New Bern NC

New Bern Home Inventory down

2011-12-02T07:22:00.000-08:00

The inventory of homes for sale in the New Bern area MLS is down substantially. Currently there are 1291 homes for sale. Throughout most of the year that number has been over 1500 homes. Percentage wise this is a decrease of 13%.

Although inventory typically decreases in December, this is more than we normally see. My take is folks are staying put with hopes of selling when the market improves. Whatever the reason, I hope that with less inventory, home prices will start to level off. If this happens we will all be better of in the long run.

Real Estate Update.

2011-11-29T17:15:00.000-08:00

Steve Tyson’s Real Estate Update

For selected subdivisions

Neuse Harbour

Active homes for sale by price range

Current number of homes on the market=13

Pending sales=1

Active homes for sale by price range

$182,000-$200,000=1

$209,000-$250,000=6

$254,900-$300,000=2

$$300,000-$1,225,000=4

There was 1 home that sold and closed in Neuse Harbour in the last 12 months. The sales price was $232,800

Stately Pines

Current homes on the market=6

Pending sales=1

Active homes for sale by price range

$164,000-$200,000=3

$202,000=1

$669,500=1

$769,000=1

There were 10 homes that sold and closed in Stately Pines in the last 12 months. The most expensive house sold was $214,250.

Carolina Pines

Current homes on the market=22

Pending sales=2

Active homes for sale by price range

$107,500-$150,000=5

$157,900-$200,000=2

$229,000=1

There were 18 homes that sold and closed in Carolina Pines in the last 12 months. The highest priced home sold was $265,000.

Tucker Creek

Current homes on the market=4

Pending sales=3

Active homes for sale by price range

$110,000-$150,000=1

$165,000-$200,000=3

$245,000-$289,000=2

There were 15 homes that sold and closed in Tucker Creek in the last 12 months. The highest priced home sold was $275,000.

Total homes sold January 1-Nov. 29 2009=1118

Total homes sold January 1-Nov. 29 2010=1108

During the same time frame in 2011=1107 homes have been sold.

There are currently 1312 homes listed for sale in our multiple listing service. This number is down from about 1550 In prior months. We are selling homes at a rate of about 100 a month so there is still a large inventory on hand. A buyers market is defined as more than 6 months of home inventory. It is definitely a buyer’s market as we currently have 13 months worth of inventory.

On the plus side, interest rates are still incredibly low, prices have become more reasonable, and we have a nice selection of homes to choose from.

Feel free to call or email me if you would like to have a customized absorption rate or a Comparable Market Analysis for your property. Home sales in each neighborhood can vary greatly.

Realtor Steve Tyson

The Tyson Group Realtors

2011-10-27T19:31:00.000-07:00

Steve Tyson’s Real Estate Update

Neuse Harbour

Active homes for sale by price range

Current number of homes on the market=5

Pending sales=1

Active homes for sale by price range

$279,000=1

$,334,000-$385,000=2

$ 775,000=1

$1,225,000=1

There was 1 home that sold and closed in Neuse Harbour in the last 12 months. The sales price was $232,000

Stately Pines

Current homes on the market=6

Pending sales=0

Active homes for sale by price range

$160,000-$200,000=2

$205,000-$210,900=2

$669,500=1

$769,000=1

There were 11 homes that sold and closed in Stately Pines in the last 12 months. The most expensive house sold was $214,25s0.

Carolina Pines

Current homes on the market=18

Pending sales=1

Active homes for sale by price range

$137,500-$$150,000=5

$157,000-$200,000=6

$215,000-250,000=6

$259,000=1

There were 18 homes that sold and closed in Carolina Pines in the last 12 months. The highest priced home sold was $265,000.

Tucker Creek

Current homes on the market=7

Pending sales=3

Active homes for sale by price range

$110,000-$150,000=2

$165,000-$200,000=3

$245,000-$289,000=2

There were 14 homes that sold and closed in Tucker Creek in the last 12 months. The highest priced home sold was $275,000.

Total homes sold January 1-Oct. 24 2009=982

Total homes sold January 1-Oct. 23 2010=1021

During the same time frame in 2011=981 homes have been sold.

There are currently 1387 homes listed for sale in our multiple listing service. This number is down from about 1550 In prior months. We are selling homes at a rate of about 104 a month so there is still a large inventory on hand. A buyers market is defined as more than 6 months of home inventory. It is definitely a buyer’s market as we currently have 13 months worth of inventory.

On the plus side, interest rates are still incredibly low. I have a customer that got a 3.75% rate in mid October. In the early 1980’s I remember rates went as high as 18% so it is a great time to buy and lock in a great rate.

Feel free to call or email me if you would like to have a customized absorption rate or a Comparable Market Analysis for your property. Home sales in each neighborhood can vary greatly.

I can be reached at SteveTyson@NCmove.com And remember you can always visit me online at www.NewBern-NC.Info

Realtor Steve Tyson

The Tyson Group Realtors

2011-10-18T04:59:00.001-07:00

U.S. house prices have plunged by nearly a third since 2006, and homeownership rates are falling at the fastest pace since the Great Depression.

The good news? Two key measures now suggest it's an excellent time to buy a house, either to live in for the long term or for investment income (but not for a quick flip). First, the nation's ratio of house prices to yearly rents is nearly restored to its prebubble average. Second, when mortgage rates are taken into consideration, houses are the most affordable they have been in decades.

Two of the silliest mantras during the real-estate bubble were that a house is the best investment you will ever make and that a renter "throws money down the drain." Whether buying is a better deal than renting isn't a stagnant fact but a changing condition that depends on the relationship between prices and rents, the cost of financing and other factors.

.But the math is turning in buyers' favor. Stock-oriented folks can think of a house's price/rent ratio as akin to a stock's price/earnings ratio, in that it compares the cost of an asset with the money the asset is capable of generating. For investors, a lower ratio suggests more income for the price. For prospective homeowners, a lower ratio makes owning more attractive than renting, all else equal.

Nationwide, the ratio of home prices to yearly rents is 11.3, down from 18.5 at the peak of the bubble, according to Moody's Analytics. The average from 1989 to 2003 was about 10, so valuations aren't quite back to normal.

But for most home buyers, mortgage rates are a key determinant of their total costs. Rates are so low now that houses in many markets look like bargains, even if price/rent ratios aren't hitting new lows. The 30-year mortgage rate rose to 4.12% this week from a record low of 3.94% last week, Freddie Mac said Thursday. (The rates assume 0.8% in prepaid interest, or "points.") The latest rate is still less than half the average since 1971.

Real Estate Tools at SmartMoney

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.As a result, house payments are more affordable than they have been in decades. The National Association of Realtors Housing Affordability Index hit 183.7 in August, near its record high in data going back to 1970. The index's historic average is roughly 120. A reading of 100 would mean that a median-income family with a 20% down payment can afford a mortgage on a median-price home. So today's buyers can afford handsome houses—but prudent ones might opt for moderate houses with skimpy payments.

For example, the median home in the greater Phoenix market, including houses, condos and co-ops, costs $121,700, according to Zillow.com. With a 20% down payment and a 4.12% mortgage rate, a buyer's monthly payment would be about $470. Rent for a comparable house would be more than $1,100 a month, according to data provided by Zillow.com.

Of course, all of this assumes mortgages are available—no given now that lending standards have tightened. But long-term data on down payments and credit scores suggest conditions are more normal than many buyers think, according to Stan Humphries, chief economist at Zillow. "If you have good credit, a job and a down payment, you can get a mortgage," Mr. Humphries says. "There's more paperwork and scrutiny than five years ago, but things are pretty much like they were in the '80s and '90s."

Not all housing markets are bargains. Mr. Humphries says Zillow has developed a new price/rent ratio that uses estimates for each individual property rather than city medians, to better reflect the choices facing typical buyers. A fresh look at the numbers suggests Detroit and Miami are plenty cheap for buyers, with price/rent ratios of 5.6 and 7.7, respectively. New York and San Francisco are more expensive, with ratios of 17.6 and 17.2, respectively. The median ratio for 169 markets is 10.7.

For investors seeking income, one back-of-the-envelope way of seeing how these numbers stack up against yields for other assets is to divide 1 by the price/rent ratio, resulting in a rent "yield." The median market's rent yield is 9.3% and Detroit's is 17.9%.

Investors would then subtract for taxes, insurance, upkeep and other expenses—costs that vary widely. But suppose total costs were 4% of the purchase price. That would still leave a 5.3% rent yield in the typical market. With the 10-year Treasury yield at 2.2% and the Standard & Poor's 500-stock index carrying a dividend yield of 2.1%, rents for residential housing in many markets look attractive.

A few caveats are in order. First, not all transactions are average ones. Even in low-priced markets, buyers should shop carefully. Second, prices could fall further. Celia Chen, a senior director at Moody's Analytics, expects prices to drop 3% before bottoming early next year and rising slowly thereafter. "If the economy slips back into recession, however, we could easily see a 10% drop," Ms. Chen says.

Tips to help your home appraisal

2011-10-16T06:51:00.000-07:00

. October 11, 2011, 6:06 PM ET.Ten Tips for High Value Home Appraisals.Article Comments (12) Developments HOME PAGE ».EmailPrintTwitter

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close StumbleUponMySpacedel.icio.usRedditLinkedInFarkViadeoOrkut Text By S. Mitra Kalita

Reuters

Appraisal forms might not always capture a home’s true value, but there are ways to avoid disappointment.The appraiser was due in an hour. The beds were unmade, breakfast dishes in the sink and toys scattered about the playroom. Would she care?

I got moving—and cleaning. At 34 weeks pregnant, that’s not so easy.

After all, I know lowball appraisals can kill deals, something I’ve written about for The Journal.

They can also kill a refinancing application, which we are in the midst of for our 1920s Georgian-style house in Queens. If it comes in too low, it’s not worth refinancing or you might need to put in a whole lot more equity.

We don’t know how ours turned out yet but after talking to a handful of appraisers, I felt great regret at not doing more to plan and prep. Here are some tips based on those conversations.

Caution: Some of the advice—like home valuations themselves these days—might feel contradictory. But what they all agree on is to keep the look, feel and condition of the property as updated and cared for as possible.

1.Spruce the house up. But appraisers caution that you don’t need to deep clean under couches and that a few dirty dishes won’t hurt your value. Rats, cockroaches and that car you’ve been tinkering on might… “Things like overgrown landscaping, soiled carpeting, marks on walls — those do affect value and are part of the property’s overall condition rating,” said Dean Zibas, the president and chief appraiser for Zibas Appraisal in San Clemente, Calif. In other words, think broom clean, not set design for a home-decorating magazine.

2.Curb appeal also matters so mow the lawn, hack those weeds and trim those hedges. This can also help offset your house from unfair comparisons with foreclosures nearby. “In today’s climate I can’t stress enough condition, condition, condition,” said Doreen Zimmerman, an appraiser in Paradise, Calif. “An hour or two, for the most part, will set your home apart in the actual picture that the lender gets from the appraiser vs. the actual picture that the appraiser will provide of the (foreclosure) down the street.

3.Keep a list of all the updates you’ve made and be ready to hand it over; a sketch plan of the house indicating square footage also helps. “Have a list of updating done within the past 15 years. Itemize each update with the approximate date and approximate cost. Also highlight the notable features of the property,” says Matthew George, the chief appraiser of Eagle Appraisals Inc. in Denver, Colo. Remember the items that an appraiser might not notice, like a new roof or insulation. Don’t forget the minor items. For example, I mistakenly told the appraiser we hadn’t updated one bathroom but actually we had installed a new sink and had the tub sealed. That counts, according to the experts.

4.Have comps on hand. Yes, you say this is the appraiser’s job but every little bit helps, “especially if they are aware of a property that sold without the aid of a Realtor (i.e. for-sale-by-owner),” says Mark T. Smith, the owner and president of Smith Appraisal Services in St. Augustine, Fla. That can mean it wasn’t posted on the Multiple Listing Service, and result in other delays by the time it gets posted through other government data sources.

5.Be mindful of peeling paint. Government-insured loans such as FHA and veterans’ loans will require peeling paint to be removed in houses built before 1978. But don’t worry too much about a child’s scrawling on his bedroom wall, unless it’s going to require a whole new paint job.

6.Focus. “Don’t spend money that won’t yield a return on the investment. The best expenditures for most markets are paint, carpet, light and plumbing fixtures,” says Denver’s Mr. George. Prioritize what you do; if you’re the type of homeowner who has upgraded and fixed items as they broke, you should be fine.

7.Location still matters. If there have been changes to the neighborhood, mention them, from a new playground to a new Whole Foods. If the area’s just been declared a historic or landmark district, let the appraiser know.

8.Keep the $500 rule in mind. Appraisers often value houses in $500 increments so if there’s a repair over $500 that can or should be made, it will count against the property. Fix leaky faucets, cracked windows, missing hand rails and structural damage.

9.Also remember the concept of “effective age,” the age the appraiser can assign to a home after taking into consideration updating and condition. “Say you have a cracked window, thread-bare carpet, some tiles falling off the shower surround, vinyl torn in the laundry room, and the dog ate the corner of the fireplace hearth, these items could still add up to an overall average condition rating as the home is still habitable, however your effective age will be higher resulting in comparables being utilized which will have the same effective age and resulting lower value,” says Ms. Zimmerman, who wrote the book “Challenge Your Home Appraisal” and runs a web site by the same name.

10.Lock up Fido and Fifi. Appraisers say they get annoyed enough by homeowners following them around but a snarling, growling dog is even worse. Along the same lines, try to make the appraiser comfortable — if it’s cold out, put the heat on; hot out, the air conditioning. “If it’s 100 degrees out and you never put the air conditioning on, put it on for the appraiser so they don’t question that your unit is broken,” says Ms. Zimmerman.

With those things in mind, let the appraiser do his or her job. “Questions and banter may make the inspection go slow or make the appraise miss something,” said James R. Gerot, a residential appraiser in Ottumwa, Iowa. “My inspections have a rhythm to them so once I get started interruptions are just that. Save questions until after.”

Appraisal, Doreen Zimmerman, Eagle Appraisals Inc., James R. Gerot, Smith Appraisal Services

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9:37 am October 16, 2011

Dave wrote:

.I feel sorry for Zach, and believe he could benefit from a matchbook course in real estate appraising, as a start. Competent Appraisers are trained to be eyes and ears of the real estate market, listening, seeing, reading, viewing, accepting data from everyone, compiling information about the subject market that relates to the subject, and rejecting all that is not relevant.

Doing proper homework on comps, verifying their “arm’s length” transaction, is not a difficult task, just time consuming. The independence of appraisers arises out of how they treat all the data they receive, investigate, uncover, and analyze. Zach’s tub and sink issue is a micro analysis of a lengthy article with very apparent bias.

I began appraising in New England in 1984. I would have a wonderful time in court testifying in opposition to the comments by Zach. That HVCC is in force or terminated is not the issue. It is the aptitude and unbiased position of each appraiser. The industry is rampant with those that have neither, and lending institutions that use the cost of an appraisal and their own bias to choose appraisers. We cannot legislate morality or ethics.

.

8:27 pm October 15, 2011

Jon Putnam wrote:

.Zach: I agree with your thoughts on this article, and on HVCC in general. One small thing. It is perfectly acceptable to present comps to an appraiser. The appraiser must decide if the comps (or any other information) is relevant to the assignment.

.

5:55 pm October 15, 2011

DeeDee Riley, Realtor, El Dorado Hills CA wrote:

.Great input!

.

1:25 am October 15, 2011

Zach wrote:

.Felipe – Las Vegas poses a big problem to Las Vegas now days The appraisers just report market conditions. This is like saying the weather man makes it 80 degrees and sunny.

.

1:23 am October 15, 2011

Zach wrote:

.HVCC is not a problem. All of the brokers and lenders that coerced appraisers into inflating values was a problem.

The HVCC does have undeniable unintended consequences and the system could be better. The slant from the broker/lender community is so transparent it’s not even funny…they’re only upset because they can’t push appraisers to grease the wheels on their transactions. Any major lender that tracks their appraisal data will tell you that there is a lot more objectivity in appraisal values than there is in borrower’s estimates. How many borrower’s “estimate of value” is loan balance divided by 0.8? They estimate their home to be worth what they need to get a deal done…any lender has the data to show this.

I don’t know why this author feels so compelled to write about something he is completely unqualified to speak about. This article is absolutely ridiculous.

Added a new sink and sealed the tub? Are you kidding? Sealed the tub??? Ask 10000 appraisers and every single one of them will tell you sealing a bathtub will never make its way on to an appraisal report. Why? Because the appraiser has the luxury of inspecting every nook and cranny in the subject property, but has basic info (age, beds, baths, square footage, amenities, lot size, etc) for the comparables. How is an appraiser to gauge the typical buyer’s reaction to having a bathtub resealed or address the value of a new sink? We’re talking about a couple hundred dollars in general maintenance on a home that could be worth 1000 times that. I’ve heard about every argument, but this one takes the cake as the most ridiculous of all time.

Can you imagine the outrage if an appraiser made a negative adjustment to one of the comparables because they just put in a new sink and sealed their tub? This is where the double-standard of salespeople and borrowers becomes transparent. They want the appraiser to make positive adjustments for these kind of things on their property, but would crucify an appraiser for docking their value because a comparable had these things.

All features of a property are adjusted for relative to the comps. If you just dumped $50k building a 3-car garage on your property but all of your comps also have a 3-car garage, do you know how much that $50k adjustment will equate to in adjustments on your appraisal? Exactly zero.

The author also makes the profound statement that “Location still matters”. Really? Was that ever in doubt? Mention the new playground in the neighborhood? Why? If the comps are from the same neighborhood wouldn’t they benefit the same amount from the new playground?

Have comps on hand? I suggest Mr. Kalita get familiar with the Appraisal Independence Requirements. Suggesting comps to an appraiser is either (a) going to get ignore or (b) cause them to decline the assignment. How is pushing “comps” on them not attempting to influence value? I suppose we’re all to believe that the borrower will have access to local MLS, verify terms of these transactions, and verify with independent third parties? And, of course, the borrower is performing said search of MLS based on an objective analysis of market data and an unbiased view of their home’s physical characteristics? They would never search $300k-$350k and see what pops up and looks “similar”? If banks and investors want borrower-supplied comps, why not just let the borrower send to the underwriter?

The author continues to expose himself as the amateur that he is. Perpetuating these fallacies does more damage to the marketplace than the HVCC ever will. As a leading financial publication, I am shocked and disappointed that the WSJ continues to print these stories. And I say “stories” intentionally.

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New Homes sales-Bad News

2011-10-09T08:08:00.000-07:00

Although existing real estate sales in our MLS have been down this year new home construction has been hammered. I think it is a result of banks not lending for speculative building and buyers finding homes that are almost new for much less than builders can build new homes for. Unfortunately this trend might last for some time. Consider the data below. The data below represents homes sales in each year, Jan.1-Oct.9

2006-586
2007-477
2008-303
2009-256
2010-254-
2011-190

In my next post I talk about what builders can do to get a competitive edge.

Mortgage News

2011-09-28T05:12:00.001-07:00

DOW JONES NEWSWIRES

The number of mortgage applications filed in the U.S. last week rose 9.3% from the prior week, the Mortgage Bankers Association said Wednesday, as interest rates continued to slide following the Federal Reserve's latest stimulus measure.

Refinance activity climbed 11%, according to the MBA's weekly survey, which covers more than three-quarters of all U.S. retail residential mortgage applications. Purchasing grew by a seasonally adjusted 2.6% during the week ended Friday.

Borrowers have reacted cautiously to extremely low interest rates over the past few months, while tighter lending requirements continue to pressure new applications. But mortgage activity picked up last week after the Fed's latest move, dubbed Operation Twist, helped push rates even lower. The move was designed to help lower long-term interest rates by buying up more mortgage-backed securities.

The share of applications filed to refinance an existing mortgage rose to 79.7% of total applications from 78.3% the previous week. It was the highest share since the survey changed its benchmark in January.

The four-week moving average for all mortgage applications is up 1.96%.

Adjustable-rate mortgages made up 6.1% of activity last week, down from 6.7% a week earlier.

The average rate on 30-year fixed-rate mortgages with conforming loan balances edged down to 4.25% from 4.29%, while rates on similar mortgages with jumbo loan balances decreased to 4.51% from 4.55%. The average rate on FHA-backed 30-year fixed-rate mortgages slipped to 4.05% from 4.07%.

Meanwhile, the average for 15-year fixed-rate mortgages ticked up to 3.47% from 3.46%. The 5/1 ARM average decreased to 2.95% from 2.96%.

-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; Andrew.FitzGerald@dowjones.com

Bright Spots in Real Estate.

2011-09-14T09:32:00.001-07:00

LOWESREALTORBENEFITS.COM LOWES MOVING LOWES.COM INMAN.COM

DAILY REAL ESTATE NEWS

September 14, 2011

5 bright spots in real estate recession

Mood of the Market

By Tara-Nicholle Nelson

Inman News™

Share ThisThe real estate market meltdown was much more severe and has lasted much longer than even the most bearish housing market observer would ever have predicted. Rather than values taking a dip, they've taken a double dip in many places; and the housing sector drama has infected the job market and the entire world's economy.

Yet, there are some very shiny silver linings to this whole mess -- a handful of ways in which our mindsets, habits, behaviors and approaches to money, mortgage and even life decision-making -- have been changed by this real estate market debacle. As I see it, here are the five best things about this otherwise terrible housing recession:

People now buy for the long term. Even Jeff Lewis, that reality TV house flipper extraordinaire, has declared that he's tapped out of the flipping business for the foreseeable future, trading in his real estate wheeling and dealing for the design business.

Recently, he mentioned having lost six homes in the real estate market crash. While Lewis flipped homes as his business, just five years ago, many Americans -- homeowners and investors alike -- took a short-term view on their homes, buying them with the idea that they could count on refinancing, pulling cash out or even reselling them anytime they wanted, at a profit.

Reality check -- those days are gone. Now, buyers know they'd better be prepared to stay put for somewhere between seven and 10 years (shorter in strong local markets, longer in foreclosure hot spots) before they buy if they want to break even. And this is causing them to take mortgages they can afford over time, and make smarter, longer-term choices about the homes they buy.

Dysfunctional properties are being weeded out and creatively reused. Municipalities like Detroit and Cleveland are demolishing blighted and decrepit properties in dead neighborhoods en masse, intentionally shrinking their cities to match their shrinking populations. These efforts are also eliminating breeding grounds for crime, and focusing resources on the neighborhoods that have a better chance of surviving and thriving in the long term.

In the so-called "slumburbias" of central California, Nevada and Arizona, McMansions are being repurposed into affordable housing for groups of seniors, artist communities and group homes.

American housing stock is getting an energy-efficient upgrade. The news would have you believe that every American has lost his or her home, walked away from it, or is now renting by choice. In fact, the vast majority of homeowners have simply decided to stay put.

Instead of selling and moving on up, homeowners are improving the homes they now plan to stay in for a long(er) haul. And this generation of remodeling is focused less on granite and stainless steel, and more on lowering the costs of "operating" the home and taking advantage of tax credits for installing energy-efficient doors, windows, water heaters and more. And while the first-time homebuyer tax credit is a thing of the past, the homeowner tax credits for energy-optimizing upgrades are in effect until the end of this year.

People are making more responsible mortgage decisions, and building financial good habits in the process. Buyers are buying far below the maximum purchase prices for which they are approved. They are reading their loan disclosures and documents before they sign them. And, thanks to the stingy mortgage market, they are spending months, even years, in the planning and preparation phases before they buy: paying down their debt; saving up for a down payment (and a cash cushion, so that a job loss wouldn't be disastrous); being responsible and sparing in their use of credit to optimize their FICO scores; and creating strong financial habits in one fell swoop.

Our feelings about debt and equity have been reformed. Americans no longer use their homes like ATM machines, to pull out cash, pay off their credit cards and then start the whole overspending cycle over again. Many can't, because their homes are upside down and cannot be refinanced in any event -- much less to pull cash out.

Others have been reality-checked by the recession, and are dealing with their non-mortgage debt the old fashioned way: by ceasing the pattern of spending more than they make, and applying the self-discipline it takes to pay their bills off.

Home equity, in general, is no longer viewed as an inexhaustible source of cash. Rather, we see it as a fluctuating asset to be protected and increased -- not so much through the vagaries of the market, but through the hard work of paying the principal balance down. Many of those refinancing into today's lower rates aren't doing it to pull cash out, as was the norm at the top of the market; instead, they are refinancing into 15-year loans to pay their homes off sooner than planned, or reducing their required payment so their extra savings can be applied to principal.

Of course, it remains to be seen how lasting these changes will be if and when home prices go up and mortgage guidelines loosen up. But since neither of these things look likely to happen in the short term, hopefully there's a chance that these behavior shifts will become part of a permanent mindset reset for American housing consumers.

Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.

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Copyright 2011 Tara-Nicholle Nelson

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Time to buy a home?

2011-09-13T05:06:00.000-07:00

I started my career in home construction and real estate in 1978. Home sales were brisk until the early 1980's when mortgage interest went up to as high as 18%. Talk about a challenge, try convincing someone that 18% was a good rate to pay for a home loan. Hign interest rates, high unemployment, and high inflation eventually bought the real estate market to a grinding halt.

Consider mortgage rates today, 9-13-11. You can get a 15 year mortgage for 3.33% if you have good credit. In North Carolina you can get a new 2000 square foot home for 200,000. If you borrowed $180,000 for 15 years at 3.33%, your payments, principle and interest, would be around $1271.81. You could rent a home for a comparable amount so which way should you go?

In my opinion, if you are going to be in a home only 2 or 3 years you might want to rent. Any longer buying might be the better option as we all know long term real estate will go up. It might be a few more years before the sub prime meltdown plays out but it will eventually work out and home prices will start to rise again.

Stupid Low interest rates

2011-09-12T19:15:00.000-07:00

As someone that has been in the Real Estate business for over 30 years never thought I would see these interest rates.

Freddie Mac's Primary Mortgage Market Survey®

Avg. Fees & Points

Copyright 2011, Freddie Mac. Averages are for conforming mortgages with 20% down.

30YR FRM 4.12 0.7

15YR FRM 3.33 0.6

5YR ARM 2.96 0.6

1YR ARM 2.84 0.6

Interesting read on housing

2011-07-30T03:44:00.000-07:00

RISMEDIA, July 29, 2011—(MCT)—Home prices in major U.S. cities increased in May for the second consecutive month, according to a closely watched index, although experts dismissed the uptick as seasonal while separate reports provided fresh evidence of a weak housing market.

The Standard & Poor’s/Case-Shiller index of home prices in 20 metropolitan areas rose 1 percent from April to May when left unadjusted for seasonal variations.

Prices often rise in spring because of changes in the types of homes selling: Foreclosures make up a higher proportion of sales during the winter as families take a break from home shopping and cash-rich investors dominate the market. Higher sales volumes also push up prices.

But compared with May 2010, home prices slid 4.5 percent, according to the index released Tuesday.

“Year-over-year, prices continue to deteriorate, although there has been a seasonal uptick over recent months,” says Stuart Gabriel, director of the Ziman Center for Real Estate at the University of California-Los Angeles. “This reflects a market that continues to be in search of a bottom.”

Chris G. Christopher Jr., an economist with consulting firm IHS Global Insight, said in a research note that the seasonal kick in prices will probably fade by October.

“Things do not look very favorable on the housing front since the employment situation has taken a turn for the worse in May and June,” he wrote. “The unemployment rate now stands at 9.2 percent, and consumer confidence is at depressed levels. Going forward, the Case-Shiller indexes are likely to post increases during the home-buying season, and then turn down again.”

The housing market began a renewed decline last year after the expiration of federal tax credits and has been limping along ever since. In March, home prices fell below their recession-era low, hit in April 2009, confirming a much-expected double-dip. Values have ticked up slightly since then.

One factor keeping housing weak is the high number of homes in foreclosure or headed into the foreclosure process. Then there’s the stalled jobs market, weak consumer confidence in the economy’s direction and the significant number of people saddled with mortgage debt that exceeds the value of their homes.

A separate report released Tuesday by Santa Ana, Calif., research firm CoreLogic indicated that the nation’s housing market is hampering the broader U.S. economic recovery. The report said that while several temporary factors have contributed to a slowing recovery, including high gas prices, U.S. floods and fading stimulus programs, “fundamentally, the recent slower economic growth illustrates that as the housing market goes, so does the economy.”

Housing influences the economy directly through residential construction, which typically gives a recovery a key boost. But with stiff competition from foreclosures, sales of new homes have been very weak for more than a year.

(c) 2011, Los Angeles Times.

Foreclosures

2011-06-16T05:29:00.001-07:00

Foreclosure filings in the U.S. tumbled last month to the lowest in almost four years as banks weighed down by an increasing inventory of seized homes delayed processing defaults, according to RealtyTrac Inc.

A total of 214,927 properties received default, auction or repossession notices in May, the fewest since November 2007, the Irvine, California-based data company said today in a statement. Filings dropped 33 percent from a year earlier and 2 percent from April. One in 605 households got a notice.

Foreclosure filings have fallen for eight straight months on a year-over-year basis as banks rework their documentation procedures following claims they improperly repossessed homes. Weak demand from buyers is making it difficult for lenders to sell the properties that they already have on their books, known as real estate owned, or REOs, according to RealtyTrac.

“Foreclosure processing delays continue to mask the true face of the foreclosure situation,” James J. Saccacio, RealtyTrac’s chief executive officer, said in the statement. “Even at a significantly lower level than a year ago, the new supply of REOs exceeds the amount being sold each month.”

Unemployment and falling home values are limiting property sales and have pushed about 28 percent of mortgage holders underwater on their loans, meaning they owe more than the home is worth, according to Zillow Inc. The U.S. jobless rate rose to 9.1 percent in May from 9 percent the previous month, the Labor Department reported June 3.

Eight-Year Low

Home prices slid 3.6 percent in the first quarter to the lowest level since 2003 in the S&P/Case-Shiller index of values in 20 U.S. cities. Confidence among builders in June was at the weakest in nine months, as executives expressed pessimism about the prospect of higher sales, the National Association of Home Builders/Wells Fargo sentiment index showed yesterday.

The inventory of distressed homes nationwide stands at 1.8 million, which would take about three years to sell at the current pace, Daren Blomquist, RealtyTrac’s communications manager, said in a telephone interview.

Default notices were filed on 58,797 U.S. properties last month, the lowest in more than four years and a 39 percent decline from a year earlier, according to RealtyTrac.

Auctions were scheduled for 89,251 properties, down 33 percent from May 2010. Lenders seized 66,879 homes, a 29 percent decrease from a year earlier.

States where courts oversee foreclosures showed a 45 percent decrease in filings from a year earlier, while non- judicial states had a 25 percent decline and accounted for almost two-thirds of the national total, RealtyTrac said.

Nevada, Arizona

Nevada had the highest rate of foreclosure filings per household for the 53rd straight month, with one in 103 getting a notice. Arizona had the second-highest rate at one in 210 and California was third at one in 259. Michigan, Utah, Georgia, Idaho, Florida, Illinois and Colorado also ranked in top 10.

Five states accounted for more than half of the U.S. filing total, led by California’s 51,906. Florida was second at 19,192 and Michigan third at 14,614. Arizona, Nevada, Illinois, Georgia, Texas, Ohio and Wisconsin rounded out the top 10.

RealtyTrac sells default data from more than 2,200 counties representing 90 percent of the U.S. population.

To contact the reporter on this story: Dan Levy in San Francisco at dlevy13@bloomberg.net

Real Estate Reports

2011-06-15T09:33:00.000-07:00

Timely, local real estate data trumps national reports

Perspective: A call for more useful real estate statistics

By David Charron, Tuesday, June 14, 2011.

Inman News™

Broad housing market reports are a dime a dozen these days, and if you ask me, that's a good approximation of their worth. Markets are sliced and diced and compared across the board, drawing multiple -- and often conflicting -- conclusions with shaky, obsolete data. The market's up, or maybe it's down. It's good, it's bad, and it's confusing.

For most people, even with access to all this information the results are more inconsistent than ever, often dated and out of context. But they don't have to be.

Timely and accurate information, provided on a local level with a real-world perspective, is the real estate market's most important commodity -- and the ability of the public, government, financial institutions, investors and real estate professionals to make informed decisions on local housing markets is the cornerstone of an eventual housing recovery.

Isn't it time we stop trying to drive by, looking in the rear-view mirror, and insist on seeing just the facts, clearly, as they unfold?

Article continues below

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Considering the critical role that real estate statistics play in just about every housing-related decision, it is time for our industry to rally around better data. We owe it to ourselves, our clients and our profession to insist on timeliness and clarity while delving into the motivations and methodologies of every metric we disseminate.

The most recent Case-Shiller Home Price Index of May 31 is a perfect example: It noted, of all the U.S. markets it tracks, the Washington, D.C., metro area as the only market to experience an increase in housing prices for the first quarter of 2011.

While this index may be useful for Wall Street, it hardly constitutes breaking news. Improving market conditions were reported three weeks earlier in an index produced by an MRIS subsidiary.

Metric discrepancies are about more than selling products or securing a reputation in the marketplace -- they go to the heart of how we think about information. The one real estate mantra that has remained unequivocally true through some of the most tumultuous years in the history of our profession is that all real estate is local.

By focusing on broad market-to-market comparisons instead of individual markets, we undercut our value as real estate professionals. Instead of chasing fleeting affirmations that change day in and day out, we should ensure that real estate professionals know how to read and apply local data.

Let's focus more on whether single-family homes or condos are more prevalent in a single area, the variance of seasonal market shifts, or the changes in sales activity that often precede major trends.

Let's talk about the facts as they stand today and refrain from basing decisions on reports that are already five to seven months behind the market when they hit newsstands.

We're never going to move forward as a profession by basing decisions on old data, and we'll never overcome paralysis if we compare our local markets to every other market in the country without considering the context of local driving forces.

Most people won't buy stocks today based solely on six-month-old research, nor will they decide what to wear today based on the average temperature in New York. Why don't the same principles apply to real estate?

David Charron is president and CEO of MRIS, the largest multiple listing service in the nation. MRIS facilitates more than $100 million a day in real estate transactions in the mid-Atlantic region.

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Submitted by Leon d'Ancona, B.T.L., M.T.L. on June 14, 2011 - 1:29pm.

Mr. Charron is very correct. Case-Shiller is a rather narrow index based on the principal variable used for index calculation of the price change between two arms-length sales of the same single-family home. For each sales transaction, a search is conducted to acquire information on any previous sale of the same property. If an earlier transaction is found, the two are paired and considered a “repeat sales transaction”.

In the last 25 years I have found its results very rarely reflect true small city or neighborhood values.

To dispel some of the negativity of this benchmark have a look at www.happyrenews.com a free service we provide to negate the poor press of real estate values.

Leon d'Ancona, B.T.L.,M.T.L.

President/CEO IMS Incorporated

WWW.Realestatestatistics.com

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Submitted by Keith Byrd on June 14, 2011 - 1:53pm.

Consumers want facts. Our industry's image has taken a hit from all the "now is a good time to buy" comments from agents that don't have a clue what's going on in their local market. Guess it's the difference between being a Sales person that will say anything to sell a home vs. providing a Service.

In my area, the local paper writes about the local real estate market using a single piece of data from a stats company. This value is county-wide and lumps all residential properties in one bucket and is missing any foreclosure info. In my county, foreclosure rates of sold properties in cities range from 0% to 60%.

I've been reporting statistics on my website for years but it was a tedious process to gather and report the info. I recently developed an interactive tool that displays detailed info about the local market for the last 11 years. There are over 20,000 graphs of info that I now make available to consumers in an easy-to-use presentation that's updated every month.

Check em' out here:

http://www.slocountyhomes.com/dashboard.html

Keith Byrd

SloCountyHomes.com

San Luis Obispo, CA

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Submitted by C.H. Naamad on June 14, 2011 - 2:32pm.

I agree with you a 100%!!!

C.H. Naamad

Boston Luxury Residential

Cell: 617-407-9740

Ch@blrboston.com

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Submitted by Travis Wright on June 14, 2011 - 2:54pm.

Well put, David. I have seen the impressive data reports coming out of ARMLS and I bet yours are awesome, too. Here's hoping your wisdom sinks in to all MLS'. T.

Travis In Texas

travis-wright@comcast.net

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Submitted by Albert Clark on June 15, 2011 - 3:10am.

Tagging on Tip O/Neils line, All Politics is Local we know "All RealEstate is Local" We provide a unique e-newsletter service to agents and see many agents adding their local market data that is fresh and usually zip code specific. I can attest that the local data is the most widely clicked on feature in the newsletters. Everyone wants to know what's going on in their marketplace. Long and Foster provides very attractive and useful Market Minute Reports. MRIS agents (David's area) is really Amp'ing up the availability of local stats with www.rbintel.com. We show agents how to use this data as they become advocates for their clients and prospects. Local stats, at the zip and neighborhood are a powerful marketing and retention tool

Albert Clark

Home Actions Relationship Platform

Scranton, PA

570 510 3507

aclark@homeactions.net

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From Steve Tyson-concerned citizen

2011-05-26T18:22:00.000-07:00

Bob and Carol Mattocks have put over $1 million of their own money into the Tryon Palace in the last few years. The letter below was written by Bob Mattocks and was sent to the County County Board of Commission today. To the many that believe the Tryon Palace is a irreplaceable part of New Bern and Craven County, I say if we go down lets go down fighting! Call the folks listed below and let them know the facts.

You may have heard by now that the North Carolina Senate Budget will both seriously compromise Tryon Palace’s operation beginning July 1, 2011 – as well as its very survival in 2012. In all, Tryon Palace’s appropriation will be cut over $1.5 million effective July 1, 2011 and nearly $3.7 million effective July 1, 2012.

Immediate action is needed if we are going have any chance of saving the Tryon Palace that we know and love.* This budget is expected to come up for a vote in the state senate as early as next week.

The budget cuts mean that for the new fiscal year beginnings a month from now, Tryon Palace will shut down most of the majority of its services to the public and close most of the recently opened North Carolina History Center. And, with the proposed 88.8% cut, all of Tryon Palace will close on or before July 1, 2012.

Tryon Palace does not have a source of funding to make up for these draconian cuts. We cannot raise ticket prices enough to recover 88.8% of our budget. Reducing public programs and services and closing exhibition buildings means our admission receipts and private contributions will decline at an alarming and unprecedented rate with the steep decrease in visitor attendance. Any suggestion that we can sustain higher ticket prices is tantamount to suggesting the dismantling of Tryon Palace – and it will mean the end of an investment in North Carolina that the administration of ten governors and hundreds of state legislators of both parties have supported and promoted since 1959.

This is a sad moment in the history of Tryon Palace and North Carolina. For more than 50 years, Tryon Palace has operated as a very successful public-private partnership between the citizens of North Carolina and their government. We are an important state asset in every meaning of the word. We are caretakers of 15 historic buildings and a collection of over approximately 7,000 priceless objects that belong to each and every North Carolinian. Private donors have contributed more than $136.5 million in private funds and earned income over 60 years. We are stewards of North Carolina values and the heritage they represent.

To the citizens of North Carolina, Tryon Palace represents the heart of our state’s cultural patrimony and the financial commitment made by their government to its preservation. To the 30,000 school children that pass through our doors each year, Tryon Palace is a beacon of engaging and stimulating history education – of a kind that is alarmingly missing from American classrooms today. To the more than 140,000 tourists and visitors from around the country and around the world who this year will come to learn about and explore our sites, we are ambassadors for North Carolina and for its greater role in our country’s legacy. To the many small business owners – the shopkeepers, hotel and restaurant owners in our greater community of Eastern North Carolina – the visitation generated by Tryon Palace represents a key part of a $41 million economic engine that enables them to remain in business and keep employing our fellow North Carolinians.

The proposed cuts to Tryon Palace are not targeting spending that is wasteful or expendable; they are unraveling the very fabric of North Carolina’s cultural and historic identity – and we will be paying both a moral and fiscal price for it. When we are forced to close the North Carolina History Center this June, we will not only be abandoning the cutting-edge exhibits and technology that are helping make the state of North Carolina a leader in 21st-century history education outside the classroom, we will be squandering an important investment of $42.7 million in state funds and a promise made to the citizens of our state to preserve their heritage and tell the stories of the deeds and courage of past North Carolinians. When we are forced to shut down Tryon Palace in 2012, we will be abandoning the challenge of passing on to a new generation our state’s history and, along with it, an understanding of the patriotic values that history represents. It is ironic and sad that our legislators seem to be turning against what they so adamantly profess to protect. There are indeed promises to keep and not all of them can be – or should be – measured by dollar signs.

You will find attached a short news release. Please watch your email for detailed talking points coming soon for your use in getting the word out.

*The Senate will vote on the budget next week so there is not much time left for response. I urge you to speak out against these cuts to our state’s heritage and our children’s patrimony. The State budget is on a fast track and it is imperative to contact your local senator and representatives and key House and Senate leadership as soon as possible to voice your position on this far-reaching budget reduction.

Key senators include:

Sen. Phil Berger (Guilford, Rockingham), President Pro Tempore, (919) 733-5708

Sen. Peter Brunstetter (Forsyth), Appropriations Co-Chair, (919) 733-7850

Sen. Neal Hunt (Wake), Appropriations Co-Chair, (919) 733-5850

Sen. Richard Stevens (Wake), Appropriations Co-Chair, (919) 733-5653

Sen. Tom Apodaca (Buncombe, Henderson, Polk), Appropriations Vice Chair, (919) 733-5745

Sen. Linda Garrou (Forsyth), Appropriations Vice Chair, (919) 733-5620

Sen. Don East (Alleghany, Stokes, Surry, Yadkin), NER Appropriations Co-Chair, (919 733-5743

Sen. David Rouzer (Johnston, Wayne), NER Appropriations Co-Chair, (919) 733-5748

Sen. Harry Brown (Jones, Onslow), Majority Leader, (919) 715-3034

Sen. Jean Preston (Craven), Caucus Liaison, (919) 733-5706

Key House members include:

Rep. Thom Tillis (Mecklenberg), Speaker, (919) 733-3451

Rep. Paul Stam (Wake), Majority Leader, (919) 733-2962

Rep. Dale Folwell (Forsyth), Speaker Pro Tempore, (919) 733-5787

Rep. Harold Brubaker (Randolph), Appropriations Chair, (919) 715-4946

Rep. Linda Johnson (Cabarrus), Appropriations Co-Chair, (919) 733-5861

Rep. Jeff Barnhart (Cabarrus), Appropriations Co-Chair, (919) 715-2009

Rep. Normal W. Sanderson (Craven), Craven County Local Representative, (919) 733-5853

Rep. William Wainwright (Craven), Deputy Minority Leader, (919) 733-5995

Every morning when the Palace gates swing open, the voices of generations of great leaders who built this state are heard again. Please, don’t let them be silenced.

Sincerely,

Bob Mattocks

Chairman

The Tryon Palace Commission

New Bern Home Sales

2011-05-15T11:02:00.000-07:00

The Tyson Group Realtors-Steve and Jana J. Tyson want to thank you for the opportunity to market your property for sale. As part of this process, we are keeping you up to date with the current market trends. The tables below represent the closed sales in this market in the last 30 days; sales since the beginning of the year; and current inventory levels.

You will note that since the beginning of the year 87% of the homes sold in this market are under 250K and in the last 30 days 91% of the sales were under 250K.

It is definitely a buyer’s market and quite competitive. And, if you have a home over 250K, it is far more competitive. Sales over 250K represent between 10-11% of the total sales and 33.6% of the inventory. Positioning your home to outperform competitive properties is crucial, no matter what price range of home. As an example, look at sales in the last 30 days and compare to the data in the second table which represents the total percentage of inventory by price range.

Homes Sold in the 400-500K range represented 2% of total sales and 5.6% of total inventory. For that price range it is especially important to outperform the competition in order to get your home sold. The best price range compared to inventory levels is the 150-200K range with only 19.6% of the inventory and 30% of the sales.

It is also important to look at absorption rates. Looking at the best performing price range of 150K-200k, you will note that 30 units sold in the last 30 days and there are currently 312 units on the market. This represents a 10.4 month supply of inventory. This is calculated by taking 312 units on the market for that price range ÷ 30 units sold in a month. Keep in mind this is an average supply. The better-positioned properties might sell in two months while others may take 2 years. So, even in the best performing price-range, it is important to be competitive.

We want your listing to be one of those that sells quickly. Price it better than your competitors, make any necessary repairs, paint it, clean it, declutter it and stage it and we will get it sold!

We hope you find this information to be useful and ask that you compare where you stand in the market. Please call with any questions,

Steve and Jana J. Tyson

252-675-9595

PRICE-RANGES 1588 TOTAL Homes On Market 5/15/11 % of Current Inventory

0-100K 196 12.3%

101-150K 335 21.0%

151-200K 312 19.6%

201-250K 207 13.0%

251-300K 161 10.0%

301-350K 75 4.7%

351-400K 85 5.3%

401-500K 89 5.6%

501-600k 57 3.5%

601-700K 28 1.8%

701K & Over 43 2.7%

Home Prices

2011-05-09T04:37:00.000-07:00

By NICK TIMIRAOS And DAWN WOTAPKA

Home values posted the largest decline in the first quarter since late 2008, prompting many economists to push back their estimates of when the housing market will hit a bottom.

.Home values fell 3% in the first quarter from the previous quarter and 1.1% in March from the previous month, pushed down by an abundance of foreclosed homes on the market, according to data to be released Monday by real-estate website Zillow.com. Prices have now fallen for 57 consecutive months, according to Zillow.

Last year, the housing market showed signs of improving as price depreciation slowed in some markets and stabilized in others. In response, a number of economists began forecasting that housing would hit a bottom in late 2011, then begin to recover. But the improvements, spurred by federal programs that gave buyers up to $8,000 in tax credits, proved fleeting. Sales collapsed when the credits expired last summer, and prices in many markets have been falling ever since.

While most economists expected sales to decline after tax credits expired, the drag on the market has been greater than many anticipated. "We expected December and January to be bad" as the market reeled from the after-effects of the tax credit, said Stan Humphries, Zillow's chief economist. But monthly declines for February and March were "really staggering," he said. They indicate "a reflection of the true underlying demand, which is now apparent because most of the tax credit is out of the system, and it's being completely overwhelmed by supply."

Mr. Humphries now believes prices won't hit bottom before next year and expects they will fall by another 7% to 9%. Other economists revised their forecasts. In April, the chief economist at mortgage company Fannie Mae, Doug Duncan, said home prices in the second quarter would be 5.3% lower than the previous-year period, down from his earlier estimate of a 2.6% decline.

Associated Press

An abundance of foreclosed homes on the market are pushing down home values.

.The estimates, which are based on data from the mid-1990s on, come from a proprietary computer program that takes into account sale prices for nearby homes that appear comparable, the size and other physical attributes of the home, its sales history and tax-assessment data, Mr. Humphries says.

Prices are decelerating in large part because the many foreclosed properties that often sell at a discount force other sellers to lower their prices. Mortgage companies Fannie Mae and Freddie Mac have sold more than 94,000 foreclosed homes during the first quarter, a new high that represented a 23% increase from the previous quarter. More could be on the way: They held another 218,000 properties at the end of March, a 33% increase from a year ago.

The companies are bracing for more bad news: On Friday, Fannie reported a $6.5 billion net loss, largely as it boosted loan-loss reserves in anticipation of falling home prices.

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.Paul Dales, a senior U.S. economist with Capital Economics, says prices could fall by as much as 10%, down from his previous forecasts of around 5%. A March survey of more than 100 economists by MacroMarkets LLC forecasts a 1.4% drop in prices this year, down from the December estimate of a 0.2% decline.

Other home-price indexes also show weakness. The widely followed Case-Shiller index published by Standard & Poor's showed that prices climbed from April 2009 until last summer, when they started declining as tax credits expired. Today, prices are on the verge of reaching new lows, the index shows. The Case-Shiller index tracks repeat sales of previously owned homes using a three-month moving average.

According to the Zillow index, a handful of California markets and Washington, D.C., saw price appreciation last year, but that has since reversed. Mr. Humphries attributes the "double dip" in those markets, which include Los Angeles, San Francisco and San Diego, to the way in which the tax credit stimulated demand from buyers. When the tax credit went away, markets were left with rising supply from foreclosures but with less demand from buyers.

Detroit, Chicago and Minneapolis posted the largest declines during the first quarter of the top 25 metro areas tracked by Zillow, while Pittsburgh, Dallas and Washington posted the smallest declines.

To be sure, steep declines in home prices along with mortgage rates near their lowest levels in decades have helped make housing more affordable than at any time in the past 30 years, according to Zillow. Markets that have lower levels of foreclosures, such as Dallas, and those with better job-growth prospects, such as Washington, are faring better.

However, credit standards remain tight, posing another challenge for the housing market. Just as many unqualified borrowers received loans during the boom, "there are people today who probably could afford loans but can't get them," says David Berson, chief economist at PMI Group Inc. The average credit score on loans backed by Fannie Mae stood at 762 in the first quarter, up from an average of 718 for the 2001-2004 period.

Joe Sullivan, a real-estate agent in Stockton, Calif., is worried that more traditional buyers are seeing their loan applications canceled late in the process as lenders change qualification terms. If mortgage standards continue tightening, prices are "going to drop down to where only investors can get them, people with cash money," he said. Sales to absentee buyers, primarily investors, accounted for 47% of all Phoenix-area home sales in March, the highest level for any month in more than a decade, according to DataQuick, a real-estate research firm.

Christine Rice spent two years looking to buy a home in Los Angeles but found herself continually losing out to bids from investors offering to pay in cash. In September, she finally made a winning bid, paying $275,000 for a two-bedroom home. The prospect of falling prices "doesn't keep me up at night, but only because it was so cheap," says the 43-year-old tailor, who says she and her husband needed to move to have more space for their family. Her mortgage payments plus taxes are less than the rent she had been paying. "If it had been a stretch, then maybe I'd be worried," she says.

Buyers who qualify for mortgages are demanding bigger discounts as added insurance against further declines in values. Sellers, meanwhile, are balking. "More often, they don't want to take the first offer," says Jeffrey Otteau, president of Otteau Valuation Group, an East Brunswick, N.J., appraisal firm. "What they don't realize is, in an oversupplied market, the next offer is for less."

While some analysts have argued that home prices need to fall to "clearing prices" that will attract more buyers, price declines could also complicate any recovery by pushing more borrowers under water. Zillow estimates that more than 28% of borrowers owe more than their homes are worth nationally. Those numbers are much higher in hard-hit markets such as Phoenix, where more than two-thirds of borrowers owe more than their homes are worth.

New Bern Home Sales 2011

2011-05-05T05:27:00.000-07:00

2011 Home Sales to date

Total Home Sales thru 4-30-2011=383
Of the 383 (78) were new construction
The average list price was $165,000
The average Sell price was $157,000

Nationally, according to trulia, 40% of home sales were bank owned or short sales. While we are seeing distressed sales in our market, I am guessing it is closer to 25-30%.

Last year through the same time period there were 356 homes sold. So to date we are up around 8%.

Zoning laws

2011-04-28T15:13:00.000-07:00

Frank Graham inherited a 600-acre wooded tract located about a half mile outside a small town in rural North Carolina. With the economy turning around he is considering moving forward with development of the tract. He has been thinking a residential subdivision and shopping center would fit nicely on this tract. He thinks a portion of the land might also be great for some industrial development or maybe even a mobile home park. Frank remembered seeing something in the papers about the county adopting zoning a few years ago. So before setting off on this project, he thinks it would be prudent to run his ideas by his cousin Eddie Graham, who is the long-term county manager for the county where this property is located.

Frank drops by Eddie’s office. After exchanging pleasantries and catching up about their mutual relatives, Frank briefly sketches out his thoughts about development of his tract. “Well,” Eddie says, “sounds like you have some good ideas. A good starting point even if a bit controversial. But I’m afraid I can’t be of much help. You need to go see the folks at town hall. City zoning applies out there.”

Frank is confused. “Eddie, I don’t follow all this government stuff the way you do, but I’m pretty sure this land is still out in the county. The town may be growing out that way, but I think I’d remember if it had been annexed. I’m pretty sure I don’t pay city taxes on that land. Are you sure about city zoning?”

“It’s outside the city,” Eddie explains, “but it has been subject to city planning and zoning a long time. They got ETJ at least a decade ago.” “

“And what, pray tell, is ETJ?” Frank asks.

“ETJ” is shorthand for extraterritorial jurisdiction. In this context, it is the authority of a city to apply its planning and development regulations to adjacent areas outside the city limits. Folks like Frank often want to know if this is legal and, if so, how it came to be.

For many years states have authorized municipal regulation of extraterritorial areas to protect public health and safety. For example in the early 1800′s Georgia allowed Savannah to prohibit rice farms within a mile of the city and Maryland allowed Baltimore to apply health regulations to ships within three miles of the city. Most other states followed suit. The North Carolina supreme court in 1912 upheld a law giving Greensboro authority to impose sanitary regulations in the area one mile beyond the city limits. State v. Rice, 158 N.C. 635, 74 S.E. 582 (1912). The legislature in 1917 gave all cities the authority to adopt similar health and safety regulations for areas within a mile of the city limits, an authority that is found today in G.S. 160A-193.

So how did the municipal authority in North Carolina to regulate nuisances in adjacent areas get extended to allow city planning, zoning, subdivision, and other regulations in extraterritorial areas?

As zoning and other land use regulations first came into widespread use in North Carolina, planning and development regulation were almost exclusively municipal concerns. Most cities of any size had adopted zoning by the late 1940s. By contrast, a handful of urban counties had gotten individual approval to adopt zoning, but most counties in the state had no authority to adopt zoning ordinances until 1959. As the post–World War II development boom took off, a good deal of the development occurred along the urban fringe, often in unregulated areas just outside of city corporate limits. The Institute of Government’s land use law expert, Phil Green, observed in 1953 that most of this fringe area development was taking place in “relatively chaotic fashion.”

To deal with this issue of unregulated development on the urban fringe, several cities sought authority to adopt “perimeter zoning.” Raleigh, Chapel Hill, Gastonia, and Tarboro were granted a one-mile ETJ for planning regulations in 1949. By 1958, nineteen municipalities had secured similar local legislation as extraterritorial zoning authority had been granted to Carrboro, Chapel Hill, Charlotte, Elizabeth City, Farmville, Gastonia, Goldsboro, Greensboro, High Point, Jacksonville, Kinston, Mooresville, Raleigh, Salisbury, Snow Hill, Spencer, Statesville, Tarboro, and Winston-Salem. At this point the legislature decided to look into whether this authority should be extended to all cities.

The Municipal Government Study Commission examined the issue in 1958 and came to this conclusion:

The Commission recognizes that municipalities have a special interest in the areas immediately adjacent to their limits. These areas, in the normal course of events, will at some time be annexed to the city, bringing with them any problems growing out of chaotic and disorganized development. Even prior to that time they affect the city. Health and safety problems arising outside the city do not always respect city limits as they spread . . . . Subdividers of land outside the city commonly wish to tie to city water and sewerage systems. New industrial and commercial development may, for a variety of reasons, take place just outside the corporate limits.

The study commission recommended that all cities with populations at least 2,500 be granted a one-mile area of extraterritorial jurisdiction and that cities with larger populations be granted up to five miles of extraterritorial jurisdiction, provided the county agreed. The commission noted the concern that residents of these areas were not entitled to vote in city elections and recommended mandatory representation of extraterritorial residents on city planning boards and boards of adjustment “to meet this objection in a practical and yet legal manner.” The legislature adopted the bulk of the study commission’s recommendations and granted statewide authority for municipal extraterritorial land use regulation in 1959. The statute on extraterritorial jurisdiction has undergone a number of amendments since its enactment. The current statutory scheme of tiered extraterritorial jurisdiction of one to three miles based on city population was adopted in 1971.

ETJ Boundary Sign

When a city adopts an extraterritorial boundary ordinance, the city acquires jurisdiction for all of its development ordinances and the county loses its jurisdiction for the same range of ordinances. This includes not only zoning and subdivision ordinances but also housing and building codes and regulations on historic districts and historic landmarks, open spaces, community development, erosion and sedimentation control, floodways, mountain ridges, and roadway corridors (though cities and counties can by mutual agreement modify this allocation). The city does not acquire, nor does the county lose, jurisdiction for regulations adopted under the general ordinance-making power of G.S. 160A-174, such as a nuisance lot, junked car, or noise ordinances. G.S. 160A-360 includes a detailed process that must be followed by a city in establishing extraterritorial jurisdiction, including newspaper notice, mailed notice, and public hearing requirements.

In certain instances, county approval must be given for a city to exercise its extraterritorial powers. G.S. 160A-360(a) requires county approval whenever a city with a population of more than 10,000 seeks to extend its extraterritorial jurisdiction beyond one mile. G.S. 160A-360(e) requires that county approval be secured for the extension of city extraterritorial jurisdiction into any area wherein the county is enforcing zoning, subdivision regulations, and the building code. This includes the one-mile area adjacent to cities.

A 2005 survey by the School of Government indicated that 62% of the responding North Carolina cities had adopted extraterritorial zoning. Cites with larger populations are far more likely to have done so than their less populous counterparts. The overwhelming majority (85%) of cities with ETJ only exercise this jurisdiction within one mile of the city limits.

A principal concern with granting municipalities extraterritorial power has been the lack of political representation for extraterritorial residents. The legal aspects of this concern were largely resolved when the U.S. Supreme Court concluded that federal constitutional guarantees of due process and equal protection are not violated when states grant municipalities extraterritorial jurisdiction without extending the right to vote in municipal elections to extraterritorial residents. Holt Civic Club v. City of Tuscaloosa, 439 U.S. 60, 70–75 (1978).

While most cities in the state have had authority to adopt extraterritorial development regulations for over a half-century, controversy remains. Several counties have established policies that limit their approval of new municipal ETJ to those areas that are planned to be annexed within a set time or where the city can show it has plans to extend urban services. Bills have been introduced in the 2011 session of the General Assembly to exempt farms from ETJ areas or farming from coverage by city regulations in the ETJ (H. 168, H. 195, S. 380), to limit ETJ to “urban purposes” (H. 797), and to prohibit ETJ where there is county zoning and to allow ETJ residents to vote in city elections (H. 281).

Frank Graham had straightforward questions. What is ETJ, is it legal, and why was it allowed? Those questions have straightforward answers. The more difficult questions revolve around how the state should state organize its local governments to deal with growth and development on urban fringes. How do we best manage the transition from rural to suburban? Who should plan for orderly and efficient growth in these areas? Which units of government should provide what types of urban services? How should provision of services be coordinated with planning and development regulation? How should cities and counties coordinate their planning efforts? How should we manage for transitions in jurisdiction over time? What is fair, reasonable, equitable, and effective for cities, for counties, and for residents and landowners in these areas? Those questions are likely to be before our city councils, county boards of commissioners, and the legislature for some time to come. As long as they are, we will continue to grapple with the broader implications of Frank’s questions.

Tags: ETJ, Jurisdiction, Planning, Zoning

This entry was posted on Tuesday, April 12th, 2011 at 3:56 PM and is filed under Land Use. You can follow any responses to this entry through the RSS 2.0 feed.

One Response to “Can a City Really Zone Land Outside the City?”

Jamie Wood

April 13, 2011 at 8:56 AMIf the city has a health and safety concern for the ETJ and its establishment does that give the city police power over the ETJ or is that still classified as the county?

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Daily Real Estate News

2011-04-07T04:13:00.000-07:00

Daily Real Estate News

Good News for Real estate??????

2011-03-30T05:59:00.001-07:00

Real estate: It's time to buy again

Posted by Shawn Tully, senior editor-at-large

March 28, 2011 5:00 am

Forget stocks. Don't bet on gold. After four years of plunging home prices, the most attractive asset class in America is housing.

A home under construction in Austin. The number of new homes in the pipeline nationwide is quite low.

From his wide-rimmed cowboy hat to his roper boots, Mike Castleman fits moviedom's image of the lanky Texas rancher. On a recent March evening, Castleman is feeding cattle biscuits to his two pet longhorn steers, Big Buddy and Little Buddy, on his 460-acre Bar Ten Creek Ranch in Dripping Springs, a hamlet outside Austin in the Texas Hill Country. The spread is a medley of meandering streams, craggy cliffs, and centuries-old oaks. But even in this pastoral setting, his mind keeps returning to a subject he knows as well as any expert around: the housing market. "I'm a dirt-road economist who sees what's happening on the ground, and in 35 years I've never seen a shortage of new construction like the one I'm seeing today," declares Castleman, 70, now offering a biscuit to his miniature donkey Thumper. "The talking heads who are down on real estate will hate to hear this, but America needs to build a lot more houses. And in most markets the price of new homes is fixin' to rise, not fall."

Castleman is in a unique position to know. As the founder and CEO of a company called Metrostudy, he's spent more than three decades tracking real-time data on the country's inventory of new homes. Each quarter he dispatches 500 inspectors to literally drive through 45,000 subdivisions from Baltimore to Sacramento. The inspectors examine 5 million finished lots, one at a time, and record whether they contain a house that's under construction, one that's finished and for sale, or a home that's sold. Metrostudy covers 19 states, or around 65% of the U.S. housing market, including all the ones hardest hit by the crash: Florida, California, Arizona, and Nevada. The company's client list includes virtually every major homebuilder and bank -- from Pulte (PHM) and KB Home (KBH) to Bank of America (BAC) and Wells Fargo (WFC).

The key figures that Metrostudy collects, and that those clients prize, are the number of homes that are vacant and for sale in each city, and the number of months it takes to sell all of them. Together those figures measure inventory -- the key metric in determining whether a market has a surplus or a shortage of new housing.

Today Castleman is witnessing an extraordinary reversal of the new-home glut that helped sink prices just a few years ago. In the 41 cities Metrostudy covers, a total of 78,000 houses are now either vacant and for sale, or under construction. That's less than one-fourth of the 343,000 units in those two categories at the peak of the frenzy in mid-2006, and well below the level of a decade ago. "If we had anything like normal levels of buying, those houses would sell in 2½ months," says Castleman. "We'd see an incredible shortage. And that's where we're heading."

If all the noise you're hearing about housing has you totally confused, join the crowd. One day you'll read that owning a home has never been more affordable. The next day you'll see news that housing starts have plunged to nearly their lowest level in half a century, as headlines announced in March. After four years of falling prices and surging foreclosures, it's hard to know what to think. Even Robert Shiller and Karl Case can't agree. The two economists, who together created the widely followed S&P/Case-Shiller Home Price indices, are right now offering sharply contrasting views of housing's future. Shiller recently warned that the chances were high for a further double-digit drop in U.S. home prices. But in an interview with Fortune, Case took a far brighter view: "The lack of new home building is a huge help that a lot of people are ignoring," says Case. "People think I'm crazy to be optimistic, but housing is looking like the little engine that could."

To see where real estate is truly headed, it's critical to keep your eye firmly on the fundamentals that, over time, always determine the course of prices and construction. During the last decade's historic run-up in prices, Fortune repeatedly warned that things were moving too fast. In a cover story titled "Is the Housing Boom Over?," this writer's analysis found that the basic forces that govern the market -- the cost of owning vs. renting and the level of new construction -- were in bubble territory. Eventually reality set in, and prices plummeted. Our current view focuses on those same fundamentals -- only now they're pointing in the opposite direction.

So let's state it simply and forcibly: Housing is back.

Two basic factors are laying the foundation for dramatic recovery in residential real estate. The first is the historic drop in new construction that so amazes Castleman. The second is a steep decline in prices, on the order of 30% nationwide since 2006, and as much as 55% in the hardest-hit markets. The story of this downturn has been an astonishing flight from the traditional American approach of buying new houses to an embrace of renting. But the new affordability will gradually lure Americans back to buying homes. And the return of the homeowner will start raising prices in many markets this year.

Drumming up sales

Of course, home prices are low and home construction is weak for a reason: incredibly low demand. For our scenario to play out, America will need a decent economy, with job creation and consumer confidence continuing to claw their way back to normal.

One big fear is that today's tight credit standards will chill the market. But we're really returning to the standards that prevailed before the craze, and those requirements didn't stop prices and homebuilding from rising in a good economy. "The credit standards are now at about historical levels, excluding the bubble period," says Mark Zandi, chief economist for Moody's Analytics. "We saw prices rising with fundamentals in those periods, and it will happen again."

To see why, let's examine the remarkable shift in home affordability. A new study by Deutsche Bank measures affordability in two ways: first, the share of income Americans are paying to own a home. And second, the cost of owning vs. renting. On the first metric, the analysis finds that homeowners now pay just 9.8% of their income in after-tax mortgage, tax, and insurance payments. That's down from 17.2% at the bubble's peak in 2007, and by far the lowest number in the Deutsche Bank database, going back to 1999. The second measure, the cost of owning compared with renting, should also inspire potential buyers. In 28 out of 54 major markets, it's now cheaper to pay a mortgage and other major costs than to rent the same house. What's most compelling is that in all of the distressed markets, owning now wins by a wide margin -- a stunning reversal from four years ago. It now costs 34% less than renting in Atlanta. In Miami the average rent is now $1,031 a month, vs. the $856 it costs to carry a ranch house or stucco cottage as an owner. (For more, see The top 10 cities for home buyers)

Not all markets will bounce back equally, of course. Housing resembles the weather: The exact conditions are different in every city. But in general the big U.S. markets fall into two different climate zones right now. We'll call them the "nondistressed markets" and the "foreclosure markets." A more detailed look shows why the forecast for both is favorable.

Nondistressed markets: Ready for launch

No cities went untouched by the collapse in prices over the past few years. But markets such as Northern Virginia, Indianapolis, Minneapolis, San Diego, the San Francisco suburbs, and virtually all of Texas held up reasonably well. In those areas prices spiked far less than in bubble cities -- the foreclosure markets we'll get to shortly -- chiefly because they didn't get nearly as many speculators who thought they could flip the homes or rent them to snowbirds.

The nondistressed markets will be able to get prices rising and construction growing far faster than the harder-hit areas for a simple reason: Although some of these markets are still suffering from foreclosures, they don't need to work through the big overhang haunting a Las Vegas or a Phoenix. The number of new homes for sale or in the pipeline is extraordinarily low in nondistressed markets. San Diego is typical. It has just 921 freestanding homes for sale or under construction, compared with 4,425 in late 2005. The challenge for these cities is to generate enough demand to reduce inventories of existing, or resale, homes. In the entire country the resale supply stands at 3.5 million houses and condos. That's a fairly high number, since it would take more than eight months to sell those properties; seven months or below is the threshold for a strong market.

But in the nondistressed cities, the existing home inventory is lower, closer to seven months on average. So a modest increase in demand will translate into strong gains in both prices and new construction. That should happen quickly, because most of those markets -- including Silicon Valley, Northern Virginia, and Texas -- are now showing good job growth.

Zandi of Moody's Analytics expects that prices will rise three to four points faster than inflation for the next few years in virtually all of the nondistressed markets. His view is that prices will increase in line with rents, which are now growing briskly because apartments are in short supply. Those higher rents will encourage buyers to cross the street from an apartment to a home of their own.

In Northern Virginia, Chris Bratz, an engineer, and his wife, Amy DiElsi, a publicist, are planning to leave their rental apartment and become homeowners for the first time. The main reason? Buying has simply become a far better deal than renting. "The market got completely inflated, then it crashed, so prices are coming back to where they should be," says Chris. As the couple have watched prices fall, they have also watched the rent on their apartment spiral upward, reaching $2,700 a month. They calculate that they should be able to purchase a townhouse for between $400,000 and $500,000 and pay less per month for a mortgage.

The nondistressed markets will also lead the way in construction. Zandi predicts that for the nation as a whole, single-family housing "starts" -- measured when a builder pours a foundation for a new home -- will rise from 470,000 in 2010 to as much as 700,000 this year. A large portion of that activity will happen in nondistressed markets where a tightening supply of resale houses will start making new homes look like a good deal. "Our main competition is from resales," says Jeff Mezger, CEO of KB Home. "The prices of those homes have stayed so low, because of low demand, that it's hampered the ability of builders to sell new houses."

But many would-be buyers simply prefer a brand-new house. Eventually they'll move from renters to buyers, and the trend will accelerate now that prices are no longer dropping. In Minneapolis, Yuan Qu and her husband, Xiang Chen, a researcher at the University of Minnesota, just moved from a two-bedroom rental to a new light-blue four-bedroom ranch with a chocolate-colored roof on a spacious corner lot. They paid $400,000, a bargain price compared with a few years ago. The couple, both in their early thirties, moved to Minnesota from China six years ago. "We wanted to buy a house, and we've been waiting and waiting and waiting," says Qu. "The prices went down for so long, we finally thought they couldn't keep falling." For Qu the only choice was new construction. "We're not very handy people," she admits.

Foreclosure markets: The outlook is brightening

A home off the market in Mesa, Ariz.

The true disaster areas for housing since the bubble burst have been Sunbelt cities such as Las Vegas, Phoenix, and Miami -- places that boasted great job and population growth in the mid-2000s, only to suffer a housing crash that swamped them with empty homes and condos and crushed their economies. But people always want to live in those sunny locales, and their job markets are starting to recover, albeit slowly. In foreclosure markets the inventory problem is far greater because it includes not just traditional resale homes but millions of distressed properties. Fortunately those houses are now such a screaming deal that investors, including lots of mom-and-pop buyers, are purchasing them at a rapid pace. To be sure, some foreclosure markets won't rebound for years because they're both vastly overbuilt and far from big job centers; a prime example is California's Inland Empire, a real estate disaster zone 80 miles east of Los Angeles.

But the outlook is brightening for Phoenix, Las Vegas, Miami, and parts of Northern California. A big positive is the tiny supply of new homes entering the market. Phoenix, for example, has a total of just 8,100 new homes that are either for sale or under construction, down from 53,000 in mid-2006. The big test in these cities is absorbing the steady stream of distressed properties. The foreclosures put downward pressure on the market far out of proportion to their numbers because of markdown pricing. "We had levels of inventory even higher than this in 1990 and 1991," says MIT economist William Wheaton. "But they were traditional listings, not foreclosures, so they didn't create the big discounts you get with foreclosures."

Wheaton reckons that we'll see a flow of around 1 million foreclosures a year, at a fairly even pace, from now through 2013. That figure is frequently cited as evidence that the market is doomed for years in most foreclosure markets. Not so. The reason is that the vast bulk of those units, probably over 600,000, according to Gleb Nechayev, an economist with real estate firm CB Richard Ellis (CBG), are being converted to rentals either by investors or their current owners. Those properties are finding plenty of renters, since the rental market is still extremely strong across the country. Remember, the millions who lost their homes to foreclosure still need somewhere to live.

A typical investor is Alex Barbalat, a Russian immigrant who's purchased seven homes east of San Francisco in the towns of Bay Point, Antioch, and Pittsburg. His average purchase price is around $100,000 for homes that once sold for between $300,000 and $500,000. But he has no trouble finding renters, since his tenants can commute to jobs in San Francisco on the BART transit system. Barbalat is pocketing rental yields on the prices he paid of around 12%, and he's in no hurry to sell. "I'm holding them until prices drastically rise," he says.

Investment funds are also entering the game. Dotan Y. Melech looks for bargains in Las Vegas for UnitedAMS, a firm he co-founded that manages apartments and other real estate investments. The firm has raised more than $20 million from outside investors to purchase distressed properties. So far, Melech has bought around 300 houses and plans to purchase another 200 this year. He has no trouble renting the houses he buys, since, he estimates, occupancy rates in Las Vegas are touching 95%. The "cap rate," or return on investment after all expenses, is between 8% and 10% -- twice the rate on 10-year Treasuries. Melech rents to people who lost their homes but are reliable renters. "A lot of people can't be buyers because their credit got hurt," he says.

Even with investors jumping in, buying activity in foreclosure markets hasn't yet increased enough to bring inventories down. It will soon. Zandi thinks prices will fall a couple of percentage points lower in the distressed markets in the short run. "But that will be overshooting," he says. "It's like an elastic band. If prices do drop this year, they will need to bounce back because they'll be far too low compared with rents and replacement cost." Renters will come off the sidelines to purchase homes in the years ahead, precisely the opposite trend of the past few years.

Consider the example of Michael Dynda, a retired Air Force avionics technician who now works for a government contractor in Las Vegas. Dynda, 49, is a first-time buyer who put off purchasing for years, in part because prices were falling so rapidly in Las Vegas, with no bottom in sight. But last year the combination of bargain prices and low mortgage rates became too good to resist. He ended up purchasing a 2,300-square-foot stucco home for $240,000, or about half what it would have fetched in 2007. Dynda got a 4.38% home loan, and pays the same amount on his mortgage as on the rent on the house he left to become a homeowner. "The timing was about as good as it could get," says Dynda.

Mike Castleman's company tracks the inventory of new homes in 19 states across the country. He sees supply getting tight. "Home prices are fixin' to rise," he says.

Back on the ranch, Mike Castleman is lounging in his creek-front mansion, built from "a hundred tons of fine central Texas limestone." As he shows off his collection of custom-made guitars, including one crafted to resemble the skin of a rattlesnake, the homespun housing guru once again returns to his favorite topic.

Castleman claims that this recovery will look like all the others: It will bring a severe shortage of housing. He invokes the livestock business to explain. "It takes three years between the time a bull mates with a cow and when you get a calf ready for market," he says. "That's how it is in housing too. We'll get a big surge in demand and the drywall companies will take a long time to ramp up, and it will take years to get new lots approved. Buyers will show up looking for a house in a subdivision, and all the houses will be sold. The builders will tell them it will take six months to deliver a house." But those folks, says Castleman, will be set on buying a place. "And they'll want it so bad they'll bid the prices up!" In other words: Beat the crowd.

It's a Great Time to Buy a House

Mike Castleman, the Texan with the best realtime view of housing in the U.S., tells editor-atlarge Shawn Tully that the naysayers are about to get a big surprise: rising prices for new homes.

New Bern New Home Sales

2011-03-23T06:19:00.000-07:00

2011 new home sales compared to the same time frame in 2010, 2009, 2008

2011=48   6 over $200,000

2010=44   9 over $200,000

2009=53   22 over $200,000

2008=77   38 over $200,000

2007=137 73 over $200,000

Homeowner Tax Information

2011-03-09T04:05:00.000-08:00

Click the link below to view info on the tax benefits of Homeownership.

http://www.trulia.com/blog/taranelson/2011/03/5_tax_tips_tricks_and_traps_for_homeowners?ecampaign=anews&eurl=www.trulia.com%2Fblog%2Ftaranelson%2F2011%2F03%2F5_tax_tips_tricks_and_traps_for_homeowners

New Bern sales-2011

2011-03-02T04:35:00.000-08:00

New Home sales are clicking along so far in 2011. To date there are 77 new homes closed or pending. Of these only 6 are over $200,000.

This is a little better than the same time frame for 2010 when there were 74 new homes sold or pended.

Existing, not new construction, homes sold or pending for 2011=121

Existing, not new construction, homes sold or pending for 2010, same period,=119

The life of a Realtor

2011-02-16T12:35:00.003-08:00

How to avoid real estate failure

Letters From the Home Front

By Kris Berg

Inman News™

February 16, 2011

I was first introduced to the term "cyclic failure" in college. The idea is pretty simple, even intuitive: Repeated tension and compression cause stress, and this type of stress, applied over a long enough period of time, can cause fatigue.

Enough fatigue and the result is failure, be it a slab of concrete, a bungee cord -- or a real estate agent.

Most of us have spent the better part of the past five years feeling like underpaid test subjects in an engineering science lab. In fact, in the best of markets our work is defined by compression and tension. Find a client, serve the client, then go out and find another. Lather, rinse and repeat.

One minute, we are on top of the world, flush with listings or buyer clients, reveling in the ecstasy that is positive cash flow. The next, we are wondering how we will eat in 45 days. If you have been licensed for more than two closing cycles, you know this feeling too well. If you have lived through a couple hundred or more transactions, you know it can wear you thin.

Ten years ago, it was easier to bounce back. We were tested in a fairly controlled environment. We had our highs and lows, our successes and failures, but the laws of real estate assured us that hard work would pay off, commitment would triumph, and our down time and down moments would inevitably be followed by another opportunity.

The demand side used to be a given. People would move, after all, once every five years or so. Not so today. Oh, they would if they could, but they can't. Which isn't to say that this leaves the real estate agent curled up on the couch watching "Judge Judy."

Rather, we are just as busy as we were five years ago, the difference being we used to get paid for our efforts.

My husband and I have had four listing opportunities in as many weeks. Each one involved detailed market analyses, fancy presentations -- time and money. And each one involved us playing the role of evening anchor on a night when the news sucked:

•"No, your home is not worth more than it was in 2006. Yes, I know you added those ceiling fans, but still ..."

•"No, your home isn't worth what you paid in 2005. Well, sure, you could just wait until Thursday to list. Yes, more people generally start looking in the spring, but still…"

Buyers present their own challenges, unaware of the realities of today's lending environment or unwilling to accept that the rules apply to them:

•"Yes, I know you make a lot of money, but you started your new job yesterday and ..."

•"Yes, I know you can qualify for a loan, but you have a house to sell first, so short sales and bank-owned properties are not available to you and, by the way, your current home is not worth what it was in 2005 even though you painted the walls a pleasing shade of lilac and added those ceiling fans ..."

And then, if you are a listing agent, there is the standing inventory. Communication is easy when there is something to say. Finding new ways to tell a client that market times are longer, buyers are fewer, prices are flat at best, and patience is a virtue can tax the old thesaurus.

"I don't make the news; I just report it, and you need to reduce price" tends to lose its charm toward the end of a six-month listing.

Fatigue happens. How to overcome it and avoid all-out failure is the question for all the marbles. It's our marbles at stake, and I don't profess to have the answers, but I do know that stagnation is not one of them.

It's hard sometimes to clear the cobwebs, find humor where there seemingly is little, and to feel productive while you're knee-deep in a moss-covered market. It's harder yet to find professional satisfaction when your days are spent in an echo chamber, delivering the same unwelcome rhetoric.

I've been feeling a little fatigued lately and when this happens I give myself a little time off, followed by a swift kick in the britches. In a business where the meter is always running and all days are the same, I declare it a Monday and start by just doing something -- anything.

You can't win if your head's not in the game. Catch up on your industry reading, tinker with your website, retool your listing presentation, or rewrite your business plan. Preview homes, research and study market trends, write a blog post or comment on a post. Engage in a little group therapy at the office -- or here.

Rethink how the challenges you face now might be -- if not altogether avoided -- at least mitigated in the future. Dare to lose a listing opportunity by being brutally honest, knowing that the people who respect your honesty enough to hire you will be most likely to respect you throughout the transaction and find success.

Dare to decline an opportunity to represent a buyer who isn't realistic in his expectations, recognizing that this will give you more time to dazzle and delight the more serious clients.

This market is going to be with us for a while, and what that means is that the opportunities will be fewer and more difficult. But it doesn't mean that we can't each survive and thrive -- both professionally and personally.

We need to remember that our business has cycles, as do markets. We need to be ever aware of the warning signs of too much tension and compression, and we need to be prepared to deal with the occasional fatigue lest we are threatened with catastrophic failure.

Kris Berg is broker-owner of San Diego Castles Realty. She also writes a consumer-focused real estate blog, The San Diego Home Blog.

New Bern Home Sales-selected neighborhoods

2011-02-15T17:46:00.000-08:00

Steve Tyson’s Real Estate Update

Neuse Harbour

Active homes for sale by price range

Current number of homes on the market=8

Pending sales=0

Active homes for sale by price range

$240,000-$300,000=4

$334,900-$355,000=2

$,415,000-$435,000=2

There were 2 homes that sold and closed in Neuse Harbour in the last 12 months. The most expensive was $250,000

Stately Pines

Current homes on the market=5

Pending sales=0

Active homes for sale by price range

$179,900-$200,000=3

$215,000-$274,000=2

There were 10 homes that sold and closed in Stately Pines in the last 12 months. The most expensive house sold was $262,500.

Carolina Pines

Current homes on the market=13

Pending sales=3

Active homes for sale by price range

$150,000-$200,000=7

$201,000-$260,000=6

There were 24 homes that sold and closed in Carolina Pines in the last 12 months. The highest priced home sold was $249,000.

Tucker Creek

Current homes on the market=6

Pending sales=1

Active homes for sale by price range

$110,000-$200,000=5

$282,500=1

There were 14 homes that sold and closed in Tucker Creek in the last 12 months. The highest priced home sold was $275,000.

Total homes sold in Jan.2010=69

During the same time frame in 2011=81 homes were sold.

There are currently 1465 homes listed for sale in our multiple listing service. We are selling homes at a rate of 88 a month so there is still a large inventory on hand. It is definitely a buyer’s market.

Feel free to call or email me if you would like to have a customized absorption rate or a Comparable Market Analysis for your property. Each neighborhood can vary by quite a bit.

Craven County News

Just like a business the county needs to operate with fiscal restraint during these tough economic times. It is my intention to vote for a balanced budget in the upcoming budget session without raising taxes on our citizens. It won’t be easy, but we can do it.

As an elected official I serve at the pleasure of the public. If I can be of service to you on any local government issue please don’t hesitate to email me. And if you have an issue that pertains to the state government and are having trouble get a response from the state I am always willing to try to help.

Any suggestions to make this article better would be welcomed. I can be reached at SteveTyson@NCmove.com And remember you can always visit me online at www.NewBern-NC.Info

Realtor Steve Tyson

The Tyson Group Realtors

New Bern Home sales

2011-01-30T05:36:00.000-08:00

Jan-2011 all home sales=58

Jan-2011 New home sales=16

Jan-2010 all home sales=69

Jan-2010 New Home Sales=13

Jan-2009 all home sales=55

Jan-2009 New Home Sales=15

Jan-2008 all homes sold=58

Jan-2008 New Home Sales=16

New Home Construction

2011-01-19T19:02:00.001-08:00

Daily Real Estate News
January 13, 2011
Share

Housing Starts Expected to Climb in 2011

New home construction is looking up this year.

During an economic update Wednesday at the International Builders' Show in Orlando David Crowe, chief economist of the National Association of Home Builders, projected single-family housing starts to rise by 21 percent in 2011, reaching 575,000 units.

The estimate is slightly more conservative than the Dec. 30 projection of 716,000 housing starts this year by Lawrence Yun, chief economist of the National Association of REALTORS®. Both estimates assume sustained job growth, increasing U.S. population, as well as continued low interest rates driving construction.

Yun expects about 2 million jobs to be added in 2011. However, as NAHB presenter Frank Nothaft, chief economist for Freddie Mac, pointed out, 2011 got off to a slow start with nonfarm payrolls rising only by 103,000 in December. He called the figure weaker than expected.

Credit is another factor. Lending remains tight, but if it opens up with safe underwriting standards for creditworthy buyers, Yun says there would be a bigger boost to the housing market with spillover benefits for the broader economy. The 30-year fixed-rate mortgage is forecast to rise gradually to 5.3 percent around the end of 2011; at the same time, unemployment should drop to 9.2 percent, according to NAR.

In addition, over the past 10 years the U.S. has added 27 million people. Continued population growth will also spur home construction and sales. “All the indicator trends are pointing to a gradual housing recovery,” Yun says.

An even more conservative projection of 492,000 housing starts in 2011 was released by the Portland Cement Association during the International Builders Show Wednesday. Edward Sullivan, PCA chief economist, does not expect significant increases until 2012 due to tight lending standards, a high home inventory count, and unstable housing prices. He also says that new home construction will vary considerably by region.

National Foreclosures

2011-01-19T18:53:00.001-08:00

RISMEDIA, January 13, 2011—RealtyTrac, a leading online marketplace for foreclosure properties, released its Year-End 2010 U.S. Foreclosure Market Report, which shows a total of 3,825,637 foreclosure filings—default notices, scheduled auctions and bank repossessions—were reported on a record 2,871,891 U.S. properties in 2010, an increase of nearly 2% from 2009 and an increase of 23% from 2008. The report also shows that 2.23% of all U.S. housing units (one in 45) received at least one foreclosure filing during the year, up from 2.21% in 2009, 1.84% in 2008, 1.03% in 2007 and 0.58% in 2006.

Foreclosure filings were reported on 257,747 U.S. properties in December, a decrease of nearly 2% from the previous month and down 26% from December 2009—the biggest annual drop in foreclosure activity since RealtyTrac began publishing its foreclosure report in January 2005 and giving December the lowest monthly total since June 2008.

December Default notices (NOD, LIS) decreased 4% from the previous month and were down 35% from December 2009; Scheduled foreclosure auctions (NTS, NFS) decreased 3% from the previous month and were down 20% from December 2009; and bank repossessions (REO) increased nearly 4% from the previous month—thanks in part to substantial month-over-month increases in some states such as Nevada (71% increase), Arizona (52% increase) and California (47% increase)—but were still down 24% from December 2009.

Foreclosure filings were reported on 799,064 U.S. properties in the fourth quarter, a 14% decrease from the previous quarter and an 8% decrease from the fourth quarter of 2009. The fourth quarter total was the lowest quarterly total since Q4 2008.

“Total properties receiving foreclosure filings would have easily exceeded 3 million in 2010 had it not been for the fourth quarter drop in foreclosure activity—triggered primarily by the continuing controversy surrounding foreclosure documentation and procedures that prompted many major lenders to temporarily halt some foreclosure proceedings,” said James J. Saccacio, chief executive officer of RealtyTrac. “Even so, 2010 foreclosure activity still hit a record high for our report, and many of the foreclosure proceedings that were stopped in late 2010—which we estimate may be as high as a quarter million—will likely be re-started and add to the numbers in early 2011.”

Nevada, Arizona, Florida post top state foreclosure rates

More than 9% of Nevada housing units (one in 11) received at least one foreclosure filing in 2010, giving it the nation’s highest state foreclosure rate for the fourth consecutive year despite a 5% decrease in foreclosure activity from 2009. Nevada foreclosure activity in December increased 18% from the previous month and was up 14% from December 2009. Fourth quarter foreclosure activity in Nevada decreased nearly 7% from the previous quarter but increased 19% from the fourth quarter of 2009.

Arizona registered the nation’s second highest state foreclosure rate for the second year in a row, with 5.73% of its housing units (one in 17) receiving at least one foreclosure filing in 2010, and Florida registered the nation’s third highest foreclosure rate, with 5.51% of its housing units (one in 18) receiving at least one foreclosure filing during the year.

Other states with 2010 foreclosure rates ranking among the nation’s 10 highest were California (4.08%), Utah (3.44%), Georgia (3.25%), Michigan (3.00%), Idaho (2.98%), Illinois (2.87%), and Colorado (2.51%).

California, Florida, Arizona, Illinois and Michigan account for half of national total

Five states accounted for 51% of the nation’s total foreclosure activity in 2010: California, Florida, Arizona, Illinois and Michigan. Together these five states documented nearly 1.5 million properties receiving a foreclosure filing during the year despite annual decreases in the three states with the most foreclosure activity.

A total of 546,669 California properties received a foreclosure filing in 2010, a decrease of nearly 14% from 2009 but still the largest state total. After hitting a two-year low in November, California foreclosure activity rebounded nearly 15% higher in December but was still down 18% from December 2009.

Florida posted the nation’s second biggest total in 2010, with 485,286 properties receiving a foreclosure filing—a 6% decrease from 2009. Florida foreclosure activity in December hit the lowest monthly level since July 2007, down 22% from the previous month and down nearly 54% from December 2009.

A total of 155,878 Arizona properties received a foreclosure filing in 2010, a 4% decrease from 2009 but the third biggest state total for the third straight year. Arizona foreclosure activity in December jumped nearly 31% higher from a 32-month low in November, but was still down nearly 33% from December 2009.

Illinois posted the fourth biggest state total, with 151,304 properties receiving a foreclosure filing in 2010, and Michigan posted the fifth biggest state total, with 135,874 properties receiving a foreclosure filing during the year. Foreclosure activity in both states increased about 15% from 2009.

Other states with 2010 totals among the 10 biggest in the country were Georgia (130,966), Texas (118,923), Ohio (108,160), Nevada (106,160), and New Jersey (64,808).

For more information, visit www.realtytrac.com.

Save a home today

2011-01-09T13:56:00.000-08:00

The current crisis in the United States housing market; combined with the worst economic recession since the Great Depression; is causing a record number of home foreclosures in many regions of the nation. Some areas are faring better than others; but no state or region has been immune. If you or someone you know is among the millions today affected by the prospect of foreclosure, understand that you are not alone. The depth of the housing crisis; combined with the likelihood that the economic recovery will be a slow one; will result in more and more distressed propertie for several years to come.

A foreclosure can have devistating consequences for a homeowner. Not only will their credit be damaged for at least 7 years; some employors will hesitate to hire someone with a foreclosure in their financial history. Unfortunately, too many homeowners facing foreclosure proceed without a Realtor that is trained in the arcane financial science of short sales. A;s a result homeowners often do not get the best advice they need to avoid foreclosure. Now more than ever, you need to find an advocate for you and your family's interests, one who is prepared to handle your specific needs. A CDPE has that training.

Real estate professionals with the Certified Distressed Property Expert (CDPE) Designation have trained extensively to understand the options, solutions, and effective methods for dealing with homeowners facing hardships. Don't risk your financial future and the potential sale of your home with a Real estate Agent who does not have the training to be successful in this area of real estate. Steve tyson has completed the necessary training to become a certified CDPE. Call Steve today or visit his website at http://www.newbern-nc.info/ for more information.

Real estate Trends

2011-01-09T11:58:00.000-08:00

Volume XXV, Number 1

January 2011

www.realtrends.com

(Commentary continued on page 2)

Additional Commentary:

REAL Trends Consulting (RTC)

How Politically Correct are You?

Brokerage:

A Look at Real Estate Practices in Other Countries

Build a Strong Culture Around Performance

Brand Can Matter

NET

WORKORK S:

An Interview with Bruce Zipf, President & CEO of NRT, LLC

TE

CHNOLOGYNOLOGYNOLOGYNOLOGY :

Interpreting Your Website Analytics: What You Need to Know

Trigger Marketing

TREND

S:

Consumer-Related Trends That Will Influence Your Brokerage in 2011

REAL Trends Housing Market Report

EDITOR EDITOR EDITOREDITOR

’S

NOTENOTENOTE

:

REAL Trends Leadership Institute

New Book on the Future of Brokerage

Restart

The great thing about starting a new year is that we get to… start a new year. Many make New Year’s resolutions and some even stick to them. It is seen as a beginning of something.

Commentary

Sponsored By:

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Web site: www.realtrends.com

Editor:

Steve Murray –

smurray@realtrends.com

Associate Editor:

Nicolai Kolding –

nkolding@realtrends.com

REAL Trends Team:

Amy Broset –

abroset@realtrends.com

Travis Saxton

tsaxton@realtrends.com

Daniele Stufft –

dstufft@realtrends.com

Tracey Velt –

tracey@traceyvelt.com

Doniece Welch –

dwelch@realtrends.com

Copyright 2011 by REAL Trends.

All rights reserved. Material in this publication may not be electronically stored or reproduced in any form without written permission. Violators will be punishable by a fine of up to $100,000 per offense.

To purchase a membership or

any of the following REAL Trends products please visit us at

www.realtrends.com:

• REAL Trends 500

• REAL Facts

• Valuing a Residential Real Estate

Service Business

• People Still Matter

2

So it is with 2011 and residential brokerage. Let’s make some resolutions.

First, let’s get something out of the way. The old real estate broker’s prayerful promise that goes something like “I promise that if I’m given just one more good housing boom, I won’t spend it/waste it all.” Well, clearly most did just that with the 1992-2006 boom market and some even did it with the short burst we got in the second quarter of 2010. So, now we’re looking at another up period (even if it’s a modest increase from a low base), let’s remember that old adage.

Housing sales will not rise dramatically in the coming year but they will rise. With the extension of the tax levels for another two years, the extension of unemployment insurance, the one-year payroll tax holiday for employees, and the recent news of rapidly growing retail sales, the economy will find its footing. Once that takes hold, consumer confidence will rise.

Once that happens, housing sales will rise as well. Not a huge jump, but a reasonable increase in the low single digits.

Some predictions

Housing sales:

• Housing sales will increase between 3-4 percent on a unit basis.

• Prices will be generally flat with some markets showing small improvement.

Realtor® membership:

• The number of Realtors® will decline between 4-12 percent nationally with variances between regions.

Commission rate:

• The average commission rate will decline slightly after five consec-utive years of increases as markets stabilize, agents start to compete on price again for good listings and buyers increase their appetite to ask for portions of the co-op commission as rebates.

Mortgage activity:

• Interest rates will rise and as a result the percent of all mortgages due to refinancing activity will decrease while the percent due to pur-chase will rise. Overall mortgage financing dollar totals will decline.

Consolidation:

• The next six months will see a significant rise in merger and acquisition activity among brokerage firms as a) more firms run out of cash, credit and time and b) stronger firms push their marketing efforts to locate candidates more aggressively. The number of brokerage firms will decrease as a result.

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Commission splits:

• The competition for producing sales professionals will increase to unheard of levels and the incentives and compensation offered to get experienced sales professionals will rise – and Company Revenue as a percent of Gross Commission Income will shrink as well for most market leading firms.

Office space:

• Brokerage firms in all markets and of all kinds will continue to downsize their office space footprint as the cost and necessity of such infrastructure continues to decline in an era of mobility.

Growth opportunities

Property management and rental services:

One of the hottest segments of residential brokerage will be in property management and rental services. The decline in the homeownership rate and the rise of investor-owned housing will drive the demand for these services up strongly – in fact the demand has already risen and will continue to do so.

To be profitable in these segments generally requires volume and scale so should you choose to enter these segments do so with a commitment to growing the business continually. Likely, there are also many small, undercapitalized firms already in the space that can also be acquired. These services can be offered both through the sales force as well as direct to consumers. Think of the many homeowners who will have to move to find new work but who can’t sell their homes and you get a sense of one part of this market.

Search Engine Optimization (SEO):

Driving traffic to your firm is among the most important components of your marketing and advertising investments. At our firm, we found that having an expert focus on SEO has driven our traffic up over 50 percent in less than three months with more gains to come. As a result, we have more customers and more revenues. Sounds simple, doesn’t it? And it is that simple.

In the environment we are in for the next few years, each incremental customer is valuable. SEO can bring incremental customer growth at low marginal costs and can be structured as higher margin customers (in company-generated business models).

We know of several teams that have fine-tuned SEO to where they know exactly how much effort it takes to drive business up and by what percentage. All from careful monitoring of their SEO efforts.

Customer relationship management (CRM):

Brokerage firms have done an admirable job of building out solid, functional websites. Perhaps they are not as ‘sexy’ as others but they are functional, getting easier to use, and more useful. Leading firms also have an abundance of professional experienced sales professionals to serve customers. So, where is the problem?

A wide gap remains in how we respond to and communicate with customers who use our websites. A firm engaged in providing outsourced CRM, 1CAVO, reported that in test cases with brokerage firms they find that a great majority of web inquiries and requests for service go unanswered within 24 hours–a full day before anyone returns their call or email.

In our research that led to a guide on the best practices of top teams in North America, we found that the single greatest defining difference in great teams and average teams is their ability to respond to inquiries promptly and thoroughly. We also found a few brokerage firms where their response requirement before redirecting inquiries is less than 5 minutes; those firms are seeing large gains in sales from their websites.

2011 should be the year brokerage firms finally bite the bullet and put in place business rules that incent sales professionals to ‘answer the phone.’ There are also providers of CRM, such as Market Leader’s Realty Generator, that can help brokerage firms automate their business rules. There are other firms that provide similar services.

For all the talk about where listings go, syndications, unique visitors, stickiness, etc., there is no more

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In 2011, we will be dropping the name “Murray Consulting” from our brand. Going forward all of our consulting services will carry the REAL Trends brand name.

For readers who are not familiar with our consulting practice, here is a brief outline of the services that our consulting team provides to brokerage firms, management teams, Realtor® associations, and firms that provide services to the industry:

Valuation

RTC will provide a comprehensive valuation report for your firm including three different approaches to valuation and an outline of how and where a brokerage firm can act to increase value;

Merger and Acquisition Advisory and Brokerage

RTC represents sellers and buyers of brokerage firms and acts as either an advisor or a broker in this regard depending on the needs of the client.

We also act as a facilitator to two or more firms desiring merger or other forms of combination;

Benchmarking

RTC provides an analysis of your firm’s revenues and expenses against a benchmarked group of firms of similar size and characteristics;

Commission Concepts

RTC has developed a tool that provides a brokerage firm with the ability to model their own commission plan against up to eight other plans with complete

REAL Trends Consulting (RTC)

compelling investment that a brokerage firm can make than in their CRM systems and business rules. It goes without saying that it doesn’t matter one whit how big your traffic is if there is no one there to assist a customer promptly.

Recruiting:

One can argue whether mass recruiting efforts pay off or not. One can also argue as to whether to focus on recruiting only experienced sales professionals or focus on new people to the business. One cannot argue whether recruiting is necessary to the health of a brokerage firm. It is. End of topic.

Yet, this is an area where most leading brokerage firms are woefully under-performing. We can see it in the data we collect in the REAL Trends 500 and in our valuation and, merger and acquisition work. When a firm is ineffective in recruiting, ultimately it will weaken and may fail.

In 2011, leading firms will get back to the fundamentals more so than at any time in the past four to five years. One of the most fundamental aspects of sales management is recruiting, whether new to the industry or experienced sales professionals.

All the data is there to identify people in both segments. All that is required is a system of accountability for results.

In research on the practices of top sales managers that we completed in 2010, we found two key philosophies that are consistent among sales managers at the top of their game. First, they view their top responsibility as being the building and establishment of relationships with their own sales professionals. Second, they view recruiting as merely an extension of that responsibility to sales professionals who are not with their company. To the person they told us that when a manager views recruiting as ‘cold calling’ they will likely fail.

As we said earlier, this will be the year that fierce well-organized competitors will take share from others who aren’t prepared and focused. We will see it first in recruiting. n

5

impact analysis on each agent’s income as well as the Company’s revenue and earnings;

Business planning

RTC has developed a simple-to-use tool that provides a brokerage firm with the ability to model different future scenarios for their firm and in their market;

Website Analysis

RTC provides a service that analyzes a client’s website through a whole range of issues that deal directly with SEO and social media implications;

Organizational and management assessment

RTC facilitates assessments of organizational structures and management strengths and weaknesses for senior management of brokerage firms;

In 2011, we will also formally introduce the new REAL Trends Consulting Group which is a collection of a small number of the industry’s leading consultants in areas where they are the experts. Leading consultants such as Dave Colmar, Jeremy Conaway, Jerry Matthews, Brad Hollingsworth and others will be formally joining our effort to insure that our readers and clients have access to the most knowledgeable and experienced advisors in the business. n

By Michael Staver, CSP, Professional Speaker & Coach

The Staver Group

I am very tired of having to watch everything I say to make sure I don’t offend anyone. Sure, I understand there are some things that are unquestionably offensive and I do my absolute best not to offend anyone intentionally, but come on!!

Christmas Day is a national holiday - do we all understand that? It doesn’t matter whether you celebrate it or not. The Fourth of July is a national holiday along with Labor Day, etc. So I say let’s lighten up a bit. Let’s get just a tad thicker skin. Call it what it is and focus on the things that matter.

During this time of year there is so much to be grateful for; so many people that need a hand

or a smile or a (God forbid) Merry Christmas.

I respect a person’s right to believe and to

celebrate as they wish - it’s one of the things

that makes America great - but during this

season of celebration, I suggest we all spend a

little less time being offended and a little more time giving people room!

So, whatever it is you celebrate (or don’t), let’s remember a little peace on earth and good will

to uhhhhh people!

Merry Christmas! n

How Politically Correct are You?

6

We recently undertook a study of foreign real estate practices as part of a presentation given at the National Association of REALTORS® Conference in November. In addition to drawing on some past international work we’ve been involved in, we uncovered through our research and discussions a wealth of information on various brokerage structures, how agents are paid, the lending environment, tax and legal regulations, and consumer behavior. But it was perhaps that which we didn’t find that was as intriguing: woefully few reliable sources, a general lack of consistency in the way data was presented and measured, and no single resource that combines summaries of multiple foreign real estate practices with relevant and updated statistics. In short, it was a hodgepodge of websites and research reports that required an enormous amount of cross-examination to try to check the facts. In time, we hope to collaborate with others to create a repository of reliable and updated global real estate information. For now, we’ll slowly build on what we have and work on expanding our global network.

What we do have already, however, is more than enough to produce a first research report on fundamental differences in global practices in about twenty key countries. At the very least, this could help brokerage leaders and agents better understand their foreign clients and what they’re used to. It may also, perhaps, spur some ideas on what we could or could not apply back home.

Before we give a preview of some of what we’ve put together, it’s important to keep in mind that the one common difference of how real estate is transacted in the United States versus elsewhere is with respect to restrictions on cross-selling other real estate related services. The concept of RESPA (The Real Estate Settlement Procedures Act) or anything similar is generally unfamiliar outside the United States.

So, without further ado, here are eight global real estate facts we’re betting you didn’t know:

The United States is one of the few countries that allows for tax deductions on mortgage interest.

This would seem to be a fact that captured the attention of the powers that be in the National Commission on Fiscal Responsibility and Reform, but in nearly every other country worldwide, mortgage interest receives no tax benefit (the sole exception we found was the Netherlands). On the flip side, however, many countries do not levy any tax, capital gains or otherwise, upon the sale of a primary home. What this does, in combination with most other countries’ more restrictive lending practices, is increase the incentive to pay off a mortgage quickly and, arguably, reduce the size of the home one is willing and able to buy.

A country’s homeownership rate does not correlate to per capita wealth. It probably comes as little surprise that the United States’ homeownership rate (about 69%) is about equal to that of similarly wealthy countries like Canada (68%), Australia (69%), and the United Kingdom (70%). What may surprise you is how low the rate is in many wealthy countries, particularly in Japan (about 60%) and throughout northern Europe (which bottoms out with Germany, at only 43%). But perhaps the biggest stunner is reserved for the list of nations whose homeownership rate is higher, which includes four countries estimated at over 80%: China, India, Mexico, and Spain.

For the countries at the low end: the housing market woes of Japan are well documented and are thanks in large part to unfriendly lending practices and tax policies while Germany has both a very restrictive lending environment and a high population density that drives many to lifelong rentals. The reasoning for the countries at the other end of the spectrum are varied and often less clear. Spain is now paying the price for very loose lending practices during their boom so it would seem their figure could change considerably.

In China, “ownership” is often a land lease so their figures would seem skewed. And we can only speculate that much of the housing stock in India and Mexico, especially in the rural markets, has been passed down from one generation to another but often without the formal title or the oversight we’re used to. That may result in a higher homeownership

A Look at Real Estate Practices in Other Countries

BROKERROKERROKERROKERROKERAGEGE

7

rate but establishing, and transferring, legal title may be another issue so liquidity is hampered.

If you think roundtrip housing costs in North America are steep… then you don’t want to move to Russia. According to Global Property Guide, “roundtrip costs” (which calculate the average total fees – such as taxes, transfer fees, notary fees, legal fees, broker fees, etc. – to both buy and sell a home) are on the lower scale in Canada and the US (7% and 9% of the home’s price, respectively). Many countries in Europe far exceed this, like France (16%) and Italy (17%). Russia, however, comes in at a whopping 25%. What makes that even less enticing is when you consider that three-quarters of their housing stock is in apartments. Nyet spasibo!

The real estate system is far from rotten in the state of Denmark. The Danes, in our humble opinion, have created themselves a wonderfully consumer-friendly system which is both highly regulated and highly transparent. First, agencies and agents are very accountable and must abide by strict rules regarding their dealings. For example, agents must go through at least four years of college-level training in legal and housing-related courses (most Danish real estate agents are therefore also attorneys) and are required to be nearly debt-free themselves or they can lose their license.

There is no dual agency allowed and all homes are placed on a single, country-wide MLS that gives consumers and agents solid insights into not only the marketplace but, in the case of home sellers, their agent’s activities in trying to sell both their home and other homes they are representing. Although their ability to create such a system is thanks in large part to having a very homogenous society with just over 5 million citizens, it is still interesting to think about how different our industry would be here if such a system of accountability was adopted.

Going to auction Down Under. Although this may change over time, many North Americans continue to view auction sales of real estate as being for unusual circumstances, often reserved for either very high-end or distressed properties. In Australia, however, buyers and sellers long ago got more comfortable with this process. Estimates vary, but it would appear that about one-third of all sales take place through auction. Brokerages there have integrated auction into what we would consider “traditional” selling practices. Interestingly, roundtrip transaction costs appear to be lower Down Under than here.

Finally, imagine if these quirky customs existed. Before a closing can be completed in Germany, it is required that the notary read the entirety of the contract aloud at the closing table. This is an almost ceremonial event that was presumably established to provide an unbiased interpretation of the legal clauses but is, in practice, a sight to be seen (and heard) as the notary reads each and every sentence at lightning speed (like someone blasting through a disclaimer at the end of a commercial but for hours). Achtung! In Italy, the custom of “prelazione” grants a third-party right of first refusal to match a bid received by any of their neighbors. An interesting idea meant to protect the rural markets from over-development by giving small farmers the ability to grow their properties but one that, in practice we’re told, results in process-blocking bids being placed by neighbors who often retract them after getting a little extra pocket change to go away. Che macello!

Last but not least, if you are trying to buy or sell a home in England, beware you’re not “gazumped” or “gazundered” at the last minute. There is little recourse for those on the short end of a transaction that’s been unexpectedly ended by either party; the reality of doing business there is that a housing deal is fairly unsteady until final documents have been signed so fall-through rates are far higher (a buyer who is left with nothing but sunk costs after the seller takes someone else’s offer is said to be “gazumped” while the seller gets “gazundered” by a buyer who turns tail unexpectedly leaving them to start the process all over again). The government’s attempt to fix what some consider a chaotic practice (by introducing Home Information Packs in 2007) was not well received by either the industry or the consumers and was abolished last year. Blimey!

We’ll take a deeper look at these and many other foreign real estate practices early in the year both through a white paper and a webinar. Please contact us if you are interested in either and we will keep you informed as we get closer to delivery. n

8

Interview with Jim Winer, Principal,

Coldwell Banker Algerio/Q-Team Realty, Elko, NV

Unknown to most, Elko Nevada is one of the world’s largest centers of mining. Gold, silver, rare earth minerals, coal and others are found in large quantities in the area.

Add that to some of the country’s most beautiful open space with large ranches and a population of just 22-23,000 and

you get a wonderful, small, out-of-the-way place to live and work.

Jim Winer came to Elko after college seeking employment in the coal business. He stayed because of the beauty of the area, the low cost of living, and the real estate business. Winer started in the business in 2002 with a firm called Coldwell Banker Nannina and eventually bought the founder’s interest. Later an opportunity to merge with the second largest competitor (Algerio) enabled the firm to grow to its current size of 25 sales professionals (in a market that has about 75) and a market share in excess of 50 percent.

REAL Trends: What makes your firm special?

Winer: We instill in our sales professionals the thought that we are here to build businesses for ourselves by serving buyers and sellers. This is a small community, so your relationships and reputation are highly important. There is no hiding. We communicate constantly, through words and actions, that we will always ‘do what is right for our customers’, first time all the time. We don’t have to write it down, our people know that is what we believe and what we live.

For a small town, we have one of the largest selections of marketing and technology tools of any firm in the area. Coldwell Banker is a big part of that and they bring us a great deal of these tools. The key here is that we don’t force usage of any particular tool on our sales professionals but rather we insist that they use what fits them. Importantly we point out that they should be using some system and tool to build their business. Sitting around doesn’t get you anywhere.

REAL Trends: How do you stay in touch with your sales professionals?

Winer: We have a sales meeting every Tuesday. These are well attended because we go over market information, pricing, sales, listings, economic news and other facts that affect housing. We place a huge importance on being sure our people are the best informed about all of these areas. Even here in Elko, a small town, our customers want to know that we know what we are talking about when it comes to housing, mortgages and other areas related to homes and neighborhoods.

You can’t over-communicate the importance of keeping your people informed about the market.

As we like to say, you always have to be prepared for that 35 second interview in the grocery store, when a friend or acquaintance asks, “How is the housing market?” We teach our sales professionals that you have to always be prepared to answer that inquiry with authority – otherwise why bother being in the business at all?

REAL Trends: What do you think is different about being in a relatively small market?

Winer: We certainly know each other better than folks in a larger market. There is a large emphasis on community involvement. As a firm and as

Build a Strong Culture Around Performance

Develop multiple sets of marketing tools with customization;

Focus on relationships with community

9

individuals we pride ourselves on being great

supporters of a wide number of community events

and activities. One example is the National Cowboy

Poetry Gathering where the best writers of such

writing come to Elko. We are a large supporter of

these kinds of events. I don’t know whether that is

unique to brokers in smaller markets but it is a

huge effort on our behalf.

We also end up knowing each other, our

competitors, and the homes in this community

much better perhaps than those working in larger

areas. But again I don’t know that for a fact; we

just know that we work closely here to make the

market work for all parties.

REAL Trends: What is your role?

Winer: I do my own work mostly in commercial

brokerage and leasing and spend most of my time

working on the business of the company. I believe

that the more successful I can make my own sales

professionals the more successful the company will

be. So we focus on constant learning, constantly

reinforcing our way of doing business and we figure

that if we do those things well success will follow. n

Interview with Judy Green, Principal, Premier

Sotheby’s International Realty, Sarasota, FL

Sotheby’s International

Realty had opened in

Sarasota years before

and for any number of

reasons the firm had not

made the kind of

progress that was

expected. Judy Green

had served in a number

of senior executive roles

for Coldwell Banker/NRT

in both Florida and at

corporate headquarters

in New Jersey. When Green decided to get back to

Florida, despite her plan to find something ‘less

stressful,’ she took on the re-launch of Sotheby’s in

the Sarasota area. As of this writing she was

leading the firm into a merger with Premier

Properties of Southwest Florida, a firm with 7

offices and 200 sales professionals in the Naples/

Bonita Springs area south of Sarasota. The

combined firm will have about 350 sales

professionals in 10 offices throughout the Gulf

Coast of Florida.

REAL Trends: What was your original thinking on

re-opening in a tough market?

Green: We knew Sotheby’s is a powerful high-end

brand. A really strong name for both high-end sales

professionals and for high-end homeowners.

Sarasota is an area I had come to love when I

worked in the area with Coldwell Banker. We

knew there were plenty of high-end homes and

customers who would know the Sotheby’s brand

looking to have a home in the area.

We planned our brokerage to be a home for only

experienced agents; we did not want to be the

place where new agents came where we had to

provide a lot of basic training. We wanted to

emphasize a brokerage for these kinds of agents

which also meant we had to be very deep and

strong in marketing support.

REAL Trends: What surprises did you encounter?

Green: The good news is that we have grown much

faster than we thought we would even in a very

difficult market. We have grown to almost 130 sales

professionals much faster than we thought. The

market has been really tough, tough on our people.

But most of the surprises were on the upside. We

grew over 75 percent in sales over the previous year.

Brand Can Matter

Focus on recruiting to the market segment;

Marketing is highly important

10

REAL Trends: What special challenges do you have when you are focused on only experienced agents and mainly on the upper end of the market?

Green: You have to invest fairly heavily on marketing and advertising to not only get experienced agents in the high-end but also to attract high-end sellers. And it is not only that you have to spend these monies on actual advertising but you have to have marketing and advertising support staff and services along side these investments. It is not enough to have really great materials, you have to have superior support. None of that is cheap.

We try to find areas that reach potential buyers coming to the area for vacation as well as when they are looking around for a second home or a place to retire. We focus on print media that people will actually look at when they are here, such as table top magazines, special area publications that are read by the high-end consumer. We also do some newspaper but the focus there is on open houses as these are the most likely spots that someone might stop by for a look-see.

Lastly, we built systems that let sellers know when, where, and how we marketed their homes. If you can’t establish what you are doing for sellers on a fairly consistent basis you have a potential hole in your marketing system.

There are no downsides that we can see from pursuing only experienced agents. Some might say they are more expensive but we have not found that to be true. Where you have excellent marketing services and, support and a plan, experienced agents can make intelligent decisions about the trade-offs between their commission split and the value

they get.

REAL Trends: What is your focus going forward?

Green: We say that we strive ‘to make a difference in people’s lives.’ We are building our culture around that theme and much of what we do is focused on what we can do to impact that vision. Is there a way to make finding the right home easier? Is there a way we can get our sellers to

see the market the way it is rather than the

way they wish it were? How do we improve our communications with clients and customers to make the process easier? Those are the areas we will focus on along with growing in our market segment. n

11

There is no company in the residential real estate brokerage industry that is more closely watched than NRT. No other brokerage is on the receiving end of more scrutiny, more second-guessing, more imitation, or more carefully planned targeting. This is the price to be paid for being far and away the biggest player in what is still a very fragmented industry.

Since its formation in 1997 and for each year since, NRT has closed more home sale transactions than any other firm. According to last year’s annual REAL Trends 500 report, its closed sales volume is greater than the second through twelfth ranked companies combined. Few companies in any industry would attain this kind of top position without having made its fair share of enemies. Yet it’s hard not to admire, even if begrudgingly for some, how the company has navigated the seas in a fairly unassuming manner. Like a big ship in crowded waters, NRT is impossible not to notice yet it has always seemed intent on charting its course straight and steady without creating more waves than necessary.

Standing at the helm since 2005 has been Bruce Zipf, President and Chief Executive Officer. An avid weekend fisherman and boater, Zipf knows a thing or two about steering through stormy waters. He assumed the skipper’s seat from his predecessor and friend Bob Becker at nearly the exact moment that the residential real estate market was turning. As the first signs of a slowdown were becoming clear, Zipf made the decision to consolidate sales offices before nearly anyone else in the industry. Since 2005, the company has reduced its office count from a high of 1,100 to less than 750 today, an elimination of over 1 million square feet of leased space.

“With the increased use of technology, the need for large office space has diminished,” said Zipf. “Rent expense is a significant line item in operating a real estate brokerage company and something that needed to be addressed as the market conditions changed.”

Although office consolidations have yielded considerable cost reductions for NRT, this has still not been enough to keep pace with the drop in the company’s sales volume which, despite its continued top ranking nationally, is less than half of its peak from five years ago. When you combine the reality that its parent company, Realogy Corporation, is carrying over $6 billion of debt with the fact that over three-quarters of Realogy’s operating expenses are with NRT, it’s clear that Zipf has had to maximize efficiencies at nearly every conceivable level.

When asked about Apollo Management, the private equity investment firm that acquired Realogy in a highly leveraged buyout over three year ago, Zipf offered his perspective.

“They have been strong financial partners standing behind Realogy, and by extension, NRT, through probably some of the most difficult times that were ever registered in residential real estate,” Zipf said. He referred on several occasions to Apollo as both a financial and strategic partner. “Apollo has been extremely supportive of the operating decisions that Realogy and NRT have made, especially in the area of investments and acquisitions,” Zipf said. As an example of NRT’s investment in technology, Zipf cites HomeBase, a proprietary transaction management system that has been three years and several million dollars in development and is now in nearly every NRT office. And, of course, there are the acquisitions.

In 1996, HFS Incorporated, the predecessor to the predecessor of Realogy, acquired Coldwell Banker

An Interview with Bruce Zipf, President & CEO of NRT, LLC

N

etworks

12

Corporation and its approximately 330 company-owned offices. NRT (initially known as the National Realty Trust) was born of this purchase and has used acquisitions as its main growth strategy ever since. In its first several years, NRT grabbed the industry’s attention and market share as a ravenous purchaser of brokerages big and small; up until July of 2000 it averaged an astonishing one acquisition per week. Although the pace slowed down over the next six years, it was still buying over two firms per month during this time. In 2007, however, NRT slowed its acquisitions pace considerably as the market really turned south. It has remained that way until very recently with nearly all deals since that time being “roll-in” transactions in which the company adds sales associates but without any net gain in branch offices. It simply made no sense to add overhead and risk from additional bricks and mortar while the market was getting worse by the day.

Over the last several months, however, NRT has been turning heads again as its acquisitions have increased in both frequency and size. Five deals in October and November, including three sizeable transactions in Pennsylvania (Coldwell Banker Preferred), California (the Cashin Company), and New Mexico (Santa Fe Partners), added nearly 1,000 agents and close to $2 billion in sales volume. Of particular note was the purchase of the eight-office Coldwell Banker Preferred in Philadelphia, which marks the first time NRT has entered a new metropolitan market since it began consolidating offices in late 2005.

“Philadelphia was always a hole in our presence along the eastern seaboard,” Zipf said. “We were presented with a unique opportunity, and it was a perfect fit for us.” He signaled that there will be more to come in that area, possibly soon. “Our mission is to grow and, over the next several months, we expect to further strengthen our position there.”

After adding the nation’s fifth largest market to its operations, NRT’s East Coast presence spans from Maine to Florida, but with a notable gap from central Virginia through the Carolinas. Asked whether or not the company was now pursuing growth there, too, Zipf admitted NRT’s interest in those markets but hinted that they would be patient. “I believe that over the next several years that opportunity will come about.”

It seems clear that Zipf considers NRT’s size to be a benefit rather than a hindrance as its acquisition activity picks up, but he thinks the increase in deals being completed is less about a shift in NRT’s terms than it is in sellers’ attitudes. “That has generated some of the perceived increase in acquisitions: sellers are coming around,” he said, noting that many seem to be accepting that “this is as good as it’s going to be over the next couple years” so the price and terms they could get from NRT today may not be substantially different than what they would get tomorrow. “What we’re looking at today, more or less, is going to be the market,” continued Zipf. By incorporating into the valuation analysis the company’s ability to reduce costs through combined operations, NRT is able to “build off synergies and price acquisitions accordingly.” Regardless of whether it’s truly driven by a shift in purchase terms or in sellers’ expectations, many in the industry view NRT’s increased deal activity as a clear indicator that the biggest player in the industry may be signaling that the bottom has either arrived or is very near.

From many perspectives, NRT has always served as a barometer both of and for the industry. Because of its presence in over 35 major metropolitan markets, NRT is able to “get a bird’s eye view of what’s going on in the national market,” acknowledged Zipf. Although he wouldn’t make any forecasts for 2011, Zipf did say that the markets that had fared best for NRT, and it seemed those they were still most bullish on, were those that had “strong diversity in economic and business mix” as well as the “stronger per capita income, high-end urban and suburban markets with larger than normal” international interest such as Manhattan, Boston, Los Angeles, and San Francisco.

Although foreign capital may help those markets, Zipf echoed many others’ opinions when citing employment as the top issue facing both the economy and housing but he seemed reasonably optimistic that this would improve. “One positive

13

thing,” he concluded, “and this is a known fact: most

of corporate America is reasonably cash-rich and the

sooner they open up some of the purse strings and

invest in human resources and invest in growing

some of their businesses, which I believe they will as

we go into 2011 and 2012, then that will improve the

employment picture. And as the employment picture

improves so will the real estate picture.”

Despite his optimism, it is the fragility of the

economy that makes 2011 so hard for most to

predict. Although it would appear NRT will once

again become a more acquisitive force, though

certainly not to the degree it was a decade ago, the

sailing won’t be easy as the industry continues to

face headwinds and NRT’s parent has to manage

the business with a considerable debt burden. At

the end of the first quarter of 2011, a closely

followed provision in Realogy’s debt covenants

tightens once again: its senior secured debt (which

is over $2.5 billion of the total debt) can be no

higher than 4.75 times Realogy’s trailing twelve

months’ adjusted EBITDA, which is down from 5.0

times throughout 2010. Although Realogy has

managed this well throughout 2010 (it has held

between 4.34x and 4.57x), both the National

Association of REALTORS® and Fannie Mae (as well

as REAL Trends) are forecasting that transactions in

the first half of 2011 will be between 7% and 10%

less than 2010 levels with prices flat to slightly

down. So the questions for NRT are many: is their

recent swell of acquisitions an indication of a

future wave or a temporary blip on the screen? Is

this a clue that they believe the tide will turn in

2011, or is it a necessary strategy to help

successfully navigate through the waters ahead,

especially in light of the tightening covenants?

The skipper, of course, wouldn’t say. But the ship

sails on. n

Join The Leaders of

Residential Real Estate

The brightest minds of the residential real estate industry will come together to share with you the

dramatic changes taking place in the economy, business and real estate…changes that will effect how

you do business tomorrow.

In our 20th year of networking, brainstorming, learning, teaching and sharing, spread your wings and

join the EAGLES for this outstanding conference.

2011 REAL Trends

Gathering of Eagles

May 4-6, 2011 • The Westin Denver Downtown • Denver, Colorado

For more details, contact dstufft@realtrends.com or phone 303.741.1000.

14

TE

CHNOLOGYNOLOGYNOLOGYNOLOGY

Website analytics can be a scary and intimidating subject when you’re not perfectly comfortable with the terminology. Often times, even when you are comfortable with the terminology it doesn’t necessarily mean what you are interpreting is actually important. This article will outline the information within most analytical reporting systems, and we will use several examples from Google analytics as a reference point. While we understand that not all websites employ Google analytics, even if you do not have that platform you can certainly take the same concepts and apply them to any similar website traffic system.

Where to Start: Your Dashboard or Traffic Summary

In this area, you will find some valuable information that goes well beyond your visitors and page views. Pay attention to the average pages per visitor and the average time spent on the site. This is very important in understanding the ability of your content to capture your visitor’s attention. A bad website with content that is relatively unuseful will see low page views and low average time. In some cases, if you have a decent average time-on-site, (upwards of 2 minutes) but low page views, it may signify that you are divulging too much information on your homepage thus giving the visitor no reason to dive any deeper. When looking for growth, the percentage of new visitors on your site is a key number to look into. While this isn’t 100% accurate due to changing IP addresses, it does give you a good trending feel for your site.

Bounce Rate is a very useful term when used in the right context. For most sites, the bounce rate in the dashboard isn’t super useful unless you see it upwards of 70% which would be cause for concern, but it does become more relevant as you get inside the site. It can give you useful insight into your content or pages that are sending visitors away. A good example is an intrusive form that may be asking too many questions or questions that are too personal can scare visitors away. This will result in a high bounce rate for that page.

In your dashboard, you can also distinguish between unique and reoccurring visitors. Under the site usage portion of your dashboard, you will see your overall visitors. This number indicates the total amount of reoccurring visits to your website during the time period specified. Below the site usage box, is a box that is titled visitors overview. This is where you can draw your unique visitor number from. Both visitors and unique visitors are important in their own way but together they can tell you some useful information about your site.

For instance, if the two numbers are relatively close in nature it means you are getting few returning visits to your website during the specified date range and it may mean the content is only useful on an irregular basis. A lot of Realtors® will see this trend simply due to the nature of their business and it is in no way a reason to panic.

Visitors Tab

Under the visitors tab in Google analytics, there

are several useful data tools. The first is the connection speed of users who are using your website. Be cautious of loading too much info, pictures, or heavy flash-intensive content on your site if you get a high percentage of slower connections. This will vary by market, but it can cause end-user frustration who will not likely return, thus decreasing your average time-on-site and your overall pages viewed.

Secondly, not all websites are created equal, but the fundamental building blocks should be relatively versatile and your browser capabilities under your visitor tab will break down who is using what. Even though the site might look perfect on one browser it is important to periodically check what it looks like from other popular browsers.

Interpreting Your Website Analytics: What You Need to Know

15

Your mobile tab is a very important and growing feature within Google Analytics. Obviously, this area of web travel is booming greatly so what can this area tell you? We recently conducted a REAL Trends Website Analysis on a client that had some wonderful web traffic considering the size of the company and market; however we noticed that they were receiving approximately 12,000 monthly visits via mobile phones of all nature. This mobile traffic was spending 90% less time on the site and viewing 1/4th of the overall pages versus the regular visitor. Now, it is important to note that a decrease is expected due to the nature of the smaller screens and the habits of users, but in this case it was alarmingly high. Upon further review with a mobile phone, the site was indeed very hard to navigate and took a considerable amount of time to load; this would lead to frustration from users.

On the other side of the equation, we conducted a website analysis where we saw the opposite results. The mobile visitors browsing to the client’s website was virtually identical in nature to their normal web traffic and upon further review they had built a nice looking simplified version of their site for mobile browsers. So, to recap here be sure to compare average time spent on your site and average page views to your normal web traffic numbers for anything that may be out of the ordinary.

Traffic Sources Tab

This tab has some very useful marketing and other data. The starting point to explore here is the pie chart that is displayed on the first screen. It can give you a great indicator of your weak or strong areas. If you get a relatively low percentage of direct traffic you may want to consider rebranding, increasing your branding of your site, or attaining an easier to remember domain, etc. If your referring sites percentage is relatively low (say less than 5%) it may be useful to start a reciprocal link campaign to increase the overall traffic and your site’s presence among industry specific traffic.

Of course, search traffic is important and there are two things to note here: 1) If the percentage is low or less than 5-10%, you may have some serious SEO to implement, 2) if you click on the search engines tab and find that the traffic coming from this source is viewing very few pages and spending little time on your site, this may be an indicator that your search efforts are drawing in a not-so-valuable visitor and it would be wise to refocus your efforts to obtain an ideal visitor.

Under the keywords submenu you will find some very useful data. Naturally, this can tell you where your SEO strong points are right from the main screen, but at the same time it can also tell you your weak points. We recently conducted a site analysis for a company that had all of the top 50 keywords and had some form of the company’s name in the search term. This can tell you your brand is strong and people are searching it frequently, but in this case it was indicating that they had little SEO implemented outside of their brand name.

It was very evident they needed some work on

the SEO front. Also, keep an eye on the metrics associated with the term as well. If you end up noticing that a specific search term has a high bounce rate and low time-on-page it is a good indicator that the traffic and/or that term is not relevant to you or is commonly confused with something similar.

Content Tab

Keeping an eye on your most popular content is a great way to get a better understanding of your consumer habits, interests, etc. If you see that 90% of your traffic is viewing only a small portion of your website, we feel it’s wise to either work on the content not being viewed or play up the content that is being used and make it readily available. The new In-Page Analytics feature is a useful tool (yet still work in progress) to see what links people are actively using on a given page of your site.

You can use this to further identify visitors’ habits and correct any problems you may have. In a recent analysis we had a client that dedicated a large

16

portion of their homepage to specific content in their industry. This content was drawing less than .01% of navigational clicks indicating the content was not what the user was looking for. That valuable homepage “real estate” could go to better, more useful content. This is an example of understanding your visitor/consumer and giving them what they want. n

REAL Trends Website Consulting

Our website consulting is a service dedicated to the real estate industry. REAL Trends will take

an unbiased look into the functioning, marketing, SEO, and other essential metrics of your websites. Whether you’re in the decision process to get a new website, make changes to your current website, or hire SEO experts, the team

at REAL Trends can give you some very valuable direction and information at an affordable price. We will highlight strengths and weaknesses, make recommendations, and deliver a professional report for your ongoing web efforts. If you are interested in discussing your site and how we can help you please email realtrends@realtrends.com or call 303-741-1000. n

An interview with Debbie Gurley of Quantum Digital

REAL Trends caught up with Debbie Gurley of QuantumDigital to find out more about their new service called TriggerMarketing. Debbie brings over 29 years of customer and sales support experience to the QuantumDigital team and has worked intimately with numerous clients seeking dynamic direct marketing programs that offer efficiency and improved ROI.

REAL Trends: Tell us about your services offered

to the real estate industry.

Gurley: We currently offer direct mail, print on demand, and email marketing services.

REAL Trends: Define the scope of your customer base.

Gurley: Real estate makes up about 50% of our overall customer base and within the real estate industry we work with all sizes of brokerage companies all the way down to individual agents.

REAL Trends: Explain TriggerMarketing for Automated Lead Generation.

Gurley: This is an automated program to uncover warm leads using listing databases, email, and mobile devices. Within seconds, TriggerMarketing launches an integrated marketing campaign featuring your new listing and notifies you via email whenever a warm lead shows interest.

Now, you can effectively market your listings in

a consistent way—even when your resources and time are limited:

• Just listed postcards mailed to homeowners surrounding your new listing

• Custom website that emails you whenever prospects visit to get property details

• House flyers designed to attract leads and more listing opportunities

REAL Trends: Being a printing company in the green era can create a difficult challenge. What is QuantumDigital doing to reduce its environmental impact?

Gurley: At QuantumDigital, we’re committed to doing our part to reduce our environmental footprint and conserve vital natural resources. Not only do we personally hold ourselves accountable to practice the highest standards of environmental stewardship, we’ve also taken the necessary steps to

Trigger Marketing

17

become chain-of-custody certified by the FSC

(Forest Stewardship Council).

REAL Trends: Five years from now what new or

emerging technology or capability will impact the

real estate industry?

Gurley: Real-time response will play a significant

role in this area whether it’s via mobile, email,

voice, print, etc. This is why we created the

TriggerMarketing program to address the growing

importance of real-time response and to give their

consumers the instantaneous results they desire.

REAL Trends: Why is customer service so

important in the real estate industry and how

can QuantumDigital help?

Gurley: Customers are the real estate business and

building/fostering those relationships is why social

marketing is becoming more and more pertinent.

We believe automated direct mail can give you that

personal touch to stand out amongst your

competitors and also be used to enhance your

brand socially. Consumers are much more likely to

respond to a customized direct email piece that is

relevant than to a generic email campaign.

REAL Trends: Our editor, Steve Murray, will be

speaking at your conference in January. Tell us

about this upcoming event in 2011.

Gurley: The Ignite 2011 Real Estate Summit is

hosted by QuantumDigital and will be held in

Austin, Texas on January 20th and 21st. It is an

opportunity to network with real estate industry

leaders from companies such as Leading Real Estate

Companies of the World, Better Homes and

Gardens Real Estate, Weichert, Prudential Gary

Greene, Long Realty, and of course REAL Trends

and many more. Hear how they’re leveraging the

latest technologies, marketing automation

programs, and leadership techniques to increase

productivity and pull ahead of the competition.

Travis Saxton is the marketing and technology

manager at REAL Trends. His background includes

web consulting for numerous industries and

businesses across the U.S. and Canada. Most

recently he spent several years consulting and

guiding the newspaper industry in the online arena

before joining REAL Trends. n

18

TREND

S

By Jeremy Conaway, Contributing Editor

If you haven’t already done so it is that time of the year to once again gather your stakeholders, key personnel and decision makers together for your firm’s annual planning conference. Never has this exercise been more important than in today’s fast moving, highly flexible and quickly transitioning real estate marketplace.

To assist our readers to set their brokerage business course in 2011, we have researched the business trends that have been identified by such publications as the Harvard Business Review (HBR), Advertising Age, Fast Company, Entrepreneur, Forbes and Fortune. Of course none of these publications specialize in or are noted for their expertise in real estate. While some experts and readers would suggest that this is a problem we would opine that failing to view itself in the context of the overall business environment is one of the shortfalls of the current real estate industry. While a few of the successful strategies and tactics that will be put into place by our industry will be exclusively real estate in nature, the majority will be drawn from a much wider business experience base.

It can be argued that the single most important trend in consumer behavior in 2011 will be one that has already been a major force in the industry over the past three years. This of course is the overall growing power and sophistication of the consumer relative to all aspects of business. In an industry in which top agents continue to believe that they have a psychological, informational and experiential superiority over their clients, customers and consumers this trend continues to be the yardstick by which relevancy is being measured.

While many real estate professionals continue to measure their value proposition based upon traditional factors, today’s real estate consumer is measuring relevancy and value against a whole new set of personal, lifestyle, economic and market factors. This trend will be most influential in urban markets. Urban consumers tend to be more daring, more liberal, more tolerant, more experienced, and more prone to trying out new products and services.

The second trend that brokerages should be tracking is the growing consumer desire to encounter a human touch in everything that they do. One needs merely to spend ten minutes in an AT&T consumer service telephone queue to understand the desperation being shown by many firms to avail themselves of lower cost high tech rather than high teach. Consumers are becoming increasingly annoyed and dissatisfied with being denied the simple courtesy of contact with a real person who has the authority to make a decision and solve a problem. The real estate industry should use this trend to its advantage by installing a human touch in its property inventory search functions.

The third consumer trend of interest for 2011 is tied to the issues of product pricing. While real estate consumers have always looked out for special offers and discounts, new technologies combined with unstable markets will mean that 2011 will see high levels of pricing chaos especially in real estate markets where a predominance of distressed properties continue to negatively impact pricing policies and appraisal processes.

Today’s real estate consumers are constantly connected, and when they hear about housing related pricing and market “deals” they can quickly and easily spread them through their social networks. Increasingly, these consumers will be part of exclusive networks or real estate buying groups that facilitate either receiving special deals or demanding them.

Mobile devices increasingly enable consumers to find or receive dynamic deals right at the point of sale, or to compare prices online. Case in point: Amazon.com just released an iPhone app that allows users to compare prices by scanning the product’s barcode, photographing it or saying its name. Look for Zillow to expand its functionality in this direction over the next year. Always-on connectivity will further encourage changing consumer-spending habits in a myriad of ways.

Consumer-Related Trends That Will Influence Your Brokerage in 2011

19

The fourth consumer trend arises out of the fact that over 90% of real estate consumers now use the internet as a significant part of their property search and marketing activities. This activity is no longer experimental but rather has become a sophisticated consumer skill set, indeed almost a culture. Like all cultures it will be developing its own status symbols and “cool” points. What started with showing off the number of visitors to one’s listing pages or agent blog now also encompasses the number of one’s Facebook friends (or any other social network), Twitter followers that respond to the listing, Yelp and Foursquare check-ins and a host of other metrics that indicate one’s ‘wiredness’ will soon spread to the real estate space.

In 2011, brokerages should consider supplying their (online-loving) customers with any kind of symbol, virtual or ‘real world’ symbol or logo that helps them display to peers their online contributions, interestingness, creations or popularity.

Indeed, one extra element to watch out for in 2011 is new status symbols that straddle the ‘real’ and ‘online’ worlds. From physical manifestations of digital status (think personalized Facebook and Twitter memorabilia), to online recognition of physical activities (status updates or badges based on real-world visits), consumers will seek to display their online status symbols in all arenas including real estate. Watch for Zillow and Trulia to join this trend during the first two quarters of the year.

One last trend that brokerages should consider adopting is today’s consumers’ almost compulsive interest in being surrounded by all things “healthy.” As good health is now as important to some consumers as having the biggest, newest or shiniest status symbols, growing numbers of consumers will expect health products and services in 2011 to prevent misery if not improve their quality of life, rather than merely treating illnesses and ailments.

Some signs of the times:

• 73% of U.S. consumers consider being physically fit important to being ‘well’, with 74% including ‘feeling good about themselves.’ (Source: The Hartman Group, August 2010)

• An estimated 500 million people worldwide are expected to be using mobile healthcare applications by 2015. (Source: Reasearch2Guidance, Nov. 2010)

• There were nearly 17,000 health apps available in major app stores in November 2010, with 57% of them being aimed at consumers rather than health care professionals. (Source: Reasearch2Guidance, November 2010)

• The heaviest use of health or medical related apps is by young adults: about 15% of those aged 20 to 33 (a prime real estate consumer group) have such apps, compared to 8% of users aged 30 to 49. (Source: The Pew Internet Project, October 2010)

• In 2011, more and more health and “well being” monitoring technologies will become portable, wearable and cheaper (the smart phones held by many consumers are now more advanced than most dedicated medical devices).

Also, both regular and dedicated medical social networks give audiences a platform to share, compare and discuss their personal health issues with other consumers. Last but not least, the ‘consumerization’ of health means that more consumers will choose products with embedded health benefits that are actually well designed, desirable, accessible, fun, tasty, interesting or storied.

It will be a quick jump from these matters to the new world of “healthy houses.” Akin to the fast growing “green” house movement the relative value of homes whose location, configuration and composition support good health for their occupants will begin to impact the marketplace. Brokers should consider who should be the first in their marketplace to offer “Healthy Rated” houses as a marketing benefit aimed at today’s health conscious real estate consumer.

There will be more to the 2011 real estate marketplace than transitioning mortgage rates, distressed properties and emerging rental lifestyles. Opportunities abound for brokerages to convert consumer trends, needs and demands to market share results. n

20

December 13, 2010 – The REAL Trends Housing Market Report for November 2010 showed that the annualized rate of the combination of new and existing housing sales decreased to 3.660 million from the 4.327 million recorded in October 2010. Overall housing sales fell for the fifth month in a row when compared to the same months in 2009.

November 2010 unit sales fell 25.7 percent from November 2009. The average price of all sales increased 7.3 percent from November 2009, a positive point in otherwise disappointing results.

Housing unit sales for all regions fell in the last twelve months with the Northeast showing the greatest decline of 32.2 percent followed by the Midwest which saw unit sales fall 30.6 percent from November 2009. The West had the smallest decline at 19.2 percent.

Average prices of homes sold in November 2010 increased 7.3 percent compared to November of 2009 on a national basis. Every region showed increases in the average price with the Northeast showing the greatest improvement with a 9.1 percent increase in the average price of homes sold. The Midwest showed the smallest increase at 4.8 percent improvement.

“The housing market continues to suffer the effects of record high unemployment and restrictions in the sale of foreclosed homes. The halt in foreclosure proceedings appeared to have impacted sales significantly. Foreclosure and distressed home sales are a significant portion of all sales in the first 10 months of 2010 and it appears that purchasers are waiting for more inventory. The annualized rate fell 15.4 percent from last month which indicates that housing continues to face strong obstacles

in getting back to a healthy condition,” said

Steve Murray, editor of the REAL Trends Housing Market Report.

“The downside is that on a year over year basis housing sales continue to fall. We expect that the unit sales rate will continue to show year over year declines for the remainder of the year and into the first half of 2011 as the 2010-2011 results will be compared against sales that took place during the first wave of tax credit fueled housing sales in the fourth quarter of 2009 and the first two quarters of 2010. The declines will be partially offset by improving conditions in the overall economy.” n

REAL Trends Housing Market Report – November 2010

Housing sales continue to slump in November as the annualized unit basis decreased to

3.660 million new and existing home sales. This November results were down from

October 2010 rate of 4.327 million.

New and existing housing sales in November declined 25.7 percent from November 2009 while the average price increased 7.3 percent from the same month a year ago.

See the REAL Trends

November/October Housing Market Report Chart on the Following Page

21

REAL Trends November/October Housing Market Report

(Versus same month a year ago)

November 2010 November 2010 October 2010 October 2010

Closed Sales Avg. Price Closed Sales Avg. Price

National -25.7% +7.3% -25.4% +8.2%

Regional Report

Northeast -32.2% +9.1% -27.8% +12.3%

South -23.0% +7.6% -24.4% +1.9%

Midwest -30.6% +4.8% -32.7% +5.4%

West -19.2% +5.8% -19.6% +8.2%

-5.0%0.0%5.0%10.0%15.0%-25.0%-30.0%-35.0%-20.0%-15.0%-10.0%November 2010Closed SalesNovember 2010Avg. PriceOctober 2010Closed SalesOctober 2010Avg. PriceNationalNortheastSouthMidwestWest

Editor’s Note

REAL Trends Leadership Institute

Attendance is growing rapidly for the January

26-28, 2011 REAL Trends Leadership Institute.

The program has three distinct parts: Wednesday

the 26th is a day-long program with Larry Kendall

and Ninja Leadership. Thursday and Friday are

broken into two deep dives – Recruiting is the first

and Finance and Operations is the second.

There are a limited number of

spots left, so if you:

a) need to relearn the

fundamentals of leadership,

b) need to fire up your

recruiting program, or

c) need to hear form the

industry’s leading CFO’s and

COO’s go to

www.realtrends.com/conferences

to learn more or to register for

the REAL Trends Leadership

Institute.

New Book on the Future of Brokerage

Game Plan is the title of a new book we are writing

in partnership with Market Leader CEO Ian Morris

about the future of residential brokerage. We are

seeking input from a wide array of industry sales,

technology, management, and marketing

professionals. Should you want to add your own

comments about your view of the future please

send them via email to smurray@realtrends.com n

We at REAL Trends

wish you and yours a very

Happy and Prosperous

New Year!

22

Price Reductions

2010-11-17T15:04:00.001-08:00

Nearly half of homes on the market had experienced a price reduction at least once in October, according to a monthly review of multiple listing service listings in 26 major markets conducted by national online brokerage ZipRealty.

Sellers had cut asking prices on 48.4 percent of listings last month -- a total of 316,097 homes. The number of discounted homes fell 2.2 percent from September but rose 22.4 percent compared to October 2009. (Note: October 2009's figures include a 27th market: Sacramento). Homes had been reduced an average of two times, essentially flat from the same time last year.

Sellers discounted homes for a median $19,423, up 1.4 percent from September, but down 21.4 percent from October 2009. The median list price for homes last month was $241,309, down 1.6 percent month-to-month and 14.3 percent year-over-year.

The ratio of price-reduction amount to list price was 7.5 percent, up from 7.3 percent in September but down from 8.1 percent in October 2009.

Total for-sale inventory fell 3.3 percent month-to-month but rose 10.1 percent year-over-year to 653,811, ZipRealty reported.

In 12 out of 26 markets, more than half of sellers had slashed listing prices: Philadelphia, Pa.; Austin, Texas; Seattle, Wash.; Boston, Mass; Orange County, Calif.; Baltimore, Md.; Tucson, Ariz.; Chicago, Ill.; Orlando, Fla.; Minneapolis/St. Paul, Minn.; Jacksonville, Fla.; and Phoenix, Ariz.

By contrast, only three of 27 markets had seen more than half of their listings discounted in October 2009: Chicago, Jacksonville and Orlando.

For the first time in 2010, Phoenix led the pack last month with 56.1 percent of listings experiencing discounts. Denver, Colo. had the smallest share of discounted listings: 34 percent.

Source: Inman News

Comparable sales in New Bern

2010-11-12T19:02:00.000-08:00

In the last week there 16 closings in our MLS.
In the same time frame one year ago there were 21 closings. This represents a decrease of almost 24%.

For the entire year sales are just about the same as last year.

New home sales for the year are about the same as last year. The new home inventory is slowly but surely working its way down. Currently there is about a 11 month inventory of new homes on the market. A stable market is generally defined as a 6 month inventory.

Good news for interest rates

2010-11-09T13:31:00.001-08:00

Bankrate: Mortgage Rates Return to Record Low Territory

RISMEDIA, November 9, 2010--Mortgage rates revisited record lows this week, with the average rate on the benchmark conforming 30-year fixed mortgage rate returning to 4.42 percent, according to Bankrate.com's weekly national survey. The average 30-year fixed mortgage has an average of 0.37 discount and origination points.

The average 15-year fixed mortgage hit a new low of 3.81 percent, and the larger jumbo 30-year fixed rate did as well, sinking to 5.04 percent. Adjustable rate mortgages were mostly lower, with the average 5-year ARM falling to 3.57 percent and the average 7-year ARM retreating to 3.87 percent.

Mortgage rates fell back into record low territory this week. The Federal Reserve has announced another injection of $600 billion over the next 8 months, but it remains to be seen if this is enough to push Treasury yields and mortgage rates lower, and if so, by how much. Even if the Fed is successful in pushing rates lower, it doesn't alter the fact that many would-be borrowers are upside-down, living on a reduced income, or concerned about a lack of job security.

The last time mortgage rates were above 6 percent was Nov. 2008. At that time, the average rate was 6.33 percent, meaning a $200,000 loan would have carried a monthly payment of $1,241.86. With the average rate now 4.42 percent, the monthly payment for the same size loan would be $1,003.89, a savings of $238 per month for a homeowner refinancing now.

SURVEY RESULTS

•30-year fixed: 4.42% -- down from 4.51% last week (avg. points: 0.37)

•15-year fixed: 3.81% -- down from 3.90% last week (avg. points: 0.28)

•5/1 ARM: 3.57% -- down from 3.67% last week (avg. points: 0.34)

October Housing Report

2010-11-07T05:09:00.000-08:00

The Administration’s goal is to promote stability for both the housing

market and homeowners. To meet these objectives in the context of

a very challenging market, the Administration developed a broad

approach implementing state and local housing agency initiatives, tax

credits for homebuyers, neighborhood stabilization and community

development programs, mortgage modifi cations and refi nancing,

continued Federal Housing Administration (FHA) engagement, and

support for Fannie Mae and Freddie Mac. In addition, Federal

Reserve and Treasury MBS purchase programs have helped to keep

mortgage interest rates at record lows over the past year. More detail

on the Administration’s efforts can be found in the Appendix.

October 2010 Scorecard on Administration’s

Comprehensive Housing Initiative

The President’s housing market recovery efforts began immediately after

taking offi ce in February 2009. The October 2010 housing scorecard

includes the following key indicators of market health and results of the

Administration’s comprehensive response, as outlined above:

• Families continued to benefit from the lowest rates in

history on 30-year fixed mortgages. Since April of 2009,

record low rates have helped more than 7.1 million homeowners

to refi nance, resulting in more stable home prices and $12.7

billion in total borrower savings.

• As expected with the expiration of the Homebuyer Tax

Credit, new and existing home sales remained below

levels seen in the first half of 2010. At the same time, home

prices remained level in the past year after 33 straight months of

decline and homeowners added $95 billion in home equity in the

second quarter.

• More than 3.52 million modification arrangements were

started between April 2009 and the end of August 2010

—nearly triple the number of foreclosure completions

during that time. These included more than 1.3 million trial

Home Affordable Modifi cation Program (HAMP) modifi cation

starts, more than 510,000 Federal Housing Administration (FHA)

loss mitigation and early delinquency interventions, and more

than 1.6 million proprietary modifi cations under HOPE Now.

While some homeowners may have received help from more than

one program, the number of agreements offered nearly tripled

foreclosure completions for the same period (1.3 million).

• At nine months, almost 90 percent of homeowners

remain in their permanent HAMP modification, with 11

percent defaulted. Early data indicate that HAMP permanent

modifi cations are performing well over time, with lower

delinquency rates than those reported by the industry at large.

At nine months, less than 16 percent of permanent modifi cations

are 60+ days delinquent. To view the September HAMP Servicer

Performance Report, visit: http://www.fi nancialstability.gov/

docs/Sept%20MHA%20Public%202010.pdf

Data in the scorecard also show that the recovery in the housing

market continues to remain fragile, for example, foreclosure

completions continue to move upward and a large supply of homes

are being held off the market. While the recovery will take place over

time, the Administration remains committed to its efforts to prevent

avoidable foreclosures and stabilize the housing market.

The impact of recent new and expanded resources is expected to

contribute to progress captured in future Housing Scorecards. For

example, in July the Federal Housing Administration (FHA) announced

a short refi nance option targeted to help people who owe more on

their mortgage than their home is worth because their local markets

saw large declines in home values. The option will allow certain

underwater non-FHA borrowers – those current on their existing

mortgage and whose lenders agree to write off at least 10 percent of

the unpaid principal balance of the fi rst mortgage – the opportunity to

qualify for a new FHA-insured mortgage.

U.S. Department of Housing and Urban Development
Office of Policy Development and Research

e Obama Administration’s E orts

To Stabilize e Housing Market

and Help American Homeowners

October 2010

U.S Department of Housing and Urban Development
U.S. Department of the Treasury

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

House Prices Show Signs Of Stabilizing

Existing And New Home Sales

Existing Homes On e Market Below Peak, But Number Of

Units Held Off e Market Has Increased

Expectations On House Prices Have Shifted Up From 2009

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

Mortgage Aid Has Been Extended More an 3 Million Times,

Outpacing Foreclosures

Mortgage Rates Fall To Record Low And Affordability Index Remains High

Foreclosure Starts And Completions Remain Elevated

7.1 Million Homeowners Have Refinanced Since April 1, 2009

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

Homeowners Save From Reduced Mortgage Payments

Home Equity Up More an $1 Trillion Since First Quarter 2009

FHA Supports Mortgage Lending During Crisis

Housing Counselors Serve Millions Of Families

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

HOUSING MARKET FACT SHEET

Indicator is Period Last Period Year Ago As of Dec 2008 Latest Release

Mortgage Rates (30-Yr FRM, percent) 4.21 4.19 5.00 5.10 21-Oct-10

Housing Affordability (index) 168.3 162.2 161.9 166.3 August-10

Home Prices (indices)

Case Shiller (NSA)

FHFA (SA)

148.9

192.4

148.0

193.4

144.3

198.9

150.5

198.9

July-10

July-10

Home Sales (thousands, SA)

New

Existing

First Time Buyers

24.0

344.2

173.0 (p)

24.0

320.0

161.7

33.8

425.0

215.6

31.4

395.0

174.8

August-10

August-10

August-10

Housing Supply

Existing Homes for Sale (thousands, NSA)

Existing Homes - Months’ Supply (months)

New Homes for Sale (thousands, SA)

New Homes for Sale - Months’ Supply (months,SA)

Vacant Units Held Off Market (thousands)

3,982

11.6

206

8.6

3,743

4,007

12.5

209

8.7

3,628

3,924

9.2

262

7.8

3,501

3,700

9.4

353

11.2

3,508

August-10

August-10

August-10

August-10

2nd Q 10

Mortgage Originations (thousands)

Refi nance Originations

Purchase Originations

1,132.7

925.0

1,050.9

614.7

1,941.0

992.4 (r)

767.2

986.4

2nd Q 10

2nd Q 10

FHA Originations (thousands)

Refi nance Originations

Purchase Originations

Purchases by First Time Buyers

47.4

63.5

44.5

(p)

(p)

(p)

51.7

67.2

44.9

(r)

(r)

(r)

60.6

103.4

84.6

62.9

72.7

56.2

September-10

September-10

September-10

Mortgage Delinquency Rates (percent)

Prime

Subprime

FHA

5.2

36.4

12.4

5.2

36.2

12.5

5.8

36.3

14.7

4.4

34.1

14.3

September-10

September-10

August-10

Seriously Delinquent Mortgages (thousands)

Prime

Subprime

FHA

1747.0

1974.9

558.0

1,782.3

1,960.6

559.6

1760.7

1964.6

453.0

912.8

1,642.1

333.1

September-10

September-10

August-10

Underwater Borrowers (thousands) 10,971.2 11,276.9 10,155.6 (a) -- 2nd Q 10

Foreclosure Actions (thousands)

Notice of Default (Foreclosure Starts)

Notice of Foreclosure Sale

Foreclosure Completions

Short Sales

102.4

142.9

102.1

18.7 (p)

96.5

147.0

95.4

29.1

122.2

133.7

87.8

22.9

121.5

103.0

78.9

13.8

September-10

September-10

September-10

July-10

HOUSING ASSISTANCE AND STABILIZATION PERFORMANCE METRICS

Indicator is Period Last Period Cumulative From Apr 1, 2009 Latest Release

Distressed Homeowners Assisted (thousands)

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

FHA Loss Mitigation Interventions

HOPE Now Modifi cations

35.3

27.8

56.4

115.8

26.6

33.3

39.2

120.4

1,369.4

495.9

568.1

1,675.6

September-10

September-10

September-10

August-10

Counseled Borrowers (thousands) 713.5 839.4 4,272 2nd Q 10

Borrower Annual Savings ($ millions)

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

All Refi nances

--

--

--

--

--

--

2,313.3

2,407.5

12,737.3

2nd Q 10

2nd Q 10

2nd Q 10

Activities Completed Under NSP (housing units)

New Construction or Residential Rehab

Demolition or Clearance

Direct Homeownership Assistance

3,033

1,041

1,147

2,537

667

1,094

9,249 [36,292]

2,987 [8,252]

3,768 [18,000]

(b)

(b)

(b)

2nd Q 10

2nd Q 10

2nd Q 10

Change in Aggregate Home Equity ($ billions) 95.4 201.1 1,020.3 2nd Q 10

SA = seasonally adjusted, NSA = not SA, p = preliminary, a = adjusted for methodology change, r = revised, b = brackets include units in process.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

SOURCES AND METHODOLOGY

A. Items in Tables

Description Frequency Sources Notes on Methodology

Distressed Homeowners Assisted

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

FHA Loss Mitigation Interventions

HOPE Now Modifi cations

Monthy

Monthy

Monthy

Monthy

Treasury

Treasury

HUD

Hope Now Alliance

As reported.

As reported.

All FHA loss mitigation and early delinquency interventions.

All proprietary modifi cations completed.

Counseled Borrowers (thousands) Quarterly HUD Housing counseling activity reported by all HUD-approved housing counselors.

Borrower Annual Savings

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

All Refi nances

Quarterly

Quarterly

Quarterly

HUD, Treasury, and Freddie Mac

HUD and Treasury

HUD, and MBA

HUD estimate of annualized savings based on Treasury reported active HAMP trial modifi cations

and Freddie Mac monthly savings estimates.

HUD estimate of annualized savings based on Treasury reported active HAMP permanent

modifi cations and median monthly savings estimates.

Refi nance originations (see below) multiplied by HUD estimate of annualized savings per refi nance.

Completed Activities Under NSP (housing units)

New Construction or Residential Rehab

Demolition or Clearance

Direct Homeownership Assistance

Quarterly

Quarterly

Quarterly

HUD

HUD

HUD

Housing units constructed/rehabilitated using Neighborhood Stabilization Program.

Bracketed numbers include units in process, to be completed by 3/2013.

Housing units demolished/cleared using Neighborhood Stabilization Program. Bracketed

numbers as above.

Completed downpayment assistance or non-amortizing second mortgages by grantee to

make purchase of NSP unit affordable. Bracketed numbers as above.

Change in Aggregate Home Equity Quarterly Federal Reserve Board Difference in aggregate household owners’ equity in real estate as reported in the Federal

Reserve Board’s Flow of Funds Accounts of the United States for stated time period.

Mortgage Rates (30-Yr FRM) Weekly Freddie Mac Primary Mortgage Market Survey, as reported for 30-Year fi xed rate mortgages (FRM).

Housing Affordability Monthly National Association of Realtors ® NAR’s composite housing affordability index as reported. A value of 100 means that a

family with the median income has exactly enough income to qualify for a mortgage on a

median-priced home. An index above 100 signifi es that family earning the median income

has more than enough income to qualify.

Home Prices

Case-Shiller (NSA)

FHFA (SA)

Monthy

Monthy

Standard and Poor’s

Federal Housing Finance Agency

Case-Shiller 20-metro composite index, January 2000 = 100. Standard and Poor’s

recommends use of not seasonally adjusted index when making monthly comparisons.

FHFA monthly (purchase-only) index for US, January 1991 = 100.

Home Sales (SA)

New

Existing

First Time Buyers

Monthy

Monthy

Monthy

HUD and Census Bureau

National Association of Realtors ®

NAR, Census Bureau, and HUD

Seasonally adjusted annual rates divided by 12. A newly constructed house is considered

sold when either a sales contract has been signed or a deposit accepted, even if this occurs

before construction has actually started.

Seasonally adjusted annual rates divided by 12. Existing-home sales, which include singlefamily,

townhomes, condominiums and co-ops, are based on transaction closings. This differs

from the U.S. Census Bureau’s series on new single-family home sales, which are based on

contracts or the acceptance of a deposit.

Sum of seasonally adjusted new and existing home sales (above) multiplied by National

Association of Realtors ® annual estimate of fi rst time buyer share of existing home sales.

Housing Supply

Existing Homes for Sale (NSA)

Existing Homes - Months’ Supply

New Homes for Sale (SA)

New Homes for Sale - Months’ Supply (SA)

Vacant Units Held Off Market

Monthly

Monthly

Monthly

Monthly

Quarterly

National Association of Realtors ®

National Association of Realtors ®

HUD and Census Bureau

HUD and Census Bureau

Census Bureau

As reported.

As reported.

As reported.

As reported.

As reported.

Mortgage Originations

Refi nance Originations

Purchase Originations

Quarterly

Quarterly

Mortgage Bankers Association

and HUD

Mortgage Bankers Association

and HUD

HUD estimate of refi nance originations based on MBA estimate of dollar volume of refi ance

originations.

HUD estimate of home purchase originations based on MBA estimate of dollar volume of

home purchase originations.

FHA Originations

Refi nance Originations

Purchase Originations

Purchases by First Time Buyers

Monthy

Monthy

Monthy

HUD

HUD

HUD

FHA originations reported as of date of loan closing. Estimate for current month scaled upward

due to normal reporting lag and shown as preliminary.

Mortgage Delinquency Rates (NSA)

Prime

Subprime

FHA

Monthy

Monthy

Monthy

LPS-McDash Analytics

LPS-McDash Analytics

HUD

Total mortgages past due (30+ days) but not in foreclosure, divided by mortgages actively serviced.

Total mortgages past due (30+ days) but not in foreclosure, divided by mortgages actively serviced.

Total FHA mortgages past due (30+ days) but not in foreclosure, divided by FHA’s insurance in force.

Seriously Delinquent Mortgages

Prime

Subprime

FHA

Monthly

Monthly

Monthly

LPS-McDash, MBA, and HUD

LPS-McDash, MBA, and HUD

HUD

Mortgages 90+ days delinquent or in foreclosure, scaled up to market.

Mortgages 90+ days delinquent or in foreclosure, scaled up to market.

Mortgages 90+ days delinquent or in foreclosure.

Underwater Borrowers Quarterly First American CoreLogic As reported. Due to change in reporting methodology, underwater borrower estimates prior to

the third quarter of 2009 are adjusted to be compatible with current estimates.

Foreclosure Actions

Notice of Default (Foreclosure Starts)

Notice of Foreclosure Sale

Foreclosure Completions

Short sales

Monthly

Monthly

Monthly

Monthly

Realty Trac

Realty Trac

Realty Trac

Core Logic

Reported counts of notice of default plus lis pendens. Some foreclosure starts may be omitted in

states where the fi ling of a notice of default is optional.

Notice of sale (auctions).

Real Estate Owned (REO).

Count of Short Sales for the month as reported.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

SOURCES AND METHODOLOGY

B. Notes on Charts.

1. Monthly house price trends shown as changes in respective house price indices applied to a common base price set equal to the median price of an existing

home sold in January 2003 as reported by the National Association of Realtors. Indices shown: S&P/Case Shiller 20-metro composite index (NSA), January

2000 = 100, and FHFA monthly (purchase-only) index for US (SA), January 1991 = 100.

2. S&P/Case-Shiller 20 metro composite index (NSA) as reported monthly. Futures index fi gures report forward expectations of the level of the S&P/Case Shiller

index as of the date indicated, estimated from prices of futures contracts reported by Radar Logic.

3. Reported seasonally adjusted annual rates for new and existing home sales divided by 12.

4. HUD estimate of refi nance originations based on MBA estimate of dollar volume of refi nance originations.

5. Cumulative HAMP modifi cations started, FHA loss mitigation and early delinquency interventions, plus proprietary modifi cations completed as reported by

Hope Now Alliance. Some homeowners may be counted in more than one category. Foreclosure completions are properties entering Real Estate Owned

(REO) as reported by Realty Trac.

6. Foreclosure starts include notice of default and lis pendens, completions are properties entering REO. Both as reported by Realty Trac. See “Foreclosure

Actions” above.

7. See “Borrower Annual Savings” above.

8. FHA market shares as FHA purchase and refi nance originations divided by HUD estimates of purchase and refi nance mortgage originations as noted in

“Mortgage Originations” above.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

The Administration has taken a broad set of actions to stabilize the housing market and help American

homeowners. A year ago, stress in the fi nancial system had severely reduced the supply of mortgage credit,

limiting the ability of Americans to buy homes or refi nance mortgages. Millions of responsible families who

had made their monthly payments and had fulfi lled their obligations saw their property values fall. They also

found themselves unable to refi nance at lower mortgage rates.

In February 2009, less than one month after taking offi ce, President Obama announced the Homeowner

Affordability and Stability Plan. As part of this plan and through other housing initiatives, the Administration

has taken the following actions to strengthen the housing market:

• Supported Fannie Mae and Freddie Mac to ensure continued access to affordable mortgage credit;

• The Federal Reserve and the U.S. Treasury purchased more than $1.4 trillion in agency mortgage

backed securities through independent MBS purchase programs, helping to keep mortgage rates at

historic lows;

• Launched a modifi cation initiative to help homeowners reduce mortgage payments to affordable levels

and to prevent avoidable foreclosures;

• Launched a $23.5 billion Housing Finance Agencies Initiative to increase sustainable homeownership

and rental resources;

• Supported the First Time Homebuyer Tax Credit, which has helped 2.5 million American families

purchase homes;

• Provided more than $5 billion in support for affordable rental housing through low income housing tax

credit programs and $6.92 billion in support for the Neighborhood Stabilization Program to restore

neighborhoods hardest hit by the concentrated foreclosures;

• Created the $4.1 billion HFA Hardest Hit Fund for innovative foreclosure prevention programs in the

nation’s hardest hit housing markets.

• Supported home purchase and refi nance activity through the FHA to provide access to affordable

mortgage capital and help homeowners prevent foreclosures.

###

AppendixThe Administration’s goal is to promote stability for both the housing

market and homeowners. To meet these objectives in the context of

a very challenging market, the Administration developed a broad

approach implementing state and local housing agency initiatives, tax

credits for homebuyers, neighborhood stabilization and community

development programs, mortgage modifi cations and refi nancing,

continued Federal Housing Administration (FHA) engagement, and

support for Fannie Mae and Freddie Mac. In addition, Federal

Reserve and Treasury MBS purchase programs have helped to keep

mortgage interest rates at record lows over the past year. More detail

on the Administration’s efforts can be found in the Appendix.

October 2010 Scorecard on Administration’s

Comprehensive Housing Initiative

The President’s housing market recovery efforts began immediately after

taking offi ce in February 2009. The October 2010 housing scorecard

includes the following key indicators of market health and results of the

Administration’s comprehensive response, as outlined above:

• Families continued to benefit from the lowest rates in

history on 30-year fixed mortgages. Since April of 2009,

record low rates have helped more than 7.1 million homeowners

to refi nance, resulting in more stable home prices and $12.7

billion in total borrower savings.

• As expected with the expiration of the Homebuyer Tax

Credit, new and existing home sales remained below

levels seen in the first half of 2010. At the same time, home

prices remained level in the past year after 33 straight months of

decline and homeowners added $95 billion in home equity in the

second quarter.

• More than 3.52 million modification arrangements were

started between April 2009 and the end of August 2010

—nearly triple the number of foreclosure completions

during that time. These included more than 1.3 million trial

Home Affordable Modifi cation Program (HAMP) modifi cation

starts, more than 510,000 Federal Housing Administration (FHA)

loss mitigation and early delinquency interventions, and more

than 1.6 million proprietary modifi cations under HOPE Now.

While some homeowners may have received help from more than

one program, the number of agreements offered nearly tripled

foreclosure completions for the same period (1.3 million).

• At nine months, almost 90 percent of homeowners

remain in their permanent HAMP modification, with 11

percent defaulted. Early data indicate that HAMP permanent

modifi cations are performing well over time, with lower

delinquency rates than those reported by the industry at large.

At nine months, less than 16 percent of permanent modifi cations

are 60+ days delinquent. To view the September HAMP Servicer

Performance Report, visit: http://www.fi nancialstability.gov/

docs/Sept%20MHA%20Public%202010.pdf

Data in the scorecard also show that the recovery in the housing

market continues to remain fragile, for example, foreclosure

completions continue to move upward and a large supply of homes

are being held off the market. While the recovery will take place over

time, the Administration remains committed to its efforts to prevent

avoidable foreclosures and stabilize the housing market.

The impact of recent new and expanded resources is expected to

contribute to progress captured in future Housing Scorecards. For

example, in July the Federal Housing Administration (FHA) announced

a short refi nance option targeted to help people who owe more on

their mortgage than their home is worth because their local markets

saw large declines in home values. The option will allow certain

underwater non-FHA borrowers – those current on their existing

mortgage and whose lenders agree to write off at least 10 percent of

the unpaid principal balance of the fi rst mortgage – the opportunity to

qualify for a new FHA-insured mortgage.

U.S. Department of Housing and Urban Development
Office of Policy Development and Research

e Obama Administration’s E orts

To Stabilize e Housing Market

and Help American Homeowners

October 2010

U.S Department of Housing and Urban Development
U.S. Department of the Treasury

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

House Prices Show Signs Of Stabilizing

Existing And New Home Sales

Existing Homes On e Market Below Peak, But Number Of

Units Held Off e Market Has Increased

Expectations On House Prices Have Shifted Up From 2009

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

Mortgage Aid Has Been Extended More an 3 Million Times,

Outpacing Foreclosures

Mortgage Rates Fall To Record Low And Affordability Index Remains High

Foreclosure Starts And Completions Remain Elevated

7.1 Million Homeowners Have Refinanced Since April 1, 2009

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

Homeowners Save From Reduced Mortgage Payments

Home Equity Up More an $1 Trillion Since First Quarter 2009

FHA Supports Mortgage Lending During Crisis

Housing Counselors Serve Millions Of Families

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

HOUSING MARKET FACT SHEET

Indicator is Period Last Period Year Ago As of Dec 2008 Latest Release

Mortgage Rates (30-Yr FRM, percent) 4.21 4.19 5.00 5.10 21-Oct-10

Housing Affordability (index) 168.3 162.2 161.9 166.3 August-10

Home Prices (indices)

Case Shiller (NSA)

FHFA (SA)

148.9

192.4

148.0

193.4

144.3

198.9

150.5

198.9

July-10

July-10

Home Sales (thousands, SA)

New

Existing

First Time Buyers

24.0

344.2

173.0 (p)

24.0

320.0

161.7

33.8

425.0

215.6

31.4

395.0

174.8

August-10

August-10

August-10

Housing Supply

Existing Homes for Sale (thousands, NSA)

Existing Homes - Months’ Supply (months)

New Homes for Sale (thousands, SA)

New Homes for Sale - Months’ Supply (months,SA)

Vacant Units Held Off Market (thousands)

3,982

11.6

206

8.6

3,743

4,007

12.5

209

8.7

3,628

3,924

9.2

262

7.8

3,501

3,700

9.4

353

11.2

3,508

August-10

August-10

August-10

August-10

2nd Q 10

Mortgage Originations (thousands)

Refi nance Originations

Purchase Originations

1,132.7

925.0

1,050.9

614.7

1,941.0

992.4 (r)

767.2

986.4

2nd Q 10

2nd Q 10

FHA Originations (thousands)

Refi nance Originations

Purchase Originations

Purchases by First Time Buyers

47.4

63.5

44.5

(p)

(p)

(p)

51.7

67.2

44.9

(r)

(r)

(r)

60.6

103.4

84.6

62.9

72.7

56.2

September-10

September-10

September-10

Mortgage Delinquency Rates (percent)

Prime

Subprime

FHA

5.2

36.4

12.4

5.2

36.2

12.5

5.8

36.3

14.7

4.4

34.1

14.3

September-10

September-10

August-10

Seriously Delinquent Mortgages (thousands)

Prime

Subprime

FHA

1747.0

1974.9

558.0

1,782.3

1,960.6

559.6

1760.7

1964.6

453.0

912.8

1,642.1

333.1

September-10

September-10

August-10

Underwater Borrowers (thousands) 10,971.2 11,276.9 10,155.6 (a) -- 2nd Q 10

Foreclosure Actions (thousands)

Notice of Default (Foreclosure Starts)

Notice of Foreclosure Sale

Foreclosure Completions

Short Sales

102.4

142.9

102.1

18.7 (p)

96.5

147.0

95.4

29.1

122.2

133.7

87.8

22.9

121.5

103.0

78.9

13.8

September-10

September-10

September-10

July-10

HOUSING ASSISTANCE AND STABILIZATION PERFORMANCE METRICS

Indicator is Period Last Period Cumulative From Apr 1, 2009 Latest Release

Distressed Homeowners Assisted (thousands)

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

FHA Loss Mitigation Interventions

HOPE Now Modifi cations

35.3

27.8

56.4

115.8

26.6

33.3

39.2

120.4

1,369.4

495.9

568.1

1,675.6

September-10

September-10

September-10

August-10

Counseled Borrowers (thousands) 713.5 839.4 4,272 2nd Q 10

Borrower Annual Savings ($ millions)

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

All Refi nances

--

--

--

--

--

--

2,313.3

2,407.5

12,737.3

2nd Q 10

2nd Q 10

2nd Q 10

Activities Completed Under NSP (housing units)

New Construction or Residential Rehab

Demolition or Clearance

Direct Homeownership Assistance

3,033

1,041

1,147

2,537

667

1,094

9,249 [36,292]

2,987 [8,252]

3,768 [18,000]

(b)

(b)

(b)

2nd Q 10

2nd Q 10

2nd Q 10

Change in Aggregate Home Equity ($ billions) 95.4 201.1 1,020.3 2nd Q 10

SA = seasonally adjusted, NSA = not SA, p = preliminary, a = adjusted for methodology change, r = revised, b = brackets include units in process.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

SOURCES AND METHODOLOGY

A. Items in Tables

Description Frequency Sources Notes on Methodology

Distressed Homeowners Assisted

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

FHA Loss Mitigation Interventions

HOPE Now Modifi cations

Monthy

Monthy

Monthy

Monthy

Treasury

Treasury

HUD

Hope Now Alliance

As reported.

As reported.

All FHA loss mitigation and early delinquency interventions.

All proprietary modifi cations completed.

Counseled Borrowers (thousands) Quarterly HUD Housing counseling activity reported by all HUD-approved housing counselors.

Borrower Annual Savings

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

All Refi nances

Quarterly

Quarterly

Quarterly

HUD, Treasury, and Freddie Mac

HUD and Treasury

HUD, and MBA

HUD estimate of annualized savings based on Treasury reported active HAMP trial modifi cations

and Freddie Mac monthly savings estimates.

HUD estimate of annualized savings based on Treasury reported active HAMP permanent

modifi cations and median monthly savings estimates.

Refi nance originations (see below) multiplied by HUD estimate of annualized savings per refi nance.

Completed Activities Under NSP (housing units)

New Construction or Residential Rehab

Demolition or Clearance

Direct Homeownership Assistance

Quarterly

Quarterly

Quarterly

HUD

HUD

HUD

Housing units constructed/rehabilitated using Neighborhood Stabilization Program.

Bracketed numbers include units in process, to be completed by 3/2013.

Housing units demolished/cleared using Neighborhood Stabilization Program. Bracketed

numbers as above.

Completed downpayment assistance or non-amortizing second mortgages by grantee to

make purchase of NSP unit affordable. Bracketed numbers as above.

Change in Aggregate Home Equity Quarterly Federal Reserve Board Difference in aggregate household owners’ equity in real estate as reported in the Federal

Reserve Board’s Flow of Funds Accounts of the United States for stated time period.

Mortgage Rates (30-Yr FRM) Weekly Freddie Mac Primary Mortgage Market Survey, as reported for 30-Year fi xed rate mortgages (FRM).

Housing Affordability Monthly National Association of Realtors ® NAR’s composite housing affordability index as reported. A value of 100 means that a

family with the median income has exactly enough income to qualify for a mortgage on a

median-priced home. An index above 100 signifi es that family earning the median income

has more than enough income to qualify.

Home Prices

Case-Shiller (NSA)

FHFA (SA)

Monthy

Monthy

Standard and Poor’s

Federal Housing Finance Agency

Case-Shiller 20-metro composite index, January 2000 = 100. Standard and Poor’s

recommends use of not seasonally adjusted index when making monthly comparisons.

FHFA monthly (purchase-only) index for US, January 1991 = 100.

Home Sales (SA)

New

Existing

First Time Buyers

Monthy

Monthy

Monthy

HUD and Census Bureau

National Association of Realtors ®

NAR, Census Bureau, and HUD

Seasonally adjusted annual rates divided by 12. A newly constructed house is considered

sold when either a sales contract has been signed or a deposit accepted, even if this occurs

before construction has actually started.

Seasonally adjusted annual rates divided by 12. Existing-home sales, which include singlefamily,

townhomes, condominiums and co-ops, are based on transaction closings. This differs

from the U.S. Census Bureau’s series on new single-family home sales, which are based on

contracts or the acceptance of a deposit.

Sum of seasonally adjusted new and existing home sales (above) multiplied by National

Association of Realtors ® annual estimate of fi rst time buyer share of existing home sales.

Housing Supply

Existing Homes for Sale (NSA)

Existing Homes - Months’ Supply

New Homes for Sale (SA)

New Homes for Sale - Months’ Supply (SA)

Vacant Units Held Off Market

Monthly

Monthly

Monthly

Monthly

Quarterly

National Association of Realtors ®

National Association of Realtors ®

HUD and Census Bureau

HUD and Census Bureau

Census Bureau

As reported.

As reported.

As reported.

As reported.

As reported.

Mortgage Originations

Refi nance Originations

Purchase Originations

Quarterly

Quarterly

Mortgage Bankers Association

and HUD

Mortgage Bankers Association

and HUD

HUD estimate of refi nance originations based on MBA estimate of dollar volume of refi ance

originations.

HUD estimate of home purchase originations based on MBA estimate of dollar volume of

home purchase originations.

FHA Originations

Refi nance Originations

Purchase Originations

Purchases by First Time Buyers

Monthy

Monthy

Monthy

HUD

HUD

HUD

FHA originations reported as of date of loan closing. Estimate for current month scaled upward

due to normal reporting lag and shown as preliminary.

Mortgage Delinquency Rates (NSA)

Prime

Subprime

FHA

Monthy

Monthy

Monthy

LPS-McDash Analytics

LPS-McDash Analytics

HUD

Total mortgages past due (30+ days) but not in foreclosure, divided by mortgages actively serviced.

Total mortgages past due (30+ days) but not in foreclosure, divided by mortgages actively serviced.

Total FHA mortgages past due (30+ days) but not in foreclosure, divided by FHA’s insurance in force.

Seriously Delinquent Mortgages

Prime

Subprime

FHA

Monthly

Monthly

Monthly

LPS-McDash, MBA, and HUD

LPS-McDash, MBA, and HUD

HUD

Mortgages 90+ days delinquent or in foreclosure, scaled up to market.

Mortgages 90+ days delinquent or in foreclosure, scaled up to market.

Mortgages 90+ days delinquent or in foreclosure.

Underwater Borrowers Quarterly First American CoreLogic As reported. Due to change in reporting methodology, underwater borrower estimates prior to

the third quarter of 2009 are adjusted to be compatible with current estimates.

Foreclosure Actions

Notice of Default (Foreclosure Starts)

Notice of Foreclosure Sale

Foreclosure Completions

Short sales

Monthly

Monthly

Monthly

Monthly

Realty Trac

Realty Trac

Realty Trac

Core Logic

Reported counts of notice of default plus lis pendens. Some foreclosure starts may be omitted in

states where the fi ling of a notice of default is optional.

Notice of sale (auctions).

Real Estate Owned (REO).

Count of Short Sales for the month as reported.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

SOURCES AND METHODOLOGY

B. Notes on Charts.

1. Monthly house price trends shown as changes in respective house price indices applied to a common base price set equal to the median price of an existing

home sold in January 2003 as reported by the National Association of Realtors. Indices shown: S&P/Case Shiller 20-metro composite index (NSA), January

2000 = 100, and FHFA monthly (purchase-only) index for US (SA), January 1991 = 100.

2. S&P/Case-Shiller 20 metro composite index (NSA) as reported monthly. Futures index fi gures report forward expectations of the level of the S&P/Case Shiller

index as of the date indicated, estimated from prices of futures contracts reported by Radar Logic.

3. Reported seasonally adjusted annual rates for new and existing home sales divided by 12.

4. HUD estimate of refi nance originations based on MBA estimate of dollar volume of refi nance originations.

5. Cumulative HAMP modifi cations started, FHA loss mitigation and early delinquency interventions, plus proprietary modifi cations completed as reported by

Hope Now Alliance. Some homeowners may be counted in more than one category. Foreclosure completions are properties entering Real Estate Owned

(REO) as reported by Realty Trac.

6. Foreclosure starts include notice of default and lis pendens, completions are properties entering REO. Both as reported by Realty Trac. See “Foreclosure

Actions” above.

7. See “Borrower Annual Savings” above.

8. FHA market shares as FHA purchase and refi nance originations divided by HUD estimates of purchase and refi nance mortgage originations as noted in

“Mortgage Originations” above.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

The Administration has taken a broad set of actions to stabilize the housing market and help American

homeowners. A year ago, stress in the fi nancial system had severely reduced the supply of mortgage credit,

limiting the ability of Americans to buy homes or refi nance mortgages. Millions of responsible families who

had made their monthly payments and had fulfi lled their obligations saw their property values fall. They also

found themselves unable to refi nance at lower mortgage rates.

In February 2009, less than one month after taking offi ce, President Obama announced the Homeowner

Affordability and Stability Plan. As part of this plan and through other housing initiatives, the Administration

has taken the following actions to strengthen the housing market:

• Supported Fannie Mae and Freddie Mac to ensure continued access to affordable mortgage credit;

• The Federal Reserve and the U.S. Treasury purchased more than $1.4 trillion in agency mortgage

backed securities through independent MBS purchase programs, helping to keep mortgage rates at

historic lows;

• Launched a modifi cation initiative to help homeowners reduce mortgage payments to affordable levels

and to prevent avoidable foreclosures;

• Launched a $23.5 billion Housing Finance Agencies Initiative to increase sustainable homeownership

and rental resources;

• Supported the First Time Homebuyer Tax Credit, which has helped 2.5 million American families

purchase homes;

• Provided more than $5 billion in support for affordable rental housing through low income housing tax

credit programs and $6.92 billion in support for the Neighborhood Stabilization Program to restore

neighborhoods hardest hit by the concentrated foreclosures;

• Created the $4.1 billion HFA Hardest Hit Fund for innovative foreclosure prevention programs in the

nation’s hardest hit housing markets.

• Supported home purchase and refi nance activity through the FHA to provide access to affordable

mortgage capital and help homeowners prevent foreclosures.

###

AppendixThe Administration’s goal is to promote stability for both the housing

market and homeowners. To meet these objectives in the context of

a very challenging market, the Administration developed a broad

approach implementing state and local housing agency initiatives, tax

credits for homebuyers, neighborhood stabilization and community

development programs, mortgage modifi cations and refi nancing,

continued Federal Housing Administration (FHA) engagement, and

support for Fannie Mae and Freddie Mac. In addition, Federal

Reserve and Treasury MBS purchase programs have helped to keep

mortgage interest rates at record lows over the past year. More detail

on the Administration’s efforts can be found in the Appendix.

October 2010 Scorecard on Administration’s

Comprehensive Housing Initiative

The President’s housing market recovery efforts began immediately after

taking offi ce in February 2009. The October 2010 housing scorecard

includes the following key indicators of market health and results of the

Administration’s comprehensive response, as outlined above:

• Families continued to benefit from the lowest rates in

history on 30-year fixed mortgages. Since April of 2009,

record low rates have helped more than 7.1 million homeowners

to refi nance, resulting in more stable home prices and $12.7

billion in total borrower savings.

• As expected with the expiration of the Homebuyer Tax

Credit, new and existing home sales remained below

levels seen in the first half of 2010. At the same time, home

prices remained level in the past year after 33 straight months of

decline and homeowners added $95 billion in home equity in the

second quarter.

• More than 3.52 million modification arrangements were

started between April 2009 and the end of August 2010

—nearly triple the number of foreclosure completions

during that time. These included more than 1.3 million trial

Home Affordable Modifi cation Program (HAMP) modifi cation

starts, more than 510,000 Federal Housing Administration (FHA)

loss mitigation and early delinquency interventions, and more

than 1.6 million proprietary modifi cations under HOPE Now.

While some homeowners may have received help from more than

one program, the number of agreements offered nearly tripled

foreclosure completions for the same period (1.3 million).

• At nine months, almost 90 percent of homeowners

remain in their permanent HAMP modification, with 11

percent defaulted. Early data indicate that HAMP permanent

modifi cations are performing well over time, with lower

delinquency rates than those reported by the industry at large.

At nine months, less than 16 percent of permanent modifi cations

are 60+ days delinquent. To view the September HAMP Servicer

Performance Report, visit: http://www.fi nancialstability.gov/

docs/Sept%20MHA%20Public%202010.pdf

Data in the scorecard also show that the recovery in the housing

market continues to remain fragile, for example, foreclosure

completions continue to move upward and a large supply of homes

are being held off the market. While the recovery will take place over

time, the Administration remains committed to its efforts to prevent

avoidable foreclosures and stabilize the housing market.

The impact of recent new and expanded resources is expected to

contribute to progress captured in future Housing Scorecards. For

example, in July the Federal Housing Administration (FHA) announced

a short refi nance option targeted to help people who owe more on

their mortgage than their home is worth because their local markets

saw large declines in home values. The option will allow certain

underwater non-FHA borrowers – those current on their existing

mortgage and whose lenders agree to write off at least 10 percent of

the unpaid principal balance of the fi rst mortgage – the opportunity to

qualify for a new FHA-insured mortgage.

U.S. Department of Housing and Urban Development
Office of Policy Development and Research

e Obama Administration’s E orts

To Stabilize e Housing Market

and Help American Homeowners

October 2010

U.S Department of Housing and Urban Development
U.S. Department of the Treasury

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

House Prices Show Signs Of Stabilizing

Existing And New Home Sales

Existing Homes On e Market Below Peak, But Number Of

Units Held Off e Market Has Increased

Expectations On House Prices Have Shifted Up From 2009

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

Mortgage Aid Has Been Extended More an 3 Million Times,

Outpacing Foreclosures

Mortgage Rates Fall To Record Low And Affordability Index Remains High

Foreclosure Starts And Completions Remain Elevated

7.1 Million Homeowners Have Refinanced Since April 1, 2009

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

Homeowners Save From Reduced Mortgage Payments

Home Equity Up More an $1 Trillion Since First Quarter 2009

FHA Supports Mortgage Lending During Crisis

Housing Counselors Serve Millions Of Families

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

e Obama Administration’s E orts To Stabilize e Housing Market and Help American Homeowners
October 2010

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

HOUSING MARKET FACT SHEET

Indicator is Period Last Period Year Ago As of Dec 2008 Latest Release

Mortgage Rates (30-Yr FRM, percent) 4.21 4.19 5.00 5.10 21-Oct-10

Housing Affordability (index) 168.3 162.2 161.9 166.3 August-10

Home Prices (indices)

Case Shiller (NSA)

FHFA (SA)

148.9

192.4

148.0

193.4

144.3

198.9

150.5

198.9

July-10

July-10

Home Sales (thousands, SA)

New

Existing

First Time Buyers

24.0

344.2

173.0 (p)

24.0

320.0

161.7

33.8

425.0

215.6

31.4

395.0

174.8

August-10

August-10

August-10

Housing Supply

Existing Homes for Sale (thousands, NSA)

Existing Homes - Months’ Supply (months)

New Homes for Sale (thousands, SA)

New Homes for Sale - Months’ Supply (months,SA)

Vacant Units Held Off Market (thousands)

3,982

11.6

206

8.6

3,743

4,007

12.5

209

8.7

3,628

3,924

9.2

262

7.8

3,501

3,700

9.4

353

11.2

3,508

August-10

August-10

August-10

August-10

2nd Q 10

Mortgage Originations (thousands)

Refi nance Originations

Purchase Originations

1,132.7

925.0

1,050.9

614.7

1,941.0

992.4 (r)

767.2

986.4

2nd Q 10

2nd Q 10

FHA Originations (thousands)

Refi nance Originations

Purchase Originations

Purchases by First Time Buyers

47.4

63.5

44.5

(p)

(p)

(p)

51.7

67.2

44.9

(r)

(r)

(r)

60.6

103.4

84.6

62.9

72.7

56.2

September-10

September-10

September-10

Mortgage Delinquency Rates (percent)

Prime

Subprime

FHA

5.2

36.4

12.4

5.2

36.2

12.5

5.8

36.3

14.7

4.4

34.1

14.3

September-10

September-10

August-10

Seriously Delinquent Mortgages (thousands)

Prime

Subprime

FHA

1747.0

1974.9

558.0

1,782.3

1,960.6

559.6

1760.7

1964.6

453.0

912.8

1,642.1

333.1

September-10

September-10

August-10

Underwater Borrowers (thousands) 10,971.2 11,276.9 10,155.6 (a) -- 2nd Q 10

Foreclosure Actions (thousands)

Notice of Default (Foreclosure Starts)

Notice of Foreclosure Sale

Foreclosure Completions

Short Sales

102.4

142.9

102.1

18.7 (p)

96.5

147.0

95.4

29.1

122.2

133.7

87.8

22.9

121.5

103.0

78.9

13.8

September-10

September-10

September-10

July-10

HOUSING ASSISTANCE AND STABILIZATION PERFORMANCE METRICS

Indicator is Period Last Period Cumulative From Apr 1, 2009 Latest Release

Distressed Homeowners Assisted (thousands)

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

FHA Loss Mitigation Interventions

HOPE Now Modifi cations

35.3

27.8

56.4

115.8

26.6

33.3

39.2

120.4

1,369.4

495.9

568.1

1,675.6

September-10

September-10

September-10

August-10

Counseled Borrowers (thousands) 713.5 839.4 4,272 2nd Q 10

Borrower Annual Savings ($ millions)

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

All Refi nances

--

--

--

--

--

--

2,313.3

2,407.5

12,737.3

2nd Q 10

2nd Q 10

2nd Q 10

Activities Completed Under NSP (housing units)

New Construction or Residential Rehab

Demolition or Clearance

Direct Homeownership Assistance

3,033

1,041

1,147

2,537

667

1,094

9,249 [36,292]

2,987 [8,252]

3,768 [18,000]

(b)

(b)

(b)

2nd Q 10

2nd Q 10

2nd Q 10

Change in Aggregate Home Equity ($ billions) 95.4 201.1 1,020.3 2nd Q 10

SA = seasonally adjusted, NSA = not SA, p = preliminary, a = adjusted for methodology change, r = revised, b = brackets include units in process.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

SOURCES AND METHODOLOGY

A. Items in Tables

Description Frequency Sources Notes on Methodology

Distressed Homeowners Assisted

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

FHA Loss Mitigation Interventions

HOPE Now Modifi cations

Monthy

Monthy

Monthy

Monthy

Treasury

Treasury

HUD

Hope Now Alliance

As reported.

As reported.

All FHA loss mitigation and early delinquency interventions.

All proprietary modifi cations completed.

Counseled Borrowers (thousands) Quarterly HUD Housing counseling activity reported by all HUD-approved housing counselors.

Borrower Annual Savings

HAMP Trial Modifi cations

HAMP Permanent Modifi cations

All Refi nances

Quarterly

Quarterly

Quarterly

HUD, Treasury, and Freddie Mac

HUD and Treasury

HUD, and MBA

HUD estimate of annualized savings based on Treasury reported active HAMP trial modifi cations

and Freddie Mac monthly savings estimates.

HUD estimate of annualized savings based on Treasury reported active HAMP permanent

modifi cations and median monthly savings estimates.

Refi nance originations (see below) multiplied by HUD estimate of annualized savings per refi nance.

Completed Activities Under NSP (housing units)

New Construction or Residential Rehab

Demolition or Clearance

Direct Homeownership Assistance

Quarterly

Quarterly

Quarterly

HUD

HUD

HUD

Housing units constructed/rehabilitated using Neighborhood Stabilization Program.

Bracketed numbers include units in process, to be completed by 3/2013.

Housing units demolished/cleared using Neighborhood Stabilization Program. Bracketed

numbers as above.

Completed downpayment assistance or non-amortizing second mortgages by grantee to

make purchase of NSP unit affordable. Bracketed numbers as above.

Change in Aggregate Home Equity Quarterly Federal Reserve Board Difference in aggregate household owners’ equity in real estate as reported in the Federal

Reserve Board’s Flow of Funds Accounts of the United States for stated time period.

Mortgage Rates (30-Yr FRM) Weekly Freddie Mac Primary Mortgage Market Survey, as reported for 30-Year fi xed rate mortgages (FRM).

Housing Affordability Monthly National Association of Realtors ® NAR’s composite housing affordability index as reported. A value of 100 means that a

family with the median income has exactly enough income to qualify for a mortgage on a

median-priced home. An index above 100 signifi es that family earning the median income

has more than enough income to qualify.

Home Prices

Case-Shiller (NSA)

FHFA (SA)

Monthy

Monthy

Standard and Poor’s

Federal Housing Finance Agency

Case-Shiller 20-metro composite index, January 2000 = 100. Standard and Poor’s

recommends use of not seasonally adjusted index when making monthly comparisons.

FHFA monthly (purchase-only) index for US, January 1991 = 100.

Home Sales (SA)

New

Existing

First Time Buyers

Monthy

Monthy

Monthy

HUD and Census Bureau

National Association of Realtors ®

NAR, Census Bureau, and HUD

Seasonally adjusted annual rates divided by 12. A newly constructed house is considered

sold when either a sales contract has been signed or a deposit accepted, even if this occurs

before construction has actually started.

Seasonally adjusted annual rates divided by 12. Existing-home sales, which include singlefamily,

townhomes, condominiums and co-ops, are based on transaction closings. This differs

from the U.S. Census Bureau’s series on new single-family home sales, which are based on

contracts or the acceptance of a deposit.

Sum of seasonally adjusted new and existing home sales (above) multiplied by National

Association of Realtors ® annual estimate of fi rst time buyer share of existing home sales.

Housing Supply

Existing Homes for Sale (NSA)

Existing Homes - Months’ Supply

New Homes for Sale (SA)

New Homes for Sale - Months’ Supply (SA)

Vacant Units Held Off Market

Monthly

Monthly

Monthly

Monthly

Quarterly

National Association of Realtors ®

National Association of Realtors ®

HUD and Census Bureau

HUD and Census Bureau

Census Bureau

As reported.

As reported.

As reported.

As reported.

As reported.

Mortgage Originations

Refi nance Originations

Purchase Originations

Quarterly

Quarterly

Mortgage Bankers Association

and HUD

Mortgage Bankers Association

and HUD

HUD estimate of refi nance originations based on MBA estimate of dollar volume of refi ance

originations.

HUD estimate of home purchase originations based on MBA estimate of dollar volume of

home purchase originations.

FHA Originations

Refi nance Originations

Purchase Originations

Purchases by First Time Buyers

Monthy

Monthy

Monthy

HUD

HUD

HUD

FHA originations reported as of date of loan closing. Estimate for current month scaled upward

due to normal reporting lag and shown as preliminary.

Mortgage Delinquency Rates (NSA)

Prime

Subprime

FHA

Monthy

Monthy

Monthy

LPS-McDash Analytics

LPS-McDash Analytics

HUD

Total mortgages past due (30+ days) but not in foreclosure, divided by mortgages actively serviced.

Total mortgages past due (30+ days) but not in foreclosure, divided by mortgages actively serviced.

Total FHA mortgages past due (30+ days) but not in foreclosure, divided by FHA’s insurance in force.

Seriously Delinquent Mortgages

Prime

Subprime

FHA

Monthly

Monthly

Monthly

LPS-McDash, MBA, and HUD

LPS-McDash, MBA, and HUD

HUD

Mortgages 90+ days delinquent or in foreclosure, scaled up to market.

Mortgages 90+ days delinquent or in foreclosure, scaled up to market.

Mortgages 90+ days delinquent or in foreclosure.

Underwater Borrowers Quarterly First American CoreLogic As reported. Due to change in reporting methodology, underwater borrower estimates prior to

the third quarter of 2009 are adjusted to be compatible with current estimates.

Foreclosure Actions

Notice of Default (Foreclosure Starts)

Notice of Foreclosure Sale

Foreclosure Completions

Short sales

Monthly

Monthly

Monthly

Monthly

Realty Trac

Realty Trac

Realty Trac

Core Logic

Reported counts of notice of default plus lis pendens. Some foreclosure starts may be omitted in

states where the fi ling of a notice of default is optional.

Notice of sale (auctions).

Real Estate Owned (REO).

Count of Short Sales for the month as reported.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

SOURCES AND METHODOLOGY

B. Notes on Charts.

1. Monthly house price trends shown as changes in respective house price indices applied to a common base price set equal to the median price of an existing

home sold in January 2003 as reported by the National Association of Realtors. Indices shown: S&P/Case Shiller 20-metro composite index (NSA), January

2000 = 100, and FHFA monthly (purchase-only) index for US (SA), January 1991 = 100.

2. S&P/Case-Shiller 20 metro composite index (NSA) as reported monthly. Futures index fi gures report forward expectations of the level of the S&P/Case Shiller

index as of the date indicated, estimated from prices of futures contracts reported by Radar Logic.

3. Reported seasonally adjusted annual rates for new and existing home sales divided by 12.

4. HUD estimate of refi nance originations based on MBA estimate of dollar volume of refi nance originations.

5. Cumulative HAMP modifi cations started, FHA loss mitigation and early delinquency interventions, plus proprietary modifi cations completed as reported by

Hope Now Alliance. Some homeowners may be counted in more than one category. Foreclosure completions are properties entering Real Estate Owned

(REO) as reported by Realty Trac.

6. Foreclosure starts include notice of default and lis pendens, completions are properties entering REO. Both as reported by Realty Trac. See “Foreclosure

Actions” above.

7. See “Borrower Annual Savings” above.

8. FHA market shares as FHA purchase and refi nance originations divided by HUD estimates of purchase and refi nance mortgage originations as noted in

“Mortgage Originations” above.

U.S. Department of Housing and Urban Development
Office of Policy Development e Obama Administration’s E orts To Stabilize e Housing Market and Help American H aondm Reeoswenarecrhs
October 2010

U.S Department of Housing and Urban Development

U.S. Department of the Treasury

The Administration has taken a broad set of actions to stabilize the housing market and help American

homeowners. A year ago, stress in the fi nancial system had severely reduced the supply of mortgage credit,

limiting the ability of Americans to buy homes or refi nance mortgages. Millions of responsible families who

had made their monthly payments and had fulfi lled their obligations saw their property values fall. They also

found themselves unable to refi nance at lower mortgage rates.

In February 2009, less than one month after taking offi ce, President Obama announced the Homeowner

Affordability and Stability Plan. As part of this plan and through other housing initiatives, the Administration

has taken the following actions to strengthen the housing market:

• Supported Fannie Mae and Freddie Mac to ensure continued access to affordable mortgage credit;

• The Federal Reserve and the U.S. Treasury purchased more than $1.4 trillion in agency mortgage

backed securities through independent MBS purchase programs, helping to keep mortgage rates at

historic lows;

• Launched a modifi cation initiative to help homeowners reduce mortgage payments to affordable levels

and to prevent avoidable foreclosures;

• Launched a $23.5 billion Housing Finance Agencies Initiative to increase sustainable homeownership

and rental resources;

• Supported the First Time Homebuyer Tax Credit, which has helped 2.5 million American families

purchase homes;

• Provided more than $5 billion in support for affordable rental housing through low income housing tax

credit programs and $6.92 billion in support for the Neighborhood Stabilization Program to restore

neighborhoods hardest hit by the concentrated foreclosures;

• Created the $4.1 billion HFA Hardest Hit Fund for innovative foreclosure prevention programs in the

nation’s hardest hit housing markets.

• Supported home purchase and refi nance activity through the FHA to provide access to affordable

mortgage capital and help homeowners prevent foreclosures.

###

Appendix

The Foreclosure Process in North Carolina

2010-10-31T05:22:00.000-07:00

How the foreclosure process works in N.C.

By Christine Rexrode

crexrode@charlotteobserver.com

Posted: Sunday, Oct. 31, 2010

If you're afraid that you're about to fall behind on your mortgage, you should contact your bank as soon as possible to try to work out a new payment plan. You should also talk to a HUD-approved counselor, even if the bank has already started foreclosure proceedings against you. You should be able to negotiate with your bank up until the final sale date. See www.ncforeclosurehelp.org for more information.

A house doesn't go into foreclosure as soon as a borrower misses a payment. It can take months or even years from the time that the borrower first defaults until the house is actually repossessed and the borrower is required to leave.

North Carolina's Administrative Office of the Courts calculates there were nearly 53,000 foreclosures started in the state through the end of September, but not all of those will end in actual foreclosure sales or repossessions. The N.C. Commissioner of Banks' office estimates that about half of the foreclosure starts in North Carolina actually become foreclosure sales.

Here's how the foreclosure process works in North Carolina.

STEP 1

The borrower defaults on his mortgage payment, and the bank starts sending letters threatening foreclosure action. Typically, the bank waits about 90 days before referring the case to the trustee. The trustee is a person, usually a lawyer, who is supposed to be an impartial party who makes sure that everyone in the foreclosure process is notified correctly.

STEP 2

The trustee notifies the borrower that he is going to file foreclosure papers, then files at the county courthouse and gives the homeowner notice that there will be a hearing at the Clerk of Court's office.

STEP 3

At the hearing, the trustee must prove that there is a debt, that the borrower is in default, that the mortgage agreement gives the bank the right to foreclose, and that the homeowner has been properly notified. The borrower can appeal if he can show that the trustee can't prove one of these facts.

(If the homeowner has some other line of defense - for example, he might say that the bank hired debt collectors who harassed him - then he has to file a separate lawsuit and get an injunction to stop the foreclosure filing from moving forward in the Clerk of Court's office.)

North Carolina law also requires the bank to show that it has tried to resolve the delinquent loan without resorting to foreclosure; usually, this means it has to show that it tried to work out a mortgage modification with the borrower. The clerk can grant an extension of up to 60 days if she believes that a mortgage modification could probably be worked out.

STEP 4

If the clerk allows the foreclosure to move forward, then the trustee posts a notice of sale at the courthouse and publishes another notice in the newspaper, usually the Mecklenburg Times. The trustee must also notify the homeowner.

STEP 5

The foreclosure sale is conducted by the trustee at the courthouse. In Mecklenburg, the sales happen in a designated area on the first floor. Anybody can bid at the sale. The bank usually bids the amount it is owed, although sometimes it will bid less to try to stir up interest in the property.

STEP 6

The trustee files a report of sale at the courthouse. There is a 10-day "upset bid period" where anyone can place a higher bid, as long as it is at least 5 percent more than the previous bid. The borrower can also file at any time for Chapter 13 bankruptcy protection, which will temporarily stop foreclosure proceedings.

STEP 7

If no upset bids are placed, the trustee files the final sale report and the delinquent borrower must leave the house. If the bank is the new owner, the property is called bank-owned or real-estate-owned. Most people who buy foreclosure properties buy them from the bank, rather than at the courthouse sale.

Sources: Mecklenburg County Clerk of Court’s office, N.C. Commissioner of the Banks’ office, Charlotte attorney G. Martin Hunter, Charlotte attorney Peter J. Underhill

Subscribe to The Charlotte Observer.

Read more: http://www.charlotteobserver.com/2010/10/31/1799908/how-foreclosure-process-works.html#ixzz13wEIGjq1

Home sales in selected areas of New Bern

2010-10-23T06:07:00.000-07:00

Neuse Harbour

Active homes for sale by price range

Current number of homes on the market=12

Pending sales=0

Active homes for sale by price range

$240,000-$300,000=6

$,300,000-$400,000=3

$400,000-$439,000=2

$1,250,000=1

There were 6 homes that sold and closed in Neuse Harbour in the last 6 months. The most expensive was $250,000

Stately Pines

Current homes on the market=6

Pending sales=1

Active homes for sale by price range

$181,900-$200,000=4

$200,000-$288,000=1

$799,000=1

There were 7 homes that sold and closed in Stately Pines in the last 6 months. The most expensive house sold was $262,500.

Carolina Pines

Current homes on the market=22

Pending sales=1

Active homes for sale by price range

$107,000-$150,000=5

$151,000-$200,000=8

$201,000-$256,000=9

There were 17 homes that sold and closed in Carolina Pines in the last 6 months. The highest priced home sold was $249,000.

Tucker Creek

Current homes on the market=6

Pending sales=2

Active homes for sale by price range

$119,900-180,000=4

$269,000-$299,000=2

There were 9 homes that sold and closed in Tucker Creek in the last 6 months. The highest priced home sold was $270,000.

Feel free to call or email me if you would like to have a customized absorption rate or a Comparable Market Analysis for your property.

Currently mortgage interest rates are low which is great news for buyers. 30 year mortgages are being quoted at 4.21% and 15 year mortgages are 3.64%.

1002 homes were sold in our entire MLS system from Jan.1 2010 thru Oct.23, 2010. Of these 226 were new construction.

982 homes were sold in our entire MLS system from Jan.1 2009 thru Sept.15, 2009. Of these 268 were new construction.

Craven County News

As an elected official I serve at the pleasure of the public. If I can be of service to you on any local government issue please don’t hesitate to email me. And if you have an issue that pertains to the state government and are having trouble get a response from the state I am always willing to try to help.

Any suggestions to make this article better would be welcomed. I can be reached at SteveTyson@NCmove.com And remember you can always visit me online at www.NewBern-NC.Info

Realtor Steve Tyson

The Tyson Group Realtors

Wrong again

2010-10-05T03:09:00.000-07:00

Nation's Building News

The Official Online Newspaper of NAHB

FONT SIZE: A A AHousing Forum

Once Again, the Housing Naysayers Have Got It Wrong

By Jason Forrest

The naysayers and pessimists are out in full force with their doomsday proclamations that homes are no longer a solid investment.

The New York Times printed this headline in August: "Housing Fades as a Means to Build Wealth, Analysts Say." And the September issue of Time magazine has the cover story, “Rethinking Homeownership: Why Owning a Home May No Longer Make Economic Sense.”

People have been reading these articles and thinking that they shouldn’t buy a home, but historically, booms always follow busts and demand eventually catches up with supply. Add the basic human need for shelter and the United States is in position for the inevitable — another housing boom.

It’s not the first time we’ve seen dismal predictions from credible sources such as The New York Times and Time magazine. Here are a few others:

■“The prices of houses seem to have reached a plateau, and there is reasonable expectancy that prices will decline.” — Time

■“If you are looking to buy, be careful. Rising home values are not a sure thing anymore.” — The Miami Herald

■“Most economists agree a home will become little more than a roof and a tax deduction, certainly not the lucrative investment it was.” — Money

■“We’re starting to go back to the time when you bought a home not for its potential money-making abilities, but rather as a nesting spot.” — Los Angeles Times

■“Financial planners agree that houses will continue to be a poor investment.” — Kiplinger’s Personal Finance Magazine

But wait, I forgot to mention the dates. Each of the above quotes was printed between 1947 and 1993. And following each, the markets recovered and eventually boomed. That means they were all wrong. Demand caught up with supply and the economy improved.

Those last two quotes came from 1993, a low point for real estate values in Los Angeles. Median prices in L.A. reached $222,200 at their peak in 1990, and dropped to $178,300 in 1998. Selling during the bust would have cost home owners more than 20%. I’d be willing to bet that more than a few people heeded the advice not to buy a home in the L.A. area and then missed out on one of the biggest housing booms in history. As usual though, prices rose in the long term, with median values reaching $533,200 in 2005. In 2010, median prices in L.A. are at $345,000, according to John Burns Real Estate Consulting's August 2010 report, which still represents a gain of more than 55% from 1990.

Los Angeles is not alone. The median home price in Austin, Texas, reached $109,000 in 1988. Two years later, median prices had fallen 28.5%, to $81,200. Median home prices in Austin today have reached $202,800, according to Burns, more than an 86% increase since 1988. Similar trends have occurred in San Francisco, Phoenix, Denver, Honolulu and other markets.

(In his article, “Housing Is Good as Gold,” Paul Cardis, founder and CEO of AVID Ratings, includes a graph highlighting national boom and bust cycles in the last 49 years.)

Warren Buffett says, “Be greedy when others are fearful and fearful when others are greedy.” That means that the time to buy is when the masses are freaked out and prices are low.

History repeats itself. Land has been king for thousands of years — starting with Solomon and going all the way through Warren Buffett, who has recently taken on top economists himself by ruling out a double-dip recession.

My dad taught me that if you want to be the best at something, you should copy what the best do. So if you want to be wealthy and successful, you copy the top 10%. As one of the world’s richest people, Warren Buffett’s strategy seems to be working out all right for him.

Investors are buying land while it’s cheap to eventually make a profit on the re-sale, and they now make up 60% of the buyers, said Jeff Frieden, CEO of REDC, in July’s Investor’s Business Daily.

In the recent New York Times article cited above, Stan Humphries, chief economist for the real estate site Zillow, said “housing values will only keep up with inflation. A home will return the money an owner puts in each month, but will not multiply the investment.” He’s wrong — demand will catch up with the surplus housing inventory and then outweigh the supply.

We have yet to figure out a way to produce more land, but people still need places to live. Plus, the population is growing. More than 4.3 million babies were born in the U.S. in 2007, and they will be looking for homes sometime in the late 2020s. The Census also estimates an average 888,000 immigrants entering the country annually and projects a U.S. population of 392 million by 2050, more than a 50% increase in size from 1990.

Housing opportunities will also continue to arise from people entering new stages of their lives. The Census counted more than 54.5 million Americans between the ages of 50 and 64 in 2008. Approaching retirement, many of these folks will downsize or move to active adult communities like The Villages in Florida, the largest, most successful retirement community in the nation.

Growing families will want more space; newlyweds (there were almost 2.2 million of them in 2008) will need homes and workers will be moving in response to new jobs, job relocations or raises. Add those entering the workforce from high school and college, and demand is bottling up, positioning the U.S. for another housing boom.

Beyond the historical elements and the logic of supply versus demand, people are driven to buy homes for emotional reasons. Psychologists say that buying a home is the third most emotional thing people go through, following birth and marriage. Shelter is a basic human need; in Maslow’s hierarchy of needs it is right up there with food, air and sleep. But buying a home is also an important step in improving your life. It can mean a better school district or a less stressful marriage and it’s at the core of the American dream. Homes are a sound financial investment, but if that alone doesn’t motivate people to buy, their emotions will.

People are bound to panic during busts, giving in to their fears and market anxiety. Even so, as always, housing remains a solid investment. Demand will catch up with the supply; historically, booms always follow busts; and people are emotional beings who will do whatever it takes to provide for their families.

Jason Forrest is a new home sales trainer and author of “Creating Urgency in a Non-Urgent Housing Market” and “40 Day Sales Dare.” Contact information is on his website: www.jasonforrestspeaker.com.

Reason to buy a home in New Bern today

2010-09-21T15:04:00.003-07:00

Enough with the doom and gloom about homeownership.

Sure, maybe there's more pain to come in the housing market. But when Time magazine starts running covers that declare "Owning a home may no longer make economic sense," it's time to say: Enough is enough. This is what "capitulation" looks like. Everyone has given up.

The Sept. 6 cover of Time magazine: This is what capitulation looks like.

.After all, at the peak of the bubble five years ago, Time had a different take. "Home Sweet Home," declared its cover then, as it celebrated the boom and asked: "Will your house make you rich?"

But it's not enough just to be contrarian. So here are 10 reasons why it's good to buy a home.

1. You can get a good deal. Especially if you play hardball. This is a buyer's market. Most of the other buyers have now vanished, as the tax credits on purchases have just expired. We're four to five years into the biggest housing bust in modern history. And prices have come down a long way– about 30% from their peak, according to Standard & Poor's Case-Shiller Index, which tracks home prices in 20 big cities. Yes, it's mixed. New York is only down 20%. Arizona has halved. Will prices fall further? Sure, they could. You'll never catch the bottom. It doesn't really matter so much in the long haul.

Where is fair value? Fund manager Jeremy Grantham at GMO, who predicted the bust with remarkable accuracy, said two years ago that home prices needed to fall another 17% to reach fair value in relation to household incomes. Case-Shiller since then: Down 18%.

Brett Arends discusses why he thinks now is a particularly good time to buy a home.

.2. Mortgages are cheap. You can get a 30-year loan for around 4.3%. What's not to like? These are the lowest rates on record. As recently as two years ago they were about 6.3%. That drop slashes your monthly repayment by a fifth. If inflation picks up, you won't see these mortgage rates again in your lifetime. And if we get deflation, and rates fall further, you can refi.

3. You'll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes. And you'll get a tax break on capital gains–if any–when you sell. Sure, you'll need to do your math. You'll only get the income tax break if you itemize your deductions, and many people may be better off taking the standard deduction instead. The breaks are more valuable the more you earn, and the bigger your mortgage. But many people will find that these tax breaks mean owning costs them less, often a lot less, than renting.

The June 13, 2005 cover of Time.

.4. It'll be yours. You can have the kitchen and bathrooms you want. You can move the walls, build an extension–zoning permitted–or paint everything bright orange. Few landlords are so indulgent; for renters, these types of changes are often impossible. You'll feel better about your own place if you own it than if you rent. Many years ago, when I was working for a political campaign in England, I toured a working-class northern town. Mrs. Thatcher had just begun selling off public housing to the tenants. "You can tell the ones that have been bought," said my local guide. "They've painted the front door. It's the first thing people do when they buy." It was a small sign that said something big.

More on the Developments Blog

Buying a Home, Good Idea?

With Little to Do, Home Builders Focus on Quality

In Monaco, the 'Most Expensive' Home

House of the Day: Private Maine Island

.5. You'll get a better home. In many parts of the country it can be really hard to find a good rental. All the best places are sold as condos. Money talks. Once again, this is a case by case issue: In Miami right now there are so many vacant luxury condos that owners will rent them out for a fraction of the cost of owning. But few places are so favored. Generally speaking, if you want the best home in the best neighborhood, you're better off buying.

6. It offers some inflation protection. No, it's not perfect. But studies by Professor Karl "Chip" Case (of Case-Shiller), and others, suggest that over the long-term housing has tended to beat inflation by a couple of percentage points a year. That's valuable inflation insurance, especially if you're young and raising a family and thinking about the next 30 or 40 years. In the recent past, inflation-protected government bonds, or TIPS, offered an easier form of inflation insurance. But yields there have plummeted of late. That also makes homeownership look a little better by contrast.

View Full Image

Associated Press

A house for sale in Shelby, Ohio.

.7. It's risk capital. No, your home isn't the stock market and you shouldn't view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up again, too. One lesson from the last few years is that stocks are incredibly hard for most normal people to own in large quantities–for practical as well as psychological reasons. Equity in a home is another way of linking part of your portfolio to the long-term growth of the economy–if it happens–and still managing to sleep at night.

8. It's forced savings. If you can rent an apartment for $2,000 month instead of buying one for $2,400 a month, renting may make sense. But will you save that $400 for your future? A lot of people won't. Most, I dare say. Once again, you have to do your math, but the part of your mortgage payment that goes to principal repayment isn't a cost. You're just paying yourself by building equity. As a forced monthly saving, it's a good discipline.

9. There is a lot to choose from. There is a glut of homes in most of the country. The National Association of Realtors puts the current inventory at around 4 million homes. That's below last year's peak, but well above typical levels, and enough for about a year's worth of sales. More keeping coming onto the market, too, as the banks slowly unload their inventory of unsold properties. That means great choice, as well as great prices.

10. Sooner or later, the market will clear. Demand and supply will meet. The population is forecast to grow by more than 100 million people over the next 40 years. That means maybe 40 million new households looking for homes. Meanwhile, this housing glut will work itself out. Many of the homes will be bought. But many more will simply be destroyed–either deliberately, or by inaction. This is already happening. Even two years ago, when I toured the housing slump in western Florida, I saw bankrupt condo developments that were fast becoming derelict. And, finally, a lot of the "glut" simply won't matter: It's concentrated in a few areas, like Florida and Nevada. Unless you live there, the glut won't have any long-term impact on housing supply in your town.

Sell your home

2010-09-16T18:52:00.001-07:00

For Your Clients: 13 Unique Ways to Sell a Home

By Paige Tepping

RISMEDIA, September 16, 2010--In today’s market, it takes more than painting and trimming the bushes to get noticed, to stand out, to make your home memorable. While home sellers across the country are resorting to dropping the price in order to make their home more attractive, it leads to one crucial question: what can I do differently to make my home stand out?

Larry Nusbaum, Resolution Assistance Contractor for the FDIC, offers the following tips for home sellers looking to differentiate their homes from the numerous homes that are on the market today.

1. Get lighted signage that’s illuminated even after dark. This will give prospective buyers extra time to see your home as they don’t have to depend on sunlight.

2. If you or your agent are hosting an open house, be sure to serve light snacks and hand out something that attendees will remember. You want something that will be a positive reminder of your home—seasonal gifts are the perfect way to stay top of mind. Be sure to at least have pens and key chains with your agent's name and contact information on them.

3. Create an informational flyer with all the local conveniences you can find: shopping, schools, universities, hospitals, malls, restaurants, gas stations and attractions in the area, in addition to local police and fire stations, even school bus pick up locations. Assume your open house attendees don’t know the neighborhood.

4. Hand out information pertaining to your home as well as information on the other listed properties in the area showing that your house is the best value.

5. Do some staging to make sure your home looks its best.

6. Be sure to offer incentives. Some examples include a Lowe's gift card, paying for a year’s worth of yard care or a free session with a landscape architect, offering a $1,000 landscape allowance, paying for a years worth of homeowners fees, offering $1,000 for new appliances or any home improvement, offering a new carpet allowance or paying for lawn service for a year—the possibilities are endless.

7. Paint the garage floor (concrete paint). Making the garage look fresh and clean will make the whole house feel newer.

8. Send letters to all the neighbors inviting them to “pick their neighbor,” and be sure to include information about your home and the open house. Give them an incentive to talk about your home with other individuals in their sphere of influence. (i.e. a $200 gift card if they find your buyer).

9. Put up signs in your front yard and be sure to hang up as many directional signs as the neighborhood allows.

10. Put out flyers in surrounding shopping areas.

11. Have your agent create a video of your home and put the virtual tour on the Web.

12. Have your agent post ads on Craigslist and on any other free online listing sites you can find.

13. E-mail HR departments at local companies as many employees prefer to live close to their jobs but don’t make time for the house hunting process. This will make it easy for employees to find your home.

For more tips go to http://www.newbern-nc.info/

Forclosure News

2010-09-16T08:19:00.001-07:00

U.S. home seizures reached a record for the third time in five months in August as lenders completed the foreclosure process for thousands of delinquent owners, according to RealtyTrac Inc.

Bank repossessions climbed 25 percent from a year earlier to 95,364, the most since the Irvine, California-based data provider began keeping records in 2005. Foreclosure filings, including default and auction notices, fell 5 percent to 338,836. One out of every 381 U.S. households received a filing, RealtyTrac said today in a statement.

“We’re on track for a record year for homes in foreclosure and repossessions,” Rick Sharga, RealtyTrac’s senior vice president, said in a telephone interview. “There is no improvement in the underlying economic conditions.”

Foreclosures are contributing to a growing housing supply that may add as many as 12 million homes to the U.S. market. Demand is crumbling amid high unemployment and following the expiration of a federal homebuyer tax credit in April. Sales of new and existing homes fell in July to the lowest level on record. Home prices have fallen 28 percent since 2006, according to the S&P/Case-Shiller index of values in 20 U.S. cities.

About 2 million houses will be seized by lenders through 2011, according to Mark Zandi, chief economist of Moody’s Analytics in West Chester, Pennsylvania. Home sales this year will be 7 percent below the 2009 total, Fannie Mae, the largest U.S. mortgage finance company, said yesterday in a report.

Default notices are falling while seizures rise because lenders are trying to control the number of properties that enter the foreclosure process, RealtyTrac said. That doesn’t mean more owners are catching up on their mortgage payments, Sharga said.

‘Serious Price Depreciation’

“If the market is left to fend for itself, you may see more serious price depreciation,” he said. “Whether things fall precipitously depends on government and lenders controlling the inflow of new foreclosure actions.”

The number of homes that received default notices last month was 96,469, down 1 percent from July and 30 percent from a year earlier, RealtyTrac said. A default notice is the first stage of foreclosure. They peaked at 142,064 in April 2009.

A foreclosure auction, the second stage in the process, was scheduled on 147,003 properties, up 9 percent from July and 2 percent from August 2009. The record was 158,105 in March.

Bank seizures rose 3 percent from July and had their ninth straight monthly increase on a year-over-year basis, RealtyTrac said. The August total was 1.7 percent more than the previous record of 93,777 set in May.

Highest in Nevada

Nevada had the highest foreclosure rate for the 44th straight month. One in every 84 households got a notice, more than four times the national average. Filings fell 25 percent from a year earlier.

Florida had the second-highest rate, at one in every 155 households, two and a half times the U.S. average. Filings fell 8.9 percent from a year earlier. Arizona ranked third at one in 165 households, and California was fourth at one in 194.

Idaho ranked fifth at one in 220 households, with filings up 8.9 percent from July and 11 percent from a year earlier, RealtyTrac said. Utah, Georgia, Michigan, Illinois and Hawaii also ranked among the 10 highest rates.

Five states accounted for more than half of all U.S. filings, led by California’s 69,143, a fifth of the national total. Filings in the most populous state rose 3 percent from July and declined 25 percent from a year earlier.

Second in Filings

Florida ranked second with 56,877 filings, up 10 percent from July and down 9 percent from a year earlier. Michigan was third at 17,764 filings, followed by Illinois at 16,808 and Arizona at 16,510.

Georgia, Texas, Ohio, Nevada and Washington rounded out the top 10, said RealtyTrac, which sells default data from more than 2,200 counties representing 90 percent of the U.S. population.

As many as 8 million homes that are owned or will be seized by banks have yet to reach the market, according to Oliver Chang, a U.S. housing strategist with Morgan Stanley in San Francisco. Owners of 3.8 million more homes said they are “very likely” to put them up for sale within six months if there is improvement, a survey by Seattle-based Zillow Inc. showed.

Short sales take time to close

2010-09-08T04:21:00.001-07:00

Why do Short Sales Take so Long to Close?

RISMEDIA, September 8, 2010--Real estate professionals know that a short sale transaction can take months for it to be approved and closed.

The reality is that short sales usually take three to four times as much as a regular sale to finally get to the closing. From the time the Realtor actually gets the property under contract to the time the lender approves, it could take anywhere from 30 days to six months, depending on how fast the borrower provides critical information for lender and Investor approval.

Even then, you still have one more variable to account for which is the buyer waiting for all this time to get the contract approved by the lender. For this, setting the expectations is a key factor in any short-sale transaction.

Buyers Expectations

Buyers who make an offer on a short-sale property need to know that lenders have to "reverse underwrite" a short-sale and make sure that they are allowing the sale to happen close to market value. I say "reverse underwrite" because instead of determining affordability, they will look for "un-affordability."

They will check the seller's financials to verify that they can't afford the house anymore and consequently, they will order a price opinion from a broker or certified appraiser, commonly known as BPO (Broker's Price Opinion) to make sure the house is being sold close to market value. If the offer is too low compared to what is owed, it will make more financial sense to the Lender to just foreclose the property and re-sell it as an REO (Bank-Owned Property). All this will happen while the buyer is still waiting for a response so it is very important to set the expectations correctly from the beginning to avoid losing the buyer close to the end of the process.

Seller's Expectations

On the other hand, it is important to also educate the Seller and set the expectations with them from the beginning. They need to understand that the Lender takes its time responding, but when they do, they usually give a 72-hour timeframe to respond or provide the missing documentation. If the documentation is not provided within the specified timeframe, it usually ends up in a closed file and countless work-hours lost. Another common situation that is happening very often is borrowers being served with foreclosure paperwork from either the lender or homeowner's association while the short-sale is being processed. It is crucial to let them know that this might happen so that they are prepared for it and receive the documents knowing that they are in the best hands. Foreclosure and short-sale are parallel processes and one does not cancel the other. Sometimes a short-sale might delay a final sale date, but it will definitely not stop the Lender from starting the foreclosure proceedings.

Closing the Short Sale

Short sale success comes from educating not only the seller but also the buyer and everybody else involved in the transaction. Setting the right expectations is the most crucial part of a short sale. There are many hours involved in processing a short sale and the last thing you want is a seller or buyer walking away because the expectations were not set correctly.

Mortgages

2010-09-05T06:24:00.001-07:00

I'm sure by now, regardless of what lender(s) you've been dealing with lately, you've noticed a profound change in the way loans are being underwritten. If you haven't, you WILL. These massive changes are creating delayed closings, and have caught us all off-guard, INCLUDING the loan officers. Here's why.

As you may already know, Fannie Mae & Freddie Mac, which are Government Sponsored Enterprises (GSEs), have been under close government scrutiny ever since the housing market began to take a dive. The govt. has been trying to determine if they need to take over control of the two GSEs because of their apparent lack of self-control, or whatever your personal opinion may be. As a result, the two giants have been searching for ways (in my opinion) to offset some of the losses they've incurred over the last year or so.

Very recently, lenders began feverishly stressing the importance of loan quality and making sure every "T" was crossed & every "I" was dotted. The reasons behind this were that Fannie & Freddie had now begun not only scrutinizing the loans they were buying currently, but were going BACK & auditing loans they'd previously bought. You see, when a lender gives a mortgage, they almost always sell the "paper". The customer may always make their payment to that lender for the life of the loan, but that doesn't mean the paper itself wasn't sold to one of the GSEs to be included in mortgage-backed securities. In other words, although the mortgage has been sold, the lender will always SERVICE the loan. This means that there will never be a change to the customer's way of paying their mortgage payment each month. This is the primary means of income for most lenders, contrary to the belief that most lenders make their money from the interest rates they charge. Fannie & Freddie, as part of their contract with lenders, have the authority to require lenders to buy back any mortgage sold to them that has been proven to be inaccurate, incorrect, fraudulent, etc. For this reason, Fannie & Freddie have been going through everything they have & making lenders, past & present, buy back mortgages where, for all intents & purposes, everything wasn't underwritten perfectly. No missing dates, no name discrepancies between the loan application and the deed of trust, no addresses shown on the credit report that weren't on the loan application, etc. These are only two or three of the HUNDREDS of items these two GSEs are searching for in an effort to require lenders to buy their loans back.

The true "wealth" of a bank is dictated by how swiftly their cash is moving within the organization. They don't have the capital to place every loan they do in portfolio & tie that particular money up for 30 years. A bank can typically loan (unless its changed) 8 x the amount of assets they are currently holding. This is determined by the federal government. So, as you can see they need to keep their money "free" in order to continue lending.

For all these reasons, underwriters have been asking for items from customers that are sometimes viewed as ridiculous & unbelievable. Freddie & Fannie have forced lenders to throw common sense to the wayside because if it isn't documented, it doesn't work. Underwriters are reprimanded or their underwriting authority is REVOKED if they receive too many of these problems with loans they have underwritten. Underwriting is how they put groceries in THEIR pantry, just like we do what we do. No underwriter wants the bank they work for to have to buy back a loan because they forgot something, overlooked something, or just decided to use "common sense" to underwrite the loan.

This is a new time, ladies & gentlemen, and I wanted (if nobody else had yet) to shed some light on why things had changed so drastically, so quickly. The loan officers don't even KNOW how to respond to this, but we're doing the best we can.

Here is an article that was published on August 19th, 2010 on the website www.housingwire.com . It will also help us understand what's going on.

Fitch: Big Four Banks Face $180bn in Buybacks from Fannie and Freddie

Thursday, August 19th, 2010

Government sponsored enterprises (GSEs) Freddie Mac and Fannie Mae may exercise the right to force the big four banks, JP Morgan (JPM: 37.08 +0.03%), Citigroup (C: 3.7282 -1.63%), Bank of America (BAC: 12.834 -1.43%), and Wells Fargo (WF: 34.95 -2.94%), to repurchase up to $180bn delinquent mortgages, according to a report released by Fitch Ratings Wednesday.

As of June 30, the GSEs hold $354.5bn troubled mortgages, with 50% serviced by the big four banks. Fitch estimates the big four banks already received repurchase requests up to $19.1bn in the Q110 and Q210 — $10.7bn of which related to the GSEs.

Fannie and Freddie are "actively exercising their right to put back to the original lenders a considerable amount of the troubled mortgages in their portfolios," write analysts Tom Abruzzo and Christopher Wolfe. The agencies have a right to require lenders to buyback delinquent mortgages, if it is determined the mortgage loan did not meet GSE investor underwriting or eligibility standards.

Fitch said it is undertaking a review of Fannie and Freddie to assess whether the increased reserves are just a part of the flood of troubled mortgages or whether they are expanding their interpretations of what constitutes an eligible mortgage under existing representation and warranty provisions.

"Fitch is concerned that a more aggressive request for loan repurchases could potentially expose banks with large mortgage origination operations to future losses that have not been previously incorporated into Fitch's existing exposures, and effectively into current ratings," the report said.

Under a mild loss scenario, where the banks buyback 25% of delinquent loans and recover 60% of the money, Fitch expects cumulative losses around $17bn.

Under a moderate loss scenario, in which the banks buyback 35% of delinquent loans and recover 55% of the money, Fitch expects losses around $27bn.

Under a more adverse scenario, if banks repurchase 50% of troubled mortgages and recover only half of the original investment, Fitch expects losses of about $42bn.

These figures do not include the banks' ability to cure deficiencies in loans which could lessen loss. Fitch believes the moderate scenario is the most likely and said it will continue to monitor the on-going developments between banks and the GSEs related to mortgage loan repurchases.

Sell your Home quicker

2010-09-04T05:14:00.001-07:00

For Your Clients: 10 Low-Cost Tips to Improve Your Home's Appeal

By Paige Tepping

RISMEDIA, September 4, 2010--When selling your home, the goal is to sell it quickly for the highest price while investing as little as possible in renovations. With a limited budget and a little effort, you can greatly increase your home's appeal by focusing on what prospective buyers can see on their first visit. The experts at BuyOwner.com offer the following recommendations for preparing a house for sale and staging it for showings.

Tip #1: Refresh the exterior

First impressions count when it comes to selling a home. Most buyers won’t even leave their car if they don’t find the exterior appealing. The best ways to improve your home’s exterior include:

-Repairing and/or replacing trims, shutters, gutters, shingles, mailboxes, window screens, walkways and the driveway.

-Painting siding, trim and shutters and lamp and mailbox posts.

-Pressure washing vinyl siding, roofs, walkways and the driveway.

-Washing windows.

Tip #2: Spruce up the lawn and landscape

Home buyers associate the condition of your lawn and landscaping with the condition of your home’s interior. By improving the outside, you affect buyers’ impression of the entire property. The best ways to enhance the yard include:

-Mowing and edging the lawn.

-Seeding, fertilizing and weeding the lawn.

-Keeping up with regular lawn maintenance by frequent watering.

-Trimming and/or removing overgrown trees, shrubs and hedges.

-Weeding and mulching plant beds.

-Planting colorful seasonal flowers in existing plant beds.

-Removing trash, especially along fences and underneath hedges.

-Sweeping and weeding the street curb along your property.

Tip #3: Create an inviting entrance

The front door to your home should invite buyers to enter. The best ways to improve your entry include:

-Painting the front door in a glossy, cheerful color that complements the exterior.

-Cleaning, polishing and/or replacing the door knocker, locks and handles.

-Repairing and/or replacing the screen door, the doorbell, porch lights and house numbers.

-Placing a new welcome mat and a group of seasonal potted plants and flowers by the entry.

Tip #4: Reduce clutter and furniture

A buyer cannot envision living in your home without seeing it. A home filled with clutter or even too much furniture distracts buyers from seeing how they can utilize the space your home offers. If you have limited storage space, you may want to consider renting a temporary storage unit to place items you wish to keep. The best ways to declutter your home include:

-Holding a garage sale to prepare for your move, getting rid of unnecessary items.

-Removing clutter such as books, magazines, toys, tools, supplies and unused items from counter tops, open shelves, storage closets, the garage and basements.

-Storing out-of-season clothing and shoes out of sight to make bedroom closets seem roomier.

-Removing any visibly damaged furniture.

-Organizing bookshelves, closets, cabinets and pantries. Buyers will inspect everything.

-Putting away your personal photographs, unless they showcase the home. Let buyers see themselves in your home.

-De-personalize rooms as much as you can.

Tip #5: Clean, clean, clean

The cleanliness of your home also influences a buyer's perception of its condition. The appearance of the kitchen and bathrooms will play a considerable role in a buyer's decision process, so pay particular attention to these areas. The best ways to improve these areas include:

-Cleaning windows, fixtures, hardware, ceiling fans, vent covers and appliances.

-Cleaning carpets, area rugs and draperies.

-Cleaning inside the refrigerator, the stove and all cabinets.

-Removing stains from carpets, floors, counters, sinks, baths, tile, walls and grout.

-Eliminating house odors, especially if you have pets.

-Considering air fresheners or potpourri.

Tip #6: Make minor repairs

The small stuff does count, especially with first-time home buyers. Without dismissing the importance of repairing major items such as a leaky roof or plumbing, you do not need to spend money on replacing these items. Instead, focus on the minor repairs that will make your home visually appealing. The best ways to improve your home include:

-Repairing ceilings and wall cracks.

-Repairing faucets, banisters, handrails, cabinets, drawers, doors, floors and tile.

-Caulking and grouting tubs, showers, sinks and tile.

-Adding fresh paint to ceilings, walls, trim, doors and cabinets.

-Tightening door handles, drawer pulls, light switches and electrical plates.

-Lubricating door hinges and locks.

Tip #7: Showcase the kitchen

The heart of any home is the kitchen. If you are going to spend any money on renovations, this is the one area where you will see the greatest return. Even with a modest budget, focusing on a few key areas can make a great difference in getting the asking price for your property. The best ways to showcase the kitchen include:

-Replacing cabinet doors and hardware.

-Installing under-cabinet lighting.

-Replacing light fixtures.

-Replacing outdated shelving with pantry and cabinet organizers to maximize space.

-Baking cookies or cupcakes for a showing, to create a homey smell.

Tip #8: Stage furniture

Furniture placement can enhance the space of your home while giving buyers an idea of how to best utilize the space with their own belongings. Take some time to rethink how different areas in your house could be used. Some ideas to think about include:

-Moving couches and chairs away from walls in your sitting and family rooms to create cozy conversational groups.

-Creating a reading corner in the master bedroom.

-Clearing an empty room to set up a reading space.

-Turning an awkward space into a home office.

-Setting the dining room table with your best china.

-Set wine glasses in front of the fireplace or next to a Jacuzzi tub.

Tip #9: Light up the house

Create a sense of openness and cheerfulness in your home through its lighting. To improve the lighting try:

-Opening shades and drapes to let the sunshine warm and brighten rooms.

-Installing brighter light bulbs in rooms that tend to be dark.

-Adding additional lamps for ambient lighting.

-Turning on all the lights for a showing.

Tip #10: Add fresh touches

You can easily add color and style to your home by adding fresh touches throughout. Some ideas to consider include:

-Placing fresh floral arrangements in the entry and master bedroom.

-Placing bowls of bright-colored fruit in the family room and the kitchen.

-Filling an empty corner with a potted leafy plant.

-Setting new hand soap in the bathrooms.

-Displaying fresh towels near sinks.

Remodeling tips

2010-09-03T13:06:00.001-07:00

For Your Clients: 10 Tips for Hiring a Home Remodeling Contractor

RISMEDIA, September 3, 2010-- With the U.S. economy facing the lowest home sale statistics in fifteen years and home values continuing to slide in many regions, it's not surprising to hear that housing trends point towards a large percentage of American homeowners looking to improve and maximize their existing property investment versus buying a new home. When deciding to undertake a remodeling project however, there are several invaluable tips to keep in mind as you discuss your home make-over with potential contractors.

Through advice and stories shared by both contractors and consumers, StageofLife.com, a blogging resource for homeowners, discovered 10 important tips on how to find a trustworthy home remodeling contractor to help ensure the right person or company is hired for your next home improvement project.

Tip #1: Does Your Contractor Have Proof of Insurance?

Ask the contractor to have his insurance company mail or fax a copy of his current contractor insurance card to you. If the contractor can't do this - stay away. Why? If there is an accident at your home, you are then liable. This also applies to any sub-contractor or employee that the contractor may use - those individuals should have active insurance cards faxed or mailed to you as well.

Tip #2: Did You Check References and See Photos?

Ask for at least three references - with two of them being for the same type of project you are planning - and then call the references. Additionally, ask the contractor to provide photos of previous work, especially for the same type of project. If he produces lawn and garden photos and you're planning a bathroom remodel, you may want to check out another contractor.

Tip #3: Does Your Contractor Take Debit or Credit Cards?

Besides your ability to earn a few points, bonus miles, or cash back on your project, a good sign that a contractor is financially savvy and has a bank behind his business is his ability to take debit and credit cards. This doesn't just apply to big contracting companies. Many small, one-man shops will take cards if they have a good relationship with their business bank or credit union.

Tip #4: Manners and Appearance?

If the contractor drove his vehicle to your home to give you an estimate, take a look at the way he keeps the equipment and vehicle. Are things clean? Neatly arranged? If not - that's a big warning. The way a contractor treats his tools is a direct connection to how he'll treat your home. During the initial meeting, does the contractor present himself in a professional way? Do you feel comfortable around him or his employees? They will be working in your home after all.

Tip #5: Clean Up Policy?

Ask about the clean-up policy. For example, if your home improvement is a multi-day project, will the contractor be cleaning up at the end of every day or will he leave the dust, wood chips, and other mess laying there for day #2? The more mess in your home - the more it gets tracked around. Many homeowners find themselves with mouths gaping wide after the contractor has left for the day and their floors and home are dirty and messy around the project area.

Tip #6: Will the Contractor Put It In Writing?

Is your contractor willing to put both his bid and the scope of work in writing? If not - walk away immediately. You'll be surprised how many homeowners have been duped by contractors who verbally tell you what's included in their scope of work, but will then, in the middle of everything, require extra money to finish the remodel, thus holding you hostage with an uncompleted home project.

Tip #7: Availability?

Can the contractor get the job done in your timeline rather than his timeline? There's nothing more frustrating than if a contractor tells you that a job will be done by a certain date and then it isn't . On the flip side, if you can't find a good contractor that's willing to commit to your timeline, your expectations may be too high and you may need to adjust your timeline.

Tip #8: Does Your Contractor Use "Subs?"

Does your contractor plan on doing everything himself? Or will he "sub out" work to the "trades?" For example, if you are remodeling a bathroom, you may need a plumber, electrician, and carpenter. It's okay if the contractor subs work out to these specific trades - it shows he wants the work done right.

Also, it's fair to say that you can expect your contractor to make money off the trades, or other sub-contractors, by marking up those quotes for the project. That is a standard practice to help the general contractor recover costs in the time it takes to manage the schedule. If you don't want to spend the extra money on your contractor marking up the trade quotes, then you should prepare to project manage the remodel yourself, but know this may limit your options on contractors willing to work with you.

Tip #9: Quoting & Billing Procedure?

Ask the contractor about his quoting procedure. Will it contain general information, or will it be specific? For example - most contractors will charge you for a fuel surcharge, material up-charges, waste removal, labor, etc. Some will show you these exact costs in a line item invoice, but others roll it up into one big bill. How much detail do you want? You should clarify that with your contractor upfront.

Also - what is the payment or billing policy? Is money required upfront? If so, go back to #1 and #2 above to make sure you have the contractor's references checked and have a copy of his contractor's insurance.

Tip #10: Did Your Contractor Get the Permits?

Ask your contractor to take care of the permits. Although permits cost you money, the inspection process is meant to protect you from poor workmanship and to make sure that everything is being built to code.

By following these 10 tips for hiring a home contractor, you'll feel more confident that you've found the right contractor for your remodeling job.

Credit Scores

2010-09-02T05:19:00.000-07:00

What do you advise a financially fit homebuyer to do to increase their credit score or make themselves more attractive buyers, to qualify for the lowest mortgage rates?

A: A FICO score of 700 (FHA)/740 (Conventional) or better qualifies you for the lowest rates. In fact, it qualifies you just as well as a higher score, so if you’re at or over 700/740, there’s no loan qualification rationale for investing effort into boosting it. But these are firm breaking points. The difference between a score of 698 and a score of 700 (in an FHA loan scenario) can cost you a quarter of a point in interest, or thousands of dollars over the life of your mortgage.

I’ve found that people asking about how to boost their credit to qualify for the best interest rates is similar to people asking me how to lose weight: I tell them the truth, then their eyes glaze over when I give them the straight dope, no magic bullets. No one wants to hear: eat vegetables, cut the sugar, and exercise; similarly, they don’t want to hear pay your bills on time, every time.

But I’ve been asked this question a lot recently, so here goes, anyway!

1. Pull your reports online – get them for free, no strings attached, at the government authorized website AnnualCreditReport.com. This doesn’t get you your actual FICO scores, but it does get you the content of your report. Look for errors that could be depressing your score, like accounts that don’t belong to you, balances that are actually lower than reported, old debts that are paid off that should have been removed entirely (7 years for credit cards, 10 for bankruptcies).

2. Consider reopening accounts you thought were open but have been closed because you haven’t used them in so long - it will help boost your utilization ratio, one element of your credit score that is dependent on how much available credit you have.

3. Pay down some debt. This both decreases your debt-to-income ratio (36% is the goal, including the proposed mortgage payment) and increases your credit score, if you do it right (see the next tip).

4. Don’t close any accounts. Instead, spread your debt out. The ideal utilization ratio is about 20-30% of your available credit overall, and on any given account. Closing accounts reduces the amount of credit that is available to you, so it makes it look like you’re closer to being maxed out.

So if you have one card that’s near its max and several others that have zero balances and you’re trying boost your score a bit, quickly, consider balance transfers to spread our your debt more evenly, aiming for 20-30% of the available credit on each card.

5. Use your credit regularly – and pay it on time, every time: Having a good FICO score doesn't happen because you have sound personal finances, including no debt. FICO scores are a measure that shows that you have a history of responsibly using and managing and repaying your debt on an ongoing basis.

6. Finally, check in with your mortgage broker. Have them pull your report and score, as the report they pull is the one they’ll have to go by in the final analysis. If you’re really close to a score level higher, that would empower you to qualify for a lower rate, they can actually run a credit diagnostic on your score and generate some recommendations for which actions you could take to raise your score by the needed few points. Then many of them can do what’s called a ‘Rapid Rescore’ – once you’ve paid that bill off, they can actually submit a request directly to the credit bureaus to update that information and your score in just a few days.

None of these tips will get someone with a 500 credit score to a 700 (other than a massive debt reduction program). But if you’re trying to get a little boost to get you over a credit score hump, these can be potent, and save you beaucoup bucks in interest.

Psst - you should follow Trulia and Tara on Facebook, too!.

Housing market report

2010-09-02T04:46:00.000-07:00

Housing prices up in June
But worry persists as foreclosures, unemployment remain bloated.

By Kirsten Valle

kvalle@charlotteobserver.com

Posted: Wednesday, Sep. 01, 2010

Charlotte-area home prices continued to inch up in June, a closely watched index released Tuesday shows.

Prices in the metropolitan area rose 0.7 percent from May, according to the S&P/Case-Shiller Home Price Index. Home prices climbed in June in 17 of the 20 market areas the index tracks, stayed flat in two and declined in one.

The index shows housing prices have begun to rebound from the lowest point of the housing crisis. But other recent indicators signal a difficult road ahead, as first-time homebuyer tax credits have ended, foreclosures continue and unemployment remains inflated.

Mecklenburg home sales fell 11 percent in July, for instance, over the year before, and the average home price climbed just 1 percent that month, remaining below the levels of a few years ago.

Charlotte has held up better than other markets in some respects, but it continues to lag on the Case-Shiller index, the latest data show.

Charlotte-area prices fell 2.7 percent in June from June 2009 - one of only five markets to experience a year-over-year decline, the index shows. That's well below the average gain of 4.2 percent for the Case-Shiller index's 20 markets.

The index is one of the most precise measures of home values because it tracks repeat sales. Like stock market indexes, Case-Shiller reflects changes in price, not an actual price.

Las Vegas remained among the weaker cities, the report found, with home prices falling 0.6 percent from May and 5.2 percent from June 2009. But other markets showed improvement: California's major cities, for instance, have moved from some of the hardest hit to three of the four leading cities, based on year-to-year gains, the index shows.

Still, worry persists.

"While the numbers are upbeat, other more recent data on home sales and mortgages point to fewer gains ahead," said David Blitzer, chairman of the S&P index committee, in a statement Tuesday. "... If this relative weakness in demand continues, it will likely filter through to home prices in coming months."

Kirsten Valle: 704-358-5248

Read more: http://www.charlotteobserver.com/2010/09/01/1658732/housing-prices-up-in-june.html#ixzz0yN6kXyNj

Open Homes

2010-08-31T04:16:00.001-07:00

Tips for a Successful Real Estate Open House

By Paige Tepping

RISMEDIA, August 31, 2010--The Sunday real estate open house is a longstanding ritual in the real estate marketplace, and many homes have been sold on a lazy Sunday afternoon. When used properly, open houses can be a great marketing strategy.

According to the experts at Buy-and-Sell-House-Fast.com, the following steps will help you get the most out of your real estate open house and increase your chances of selling your home for the price you want.

-Be sure to meet with your agent in advance of the open house. Discuss all the various details about what is involved in holding a successful open house. While many home sellers are comfortable with an open house, others are not. If you choose not to host an open house, there are other ways to sell your home.

-Be certain to go through the entire home with the real estate agent the day before the open house. Take careful notes and follow all of his/her recommendations.

-Try not to become emotionally involved when evaluating the condition of your home prior to the open house. Remember that your real estate agent is trying to make your home more appealing to potential buyers, not criticizing your decorating style or choice of accessories.

-Any needed home repairs should be completed before the open house begins. This includes things like peeling paint, loose stairs, banisters in need of repair and the like. It is crucial that guests see a home that is in immaculate condition.

-Never underestimate the importance of making a good first impression. Many visitors make a decision about the home in the first few seconds. Be sure the entranceway to the home is immaculate, and that the steps leading up to the home are well swept and free of debris.

-Ask the real estate agent to create a professional-looking sign in sheet for all visitors. It is important to get the name and phone number of all attendees to the open house.

-Always discuss the price of the home prior to the open house. This will allow the agent to negotiate the price on the spot if a good prospect attends.

-Be sure to consider unusual ways to market your open house. For instance, if you belong to any special groups or organizations, be sure to market the upcoming open house to the members. For instance, the local garden club may be very interested in attending an open house that includes a beautiful outdoor garden.

-It is a good idea to provide cookies, brownies or other snacks for guests at the open house. A punch bowl is also an attractive addition.

-Pets should be kept away from open house visitors. It may be a good idea to have a friend or family member takes care of your pets until the open house is over.

-Be sure to lock up all medications, both prescription and non-prescription. Also be sure to lock up any cash or valuables in the home prior to the open house.

-Make sure that the home is spotless and free of unpleasant odors prior to the open house. You may want to bake a fresh batch of cookies an hour or two before the open house begins. Not only will the aroma mask any unpleasant smells, but it will create a warm and inviting ambiance as well.

-Be sure the temperature in the home is pleasant. A home that is too hot or too cold can make visitors uncomfortable, and lead them to wonder about the quality of the heating and air conditioning system.

-Play soft music in the background during the open house. Background music helps set a good mood for visitors.

-Always open the curtains and the drapes prior to the open house. This will allow fresh air and sunshine in and help give the impression of a larger space.

-If your home does not have plants, you may want to buy a few before the open house. Plants can provide a warm feel and help make guests at the open house feel more at home.

Taxes on a second Home

2010-08-31T04:15:00.000-07:00

For Your Clients: Can I Deduct Taxes on Second House?

By Claudia Buck

RISMEDIA, August 31, 2010--(MCT)--Do I pay taxes for household workers? Can I take a deduction for a second home used by family? The IRS' Jesse Weller and the California Franchise Tax Board's Brenda Voet tackle those questions from readers.

QUESTION: I bought a house a mile from my primary residence with the specific intent of renting it in the future to my daughter. If my daughter lives in the house this year and pays the utilities in her name (but pays no rent), does the house still qualify as a second residence?

ANSWER: Yes, you are considered to have personally used the second property all year because your daughter used it as her primary residence. Accordingly, you may deduct the entire amount of the property tax and mortgage interest as itemized deductions.

Q: If I hire people to work in my yard or do housekeeping, is there a limit to the amount I can pay them without having to fill out 1099s like an employer does? And if there is a limit, does it only apply for one person, or can I hire another for the same limit for a different type of work?

A: When a taxpayer hires people to work in and around his/her personal household — such as housekeepers, baby sitters, gardeners and yard workers — those workers may be considered employees.

Although you usually do not need to complete a Form 1099 for paid work that is performed in and around your home, you may need to issue a Form W-2, Wage and Tax Statement. You also may be responsible for withholding and paying employment taxes on wages paid to workers who qualify as your employees.

Usually a household worker is considered an employee if the payer can control both what work is done and how it is done. If the worker controls how the work is done, the worker is normally considered self-employed and not an employee.

For example, (individuals) who work in your home like carpenters, builders and plumbers are normally self-employed, independent contractors and are not employees. Self-employed workers usually provide their own tools and offer their services to the general public.

To answer your question about the payment threshold: If you pay an individual household employee cash wages (including wages paid by check or money order) of more than $1,700 in 2010, you generally must withhold Social Security and Medicare taxes from all cash wages.

You have the option to pay your employee's share of taxes from your own funds rather than withhold it from their salary. You are not required to withhold federal income tax from wages you pay to a household employee, unless your employee asks you to withhold income tax and you agree. In some situations, you also may be responsible to pay federal unemployment taxes on a portion of the cash wages.

If you must withhold and pay Social Security and Medicare taxes, or if you withhold federal income tax, you will need to file a Form W-2 for each employee after the end of the year. In that situation you will also need to file a Schedule H, Household Employment Taxes, after the end of the year with your Form 1040 individual income tax return.

New Home Sales in New Bern

2010-08-20T04:58:00.000-07:00

New home sales in the New Bern area have been steady as compared to 2009. Through 8-20-2010 there have been 202 new home sales. There are currently 305 new homes listed in the MLS although some of these are proposed construction. Of these only 13 percent are over $200,000. All this equates to a 10-11 month inventory of new homes. The defination of a buyers market is over 6 months of homes for sale.

For the same time frame in 2009 there were 204 new home sales. At first glance it looks like sales this year are about the same as last. However, some builders are giving deep discounts to buyers. This is not healthy for anyone in the long run as it will hurt everyone's appraisals.

More to life than money?

2010-08-03T04:33:00.000-07:00

In Difficult Financial Times, Sense of Purpose is Key to Happiness

By Robert Powell

RISMEDIA, August 3, 2010--(MCT)--When it comes to feeling as though you're enjoying the good life, money matters. Make no mistake about it. But it's just one critical ingredient, according to a new study.

Being healthy, creating deep relationships with family and friends, having a sense of purpose, and feeling like you belong are major components of a happy life. What's more, those ingredients are just as true for those in their 20s as those in their 70s — and in the midst of a recession, too, according to MetLife's Mature Market Institute 2010 Meaning Really Matters study, which is based on the work of Richard J. Leider, author of "The Power of Purpose."

Being healthy and wealthy have always been two well-known ingredients of happiness, but the study also shed light on what it takes to live the good life and what type of people are living one.

If you're happy, age might have something to do with it. In 2010, almost half of those aged 45 to 74 said they were living the good life compared to just 29 percent of 25- to 44-year-olds.

But how do you know whether you're living the good life? In the study, MetLife said those living the good life uttered such comments as "Being spiritually, emotionally, mentally, and physically healthy," "Having enough money not to worry about whether or not I can pay the bills; good friends to share life with" and "Having a safe, healthy, and happy life with family and friends."

MetLife said 74 percent of those living the good life were completely content, as opposed to only 24 percent who weren't living the good life. What's more, those living the good life generally look forward to each day, consider themselves very happy, are in control of their lives, and are highly optimistic about their future.

The chief component is having a sense of purpose, according to the study. That sense of purpose is "interrelated with vision — having clarity about the path to the good life and focus — knowing and concentrating on the most important things that will get you to the good life." Over eight in 10 (82 percent) of those who feel their lives have purpose are living the good life compared to 35 percent for those who are not living the good life.

The good news, at least for those who equate wisdom with age, is this: The older you are, the more likely you have vision and focus. Younger Americans, not so much — proving once again perhaps that youth is wasted on the young. Likewise, MetLife reports that older Americans (those age 45-74) are more likely to focus more on meaning-laden activities like spending more time on helping others and making their community a comfortable place to be than younger people, while younger cohorts plan to spend more time on such crass activities as generating, managing, and accumulating money.

But even though the young (and even some older folks) lack meaning in their lives now doesn't mean it will last forever. "If people are dissatisfied with their lives — if they feel it lacks meaning — they can do something about it," the study said.

"Discovering purpose is an ongoing quest rather than a one-time trip to an exotic land," the study said.

What's more, MetLife says one's purpose "is likely to change a number of times as one grows older and their experiences and goals expand and shift."

So what's the trick to leading the good instead of the bad life? Well, according to MetLife, you can greatly improve your chances by looking at your long- and short-term plans, including "a situational assessment of where you are today."

Specifically, MetLife recommends the following:

First, envision your long- and near-term future. Think about your life two or three years out and ask yourself the following questions. Then think about your life 20 years from now and ask yourself the very same questions.

Picture yourself in two or three years and then in 20 years. How old are you? What goals do you have for yourself?

What are you doing? How much are you working? If you are working, what are you doing? Are you spending the amount of time you would like with friends and family? What kind of daily routine do you have? What do you like to do with your free time?

Where are you living? Has your residence changed? Are you living in another state or location from where you are today? What kind of community are you living in? What do you like about where you live?

How are your loved ones? How close do your loved ones live to you? What are your loved ones doing? How often do you see your loved ones? What important changes in their lives have they experienced?

Second, get a sense of your wealth. What's the point of having the good life without money? Exactly. MetLife says the other thing you need to do is ask yourself the following questions about money.

Do you know what your assets are worth?

Do you know your net income?

Do you know your total spending?

Is there any money left over to help reach your goals?

Said MetLife: "Assess the information you have put together and consider whether your current financial and legal situation is on track to support your near-term and long-term goals."

Last but not least, MetLife recommends not just creating and acting on the plan, but protecting it as well. Why is that so important? As everyone knows, stuff — bad and good — happens in life.

"Living the good life also means weathering significant changes and transitions caused by positive or negative 'trigger events' such as job loss, marriage, illness, the birth of a child or grandchild, divorce, moving, retirement, and the death of a loved one," the study said.

Knowing in advance that you'll have to weather such storms will go a long way toward improving your odds of living the good life. L'chaim.

(c) 2010, MarketWatch.com Inc.

Distributed by McClatchy-Tribune Information Services.

Energry Savings

2010-08-03T04:30:00.000-07:00

6 Tips to Keeping Your Home Cooler

By Stephanie Andre

RISMEDIA, August 3, 2010--Wow, it's hot outside! The summer's in full swing with no signs of cooling. And while you may be tempted to crank up the A/C, remember - you won't be nearly as excited to see that electric bill next month.

To save some money -- and, don't forget, energy! -- here are six tips that might just help.

1.Avoid heat build-up in your home – The best way to keep your home cool is to keep the heat out. This can be done by closing the drapes on windows facing the sun (east-facing windows in the morning and west-facing windows in the afternoon). You should also try to avoid heat-generating activities, such as cooking, on hot days or during the hottest part of the day. If you are cooking, use your range fan to vent the hot air out of your house. By reducing the amount of heat in your home, you will have to use less energy to cool it.

2.Use ventilation and circulation to cool your home – Instead of automatically turning on the air conditioner on hot days, try cooling your home with window and ceiling fans. Circulating air can make your home feel cool and comfortable in a much more efficient way than air conditioning. There is also the option of a whole house fan (a large ventilating fan installed in you attic that expels hot air out of your home) which can circulate air throughout your entire home.

3.Keep air conditioning efficient and to a minimum – When you do have to use air conditioning, there are ways to make it more efficient. First of all, turn up the temperature setting on your air conditioner by a couple of degrees. Most people keep the temperature setting lower than it needs to be, hence using more energy than is needed to keep your home cool. It is recommended that you keep the temperature at about 25° C (77° F). Also, remember to turn off your air conditioner once your home has reached a comfortable temperature. By coupling minimum air conditioning with reducing the amount of heat entering your home, you can keep it cool without using excess energy. It isn’t recommended that you leave your air conditioner on when you leave your house, but if you’re going to do so, turn the temperature setting up a few more degrees while you’re gone to about 28° C (82° F). Also, remember to turn off your air conditioner if you’re going to be away from your home for more than a day. It is also important to make sure your cooling vents aren’t blocked so that the energy being used is going towards actually cooling your home and not being wasted. Furthermore, keep rooms that don't need cooling, such as closets, closed off when you're air conditioning.

4.Make sure your home isn’t losing cool air – By weather-stripping and caulking around windows, doors and electrical outlets on outer walls, you can prevent losing cool air from your home and prevent hot air from getting in. Improve your home’s insulation on outer walls, again to keep cool air in, and hot air out. You should also consider installing storm doors for the same reasons if your home doesn’t already have them. If you have a fireplace, keep the flue closed. These provide an extra barrier against the escape of cool air. All of these options will make cooling your home more efficient and will save you money on your energy bill.

5.Select energy-efficient cooling systems – If you’re in the market for a new cooling system, there are many new technologies that are much more efficient than older versions. As with other appliances, you should look for the Energy Star logo and compare the amount of electricity each uses.

6.Use the coolest parts of your home – On hot days, parts of your house will naturally stay cooler than others. For example, if you have a basement it will remain cool even during the hottest part of the day (this is because the cool air in your home will sink down to your basement). One way you can reduce the amount of energy used to cool your home is to do more in cooler areas of your home. This way, you won't have to use energy to stay cool.