 58,400 building permits were issued. Here’s a look at housing starts in different U.S. regions:
Midwest: up 33.3 percent
Northeast: up 28.6 percent
South: down 1.4 percent
West: down 14.8 percent
Source: The Wall Street Journal, Jeff Bater (06/17/2009)
Despite high unemployment and general concerns of too much existing inventory, new-home construction appears to be rising.
According to Friday’s report from the U.S. Commerce Department, construction of new homes rose 3.6 percent in June compared to May. Building permits climbed 8.7 percent, and single-family home starts jumped 14.4 percent to 470,000, after rising 5.9 percent in May.
In real numbers, ground was broken for an estimated 58,300 houses nationwide in June, and an estimated 58,400 building permits were issued. Here’s a look at housing starts in different U.S. regions:
Midwest: up 33.3 percent
Northeast: up 28.6 percent
South: down 1.4 percent
West: down 14.8 percent
Source: The Wall Street Journal, Jeff Bater (06/17/2009)
Friday, July 10, 2009
West Whiteland deed dispute ends
The township will get the deed to the land for its new municipal building, a judge ruled this week, and the township must pay the developer $242,063 in back taxes. This is good news for the township, where construction of a $16.8 million municipal building has gone forward without clear title to the land on which it sits.
According to court documents, the $242,063 in taxes includes $12,078 paid to the township, $45,394 paid to Chester County and $184,589 paid to the school district.
The developer refused to turn over the deed until the back taxes were reimbursed, and in November 2005 the township filed an emergency petition to enforce the settlement agreement and turn over the deed.
Source: Daily Local; 7/3/09
According to court documents, the $242,063 in taxes includes $12,078 paid to the township, $45,394 paid to Chester County and $184,589 paid to the school district.
The developer refused to turn over the deed until the back taxes were reimbursed, and in November 2005 the township filed an emergency petition to enforce the settlement agreement and turn over the deed.
Source: Daily Local; 7/3/09
Friday, June 26, 2009
NAR: Existing-Home Sale Continue to Rise
Daily Real Estate News June 23, 2009
Sales of existing homes showed another gain in May, benefiting from favorable affordability conditions and a first-time buyer tax credit, according to the NATIONAL ASSOCIATION OF REALTORS ®. May’s increase was the first back-to-back monthly gain since September 2005.
Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 2.4 percent to a seasonally adjusted annual rate of 4.77 million units in May from a downwardly revised level of 4.66 million units in April. Sales remained 3.6 percent below the 4.95 million-unit pace in May 2008.
Lawrence Yun, NAR chief economist, expected an improvement in sales. “Historically low mortgage interest rates clearly drew buyers into the market, and housing remains very affordable even with a recent uptick in rates,” Yun says. “First-time buyers also are being drawn off the sidelines by the $8,000 tax credit, which is helping to absorb inventory.
Poor Appraisals Stall Transactions
However, the increase in sales is less than expected because poor appraisals are stalling transactions. Pending home sales indicated much stronger activity, but some contracts are falling through from faulty valuations that keep buyers from getting a loan.
Total housing inventory at the end of May fell 3.5 percent to 3.80 million existing homes available for sale, which represents a 9.6-month supply at the current sales pace, down from a 10.1-month supply in April.
Yun says the appraisal problem is serious. “Lenders are using appraisers who may not be familiar with a neighborhood, or who compare traditional homes with distressed and discounted sales,” he says. “In the past month, stories of appraisal problems have been snowballing from across the country with many contracts falling through at the last moment. There is danger of a delayed housing market recovery and a further rise in foreclosures if the appraisal problems are not quickly corrected.”
NAR President Charles McMillan says appraisals and the tax credit are key issues. “To maximize the potential for a housing recovery and subsequent economic recovery, we need realistic appraisals that are based on proper comparisons and done by a local specialist,” he said. “In addition, the first-time buyer tax credit should be expanded to all buyers of primary homes regardless of income. Extending the credit into 2010 would allow more time for the market to catch up with underlying demand, in part because many families with children, who normally time their purchase based on school year considerations, do not have enough time to move before the start of school in late August.
“Freeing a pent-up demand in housing will absorb inventory at a faster pace, strengthen communities and stabilize home prices earlier,” McMillan said.
A Closer Look at May Housing Data
An NAR practitioner survey in May showed first-time buyers accounted for 29 percent of transactions, and that the number of buyers looking at homes is nearly 10 percentage points higher than a year ago. “This is the time of year when we see large increases in the number of repeat buyers, who are benefiting from sales to entry-level buyers,” Yun says. “Investors appear less active, but are more prevalent in areas with large price corrections.”
National median existing-home price: for all housing types was $173,000 in May, down 16.8 percent from a year earlier. Distressed properties, which declined to 33 percent of all sales in May from 45 percent in April, continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. “The decline in the distressed sales share likely results from an increase of repeat buyers in May,” Yun says. “First-time buyers are concentrated in the lower price ranges, which include most of the distressed sales.”
Single-family home sales: rose 1.9 percent to a seasonally adjusted annual rate of 4.25 million in May from a pace of 4.17 million in April, but are 3 percent below the 4.38 million-unit level in May 2008. The median existing single-family home price was $172,900 in May, down 16.1 percent from a year ago.
Existing condominium and co-op sales: increased 6.1 percent to a seasonally adjusted annual rate of 520,000 units in May from 490,000 in April, but are 8.9 percent below the 571,000-unit level in May 2008. The median existing condo price was $173,800 in May, down 21.9 percent from a year earlier.
By the RegionHere’s how housing fared across the country for existing-home sales:
Northeast: rose 3.9 percent to an annual level of 800,000 in May, but are 10.1 percent below a year ago.
Median price: $243,600, which is 12.5 percent below May 2008.
Midwest: jumped 9 percent in May to a pace of 1.09 million but are 4.4 percent below May 2008.
Median price: $145,800, which is 10.4 percent lower than a year ago.
South: unchanged at an annual pace of 1.74 million in May but are 8.9 percent below a year ago.
Median price: $157,400, down 9.9 percent from May 2008.
West: slipped 0.9 percent to an annual rate of 1.14 million in May, but are 11.8 percent higher than May 2008.
Median price: $197,700, down 30.6 percent from a year ago.
Source: NAR
Sales of existing homes showed another gain in May, benefiting from favorable affordability conditions and a first-time buyer tax credit, according to the NATIONAL ASSOCIATION OF REALTORS ®. May’s increase was the first back-to-back monthly gain since September 2005.
Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 2.4 percent to a seasonally adjusted annual rate of 4.77 million units in May from a downwardly revised level of 4.66 million units in April. Sales remained 3.6 percent below the 4.95 million-unit pace in May 2008.
Lawrence Yun, NAR chief economist, expected an improvement in sales. “Historically low mortgage interest rates clearly drew buyers into the market, and housing remains very affordable even with a recent uptick in rates,” Yun says. “First-time buyers also are being drawn off the sidelines by the $8,000 tax credit, which is helping to absorb inventory.
Poor Appraisals Stall Transactions
However, the increase in sales is less than expected because poor appraisals are stalling transactions. Pending home sales indicated much stronger activity, but some contracts are falling through from faulty valuations that keep buyers from getting a loan.
Total housing inventory at the end of May fell 3.5 percent to 3.80 million existing homes available for sale, which represents a 9.6-month supply at the current sales pace, down from a 10.1-month supply in April.
Yun says the appraisal problem is serious. “Lenders are using appraisers who may not be familiar with a neighborhood, or who compare traditional homes with distressed and discounted sales,” he says. “In the past month, stories of appraisal problems have been snowballing from across the country with many contracts falling through at the last moment. There is danger of a delayed housing market recovery and a further rise in foreclosures if the appraisal problems are not quickly corrected.”
NAR President Charles McMillan says appraisals and the tax credit are key issues. “To maximize the potential for a housing recovery and subsequent economic recovery, we need realistic appraisals that are based on proper comparisons and done by a local specialist,” he said. “In addition, the first-time buyer tax credit should be expanded to all buyers of primary homes regardless of income. Extending the credit into 2010 would allow more time for the market to catch up with underlying demand, in part because many families with children, who normally time their purchase based on school year considerations, do not have enough time to move before the start of school in late August.
“Freeing a pent-up demand in housing will absorb inventory at a faster pace, strengthen communities and stabilize home prices earlier,” McMillan said.
A Closer Look at May Housing Data
An NAR practitioner survey in May showed first-time buyers accounted for 29 percent of transactions, and that the number of buyers looking at homes is nearly 10 percentage points higher than a year ago. “This is the time of year when we see large increases in the number of repeat buyers, who are benefiting from sales to entry-level buyers,” Yun says. “Investors appear less active, but are more prevalent in areas with large price corrections.”
National median existing-home price: for all housing types was $173,000 in May, down 16.8 percent from a year earlier. Distressed properties, which declined to 33 percent of all sales in May from 45 percent in April, continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes. “The decline in the distressed sales share likely results from an increase of repeat buyers in May,” Yun says. “First-time buyers are concentrated in the lower price ranges, which include most of the distressed sales.”
Single-family home sales: rose 1.9 percent to a seasonally adjusted annual rate of 4.25 million in May from a pace of 4.17 million in April, but are 3 percent below the 4.38 million-unit level in May 2008. The median existing single-family home price was $172,900 in May, down 16.1 percent from a year ago.
Existing condominium and co-op sales: increased 6.1 percent to a seasonally adjusted annual rate of 520,000 units in May from 490,000 in April, but are 8.9 percent below the 571,000-unit level in May 2008. The median existing condo price was $173,800 in May, down 21.9 percent from a year earlier.
By the RegionHere’s how housing fared across the country for existing-home sales:
Northeast: rose 3.9 percent to an annual level of 800,000 in May, but are 10.1 percent below a year ago.
Median price: $243,600, which is 12.5 percent below May 2008.
Midwest: jumped 9 percent in May to a pace of 1.09 million but are 4.4 percent below May 2008.
Median price: $145,800, which is 10.4 percent lower than a year ago.
South: unchanged at an annual pace of 1.74 million in May but are 8.9 percent below a year ago.
Median price: $157,400, down 9.9 percent from May 2008.
West: slipped 0.9 percent to an annual rate of 1.14 million in May, but are 11.8 percent higher than May 2008.
Median price: $197,700, down 30.6 percent from a year ago.
Source: NAR
Home Buyer Tax Credit Could Expand
Daily Real Estate News June 22, 2009
A first-time home buyer tax credit of up to $8,000 has helped to move housing inventory during an otherwise sluggish real estate cycle. Now both legislators and the business community are hoping to build on the incentive's success by expanding it. A number of bills have been introduced in the House and the Senate that lobby for an expansion of the measure. Among the proposed changes:
Setting a new cap of $15,000.
Extending the tax break into mid-2010.
Making the benefit available to all home buyers, not just first-timers.
Offering a separate tax credit to $3,000 for borrowers who refinance.
USA Today, Stephanie Armour (06/22/09)
A first-time home buyer tax credit of up to $8,000 has helped to move housing inventory during an otherwise sluggish real estate cycle. Now both legislators and the business community are hoping to build on the incentive's success by expanding it. A number of bills have been introduced in the House and the Senate that lobby for an expansion of the measure. Among the proposed changes:
Setting a new cap of $15,000.
Extending the tax break into mid-2010.
Making the benefit available to all home buyers, not just first-timers.
Offering a separate tax credit to $3,000 for borrowers who refinance.
USA Today, Stephanie Armour (06/22/09)
Top Rising, Falling Housing Markets
Daily Real Estate News June 26, 2009
When the recovery in housing finally comes, some housing markets will rebound sooner than others.
Real estate forecasting service Local Market Monitor, which covers the nation’s 300 largest markets, has identified 13 markets where it predicts home prices will rise in the coming months and 11 markets where it expects home prices will continue to decline significantly.
To make these picks, Local Market Monitor uses a proprietary formula.
Here are the 13 markets where it expects prices to rise:
Baton Rouge, La.
Buffalo-Niagara Falls
Dallas-Plano-Irving
Fort Worth-Arlington
Houston-Sugar Land-Baytown
Little Rock-North Little Rock-Conway, Ark.
McAllen-Edinburg-Mission, Texas
Oklahoma City
Rochester, N.Y.
San Antonio
Syracuse, N.Y.
Tulsa
Wichita, Kan.
Here are the 11 markets where it believes home prices will continue to decline:
Bakersfield, Calif.
Fort Lauderdale-Pompano Beach-Deerfield Beach, Fla.
Fresno, Calif.
Las Vegas-Paradise
Miami-Miami Beach-Kendall
Orlando-Kissimmee
Oxnard-Thousand Oaks-Ventura, Calif.
Phoenix-Mesa-Scottsdale
Riverside-San Bernardino-Ontario, Calif.
Stockton, Calif.
West Palm Beach-Boca Raton-Boynton Beach, Fla.
Source: Local Market Monitor (06/23/2009)
When the recovery in housing finally comes, some housing markets will rebound sooner than others.
Real estate forecasting service Local Market Monitor, which covers the nation’s 300 largest markets, has identified 13 markets where it predicts home prices will rise in the coming months and 11 markets where it expects home prices will continue to decline significantly.
To make these picks, Local Market Monitor uses a proprietary formula.
Here are the 13 markets where it expects prices to rise:
Baton Rouge, La.
Buffalo-Niagara Falls
Dallas-Plano-Irving
Fort Worth-Arlington
Houston-Sugar Land-Baytown
Little Rock-North Little Rock-Conway, Ark.
McAllen-Edinburg-Mission, Texas
Oklahoma City
Rochester, N.Y.
San Antonio
Syracuse, N.Y.
Tulsa
Wichita, Kan.
Here are the 11 markets where it believes home prices will continue to decline:
Bakersfield, Calif.
Fort Lauderdale-Pompano Beach-Deerfield Beach, Fla.
Fresno, Calif.
Las Vegas-Paradise
Miami-Miami Beach-Kendall
Orlando-Kissimmee
Oxnard-Thousand Oaks-Ventura, Calif.
Phoenix-Mesa-Scottsdale
Riverside-San Bernardino-Ontario, Calif.
Stockton, Calif.
West Palm Beach-Boca Raton-Boynton Beach, Fla.
Source: Local Market Monitor (06/23/2009)
Saturday, June 13, 2009
Ecovillage to open in London Grove
A new housing development is being proposed in London Grove that would feature homes where nobody has to pay an electric bill and a clubhouse where residents prepare and eat a communal dinner a few nights a week. The cohousing community, where people would live in their own homes but share communal facilities, would also be built with an eye toward being environmentally sustainable, incorporating features that will earn it a LEED certification, a green building standard of the U.S. Green Building Council.
Known as an ecovillage, all the houses will utilize solar and geothermal energy for their heating and cooling.
Known as Three Groves Ecovillage, the development would be located on a 7.5 acre parcel on the corner of Prospect Avenue and West State Street. The approval process for the development will take about a year and investors are hoping the first construction would begin in the later part of 2010.
Source: Daily Local; 6/7/09
Known as an ecovillage, all the houses will utilize solar and geothermal energy for their heating and cooling.
Known as Three Groves Ecovillage, the development would be located on a 7.5 acre parcel on the corner of Prospect Avenue and West State Street. The approval process for the development will take about a year and investors are hoping the first construction would begin in the later part of 2010.
Source: Daily Local; 6/7/09
Norristown movie studio receives recommendation from planning commission
The $100 million Studio Centre renovation of the former Logan Square Shopping Center on Markley Street received a unanimous recommendation from the Norristown Planning Commission this week. Norristown’s council is expected to consider the final site plans at its next meeting on June 16. Council’s approval of the plan is contingent upon a $10 million direct state subsidy and an $8 million tax increment financing (TIF) plan that requires the approval of Norristown, Norristown Area School District and the Montgomery County Commissioners.
The current plans for the studio include 72,000-square-feet of studio space divided into five soundstages, 98,000 square-feet of movie support space, a 50,000 square-foot supermarket and 20,000 square-feet of new retail space.
If final approval is granted and the movie studio construction moves forward, area leaders expect this to be a catalyst to jumpstart Norristown’s revitalization.
Source: The Times Herald; 6/10/09
The current plans for the studio include 72,000-square-feet of studio space divided into five soundstages, 98,000 square-feet of movie support space, a 50,000 square-foot supermarket and 20,000 square-feet of new retail space.
If final approval is granted and the movie studio construction moves forward, area leaders expect this to be a catalyst to jumpstart Norristown’s revitalization.
Source: The Times Herald; 6/10/09
Friday, June 12, 2009
Top 10 Best Places to Live U.S.
Daily Real Estate News June 10, 2009
News & World Report magazine looked at areas with strong economies, low living costs, and plenty of fun things to do to identify this year's best places to live.
The editors reviewed more than 2,000 locations nationwide, considering such factors as sales taxes, housing prices, average number of children per square mile, proximity to healthcare, and the availability of educational institutions. Readers can use a database search to tailor the results to their own situation."Choosing where to live is a difficult decision for any family," says Brian Kelly, editor of U.S. News & World Report. "With U.S. News's Best Places to Live, we've crunched the most important geographic, economic, and educational data and provided the search tools to help make this decision a little easier for families."
The 10 cities honored as Best Places to Live are (listed alphabetically):
Albuquerque, N.M.
Auburn, Ala.
Austin, Texas
Boise, Idaho
Durham, N.C.
La Crosse, Wis.
Loveland, Colo.
San Luis Obispo, Calif.
St. Augustine, Fla.
Upper St. Clair, Pa.
Source: U.S. News & World Report (06/09/2010)
News & World Report magazine looked at areas with strong economies, low living costs, and plenty of fun things to do to identify this year's best places to live.
The editors reviewed more than 2,000 locations nationwide, considering such factors as sales taxes, housing prices, average number of children per square mile, proximity to healthcare, and the availability of educational institutions. Readers can use a database search to tailor the results to their own situation."Choosing where to live is a difficult decision for any family," says Brian Kelly, editor of U.S. News & World Report. "With U.S. News's Best Places to Live, we've crunched the most important geographic, economic, and educational data and provided the search tools to help make this decision a little easier for families."
The 10 cities honored as Best Places to Live are (listed alphabetically):
Albuquerque, N.M.
Auburn, Ala.
Austin, Texas
Boise, Idaho
Durham, N.C.
La Crosse, Wis.
Loveland, Colo.
San Luis Obispo, Calif.
St. Augustine, Fla.
Upper St. Clair, Pa.
Source: U.S. News & World Report (06/09/2010)
Wednesday, June 10, 2009
Update: FHA backs away from no down payment loans
June 2, 2009 1:51 pm
After announcing a plan that would have allowed first time homebuyers to use a special tax credit to cover the 3.5% required down payment on an FHA-insured loan, the Dept. of Housing and Urban Development apparently had second thoughts.
Late last week HUD released a newly remodeled plan that does not allow the first-time homebuyer tax credit to be used for the down payment. Seems there was plenty of push back that allowing borrowers to land a mortgage without any “skin in the game” was not exactly a great idea. What’s amazing is that the proposal even got floated in the first place; the notion that taxpayer dollars would have been on the line for mortgages that required no down payment was a bit of a head spinner.
What HUD finally settled on was that lenders can essentially advance qualified home buyers the value of their tax credit today to reduce their mortgage costs, but only if the borrower can bring a minimum 3.5% down payment to the table. Approved uses of the tax credit include paying for closing costs, making a larger down payment (to thereby reduce the monthly mortgage cost) or buying down the interest rate by paying points. The real value of the new rule is that eligible homebuyers can now “use” their tax credit today, rather than having to wait to recoup the value of the credit when they file their 2009 federal tax return in early 2010.
Basically, if you meet the eligibility rules you can now get a maximum of $8,000 advanced to you to buy a home. Single homebuyers with income below $75,000 and married couples who file a joint return with income below $150,000 are eligible for the max tax credit. (A limited credit is available for individuals with income between $75,000-$95,000 and joint filers with income between $150,000 and $170,000; the credit completely phases out above those income levels.) Anyone who has not owned a primary residence for three years is considered a first-timer, but to grab the tax credit you must close on an FHA-insured loan before December 1 of this year.
– Carla Fried
After announcing a plan that would have allowed first time homebuyers to use a special tax credit to cover the 3.5% required down payment on an FHA-insured loan, the Dept. of Housing and Urban Development apparently had second thoughts.
Late last week HUD released a newly remodeled plan that does not allow the first-time homebuyer tax credit to be used for the down payment. Seems there was plenty of push back that allowing borrowers to land a mortgage without any “skin in the game” was not exactly a great idea. What’s amazing is that the proposal even got floated in the first place; the notion that taxpayer dollars would have been on the line for mortgages that required no down payment was a bit of a head spinner.
What HUD finally settled on was that lenders can essentially advance qualified home buyers the value of their tax credit today to reduce their mortgage costs, but only if the borrower can bring a minimum 3.5% down payment to the table. Approved uses of the tax credit include paying for closing costs, making a larger down payment (to thereby reduce the monthly mortgage cost) or buying down the interest rate by paying points. The real value of the new rule is that eligible homebuyers can now “use” their tax credit today, rather than having to wait to recoup the value of the credit when they file their 2009 federal tax return in early 2010.
Basically, if you meet the eligibility rules you can now get a maximum of $8,000 advanced to you to buy a home. Single homebuyers with income below $75,000 and married couples who file a joint return with income below $150,000 are eligible for the max tax credit. (A limited credit is available for individuals with income between $75,000-$95,000 and joint filers with income between $150,000 and $170,000; the credit completely phases out above those income levels.) Anyone who has not owned a primary residence for three years is considered a first-timer, but to grab the tax credit you must close on an FHA-insured loan before December 1 of this year.
– Carla Fried
Monday, June 8, 2009
DASD plans 2.5% property tax hike
Residents living in the Downingtown Area School District will see a tax increase of about 2.5 percent next school year, finance administrators said at a meeting on Tuesday night. The school board approved the preliminary 2009-10 budget in February. At that time, the budget stood at $184 million and included a 3.75 percent property tax increase.
At Tuesday's finance meeting, district officials announced that the budget now stands at $183.9 million and includes a 2.5 percent tax increase. This is the lowest proposed tax increase the district has had in 14 years. A 2.5 percent hike would raise the tax rate to 25.48 mills, with one mill equal to $1 in tax for every $1,000 in assessed property value.
An average taxpayer with a home in the district assessed for tax purposes at $175,000 would therefore generate a school property tax bill of $4,459 — an increase of $109.28 over the prior year. Eligible residents will receive a tax credit of $209 in their school property tax bill from slot revenues.
The school board is expected to vote on next year's budget at its June 10 meeting.
Source: Daily Local; 5/29/09
At Tuesday's finance meeting, district officials announced that the budget now stands at $183.9 million and includes a 2.5 percent tax increase. This is the lowest proposed tax increase the district has had in 14 years. A 2.5 percent hike would raise the tax rate to 25.48 mills, with one mill equal to $1 in tax for every $1,000 in assessed property value.
An average taxpayer with a home in the district assessed for tax purposes at $175,000 would therefore generate a school property tax bill of $4,459 — an increase of $109.28 over the prior year. Eligible residents will receive a tax credit of $209 in their school property tax bill from slot revenues.
The school board is expected to vote on next year's budget at its June 10 meeting.
Source: Daily Local; 5/29/09
West Chester School District hikes taxes 5.9% in Chester County and 9.4% in Delaware County
School taxes for property owners in the Chester County portion of the West Chester Area School District will increase by 5.9 percent next year. For property owners in the district's Delaware County section, school taxes will go up 9.4 percent.
The West Chester Area School Board approved a 2009-2010 final budget on Monday night that calls for $198.7 million in spending. This represents an increase of 3.3 percent over the current year budget, but it comes in the face of a decrease of 6.6 percent in local tax revenue, the district's biggest source of funding, district officials said.
Earlier this year the board approved a preliminary budget that included a 6.6 percent tax increase for Chester County and a 10.1 percent increase for Delaware County. The board's finance committee last week recommended dropping these increases a full percentage point.
The 2009-2010 tax increase is above the limit set by Act 1, but it does not need to go to referendum, officials said, because the district was able to use several Act 1 exemptions.
The district in December 2008 projected a $13.3 million 2009-2010 budget deficit, but due to budget cuts and federal stimulus funding, the gap has been brought down to $6.4 million. The average residential tax bill in the District's Chester County portion will be $3,391, while the average bill in the District's Delaware County portion will be $4,036, officials said. This is based on an average Chester County assessed value of $189,950, and an average Delaware County assessment of $285,000. The millage in the district's Chester County portion will rise 1 mill, to 17.85 mills, while the millage in the district's Delaware County portion will rise 1.22 mills, to 14.16 mills. A mill is a dollar of tax on $1,000 of a property's assessed value.
Source: Daily Times; 5/27/09
The West Chester Area School Board approved a 2009-2010 final budget on Monday night that calls for $198.7 million in spending. This represents an increase of 3.3 percent over the current year budget, but it comes in the face of a decrease of 6.6 percent in local tax revenue, the district's biggest source of funding, district officials said.
Earlier this year the board approved a preliminary budget that included a 6.6 percent tax increase for Chester County and a 10.1 percent increase for Delaware County. The board's finance committee last week recommended dropping these increases a full percentage point.
The 2009-2010 tax increase is above the limit set by Act 1, but it does not need to go to referendum, officials said, because the district was able to use several Act 1 exemptions.
The district in December 2008 projected a $13.3 million 2009-2010 budget deficit, but due to budget cuts and federal stimulus funding, the gap has been brought down to $6.4 million. The average residential tax bill in the District's Chester County portion will be $3,391, while the average bill in the District's Delaware County portion will be $4,036, officials said. This is based on an average Chester County assessed value of $189,950, and an average Delaware County assessment of $285,000. The millage in the district's Chester County portion will rise 1 mill, to 17.85 mills, while the millage in the district's Delaware County portion will rise 1.22 mills, to 14.16 mills. A mill is a dollar of tax on $1,000 of a property's assessed value.
Source: Daily Times; 5/27/09
Pending home sales rise 6.7 percent in April
By ALAN ZIBEL
WASHINGTON (AP) — The number of U.S. homebuyers who agreed to buy a previously occupied home took the largest monthly jump in nearly eight years in April, but there are still plenty of danger signs for the U.S. housing market.
Home sales appear likely to head upward this summer, potentially to levels not seen since the stock market collapsed last autumn, but prices are expected to keep falling well into next year. Layoffs, which are causing foreclosures to soar, coupled with rising mortgage rates could dampen any real estate recovery.
The National Association of Realtors said Tuesday its seasonally adjusted index of sales contracts signed in April surged 6.7 percent to 90.3, far exceeding analysts' forecasts. It was the biggest monthly jump since October 2001, when pending sales rose 9.2 percent.
The big boost likely reflects the impact of a new $8,000 tax credit for first-time homebuyers that was included in the economic stimulus bill signed by Obama in February. Since buyers need to complete their purchases by Nov. 30 to claim the credit, "we expect greater activity in the months ahead," Lawrence Yun, the Realtors' chief economist, said in a statement.
Typically there is a one- to two-month lag between a contract and a done deal, so the index is a barometer for future existing home sales.
While economists are encouraged by signs that demand for housing is returning, the outlook is far from sunny. Mortgage rates are rising, making homes less affordable for many borrowers. The average rate for a 30-year, fixed-rate mortgage is around 5.3 percent this week compared with about 5 percent last week, according to Bankrate.com.
Stock indexes advanced modestly in morning trading, but then traded in a tight range around the break-even point. Financial stocks fell after several banks announced plans to raise capital to help repay federal bailout funds.
The health of the U.S. housing market, mired in a three-year slump, is one of the key issues facing the economy. Though sales may be recovering, analysts cautioned that prices will take longer to stabilize because of the glut of unsold properties for sale. Prices are unlikely to rise until foreclosures start declining, and that's unlikely to happen before the end next year.
The national median sales price in April plunged more than 15 percent from year-ago levels to $170,200, driven by sales of inexpensive foreclosures and other distressed low-end properties. That was the second-largest yearly price drop on record, according to the Realtors' group.
Still unknown is the effectiveness of President Barack Obama's $50 billion plan to prevent foreclosures by modifying loans in bulk. Analysts are growing worried that it will not have a substantial impact.
"I haven't seen evidence yet of any significant modifications," said Mark Zandi, chief economist at Moody's Economy.com. "I was hoping that we would see more of a pickup."
The Realtors' index of pending sales contracts was 3.2 percent above last year's levels and has risen for three straight months after hitting a record low in January. A nearly 33 percent sales increase in the Northeast and a 9.8 percent jump in the Midwest led the overall surge. Sales contracts were flat or up slightly in the South and West.
Still, Yun cautioned that the pending sales data is more volatile than in the past. Many homeowners need to sell their properties for less than the balance they owe on their mortgages — a so-called "short sale" — which requires the lenders' approval. That process is often difficult, time-consuming and can fall apart before the deal closes.
Copyright © 2009 The Associated Press.
WASHINGTON (AP) — The number of U.S. homebuyers who agreed to buy a previously occupied home took the largest monthly jump in nearly eight years in April, but there are still plenty of danger signs for the U.S. housing market.
Home sales appear likely to head upward this summer, potentially to levels not seen since the stock market collapsed last autumn, but prices are expected to keep falling well into next year. Layoffs, which are causing foreclosures to soar, coupled with rising mortgage rates could dampen any real estate recovery.
The National Association of Realtors said Tuesday its seasonally adjusted index of sales contracts signed in April surged 6.7 percent to 90.3, far exceeding analysts' forecasts. It was the biggest monthly jump since October 2001, when pending sales rose 9.2 percent.
The big boost likely reflects the impact of a new $8,000 tax credit for first-time homebuyers that was included in the economic stimulus bill signed by Obama in February. Since buyers need to complete their purchases by Nov. 30 to claim the credit, "we expect greater activity in the months ahead," Lawrence Yun, the Realtors' chief economist, said in a statement.
Typically there is a one- to two-month lag between a contract and a done deal, so the index is a barometer for future existing home sales.
While economists are encouraged by signs that demand for housing is returning, the outlook is far from sunny. Mortgage rates are rising, making homes less affordable for many borrowers. The average rate for a 30-year, fixed-rate mortgage is around 5.3 percent this week compared with about 5 percent last week, according to Bankrate.com.
Stock indexes advanced modestly in morning trading, but then traded in a tight range around the break-even point. Financial stocks fell after several banks announced plans to raise capital to help repay federal bailout funds.
The health of the U.S. housing market, mired in a three-year slump, is one of the key issues facing the economy. Though sales may be recovering, analysts cautioned that prices will take longer to stabilize because of the glut of unsold properties for sale. Prices are unlikely to rise until foreclosures start declining, and that's unlikely to happen before the end next year.
The national median sales price in April plunged more than 15 percent from year-ago levels to $170,200, driven by sales of inexpensive foreclosures and other distressed low-end properties. That was the second-largest yearly price drop on record, according to the Realtors' group.
Still unknown is the effectiveness of President Barack Obama's $50 billion plan to prevent foreclosures by modifying loans in bulk. Analysts are growing worried that it will not have a substantial impact.
"I haven't seen evidence yet of any significant modifications," said Mark Zandi, chief economist at Moody's Economy.com. "I was hoping that we would see more of a pickup."
The Realtors' index of pending sales contracts was 3.2 percent above last year's levels and has risen for three straight months after hitting a record low in January. A nearly 33 percent sales increase in the Northeast and a 9.8 percent jump in the Midwest led the overall surge. Sales contracts were flat or up slightly in the South and West.
Still, Yun cautioned that the pending sales data is more volatile than in the past. Many homeowners need to sell their properties for less than the balance they owe on their mortgages — a so-called "short sale" — which requires the lenders' approval. That process is often difficult, time-consuming and can fall apart before the deal closes.
Copyright © 2009 The Associated Press.
Wednesday, May 13, 2009
Tax Credit Can Be Used for Down Payment
Daily Real Estate News May 12, 2009
Tax Credit Can Be Used for Down Payment Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development, on Tuesday said that the Federal Housing Administration is going to permit its lenders to allow home buyers to use the $8,000 tax credit as a down payment.Previously, most buyers wouldn't receive the funds until after they filed their tax return, and that deterred some people from using the credit. The NATIONAL ASSOCIATION OF REALTORS® has been calling for the change.
“We all want to enable FHA consumers to access the home buyer tax credit funds when they close on their home loans so that the cash can be used as a down payment,” Donovan says. His remarks came in an address to several thousand REALTORS® gathered Tuesday morning at "The Real Estate Summit: Advancing the U.S. Economy," at the 2009 REALTORS® Midyear Legislative Meetings & Trade Expo in Washington, D.C.
He says FHA’s approved lenders will be permitted to “monetize” the tax credit through short-term bridge loans. This will allow eligible home buyers to access the funds immediately at the closing table.
Tax Credit Can Be Used for Down Payment Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development, on Tuesday said that the Federal Housing Administration is going to permit its lenders to allow home buyers to use the $8,000 tax credit as a down payment.Previously, most buyers wouldn't receive the funds until after they filed their tax return, and that deterred some people from using the credit. The NATIONAL ASSOCIATION OF REALTORS® has been calling for the change.
“We all want to enable FHA consumers to access the home buyer tax credit funds when they close on their home loans so that the cash can be used as a down payment,” Donovan says. His remarks came in an address to several thousand REALTORS® gathered Tuesday morning at "The Real Estate Summit: Advancing the U.S. Economy," at the 2009 REALTORS® Midyear Legislative Meetings & Trade Expo in Washington, D.C.
He says FHA’s approved lenders will be permitted to “monetize” the tax credit through short-term bridge loans. This will allow eligible home buyers to access the funds immediately at the closing table.
Friday, May 1, 2009
Developers propose shopping center for The Flats in Coatesville
Without a slide show, architectural renditions or any other frills, developers hoping to put a grocery store and other retail shops on what is currently a contaminated, desolate site made their pitch to City Council on Monday night. City Council did not take any action on the proposal, which the city's Redevelopment Authority approved last week. But council is expected to support or reject the plan at its May 11 meeting.
Mosaic developers said they hope to construct a roughly 82,000-square-foot shopping center with a grocery store as an anchor. It will occupy the southern half what is known locally as The Flats — 26 acres north of West Lincoln Highway and west of Route 82 along the east bank of the Brandywine Creek. It's still unclear what will be done with the northern portion of the site. Previously, Iacobucci Homes was in the mix with the intention of building row homes and condominiums on the site. But the company has since pulled out of the project.
Last week, Chetty Builders and The Shelter Group presented their hopes for the site to the authority.
Chetty Builders' plan includes building about 90 townhouses. The Shelter Group told the authority it would like to build about 75 apartments for senior citizens at The Flats. The authority has made no decisions on either company's proposals.
Source: Daily Local; 4/30/09
Mosaic developers said they hope to construct a roughly 82,000-square-foot shopping center with a grocery store as an anchor. It will occupy the southern half what is known locally as The Flats — 26 acres north of West Lincoln Highway and west of Route 82 along the east bank of the Brandywine Creek. It's still unclear what will be done with the northern portion of the site. Previously, Iacobucci Homes was in the mix with the intention of building row homes and condominiums on the site. But the company has since pulled out of the project.
Last week, Chetty Builders and The Shelter Group presented their hopes for the site to the authority.
Chetty Builders' plan includes building about 90 townhouses. The Shelter Group told the authority it would like to build about 75 apartments for senior citizens at The Flats. The authority has made no decisions on either company's proposals.
Source: Daily Local; 4/30/09
West Goshen residents fret road-widening project
West Goshen Township's plans to widen a section of Boot Road near the Route 202 interchange to deal with heavy traffic from QVC and other business parks has drawn the ire of local residents. The area to be widened is Boot Road between Greenhill Road and Wilson Drive.
Township Manager Casey LaLonde said the project, which is a joint endeavor of West Goshen and East Goshen, is just in a preliminary stage. The Pennsylvania Department of Transportation has not approved it yet.
The township plans to hold a meeting with residents regarding the Boot Road corridor improvements at 7 p.m. May 14.
Source: Daily Local; 5/1/09
Township Manager Casey LaLonde said the project, which is a joint endeavor of West Goshen and East Goshen, is just in a preliminary stage. The Pennsylvania Department of Transportation has not approved it yet.
The township plans to hold a meeting with residents regarding the Boot Road corridor improvements at 7 p.m. May 14.
Source: Daily Local; 5/1/09
West Chester approves 87 townhomes for Davis Lumber site
West Chester Borough Council granted Davis Realty Holdings final approval to build 87 townhomes on the 3.85-acre Davis Lumber site at Franklin and Barnard streets.
The Davis Lumber site is in an industrial sector of the borough and is near the former site of Wyeth Pharmaceuticals, which is also considered a prime candidate for residential redevelopment. Hunter Davis, who owns the lumberyard, declined to say when construction would begin. Davis first submitted development plans for the site last summer. The first draft of the plan showed 98 townhomes, but due in part to stormwater issues, the number of residences has been reduced. Davis' site is one of the few remaining lots in the borough suited to a large-scale housing development.
McCool Properties recently received preliminary approval to build 58 townhomes on another such parcel, the former Bishop Shanahan High School site at West Gay and Brandywine streets. Some borough officials have criticized Davis' proposal, saying it is too dense and could create traffic problems in surrounding neighborhoods. However, the proposal conforms to borough zoning, leaving Borough Council members little power to negotiate the number of planned homes.
Source: Daily Local; 4/27/09
The Davis Lumber site is in an industrial sector of the borough and is near the former site of Wyeth Pharmaceuticals, which is also considered a prime candidate for residential redevelopment. Hunter Davis, who owns the lumberyard, declined to say when construction would begin. Davis first submitted development plans for the site last summer. The first draft of the plan showed 98 townhomes, but due in part to stormwater issues, the number of residences has been reduced. Davis' site is one of the few remaining lots in the borough suited to a large-scale housing development.
McCool Properties recently received preliminary approval to build 58 townhomes on another such parcel, the former Bishop Shanahan High School site at West Gay and Brandywine streets. Some borough officials have criticized Davis' proposal, saying it is too dense and could create traffic problems in surrounding neighborhoods. However, the proposal conforms to borough zoning, leaving Borough Council members little power to negotiate the number of planned homes.
Source: Daily Local; 4/27/09
Monday, April 20, 2009
Top Economists Say Recovery Has Begun
Daily Real Estate News April 7, 2009
Economic recovery is about making people feel more confident, says Mark Zandi, chief economist of Moody’s Economy.com. Zandi evidenced increasing home sales and gains in the stock market are some promising signs that the worst is over and people will start spending again.“We’re starting to see some pent-up demand for goods,” he says.
But Zandi warns that the situation is still fragile. "Confidence is a very fickle thing. It can go from abject pessimism that pervades now to a more balanced view of the world rather quickly.”
Robert Brusca of FAO Economics is predicting strong growth in the last half of the year and a quick recovery for the labor market. "You've lost 5 million jobs. It shouldn't be hard to put 2.5 million jobs back on rather quickly after you hit bottom," he said.
Joseph Carson, chief economist at AllianceBernstein, calls improving home sales, a rising stock market, and better-than-expected retail sales in February and March good signs of a turnaround. By the time President Obama’s stimulus package takes effect, the economy will be ready, he says. "The stimulus has a much better chance of working if trends are already turning up than if it needs to halt a decline," he said.
Source: CNNMoney, Chris Isidore (04/06/2009)
Economic recovery is about making people feel more confident, says Mark Zandi, chief economist of Moody’s Economy.com. Zandi evidenced increasing home sales and gains in the stock market are some promising signs that the worst is over and people will start spending again.“We’re starting to see some pent-up demand for goods,” he says.
But Zandi warns that the situation is still fragile. "Confidence is a very fickle thing. It can go from abject pessimism that pervades now to a more balanced view of the world rather quickly.”
Robert Brusca of FAO Economics is predicting strong growth in the last half of the year and a quick recovery for the labor market. "You've lost 5 million jobs. It shouldn't be hard to put 2.5 million jobs back on rather quickly after you hit bottom," he said.
Joseph Carson, chief economist at AllianceBernstein, calls improving home sales, a rising stock market, and better-than-expected retail sales in February and March good signs of a turnaround. By the time President Obama’s stimulus package takes effect, the economy will be ready, he says. "The stimulus has a much better chance of working if trends are already turning up than if it needs to halt a decline," he said.
Source: CNNMoney, Chris Isidore (04/06/2009)
10 Riskiest U.S. Housing Markets
Daily Real Estate News April 8, 2009
Even with hints of a housing recovery in some places, risky markets, dominated by nonprime mortgages, still prevail in a number of areas. Forbes magazine and Moody’s Economy.com surveyed the 200 largest metropolitan areas, adding up the number of loans to low-rated borrowers and dividing that sum by the total number of mortgages to calculate the percentage of each area’s market that is below prime.
Here are the 10 metro areas with the highest percentages of nonprime mortgages, which makes them susceptible to defaults as unemployment rates continue to rise.
Mission, Texas
Detroit
Miami
Brownsville, Texas
Merced, Calif.
Lakeland, Fla.
Bakersfield, Calif.
Fort Lauderdale, Fla.
San Bernardino, Calif.
Visalia, Calif.
Source: Forbes, Maha Atal (03/31/2009)
Even with hints of a housing recovery in some places, risky markets, dominated by nonprime mortgages, still prevail in a number of areas. Forbes magazine and Moody’s Economy.com surveyed the 200 largest metropolitan areas, adding up the number of loans to low-rated borrowers and dividing that sum by the total number of mortgages to calculate the percentage of each area’s market that is below prime.
Here are the 10 metro areas with the highest percentages of nonprime mortgages, which makes them susceptible to defaults as unemployment rates continue to rise.
Mission, Texas
Detroit
Miami
Brownsville, Texas
Merced, Calif.
Lakeland, Fla.
Bakersfield, Calif.
Fort Lauderdale, Fla.
San Bernardino, Calif.
Visalia, Calif.
Source: Forbes, Maha Atal (03/31/2009)
Sunday, April 19, 2009
Route 29 ramp supporters say turnpike commission slipped up
Members of both political parties in Chester County are decrying the Pennsylvania Turnpike Commission's recent decision to suspend work on the Route 29 slip ramp to the turnpike in Charlestown.
The long-planned project was designed to decrease traffic congestion on Route 202 and nearby residential roads. The slip ramp would feature unmanned toll booths that allow motorists with E-ZPass to get on and off the turnpike between the Downingtown and Valley Forge exits.
The decision to shelve the project followed a decision to halt a turnpike widening project set for the 13-mile stretch between those exits. The turnpike commission issued a statement that the decision to suspend development was made in reaction to a major cost increase required to meet the demands for alternative stormwater-control methods that include features such as spray irrigation and underground storage.
The (commission) has investigated several alternative stormwater-control methods and concluded that the requested methods would increase overall construction costs by as much as 50 percent.
The Route 29 slip ramp had been anticipated for years. As recently as 2007, the commission trumpeted it as the answer to traffic concerns in the Great Valley area.
Source: Daily Local; 4/12/09
The long-planned project was designed to decrease traffic congestion on Route 202 and nearby residential roads. The slip ramp would feature unmanned toll booths that allow motorists with E-ZPass to get on and off the turnpike between the Downingtown and Valley Forge exits.
The decision to shelve the project followed a decision to halt a turnpike widening project set for the 13-mile stretch between those exits. The turnpike commission issued a statement that the decision to suspend development was made in reaction to a major cost increase required to meet the demands for alternative stormwater-control methods that include features such as spray irrigation and underground storage.
The (commission) has investigated several alternative stormwater-control methods and concluded that the requested methods would increase overall construction costs by as much as 50 percent.
The Route 29 slip ramp had been anticipated for years. As recently as 2007, the commission trumpeted it as the answer to traffic concerns in the Great Valley area.
Source: Daily Local; 4/12/09
PA limits Transco gas pipeline project
The state Department of Environmental Protection (DEP) has granted natural gas company Transco the permits it needs to begin work on the controversial Downingtown pipeline replacement project — with one important exception. Transco does not have permission to start construction in a 2,600-foot segment that spans the East Branch of Brandywine Creek in East Brandywine and East Caln.
The most environmentally sensitive way to cross the creek would be by horizontal directional drilling, which involves digging under the creek, proponents of this method said. But Transco resisted this approach, saying it would be too expensive. Instead, the company proposed a cross-cut method, which diverts surface waters. But this approach would release a lot of sediment into the creek, which is a source of drinking water in Chester County, and so state legislators appealed to state DEP Acting Secretary John Hanger to carefully review Transco's permit applications.
The DEP issued a statement Thursday saying that while the agency has granted the permits that Transco needs to start construction, the company must submit an amendment advising the state how it proposes to proceed in the 2,600-foot section around the creek. About 177 county residents are affected by the project.
Source: Daily Local; 4/12/09
The most environmentally sensitive way to cross the creek would be by horizontal directional drilling, which involves digging under the creek, proponents of this method said. But Transco resisted this approach, saying it would be too expensive. Instead, the company proposed a cross-cut method, which diverts surface waters. But this approach would release a lot of sediment into the creek, which is a source of drinking water in Chester County, and so state legislators appealed to state DEP Acting Secretary John Hanger to carefully review Transco's permit applications.
The DEP issued a statement Thursday saying that while the agency has granted the permits that Transco needs to start construction, the company must submit an amendment advising the state how it proposes to proceed in the 2,600-foot section around the creek. About 177 county residents are affected by the project.
Source: Daily Local; 4/12/09
Federal Housing Rescue Plan Launches
Daily Real Estate News April 17, 2009
The Obama Administration’s program to rescue distressed home owners got off the ground this week. The program was announced on Feb. 18, but it took several weeks to put the bureaucracy in place.
Six of the nation’s largest banks signed up to participate, the Treasury Department announced Wednesday. They are JPMorgan Chase, Wells Fargo, Citigroup, GMAC Mortgage, Saxon Mortgage Services, and Select Portfolio Servicing.
Treasury says it is allocating $50 billion to the program. The Department of Housing and Urban Development will provide the rest.
The plan calls for loan servicers to reduce interest rates so a family’s monthly mortgage obligation is no more than 38 percent of its pre-tax income. Loan servicers also can reduce loan balances. After the loans are modified, the government then provides enough money to reduce payments to 31 percent of income.
Participating servicers get $1,000 a year for each modification and another $1,000 a year for three years if the borrower remains current. Servicers get an extra $500 if they do the modifications before the borrower falls behind in his payments—and the borrower gets $1,500. Also, homeowners get $1,000 a year for five years if they remain current on their payments. The money must be used to reduce their principal balances.
Source: CNN, Tami Luhby (04/16/2009)
The Obama Administration’s program to rescue distressed home owners got off the ground this week. The program was announced on Feb. 18, but it took several weeks to put the bureaucracy in place.
Six of the nation’s largest banks signed up to participate, the Treasury Department announced Wednesday. They are JPMorgan Chase, Wells Fargo, Citigroup, GMAC Mortgage, Saxon Mortgage Services, and Select Portfolio Servicing.
Treasury says it is allocating $50 billion to the program. The Department of Housing and Urban Development will provide the rest.
The plan calls for loan servicers to reduce interest rates so a family’s monthly mortgage obligation is no more than 38 percent of its pre-tax income. Loan servicers also can reduce loan balances. After the loans are modified, the government then provides enough money to reduce payments to 31 percent of income.
Participating servicers get $1,000 a year for each modification and another $1,000 a year for three years if the borrower remains current. Servicers get an extra $500 if they do the modifications before the borrower falls behind in his payments—and the borrower gets $1,500. Also, homeowners get $1,000 a year for five years if they remain current on their payments. The money must be used to reduce their principal balances.
Source: CNN, Tami Luhby (04/16/2009)
Signs Point to Improving Economy
Daily Real Estate News April 17, 2009
Economic observers point to several factors that indicate the economy in general and the housing market in particular may be on the mend.Positive signs include:
● Sales of single-family homes in March remained flat compared to January and February at $358,000, the U.S. Commerce Department reported.
● The Labor Department reported claims were down in the week ending April 11. While some argued this could just reflect the shortened Easter/Passover holiday, others took the optimistic view that some segments of the economy are stabilizing.
● New-home construction remains low because there is so much inventory—but the situation doesn’t appear to be worsening.
"The economy is still very weak, but there are some encouraging signs that support cautious optimism," Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, said in a speech Thursday.
Source: The Wall Street Journal, Sudeep Reddy (04/17/2009)
Economic observers point to several factors that indicate the economy in general and the housing market in particular may be on the mend.Positive signs include:
● Sales of single-family homes in March remained flat compared to January and February at $358,000, the U.S. Commerce Department reported.
● The Labor Department reported claims were down in the week ending April 11. While some argued this could just reflect the shortened Easter/Passover holiday, others took the optimistic view that some segments of the economy are stabilizing.
● New-home construction remains low because there is so much inventory—but the situation doesn’t appear to be worsening.
"The economy is still very weak, but there are some encouraging signs that support cautious optimism," Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, said in a speech Thursday.
Source: The Wall Street Journal, Sudeep Reddy (04/17/2009)
Thursday, April 9, 2009
West Chester Officials recommend condo plans
A local developer's proposal to build 58 townhouse-style condos on the former Bishop Shanahan site got a favorable recommendation from West Chester Borough's Planning Commission on Tuesday. The planning commission recommended that borough council give McCool Properties' proposal preliminary approval. Should borough council grant this approval, McCool would have to make minor adjustments to the project and seek final approval.
Chris McCool, of McCool properties, said he hopes to get final approval by June, to begin marketing the townhomes by late summer, and to break ground by late fall 2009 or early spring 2010. According to current plans, the townhouses will be three stories with a two-car garage underneath; they will have three to four bedrooms, 2.5 baths, and two additional parking spaces in back. The site, which contains the former Bishop Shanahan High School, is at West Gay and Everhart streets. The high school building, which most recently housed the Collegium Charter School, will be demolished.
Source: Daily Local; 4/6/09
Chris McCool, of McCool properties, said he hopes to get final approval by June, to begin marketing the townhomes by late summer, and to break ground by late fall 2009 or early spring 2010. According to current plans, the townhouses will be three stories with a two-car garage underneath; they will have three to four bedrooms, 2.5 baths, and two additional parking spaces in back. The site, which contains the former Bishop Shanahan High School, is at West Gay and Everhart streets. The high school building, which most recently housed the Collegium Charter School, will be demolished.
Source: Daily Local; 4/6/09
Chester County fares well on lists measuring wealth
Chester County has found itself in rather prestigious company, ranking among the top 50 counties across the country in three categories: wages and salaries, dividend income and adjusted gross income.
The report, complied by the Transactional Records Access Clearinghouse at Syracuse University, looked at individual and joint federal tax returns filed in 3,140 counties nationwide in 2007. In Adjusted Gross Income, or AGI, Chester County ranked 21 at $96,578. On the Wages and Salaries list, Chester County ranked 15 at $70,404.
Top employers include Vanguard, QVC and Sungard, which offer top wages. Chester County is home to a number of biotechnology companies as well. On the education front, Chester County has four universities and graduate campus Penn State Great Valley. In addition, the county has an excellent public and private high-school system within its borders.
In Chester County, 42.5 percent of adults 25 and older have a bachelor’s degree or higher compared to 22.4 percent in the rest of the commonwealth, he noted. For the complete list, visit www.trac.syr.edu.
Source: Main Line Suburban Life; 4/8/09
The report, complied by the Transactional Records Access Clearinghouse at Syracuse University, looked at individual and joint federal tax returns filed in 3,140 counties nationwide in 2007. In Adjusted Gross Income, or AGI, Chester County ranked 21 at $96,578. On the Wages and Salaries list, Chester County ranked 15 at $70,404.
Top employers include Vanguard, QVC and Sungard, which offer top wages. Chester County is home to a number of biotechnology companies as well. On the education front, Chester County has four universities and graduate campus Penn State Great Valley. In addition, the county has an excellent public and private high-school system within its borders.
In Chester County, 42.5 percent of adults 25 and older have a bachelor’s degree or higher compared to 22.4 percent in the rest of the commonwealth, he noted. For the complete list, visit www.trac.syr.edu.
Source: Main Line Suburban Life; 4/8/09
Monday, March 30, 2009
Survey: Households Say Now Good Time to Buy
Daily Real Estate News March 26, 2009
More than three-quarters (78 percent) of potential first-time home buyers say that now is a good time to buy a home, despite widespread concern about the economy. Out of the 1,000 prospective U.S. first-time home buyers surveyed in early March for the CENTURY 21 First-Time Home Buyer Survey, 68 percent think now is a better time to buy than six months ago.
Prices are the driving motivation for potential first-time home buyers with more than eight of ten first-time home buyers (85 percent) saying they consider current home prices affordable and 73 percent citing that taking advantage of current prices is a major factor in their decision to buy. Interestingly, potential first-time buyers are still split between “being willing to consider an offer now” (42 percent) and “waiting for prices to go down before they seriously consider making a purchase” (48 percent).
“Current pricing, rates and incentives, such as the First Time Homebuyer Tax Credit, provide tremendous opportunities for first-time home buyers to get into the market,” said Tom Kunz, Century 21 Real Estate president and CEO. “Our research shows that while consumers still have concerns about the future of the economy, many are actively considering their options as we move into the spring selling season.”
Among the survey’s other key findings:
Bargains in the marketplace are providing additional options for buyers to consider. 56 percent of potential first-time home buyers are considering purchasing a foreclosed or short sale home, and 63 percent are open to purchasing either a “fixer-upper” or “as-is” home.
When asked to rate the features that they look for when choosing a home, price is the primary consideration with 87 percent saying this feature is “very important,” followed closely by neighborhood safety (80 percent) and the condition of the home (71 percent).
Having enough money for a down payment is a top concern of potential first-time home buyers as nearly half (46 percent) said they are “very worried” about the issue.
Most respondents (86 percent) are in the market for single family homes.
Source: Century 21
More than three-quarters (78 percent) of potential first-time home buyers say that now is a good time to buy a home, despite widespread concern about the economy. Out of the 1,000 prospective U.S. first-time home buyers surveyed in early March for the CENTURY 21 First-Time Home Buyer Survey, 68 percent think now is a better time to buy than six months ago.
Prices are the driving motivation for potential first-time home buyers with more than eight of ten first-time home buyers (85 percent) saying they consider current home prices affordable and 73 percent citing that taking advantage of current prices is a major factor in their decision to buy. Interestingly, potential first-time buyers are still split between “being willing to consider an offer now” (42 percent) and “waiting for prices to go down before they seriously consider making a purchase” (48 percent).
“Current pricing, rates and incentives, such as the First Time Homebuyer Tax Credit, provide tremendous opportunities for first-time home buyers to get into the market,” said Tom Kunz, Century 21 Real Estate president and CEO. “Our research shows that while consumers still have concerns about the future of the economy, many are actively considering their options as we move into the spring selling season.”
Among the survey’s other key findings:
Bargains in the marketplace are providing additional options for buyers to consider. 56 percent of potential first-time home buyers are considering purchasing a foreclosed or short sale home, and 63 percent are open to purchasing either a “fixer-upper” or “as-is” home.
When asked to rate the features that they look for when choosing a home, price is the primary consideration with 87 percent saying this feature is “very important,” followed closely by neighborhood safety (80 percent) and the condition of the home (71 percent).
Having enough money for a down payment is a top concern of potential first-time home buyers as nearly half (46 percent) said they are “very worried” about the issue.
Most respondents (86 percent) are in the market for single family homes.
Source: Century 21
FBI Sting: 24 Caught in Mortgage Loan Fraud
Daily Real Estate News March 26, 2009
An undercover FBI sting netted 24 people in the Chicagoland area, accusing them of mail and wire fraud that helped straw buyers get $4.2 million in home mortgages.
Among those charged were mortgage brokers, loan officers, loan processors, attorneys, property appraisers, accountants, and a banker. It’s possible that each could be facing prison terms as long as 20 years.
"We want to send a message to people that, if they think they can get $150,000 out of a bank by committing mortgage fraud, and they think that's easy money, our view is they may be walking into a criminal case," said Patrick Fitzgerald, the U.S. Attorney in Chicago who announced the indictments.In nine of the cases, the straw buyers were actually undercover investigators and there was no financial loss. In the tenth case, the loans caused losses in excess of $1.1 million.
"We will not stand by while [some] exploit the financial system for their personal gain," Robert Grant, special agent in charge of the FBI's Chicago office, told a news conference.
Source: The Associated Press, Mike Robinson (03/25/2009)
An undercover FBI sting netted 24 people in the Chicagoland area, accusing them of mail and wire fraud that helped straw buyers get $4.2 million in home mortgages.
Among those charged were mortgage brokers, loan officers, loan processors, attorneys, property appraisers, accountants, and a banker. It’s possible that each could be facing prison terms as long as 20 years.
"We want to send a message to people that, if they think they can get $150,000 out of a bank by committing mortgage fraud, and they think that's easy money, our view is they may be walking into a criminal case," said Patrick Fitzgerald, the U.S. Attorney in Chicago who announced the indictments.In nine of the cases, the straw buyers were actually undercover investigators and there was no financial loss. In the tenth case, the loans caused losses in excess of $1.1 million.
"We will not stand by while [some] exploit the financial system for their personal gain," Robert Grant, special agent in charge of the FBI's Chicago office, told a news conference.
Source: The Associated Press, Mike Robinson (03/25/2009)
America's 10 Wealthiest Towns (3/09)
Daily Real Estate News March 24, 2009
The very wealthy seem to be mostly immune from recent economic downturns. BusinessWeek ranked America’s wealthiest towns based on the 2008 net income and 2008 net worth of their residents. Here's BusinessWeek's list of America’s top 10 wealthiest communities:
Brookville, N.Y.; average income: $328,404; average net worth: $1,670,075
Atherton, Calif.; $380,535; $1,648,161
Rolling Hills, Calif.; $324,190; $1,647,622
Kenilworth, Ill.; $334,634; $1,619,702
Hillsborough, Calif.; $300,943; $1,668,732
Roslyn Estates, N.Y.; $298,935; $1,664,191
Hidden Hills, Calif.; $318,843; $1,630,085
Oyster Bay Cove, N.Y.; 317,661; $1,625,524
(tie) Chevy Chase Village, Md.; $311,170; $1,635,311
(tie) Los Altos Hills, Calif.; $298,510; $1,653,676
Source: Business Week, Prashant Gopal (03/17/2009)
The very wealthy seem to be mostly immune from recent economic downturns. BusinessWeek ranked America’s wealthiest towns based on the 2008 net income and 2008 net worth of their residents. Here's BusinessWeek's list of America’s top 10 wealthiest communities:
Brookville, N.Y.; average income: $328,404; average net worth: $1,670,075
Atherton, Calif.; $380,535; $1,648,161
Rolling Hills, Calif.; $324,190; $1,647,622
Kenilworth, Ill.; $334,634; $1,619,702
Hillsborough, Calif.; $300,943; $1,668,732
Roslyn Estates, N.Y.; $298,935; $1,664,191
Hidden Hills, Calif.; $318,843; $1,630,085
Oyster Bay Cove, N.Y.; 317,661; $1,625,524
(tie) Chevy Chase Village, Md.; $311,170; $1,635,311
(tie) Los Altos Hills, Calif.; $298,510; $1,653,676
Source: Business Week, Prashant Gopal (03/17/2009)
Survey: Chester County residents like what they have
Life is good — except in traffic. In a nutshell, that is the message Chester County residents gave to researchers surveying their opinions for county commissioners, who plan to use the responses while developing a long-range strategic plan to deliver county services.
The survey found that a significant majority of respondents say the county is a better or as good a place to live as it was five years ago. It remains an excellent place to raise a family and a good place to get an education and buy a home, respondents said.
The respondents liked the county’s open space and its convenient location. They found county workers to be courteous and knowledgeable, and they would be willing to pay higher taxes if it meant children were not abused and criminals were imprisoned. But they did not like the county’s roads, traffic, taxes and cost of living, and they said land-use planning is a concern.
Respondents were concerned about overdevelopment and had little time or inclination for a property reassessment. Key indicators show 75 percent of residents believe Chester County is a good place to live, and more than half (55 percent) say it is an excellent place to raise a family. One in three citizens responded that open space is the best thing about Chester County life.
Source: Main Line Suburban Life; 3/25/09
The survey found that a significant majority of respondents say the county is a better or as good a place to live as it was five years ago. It remains an excellent place to raise a family and a good place to get an education and buy a home, respondents said.
The respondents liked the county’s open space and its convenient location. They found county workers to be courteous and knowledgeable, and they would be willing to pay higher taxes if it meant children were not abused and criminals were imprisoned. But they did not like the county’s roads, traffic, taxes and cost of living, and they said land-use planning is a concern.
Respondents were concerned about overdevelopment and had little time or inclination for a property reassessment. Key indicators show 75 percent of residents believe Chester County is a good place to live, and more than half (55 percent) say it is an excellent place to raise a family. One in three citizens responded that open space is the best thing about Chester County life.
Source: Main Line Suburban Life; 3/25/09
Districts react to declining land value: Officials warn that as property values fall, tax rates will rise
The recent decline in real estate value has prompted droves of local land owners to seek reassessments to lower their property taxes. In 2004, the Chester County Board of Assessment Appeals received 824 reassessment requests. That number rose to 1,342 in 2005 and stayed about the same in 2006 and 2007.
In 2008, however, nearly 2,000 requests were filed through the county’s Department of Assessments. In turn, this has strained the budgets of public school districts, which rely on local property taxes for much of their funding. Not all of Chester County's school districts have been equally affected. While finance directors of the West Chester Area and the Downingtown Area school districts said reassessments have caused substantial declines in property tax income, the finance directors of Coatesville Area, Great Valley, and Tredyffrin/Easttown school districts said they've seen little change. Property owners in Chester County can file reassessment appeals from May 1 to Aug. 1. The board of assessment appeals — not local school districts or municipalities — is responsible for reassessing properties.
Source: Daily Local; 3/23/09
In 2008, however, nearly 2,000 requests were filed through the county’s Department of Assessments. In turn, this has strained the budgets of public school districts, which rely on local property taxes for much of their funding. Not all of Chester County's school districts have been equally affected. While finance directors of the West Chester Area and the Downingtown Area school districts said reassessments have caused substantial declines in property tax income, the finance directors of Coatesville Area, Great Valley, and Tredyffrin/Easttown school districts said they've seen little change. Property owners in Chester County can file reassessment appeals from May 1 to Aug. 1. The board of assessment appeals — not local school districts or municipalities — is responsible for reassessing properties.
Source: Daily Local; 3/23/09
Monday, March 23, 2009
How Will Foreclosure Effect Credit Scores?
Daily Real Estate News March 16, 2009
The amount of damage to a credit score caused by foreclosure, deed in lieu or a short sale during 2008 and 2009 may be mitigated by the slower economic times, say some credit and legal experts.FICO may have to adjust its credit scores to lessen the impact of a foreclosure in the last two years, says Todd J. Zywicki, a professor of law at George Mason University.
''It just seems obvious that a foreclosure in 2008 or 2009 doesn't have as much information value as a foreclosure five years ago,'' he says. ''To the extent that foreclosure doesn't predict future behavior as much as it did in the past, you'd expect that the FICO algorithm would change to adjust for that.''
One of the country’s largest credit unions, Golden 1 has already figured out a way to lend to people with a foreclosure on their record by offering a mortgage repair loan specifically for those who have lost a home to foreclosure and who want to buy a new one.
BECU, another large credit union based in Washington State, is about to present a program to fellow lenders, ''How to Lend to the Newly Credit Impaired.”
Source: The New York Times, Ron Lieber (03/14/2009)
The amount of damage to a credit score caused by foreclosure, deed in lieu or a short sale during 2008 and 2009 may be mitigated by the slower economic times, say some credit and legal experts.FICO may have to adjust its credit scores to lessen the impact of a foreclosure in the last two years, says Todd J. Zywicki, a professor of law at George Mason University.
''It just seems obvious that a foreclosure in 2008 or 2009 doesn't have as much information value as a foreclosure five years ago,'' he says. ''To the extent that foreclosure doesn't predict future behavior as much as it did in the past, you'd expect that the FICO algorithm would change to adjust for that.''
One of the country’s largest credit unions, Golden 1 has already figured out a way to lend to people with a foreclosure on their record by offering a mortgage repair loan specifically for those who have lost a home to foreclosure and who want to buy a new one.
BECU, another large credit union based in Washington State, is about to present a program to fellow lenders, ''How to Lend to the Newly Credit Impaired.”
Source: The New York Times, Ron Lieber (03/14/2009)
Some See Detroit As Land of Opportunity
Daily Real Estate News March 18, 2009
Home prices in the Detroit area have cratered, creating opportunities for investors who are snapping up property to renovate and flip or just rent out.
Jeremy Burgess is typical. He started his company Urban Detroit Wholesalers in 2007 with partner Jared Pomranky. They buy houses for a few thousand dollars or less because owners who are leaving the area want to get rid of the tax burden and liability. Burgess and Pomranky look for homes in working-class neighborhoods on the outskirts of the city. They do a little fix-up and painting, and then sell the homes to out-of-state investors for an average of $35,000. Local investors, they say, have a hard time seeing the opportunities, Burgess says.
Burgess claims he averages a 12 percent to 20 percent return on investment. He believes home prices will go back up once financing is easier to get. "This last drop I think is totally due to lack of financing options, and when cash is king, prices drop significantly. I see it as an artificial drop in value, and I am obviously taking advantage of it. So are my investors," Burgess says.
Source: CNN, Tristan Smith (03/17/2009)
Home prices in the Detroit area have cratered, creating opportunities for investors who are snapping up property to renovate and flip or just rent out.
Jeremy Burgess is typical. He started his company Urban Detroit Wholesalers in 2007 with partner Jared Pomranky. They buy houses for a few thousand dollars or less because owners who are leaving the area want to get rid of the tax burden and liability. Burgess and Pomranky look for homes in working-class neighborhoods on the outskirts of the city. They do a little fix-up and painting, and then sell the homes to out-of-state investors for an average of $35,000. Local investors, they say, have a hard time seeing the opportunities, Burgess says.
Burgess claims he averages a 12 percent to 20 percent return on investment. He believes home prices will go back up once financing is easier to get. "This last drop I think is totally due to lack of financing options, and when cash is king, prices drop significantly. I see it as an artificial drop in value, and I am obviously taking advantage of it. So are my investors," Burgess says.
Source: CNN, Tristan Smith (03/17/2009)
Underwater Owners May Keep Walking Away
Daily Real Estate News March 18, 2009
Housing economists are growing increasingly worried that home owners whose properties are underwater will stop trying to pay their mortgages and just walk away.
In all, the total value of U.S. residential properties fell to $19.1 trillion in December 2008 from $21.5 trillion in December 2007. About 52 percent of Nevada mortgages are underwater, followed by 32 percent in Arizona and 30 percent in both Florida and California, according to researcher First American CoreLogic.
"Should the downward spiral in home prices, neighborhood condition, and equity deterioration continue, more and more mainstream borrowers are likely to walk away from their homes," Credit Suisse said in a December report.
Source: Reuters News, Lisa Baertlein (03/17/2009)
Housing economists are growing increasingly worried that home owners whose properties are underwater will stop trying to pay their mortgages and just walk away.
In all, the total value of U.S. residential properties fell to $19.1 trillion in December 2008 from $21.5 trillion in December 2007. About 52 percent of Nevada mortgages are underwater, followed by 32 percent in Arizona and 30 percent in both Florida and California, according to researcher First American CoreLogic.
"Should the downward spiral in home prices, neighborhood condition, and equity deterioration continue, more and more mainstream borrowers are likely to walk away from their homes," Credit Suisse said in a December report.
Source: Reuters News, Lisa Baertlein (03/17/2009)
Mortgage-Help Site, Call-in Number Go Live
Daily Real Estate News March 19, 2009
The U.S. Treasury Department went live on March 19 with its Making Home Affordable program, which aims to help home owners refinance or modify their mortgages. The campaign includes a Web site at makinghomeaffordable.gov as well as a telephone hotline number at (888) 995-4673. The federal government is targeting 9 million home owners whose loans are held by Fannie Mae or Freddie Mac.
Source: Indianapolis Star (03/19/09)
The U.S. Treasury Department went live on March 19 with its Making Home Affordable program, which aims to help home owners refinance or modify their mortgages. The campaign includes a Web site at makinghomeaffordable.gov as well as a telephone hotline number at (888) 995-4673. The federal government is targeting 9 million home owners whose loans are held by Fannie Mae or Freddie Mac.
Source: Indianapolis Star (03/19/09)
Scammers Target Troubled Borrowers
Daily Real Estate News March 16, 2009
Scam artists are proliferating, attempting to make money off troubled borrowers interested in taking advantage of President Barack Obama’s foreclosure-prevention plan.
The firms charge fees for what they tell borrowers will be quick and effective negotiations with banks. In most cases, the firms take the home owners’ money – often more than $1,000 – and do nothing.
The Federal Reserve recently issued this advice for people seeking to modify their mortgages:
Work only with HUD-approved nonprofit counselors. (See www.hud.gov)
Don't agree to pay a fee before you are provided with the promised service.
Beware of people offering "guaranteed" results.
Don't sign blank forms or documents you haven't read.
Source: The Wall Street Journal, James R. Hagerty (03/11/2009)
Scam artists are proliferating, attempting to make money off troubled borrowers interested in taking advantage of President Barack Obama’s foreclosure-prevention plan.
The firms charge fees for what they tell borrowers will be quick and effective negotiations with banks. In most cases, the firms take the home owners’ money – often more than $1,000 – and do nothing.
The Federal Reserve recently issued this advice for people seeking to modify their mortgages:
Work only with HUD-approved nonprofit counselors. (See www.hud.gov)
Don't agree to pay a fee before you are provided with the promised service.
Beware of people offering "guaranteed" results.
Don't sign blank forms or documents you haven't read.
Source: The Wall Street Journal, James R. Hagerty (03/11/2009)
Chinese Drywall Leads to Lawsuits
Daily Real Estate News March 17, 2009
Several home owners are blaming some drywall imported from China in the wake of Hurricane Katrina and Wilma as giving off a foul odor and causing a range of health problems, according to a lawsuit.
Several class action lawsuits have been filed, including claims against U.S. homebuilder Lennar and a Chinese drywall manufacturer, Knauf Plasterboard Tianjin. Lennar, which has been replacing drywall in some homes, says it didn’t approve the use of the imported drywall. Knauf says it wasn’t necessarily the manufacturer and that the drywall has passed tests that have indicated that it produces no health hazards.The Consumer Product Safety Commission and Florida regulators are investigating. One estimate suggests 60,000 homes may contain the drywall.
Attorneys who have filed the suits claim residents have suffered rashes, new allergies, asthma and sore throats. Victims should be compensated and their health monitored, says attorney Ervin Gonzalez of Colson Hicks Eidson in Washington, D.C.
Source: USA Today, Julie Schmit (03/17/2009)
Several home owners are blaming some drywall imported from China in the wake of Hurricane Katrina and Wilma as giving off a foul odor and causing a range of health problems, according to a lawsuit.
Several class action lawsuits have been filed, including claims against U.S. homebuilder Lennar and a Chinese drywall manufacturer, Knauf Plasterboard Tianjin. Lennar, which has been replacing drywall in some homes, says it didn’t approve the use of the imported drywall. Knauf says it wasn’t necessarily the manufacturer and that the drywall has passed tests that have indicated that it produces no health hazards.The Consumer Product Safety Commission and Florida regulators are investigating. One estimate suggests 60,000 homes may contain the drywall.
Attorneys who have filed the suits claim residents have suffered rashes, new allergies, asthma and sore throats. Victims should be compensated and their health monitored, says attorney Ervin Gonzalez of Colson Hicks Eidson in Washington, D.C.
Source: USA Today, Julie Schmit (03/17/2009)
The REALTORS® Confidence Index: Measuring Expectations
By Meredith Dunn and Wannasiri Chompoopet
NAR Research
Current economic trends are certainly informing consumers' feelings about the nation's economic well-being, as well as their own. As measured by The Conference Board, consumer confidence has been on a continual downturn since November of 2008. In fact, from February of 2008 to February of 2009, the consumer confidence index is off more than 67 percent!
But REALTORS® confidence in and expectations for the housing market has improved recently. Expectations of real estate practitioners for residential properties for the next six months are more optimistic than they've been in a while. Below we summarize the latest figures from NAR's REALTORS® Confidence Index.
About the REALTORS® Confidence Index
The REALTORS® Confidence Index - RCI - is a key indicator of housing market strength based on a monthly survey of 3,500 real estate practitioners. Actually, the RCI comprises several indexes about different housing market conditions. Practitioners are asked about their expectations for home sales, prices and market conditions. More specifically, the RCI survey is a monthly fax survey that asks practitioners three basic questions pertaining to business in their region:
How would you describe the current housing market in your region?
What are your expectations for the housing market over the next six months in your region?
How do you rate the traffic in your region?
These three questions are asked for major segments of the housing sector including, single-family homes, townhomes/duplexes, and condominiums. These same questions are asked each month. Answers are then quantified and used to create the confidence index.
The RCI Indexes are calculated as follows: Respondents indicate whether conditions are, or are expected to be "strong" (100 points), "moderate" (50 points), and "weak" (0 points). The results are the average score for each question. A score of 50 is the threshold between a "strong" and a "weak" condition.
The RCI for January
The REALTORS® Confidence Index for single-family home sales rose for the first time in eight months from 18.8 in December of 2008 to 23.2 in January. The index for townhouses showed a similar trend, and rose to 13.1 from 11.4. The condo index also increased in January, from 9.6 in December to 11.2 in January. It should be noted, however, that the indexes for all three types of housing, are still well below last year's levels.
Confidence was highest in the Northeast and lowest in the Midwest. Existing Home Sales data for January show that prices fell the most in the Northeast, at 14.7 percent. Perhaps the rising confidencefactor in the Northeast is related to buyers beginning to take advantage of the lower prices.
Expectations of real estate practitioners for residential properties for the next six months are optimistic, and increased for all three types of housing. The single-family homes sales expectation index climbed to 34.0 from 28.3 in December. The townhouse and condo figures were 20.2 and 17.8, respectively.
The index measuring the prospective traffic of home buyers was at 31.7 in January - an improvement from December's reading of 25.1 and also an improvement over the reading of 30.7 in January of 2008. The seller's traffic index for January was 45.1 which is virtually flat compared to a month ago.
Other Survey Questions
In addition to the standard questions, each month the RCI survey features questions about a timely aspect of the housing market. In January, survey participants were asked about their most recent home buyer client experience. More than a third of survey respondents indicated that their most recent buyer client was a first-time purchaser. A third reported that their buyer purchased a foreclosed home, and just under a third of practitioners indicated that their most recent buyer client used an FHA loan for the home purchase.
Some concerns
While REALTORS® confidence is higher than last month and their expectations for their markets are in general more optimistic, they are not as confident about any upswing in home prices. The majority of survey participants - 61 percent - felt that home prices will fall over the next year. Only 39 percent thought that home prices would rise over the same period. Their view matches that of the NAR forecast which projects median prices for existing homes will decline in 2009.
NAR Research
Current economic trends are certainly informing consumers' feelings about the nation's economic well-being, as well as their own. As measured by The Conference Board, consumer confidence has been on a continual downturn since November of 2008. In fact, from February of 2008 to February of 2009, the consumer confidence index is off more than 67 percent!
But REALTORS® confidence in and expectations for the housing market has improved recently. Expectations of real estate practitioners for residential properties for the next six months are more optimistic than they've been in a while. Below we summarize the latest figures from NAR's REALTORS® Confidence Index.
About the REALTORS® Confidence Index
The REALTORS® Confidence Index - RCI - is a key indicator of housing market strength based on a monthly survey of 3,500 real estate practitioners. Actually, the RCI comprises several indexes about different housing market conditions. Practitioners are asked about their expectations for home sales, prices and market conditions. More specifically, the RCI survey is a monthly fax survey that asks practitioners three basic questions pertaining to business in their region:
How would you describe the current housing market in your region?
What are your expectations for the housing market over the next six months in your region?
How do you rate the traffic in your region?
These three questions are asked for major segments of the housing sector including, single-family homes, townhomes/duplexes, and condominiums. These same questions are asked each month. Answers are then quantified and used to create the confidence index.
The RCI Indexes are calculated as follows: Respondents indicate whether conditions are, or are expected to be "strong" (100 points), "moderate" (50 points), and "weak" (0 points). The results are the average score for each question. A score of 50 is the threshold between a "strong" and a "weak" condition.
The RCI for January
The REALTORS® Confidence Index for single-family home sales rose for the first time in eight months from 18.8 in December of 2008 to 23.2 in January. The index for townhouses showed a similar trend, and rose to 13.1 from 11.4. The condo index also increased in January, from 9.6 in December to 11.2 in January. It should be noted, however, that the indexes for all three types of housing, are still well below last year's levels.
Confidence was highest in the Northeast and lowest in the Midwest. Existing Home Sales data for January show that prices fell the most in the Northeast, at 14.7 percent. Perhaps the rising confidencefactor in the Northeast is related to buyers beginning to take advantage of the lower prices.
Expectations of real estate practitioners for residential properties for the next six months are optimistic, and increased for all three types of housing. The single-family homes sales expectation index climbed to 34.0 from 28.3 in December. The townhouse and condo figures were 20.2 and 17.8, respectively.
The index measuring the prospective traffic of home buyers was at 31.7 in January - an improvement from December's reading of 25.1 and also an improvement over the reading of 30.7 in January of 2008. The seller's traffic index for January was 45.1 which is virtually flat compared to a month ago.
Other Survey Questions
In addition to the standard questions, each month the RCI survey features questions about a timely aspect of the housing market. In January, survey participants were asked about their most recent home buyer client experience. More than a third of survey respondents indicated that their most recent buyer client was a first-time purchaser. A third reported that their buyer purchased a foreclosed home, and just under a third of practitioners indicated that their most recent buyer client used an FHA loan for the home purchase.
Some concerns
While REALTORS® confidence is higher than last month and their expectations for their markets are in general more optimistic, they are not as confident about any upswing in home prices. The majority of survey participants - 61 percent - felt that home prices will fall over the next year. Only 39 percent thought that home prices would rise over the same period. Their view matches that of the NAR forecast which projects median prices for existing homes will decline in 2009.
Friday, March 20, 2009
Gas company pursues eminent domain for pipeline
Williams Transco, the natural gas giant who has a project to replace a seven-mile section of their pipeline in the county, has started condemnation proceedings against 36 property owners who have not accepted offers made for their land. The company will be filing a joint motion expressing its need for immediate access. The action was criticized by legislators who have sought to help residents whose property is being severely affected by the natural gas company's desire for additional right-of-way for the project. The county is crisscrossed with existing pipelines by eight different companies that bring natural gas, liquid gas or other petroleum products through 62 of Chester County's 73 municipalities. Currently, at least three natural gas companies have new pipeline or pipeline expansion projects going on in the county.
Source: Daily Local; 3/11/09
Source: Daily Local; 3/11/09
Thursday, March 19, 2009
New-home construction logs unexpected gain
By JEANNINE AVERSA
Ap Economics Writer
Tue Mar 17
WASHINGTON – The number of new housing projects that builders broke ground on in February rose sharply, defying economists' forecasts for yet another drop in activity.
The Commerce Department reported Tuesday that construction of new homes and apartments jumped 22.2 percent from January to a seasonally adjusted annual rate of 583,000 units. Economists were expecting construction to drop to a pace of around 450,000 units.
February's pickup was led by a big increase in apartment construction.
By region, all parts of the country reported an increase in overall housing construction, except for the West, which led the housing boom and has been hard hit by the bust.
Some economists said the new housing figures offered a glimmer of hope.
"While it may be premature to call an absolute bottom in residential construction, we are clearly getting close," said Adam York, economist at Wachovia.
Overall housing construction activity fell to a pace of 477,000 units in January, according to revised figures. That was a little higher than first reported but still marked a record low.
Applications for building permits, considered a reliable sign of future activity, also rose in February by 3 percent to an annual rate of 547,000. Economists were expecting permits to fall to a pace of 500,000 units.
Even with February's rare burst of activity, housing construction is down a whopping 47.3 percent from a year ago.
"This is a temporary rebound, not a recovery," said Ian Shepherdson, chief U.S. economist at High Frequency Economics.
The collapse of the once high-flying housing market has been devastating to the United States' economic health.
Its spreading fallout has contributed to big pullbacks by consumers and businesses alike, plunging the economy into a recession now in its second year.
The Obama administration has announced a $75 billion program to stem skyrocketing home foreclosures, which have dumped even more properties on an already crippled market.
More than 2 million American homeowners faced foreclosure proceedings last year, and that number could soar as high as 10 million in the coming years depending on the severity of the recession, according to a report last month by Credit Suisse.
Home mortgages are harder to come by because of the credit crisis and unemployment is at a quarter-century peak of 8.1 percent, factors that will make it difficult for the depressed housing market to snap back to full health.
Builders aren't optimistic that will happen any time soon.
The National Association of Home Builders' housing market index was flat in March at a reading of nine. That was one point above the all-time low reached in January. Readings lower than 50 indicate negative sentiment about the market. The index has been below 10 since November, reflecting the toughest market conditions in a generation.
Tighter lending standards for home mortgages, rising defaults and fear about the housing market's future have sidelined buyers, an absence felt acutely by homebuilders such as D.R. Horton Inc., Pulte Homes Inc. and Centex Corp.
Ap Economics Writer
Tue Mar 17
WASHINGTON – The number of new housing projects that builders broke ground on in February rose sharply, defying economists' forecasts for yet another drop in activity.
The Commerce Department reported Tuesday that construction of new homes and apartments jumped 22.2 percent from January to a seasonally adjusted annual rate of 583,000 units. Economists were expecting construction to drop to a pace of around 450,000 units.
February's pickup was led by a big increase in apartment construction.
By region, all parts of the country reported an increase in overall housing construction, except for the West, which led the housing boom and has been hard hit by the bust.
Some economists said the new housing figures offered a glimmer of hope.
"While it may be premature to call an absolute bottom in residential construction, we are clearly getting close," said Adam York, economist at Wachovia.
Overall housing construction activity fell to a pace of 477,000 units in January, according to revised figures. That was a little higher than first reported but still marked a record low.
Applications for building permits, considered a reliable sign of future activity, also rose in February by 3 percent to an annual rate of 547,000. Economists were expecting permits to fall to a pace of 500,000 units.
Even with February's rare burst of activity, housing construction is down a whopping 47.3 percent from a year ago.
"This is a temporary rebound, not a recovery," said Ian Shepherdson, chief U.S. economist at High Frequency Economics.
The collapse of the once high-flying housing market has been devastating to the United States' economic health.
Its spreading fallout has contributed to big pullbacks by consumers and businesses alike, plunging the economy into a recession now in its second year.
The Obama administration has announced a $75 billion program to stem skyrocketing home foreclosures, which have dumped even more properties on an already crippled market.
More than 2 million American homeowners faced foreclosure proceedings last year, and that number could soar as high as 10 million in the coming years depending on the severity of the recession, according to a report last month by Credit Suisse.
Home mortgages are harder to come by because of the credit crisis and unemployment is at a quarter-century peak of 8.1 percent, factors that will make it difficult for the depressed housing market to snap back to full health.
Builders aren't optimistic that will happen any time soon.
The National Association of Home Builders' housing market index was flat in March at a reading of nine. That was one point above the all-time low reached in January. Readings lower than 50 indicate negative sentiment about the market. The index has been below 10 since November, reflecting the toughest market conditions in a generation.
Tighter lending standards for home mortgages, rising defaults and fear about the housing market's future have sidelined buyers, an absence felt acutely by homebuilders such as D.R. Horton Inc., Pulte Homes Inc. and Centex Corp.
Saturday, February 21, 2009
Will the Housing Rescue Plan Work?
Daily Real Estate News February 20, 2009
Some big guns in the world of economics have doubts.
The plan seeks to stem foreclsoures by helping home owners who are still current on their mortgage but at risk of defaulting. (For more details: Read What's in the Foreclosure Plan)
"It's a positive step in the right direction," says economist Mark Zandi of Moody's Economy.com. "I think it will be much more successful than those that preceded it. I worry that it's not going to be successful fast enough."
Likewise, Dean Baker, a housing specialist with the Center for Economic and Policy Research, said: "I'm not impressed. There are some good things in there. I think giving servicers incentives is a good thing. But it's mostly money for banks, not money for home owners. … The banks still decide who gets into this, and that's been a problem all along."
Patrick Newport, an economist with IHS-Global Insight, is also skeptical. He pointed out that the number of people who are underwater on their mortgages has risen to 15 million, but the Obama initiative aims to help only 7 million to 9 million, "Obama's plan is an ambitious one, more ambitious than analysts had been led to expect," he says. "Whether it will stop the bloodletting, however, time will tell.”
Source: Los Angeles Times, Maura Reynolds (02/19/2009)
Some big guns in the world of economics have doubts.
The plan seeks to stem foreclsoures by helping home owners who are still current on their mortgage but at risk of defaulting. (For more details: Read What's in the Foreclosure Plan)
"It's a positive step in the right direction," says economist Mark Zandi of Moody's Economy.com. "I think it will be much more successful than those that preceded it. I worry that it's not going to be successful fast enough."
Likewise, Dean Baker, a housing specialist with the Center for Economic and Policy Research, said: "I'm not impressed. There are some good things in there. I think giving servicers incentives is a good thing. But it's mostly money for banks, not money for home owners. … The banks still decide who gets into this, and that's been a problem all along."
Patrick Newport, an economist with IHS-Global Insight, is also skeptical. He pointed out that the number of people who are underwater on their mortgages has risen to 15 million, but the Obama initiative aims to help only 7 million to 9 million, "Obama's plan is an ambitious one, more ambitious than analysts had been led to expect," he says. "Whether it will stop the bloodletting, however, time will tell.”
Source: Los Angeles Times, Maura Reynolds (02/19/2009)
Fannie and Freddie Plan Big Fee Increases
Daily Real Estate News February 18, 2009
Fannie Mae and Freddie Mac are both toughening their credit score and down-payment rules as of April 1. In response, major lenders are already factoring in the higher fees, which reduces the effectiveness of the stimulus efforts.
Under the new guidelines, buyers with down payments of less than 25 percent will be charged a three-quarter point add-on penalty, no matter how high their credit score. Buyers of duplexes, where one unit is owner-occupied and the other is rented, will be charged a 1 percent add-on.
Refinancers who take cash out will be charged as much as three points if they have a low to moderate equity stake.
Freddie spokesman Brad German says the loan categories and credit risk combinations targeted by these fees "default at four to eight times" the rate of other mortgages backed by Freddie. "We have to manage these risks appropriately," he says.
Source: Washington Writers Group, Kenneth R. Harney (02/15/2009)
Fannie Mae and Freddie Mac are both toughening their credit score and down-payment rules as of April 1. In response, major lenders are already factoring in the higher fees, which reduces the effectiveness of the stimulus efforts.
Under the new guidelines, buyers with down payments of less than 25 percent will be charged a three-quarter point add-on penalty, no matter how high their credit score. Buyers of duplexes, where one unit is owner-occupied and the other is rented, will be charged a 1 percent add-on.
Refinancers who take cash out will be charged as much as three points if they have a low to moderate equity stake.
Freddie spokesman Brad German says the loan categories and credit risk combinations targeted by these fees "default at four to eight times" the rate of other mortgages backed by Freddie. "We have to manage these risks appropriately," he says.
Source: Washington Writers Group, Kenneth R. Harney (02/15/2009)
Fannie and Freddie Plan Big Fee Increases
Daily Real Estate News February 18, 2009
Fannie Mae and Freddie Mac are both toughening their credit score and down-payment rules as of April 1. In response, major lenders are already factoring in the higher fees, which reduces the effectiveness of the stimulus efforts.
Under the new guidelines, buyers with down payments of less than 25 percent will be charged a three-quarter point add-on penalty, no matter how high their credit score. Buyers of duplexes, where one unit is owner-occupied and the other is rented, will be charged a 1 percent add-on.Refinancers who take cash out will be charged as much as three points if they have a low to moderate equity stake.
Freddie spokesman Brad German says the loan categories and credit risk combinations targeted by these fees "default at four to eight times" the rate of other mortgages backed by Freddie. "We have to manage these risks appropriately," he says.
Source: Washington Writers Group, Kenneth R. Harney (02/15/2009)
Fannie Mae and Freddie Mac are both toughening their credit score and down-payment rules as of April 1. In response, major lenders are already factoring in the higher fees, which reduces the effectiveness of the stimulus efforts.
Under the new guidelines, buyers with down payments of less than 25 percent will be charged a three-quarter point add-on penalty, no matter how high their credit score. Buyers of duplexes, where one unit is owner-occupied and the other is rented, will be charged a 1 percent add-on.Refinancers who take cash out will be charged as much as three points if they have a low to moderate equity stake.
Freddie spokesman Brad German says the loan categories and credit risk combinations targeted by these fees "default at four to eight times" the rate of other mortgages backed by Freddie. "We have to manage these risks appropriately," he says.
Source: Washington Writers Group, Kenneth R. Harney (02/15/2009)
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