This Month in Real Estate
February 2010
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Commentary
January began the new decade with indications that the economy is beginning to gain traction. Real GDP grew by 2.2 percent in the third quarter of 2009 and preliminary signals point to a continued positive trend for the following quarter. GDP is a measure of total products and services produced by a country and indicates the health of the country's economy.
A dip in home sales in December was due in large part to timing. First time buyers that would have liked to close in December but qualified for the tax credit bumped their timeline up in order to cash in. News of the credit’s extension reached many of them after their plans to close in December were set.
Interest rates are back below 5% and home prices are up compared to last year. The government continues to attempt to minimize the impact of troubled homeowners by continuing to improve its foreclosure prevention program and has also taken steps to help foreclosures buyers purchase faster.
Although the unemployment rate is expected to stay high as jobs increase modestly, experts expect the economy to continue to grow in 2010.
The Housing Market
Existing Home Sales
After a rising surge for three straight months, existing home sales slowed in December after first-time buyers rushed to meet the original November tax credit deadline and evidenced by first timers accounting for 51% of sales in November compared to 43% in December. “It’s significant that home sales remain above year-ago levels, but the market is going through a period of swings driven by the tax credit,” said Lawrence Yun, NAR chief economist. December sales of 5.45 million remain 15 percent above the 4.74 million-unit level last year.
Median Home Price
Existing-home price was $178,300 in December, 1.5 percent higher than December 2008 and 8.2 percent above its low in January 2009. It was the first year-over-year gain in median price since August 2007, attributable to an increase in the number of mid- to upper-priced homes in the sales.
Inventory
The supply of homes continued to shrink, falling 6.6 percent to 3.29 million, representing a 7.2-month supply at the current sales pace. Compared to a year ago, there are now 11 percent fewer homes on the market. This is the lowest level of competing homes on the market since March 2006.
Mortgage Rates
Mortgage rates have moved back to less than 5 percent, which have been categorized by industry experts like Freddie Mac chief economist Frank Nothaft as “near a record low.” This move that may help boost home loan demand and lend support to the housing market recovery. On January 28, the average 30-year fixed-rate mortgage was 4.98 percent.
Affordability
Affordability remains at record levels, supported by the lowest mortgage rates in decades, low home prices, as well as the first-time buyer tax credit. So far this year, the home price-to-income ratio has fallen well below the historical average of 25 percent. The ratio now stands at 15 percent.
Sources: National Association of Realtors, Freddie Mac
Government Action
FHA Tightens Lending Requirements
The Federal Housing Administration (FHA) insured almost 30 percent of all purchase loans and 20 percent of refinances from September 2008 to September 2009, up from about only 2 percent of all loans three years earlier. The influx of loans combined with falling capital reserves, which cushion against rising defaults, has led the FHA to announce several measures to strengthen its economic vitality.
On January 20, the FHA announced it will do the following:
1. Raise Insurance Fees - In exchange for FHA backing, borrowers pay an up-front premium. Previously it was 1.75% of their loan. It’s now risen to 2.25%.
2. Cap Seller Contribution to Buyer’s Closing Costs - Sellers can contribute a maximum of 3%, down from 6%, of the sales price to the buyer’s closing costs. The higher cap created risk by incentivizing homes to sell at a substantially marked-up price to compensate for contribution. 3% is still a significant proportion to closing costs.
3. Require Higher Down Payments for Poor Credit - Beginning this summer, borrowers with a credit score below 580 will need to make a down payment of at least 10%. The FHA will still provide a viable alternative to the 1% of FHA borrowers who fall in this category, whereas most lenders’ credit score cutoff is 620.
The good news is the FHA, an integral player in the market, has stepped up to protect itself so it can continue helping first-time buyers, those with less cash for a down payment, and those with less-than-perfect credit obtain home loans. Additionally, these proactive measures aim to protect the agency from needing taxpayer funds from the government.
Source: The Wall Street Journal
FHA to Help New Foreclosures Sell Fast
FHA has announced it will lift the 90-day seasoning requirement for one year. The FHA ‘s 90-day “seasoning” provision requires that a home sold to an FHA buyer must be owned for at least 90 days by the seller before closing. This is intended to prevent buyers from purchasing property from “flippers” at an overly inflated value.
In the current climate, quickly selling foreclosures has risen in importance while the prominence of “flippers” has dramatically decreased. Acquiring, rehabbing, and reselling a foreclosure often takes fewer than 90 days. Banks have been reluctant to sell foreclosures to FHA buyers if they would need to push closing back to meet the FHA requirement.
There are additional stipulations; for more, please visit the press release.
Quickly moving foreclosures out of the bank’s hands and into those of home buyers is an important step in stabilizing home prices, neighborhoods, and communities leading toward a healthy housing market.
Source: U.S. Department of Housing and Urban Development
Topics For Home Sellers
Price it Right
Sellers who listed their home at the price originally recommended by their agent sold it:
•38 days faster
•For 2.25% higher
•With 1 less price reduction
Compared to sellers who did not take their agent's recommendation.
Staging Stats
Compared to homes that were not staged, staged homes had:
•more showings
•a higher list-to-sell percentage
Other notable stats found include:
•Only 1 in 3 sellers staged their home, even with all the commonly accepted advantages of staging.
•Staging typically took between 2 - 6 hours to complete.
•Including the cost of a staging professional and items purchased or rented, staging cost an average of $523.
Although it has advantages at all price points, staging was also found to be particularly important for homes priced over $600,000.
Source: Keller Williams Realty Research Study
Contact me, Heather Lawson, your local real estate expert, for information about what's going on in our area.
2ModAgents Team, Keller Williams Realty Signature
http://www.2modagents.biz/
Monday, February 8, 2010
Wednesday, February 3, 2010
February 2010 Housing Trends
FEBRUARY-2010 Housing Trends eNewsletter
Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.
The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.
Please click here to view the FEBRUARY-2010 Housing Trends eNewsletter.
If you are interested in determining the value of your home, click the Home Evaluator link for a free evaluation report.
Sunday, January 31, 2010
Friday, January 29, 2010
Help Jace Quimby go to Hawaii and have fun doing it
The decision to go to Hawaii was easy, but getting the $3,000 for the trip was another story.
Quimby has sent out letters to businesses in the DeKalb County area, asking for donations. Businesses will either donate money, or items that Quimby will raffle off at a fundraiser that will be held at 7 p.m. on Feb. 27 at the Farmers Inn in Kirkland. Shuvlhed has also made a donation to help send Jace to Hawaii and will be providing Music for Jace's Fundraiser. Check out Shuvlhed at http://www.shuvlhed.com/
Jace will be in Hawaii from June 29-July 5. He is planning on attending either the University of Wisconsin-Stevens Point, University of St. Francis, or College of DuPage next fall to play football.
Come out and support a great kid with a bright future!!
When: Feb 27th 7:00pm
Where: The Farmers Inn
521 West Main Street-Kirkland, IL 60146
To read the full story:
https://daily-chronicle.shawcms.com/articles/2009/12/25/70392148/
Wednesday, January 20, 2010
Real estate market activity near 308 Preserve Dr. Genoa Illinois
MARKET PRICING DETAILS
Total Most Recent Highest Lowest Average Median
Sold Homes 2 12/16/2009 $160,000 $62,000 $111,000 $111,000
For Sale 57 01/16/2010 $750,000 $59,900 $225,427 $184,990
RECENTLY SOLD HOMES
% of asking price received: 95%
Sales over asking price:0
Sales under asking price:2
Sales at asking price:0
TIME ON MARKET DETAILS
Avg Days On Market Total Most Recent Shortest Longest
Sold Homes 46 days 2 12/16/2009 10 days 81 days
For Sale 164 days 57 01/16/2010 5 days 558 days
RECENT ACTIVITY
Number of Sales:2
Number of New Listings:28
Avg # of Homes for Sale:54
MLS ID: 07312709
$167,000
81 days on market
808 S Oak Creek Drive Genoa, IL 60135
Sold Price: $160,000
Sold Date: Nov 19, 2009
MLS ID: 07393772
$65,000
10 days on market
203 N Hadsall Street Genoa, IL 60135
Sold Price: $62,000
Sold Date: Dec 16, 2009
Price/Sq. Feet: $44
For more real estate information or to view the listing for 308 Preserve Drive, please visit http://www.2modagents.biz/
Tuesday, January 19, 2010
Tuesday, January 12, 2010
Real estate market activity near 1804 Margaret Lane Dekalb, IL
Total Most Recent Highest Lowest Average Median
Sold Homes 25 12/16/2009 $293,000 $20,000 $138,258 $128,000
For Sale 152 01/12/2010 $719,000 $64,900 $203,205 $179,900
% of asking price received:95%
Sales over asking price:4
Sales under asking price:19
Sales at asking price:2
Avg Days On Market Total Most Recent Shortest Longest
Sold Homes 115 days 25 12/16/2009 6 days 871 days
For Sale 130 days 152 01/12/2010 1 days 1036 days
Number of Sales:25
Number of New Listings:94
Avg # of Homes for Sale:149
Recent Sales:
MLS ID: 07381627
$189,900
7 days on market
1912 Margaret Lane Dekalb, IL 60115
Sold Price: $184,000
Sold Date: Nov 22, 2009
Bedrooms: 4
Bathrooms: 2
MLS ID: 07089873
$134,900
338 days on market
207 River Drive Dekalb, IL 60115
Sold Price: $128,000
Sold Date: Nov 11, 2009
Bedrooms: 3
Bathrooms: 1
MLS ID: 07300461
$179,900
86 days on market
1616 Pickwick LaneDekalb, IL 60115
Sold Price: $164,000
Sold Date: Nov 9, 2009
Price/Sq. Feet: $98
Bedrooms: 3
Bathrooms: 2
House Size: 1677
MLS ID: 07352545
$115,000
48 days on market
114 E Dresser Road Dekalb, IL 60115
Sold Price: $115,000
Sold Date: Nov 24, 2009
Bedrooms: 4
Bathrooms: 2
MLS ID: 07281925
$169,900
102 days on market
1453 Sunflower Drive Dekalb, IL 60115
Sold Price: $159,900
Sold Date: Nov 3, 2009
Bedrooms: 2
Bathrooms: 2
Please visit our website http://www.2modagents.biz/ for more real estate information.
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