Massachusetts Housing Leaders Call on Congress to Help Main Street
MarketWatch,com reports the following:
BOSTON, Dec 18, 2008 (BUSINESS WIRE) -- The Massachusetts housing industry called on Congress today to address the housing crisis that is at the root of the nation's recession. Finley Perry, former president of the Home Builders Association of Massachusetts and former president of F. H. Perry, Builder, Inc.; Gary Ruping, president of Ruping Companies; and Jeff Rhuda, business development manager of Symes Associates, urged Congress to enact bold measures that will stimulate the housing market and, in turn, revive the local, state and national economies.
"Housing is central to our economy and is an engine of production that can lead us out of the recession," said Perry. "But it is crucial for Congress to enact a major stimulus package to stop the decline in home values, stem the tide of foreclosures, stabilize financial markets and re-ignite consumer demand."
To get the Massachusetts economy moving again, the housing industry is urging Congress to support enhancements to the home buyer tax credit and provide below-market, 30-year fixed-rate mortgages for home purchases.
Specifically, the legislation should include:
-- A 10 percent tax credit for all qualified home buyers capped at 3.5 percent of FHA, Freddie Mac or Fannie Mae loan limits (equaling $10,000 to $22,000 depending on geographic market). All primary home purchases through December 31, 2009, would be eligible. Repayment would be required only if the home was sold within three years. And the credit would be available at closing, making it easier for buyers to use it as a downpayment;
-- A below-market, 30-year fixed-rate mortgage for home purchases. The second component of the stimulus plan would provide qualified home buyers with 30-year fixed-rate mortgages at 2.99 percent interest on contracts closed until June 30, 2009 and 3.99 percent interest on closings between June 30 and December 31, 2009; and
-- Continued measures to reduce foreclosures and keep people in their homes.
The housing industry representatives cited a similar plan with both a tax credit and a mortgage rate subsidy that was enacted in 1975 when the nation was also in the midst of a recession. That successful stimulus plan jump-started the depressed economy, and the effects continued in communities across the country long after the measure expired.
Jeff Rhuda is the business development manager for Symes Associates in Beverly, Mass. Symes builds residential single-family and multifamily projects and condominiums in Massachusetts, Maine and New Hampshire. "We've seen our business decline by 45 percent, from about 120 sales a year to 42 this year," explained Rhuda. "We subcontract to a lot of people, and the impact on them is just torturous. For instance, a plumber who works for us went from 35 employees to two. Here in Massachusetts, the foreclosures are like a big drain plug pulled out from the market, taking the whole market down with it."
Gary Ruping, president of Ruping Companies, based in Bedford, said, "We decided to shutter our operations for probably six months at least, and will be installing infrastructure for the next few months. My own staff is now two people at this point. A $7,500 loan to home buyers has not done anything to improve our market. But a much more meaningful tax credit along with a subsidized interest rate will help to move people off the sidelines. As a multifamily builder, I've asked people why they're still renting, and they say they're afraid of the market. That's what's keeping them on the sidelines."
"When the housing industry is in a crisis, the entire community is affected," Perry noted. "Retailers, manufacturers, service providers and even the local government are affected. Most important, local residents suffer."
"Three million home building-related jobs across the country have been lost as a result of the slowdown in housing production, which represents $145 billion in lost wages and $4.9 billion in lost purchases," said David Crowe, chief economist of the National Association of Home Builders in Washington, D.C. "Deterioration in these jobs has now spilled over into virtually all sectors of the U.S. job market and the economies of states like Massachusetts."
In Massachusetts, housing values are down by 7.5% compared to the first quarter of 2007, while the unemployment rate has risen to 5.5%.
"We are leaving no stone unturned in our efforts to convince Congress to quickly enact a robust housing stimulus program. There's no question that stopping the decline in home values and restoring demand for housing is the fastest and most effective way of reviving the economy," Perry said.
The housing leaders in Massachusetts are part of a new coalition called Fix Housing First, consisting of more than 600 organizations, home building companies and manufacturers advocating for this major stimulus package to stem the decline in home values, stabilize financial markets and re-ignite consumer demand. To learn more about Fix Housing First, go to www.fixhousingfirst.com.
ABOUT NAHB: The National Association of Home Builders is a Washington, D.C.-based trade association representing more than 235,000 members involved in home building, remodeling, multifamily construction, property management, subcontracting, design, housing finance, building product manufacturing and other aspects of residential and light commercial construction. Known as "the voice of the housing industry," NAHB is affiliated with more than 800 state and local home builders associations around the country. NAHB's builder members will construct 80 percent of the nearly 1 million new housing units projected for 2008.
SOURCE: Home Builders Association of Massachusetts
Saturday, December 20, 2008
Tuesday, December 9, 2008
$22,000 Tax Credit for Home Buyer's Looming?
Worcester — Homebuilders' confidence in a near-term housing recovery sank to a new all-time low this month, reflecting growing worries over the U.S. financial crisis, rising unemployment and weakening consumer confidence, an industry trade association said Tuesday.
Construction starts on housing fell 4.5 percent in October, less than economists forecast, to an annual rate of 791,000 that was the lowest since records began in 1959, the Commerce Department said in Washington. Building permits, a sign of future residential projects, dropped 12 percent to a 708,000 pace, the lowest since at least 1960.
Compared with October 2007, work began on 38 percent fewer homes.
The National Association of Home Builders/Wells Fargo index of builder confidence dropped lower than forecast in October to 9, its lowest since record-keeping began in 1985, the Washington-based association said yesterday. The gauge averaged 27 last year.
``We are in a crisis situation,'' NAHB chairman Sandy Dunn, a builder from Point Pleasant, West Virginia, said in a statement. ``Tremendous economic uncertainties have driven consumers from the housing market, and it's going to take some major incentives to bring them back.''
In recent weeks, homebuilders have ratcheted up pressure on Congress to take steps that go beyond trying to reduce foreclosures. the industry wants lawmakers to enact new incentives aimed at getting reluctant homebuyers back into the market.
Specifically, they're asking for a 10 percent tax credit of up to $22,000 for homebuyers that purchase a home over the next year and a temporary interest-rate reduction on 30-year mortgages.
The builders' proposed housing aid measures would cost the government an estimated $270 billion, and would amount to a short-term fix at best, Deutsche Bank North America analyst Nishu Sood concluded in a research note earlier this month.
Builders have grown increasingly convinced that only government intervention will help stem the downward spiral in home prices and rising foreclosures that have led to a dearth in demand for new and preowned homes.
Stay tuned to The Achieva Factor for developments.
Adam Pasquale
Construction starts on housing fell 4.5 percent in October, less than economists forecast, to an annual rate of 791,000 that was the lowest since records began in 1959, the Commerce Department said in Washington. Building permits, a sign of future residential projects, dropped 12 percent to a 708,000 pace, the lowest since at least 1960.
Compared with October 2007, work began on 38 percent fewer homes.
The National Association of Home Builders/Wells Fargo index of builder confidence dropped lower than forecast in October to 9, its lowest since record-keeping began in 1985, the Washington-based association said yesterday. The gauge averaged 27 last year.
``We are in a crisis situation,'' NAHB chairman Sandy Dunn, a builder from Point Pleasant, West Virginia, said in a statement. ``Tremendous economic uncertainties have driven consumers from the housing market, and it's going to take some major incentives to bring them back.''
In recent weeks, homebuilders have ratcheted up pressure on Congress to take steps that go beyond trying to reduce foreclosures. the industry wants lawmakers to enact new incentives aimed at getting reluctant homebuyers back into the market.
Specifically, they're asking for a 10 percent tax credit of up to $22,000 for homebuyers that purchase a home over the next year and a temporary interest-rate reduction on 30-year mortgages.
The builders' proposed housing aid measures would cost the government an estimated $270 billion, and would amount to a short-term fix at best, Deutsche Bank North America analyst Nishu Sood concluded in a research note earlier this month.
Builders have grown increasingly convinced that only government intervention will help stem the downward spiral in home prices and rising foreclosures that have led to a dearth in demand for new and preowned homes.
Stay tuned to The Achieva Factor for developments.
Adam Pasquale
Monday, November 10, 2008
3rd Quarter Sales report for Mass
The Massachusetts Association of REALTORS / Bay State REALTOR News
3rd Quarter sales down for single-family, condos; multi-family sales increase 40%
11/10/2008
In addition to monthly numbers, MAR also released Q3 sales numbers this past Monday. The report shows the number of single-family homes sold in the third quarter of 2008 was down 7.9 percent compared to the same time last year (12,195 homes sold in 2007 to 11,235 homes sold in 2008). Median selling prices were down 10.4 percent from $355,000 in 2007 to $318,000 in 2008.
The condominium market experienced a drop of 11.5 percent in the number of units sold in the third quarter compared to the same quarter last year with 5,555 units sold in 2007 to 4,914 units sold in 2008. Median selling prices were down 2.8 percent from $288,000 in 2007 to $280,000 in 2008.
The multi-family market saw a 40.3 percent increase in the number of third-quarter sales compared to the same time last year with 1,304 homes sold in 2007 and 1,830 homes sold in 2008. Median selling prices were down 34.7 percent compared to the third quarter last year from $325,500 in 2007 to $212,500 in 2008.
Due to changes in reporting at local boards, second quarter multi-family data was not available previously. During the second quarter, multi-family home sales increased 22.9 percent from last year with 1,311 homes sold in Q2 2007 and 1,611 homes sold in Q2 2008. Multi-family median selling prices decreased 32.8 percent from the second quarter last year from $340,000 in Q2 2007 to $228,500 in Q2 2008.
Quarterly Regional Sales Data:
Regionally, every part of the state saw a decrease in sales of single-family homes compared to the same quarter last year, except Cape Cod, which saw an increase of 6.2 percent (801 homes sold in 2007 compared to 851 homes sold in 2008). Of the seven regions, the Western region experienced the largest drop in sales at 12.9 percent with 1,703 homes sold in Q3 2007 compared to 1,484 homes sold in Q3 2008.
While the Western region experienced the largest drop in home sales, it also experienced the lowest drop in median prices at four percent from $215,900 in 2007 to $207,250 in 2008. Conversely, while Cape Cod had the only increase in sales, that region of the state that had the largest drop in median prices at 16.3 percent from $409,000 in 2007 to $342,500 in 2008.
In the condo market, the Western region had the smallest drop in sales, with a 6.9 percent decrease compared to the same quarter last year with 275 units sold in 2007 to 256 units sold in 2008. The Southeast region had the biggest decrease in condo sales at 26.2 percent, going from 61 units sold in 2007 to 45 units sold in 2008.
The Western region had a 6.6 percent increase in median prices (from $160,000 in 2007 to $170,500 in 2008). The Southeast region experienced the biggest drop in median prices, with a significant 25.2 percent drop compared to the same quarter last year (from $189,900 in 2007 to $142,000 in 2008).
In the multi-family market, there were extreme increases in sales activity during the third quarter, with only the Southeast seeing a decline of 6.4 percent compared to last year (110 homes sold in 2007 to 103 homes sold in 2008). The Northeast region had an 85.8 percent increase in the Q3 compared to the same time last year with 226 homes sold in 2007 compared to 420 sold in 2008. Second quarter multi-family sales activity showed large increases for all regions except the Western region with a 0.5 percent decline from Q2 2007, and Cape Cod with a 15 percent decline from Q2 2007.
Despite the sales increases in Q3 and declines in Q2, only Cape Cod saw median price increases for multi-family homes. The median price on Cape Cod went up 7.2 percent in Q3 from $368,500 in 2007 to $395,000 in 2008, and 9.6 percent in Q2 from $375,000 in 2007 to $411,000 in 2008. The Northeast region saw the largest median prices decreases for both quarters, with a 42.8 percent drop in Q3 from $314,750 in 2007 to $180,000 in 2008, and a 33.5 percent drop in Q2 from $310,000 in 2007 to $206,000 in 2008. In Q2 the Central region also saw a 33.5 percent drop in median prices from $248,000 in 2007 to $165,000 in 2008.
“I feel it is a positive sign to see that investors are coming back into the multi-family market,” said MAR President Susan M. Renfrew, broker/co-owner of Renfrew Real Estate in Greenfield. “Two- and three-family homes are an important part of many communities in Massachusetts, and qualified ownership of these properties is an important step in stabilizing these neighborhoods.”
3rd Quarter sales down for single-family, condos; multi-family sales increase 40%
11/10/2008
In addition to monthly numbers, MAR also released Q3 sales numbers this past Monday. The report shows the number of single-family homes sold in the third quarter of 2008 was down 7.9 percent compared to the same time last year (12,195 homes sold in 2007 to 11,235 homes sold in 2008). Median selling prices were down 10.4 percent from $355,000 in 2007 to $318,000 in 2008.
The condominium market experienced a drop of 11.5 percent in the number of units sold in the third quarter compared to the same quarter last year with 5,555 units sold in 2007 to 4,914 units sold in 2008. Median selling prices were down 2.8 percent from $288,000 in 2007 to $280,000 in 2008.
The multi-family market saw a 40.3 percent increase in the number of third-quarter sales compared to the same time last year with 1,304 homes sold in 2007 and 1,830 homes sold in 2008. Median selling prices were down 34.7 percent compared to the third quarter last year from $325,500 in 2007 to $212,500 in 2008.
Due to changes in reporting at local boards, second quarter multi-family data was not available previously. During the second quarter, multi-family home sales increased 22.9 percent from last year with 1,311 homes sold in Q2 2007 and 1,611 homes sold in Q2 2008. Multi-family median selling prices decreased 32.8 percent from the second quarter last year from $340,000 in Q2 2007 to $228,500 in Q2 2008.
Quarterly Regional Sales Data:
Regionally, every part of the state saw a decrease in sales of single-family homes compared to the same quarter last year, except Cape Cod, which saw an increase of 6.2 percent (801 homes sold in 2007 compared to 851 homes sold in 2008). Of the seven regions, the Western region experienced the largest drop in sales at 12.9 percent with 1,703 homes sold in Q3 2007 compared to 1,484 homes sold in Q3 2008.
While the Western region experienced the largest drop in home sales, it also experienced the lowest drop in median prices at four percent from $215,900 in 2007 to $207,250 in 2008. Conversely, while Cape Cod had the only increase in sales, that region of the state that had the largest drop in median prices at 16.3 percent from $409,000 in 2007 to $342,500 in 2008.
In the condo market, the Western region had the smallest drop in sales, with a 6.9 percent decrease compared to the same quarter last year with 275 units sold in 2007 to 256 units sold in 2008. The Southeast region had the biggest decrease in condo sales at 26.2 percent, going from 61 units sold in 2007 to 45 units sold in 2008.
The Western region had a 6.6 percent increase in median prices (from $160,000 in 2007 to $170,500 in 2008). The Southeast region experienced the biggest drop in median prices, with a significant 25.2 percent drop compared to the same quarter last year (from $189,900 in 2007 to $142,000 in 2008).
In the multi-family market, there were extreme increases in sales activity during the third quarter, with only the Southeast seeing a decline of 6.4 percent compared to last year (110 homes sold in 2007 to 103 homes sold in 2008). The Northeast region had an 85.8 percent increase in the Q3 compared to the same time last year with 226 homes sold in 2007 compared to 420 sold in 2008. Second quarter multi-family sales activity showed large increases for all regions except the Western region with a 0.5 percent decline from Q2 2007, and Cape Cod with a 15 percent decline from Q2 2007.
Despite the sales increases in Q3 and declines in Q2, only Cape Cod saw median price increases for multi-family homes. The median price on Cape Cod went up 7.2 percent in Q3 from $368,500 in 2007 to $395,000 in 2008, and 9.6 percent in Q2 from $375,000 in 2007 to $411,000 in 2008. The Northeast region saw the largest median prices decreases for both quarters, with a 42.8 percent drop in Q3 from $314,750 in 2007 to $180,000 in 2008, and a 33.5 percent drop in Q2 from $310,000 in 2007 to $206,000 in 2008. In Q2 the Central region also saw a 33.5 percent drop in median prices from $248,000 in 2007 to $165,000 in 2008.
“I feel it is a positive sign to see that investors are coming back into the multi-family market,” said MAR President Susan M. Renfrew, broker/co-owner of Renfrew Real Estate in Greenfield. “Two- and three-family homes are an important part of many communities in Massachusetts, and qualified ownership of these properties is an important step in stabilizing these neighborhoods.”
Obama and Housing
Washington Report: What Obama Means for Housing
Realty Times Inc
What's an Obama administration, plus heavy new Democratic majorities in the House and Senate, going to mean for housing and real estate?
That's the trillion dollar question in Washington this week -- and nobody can give you the answers for sure. It's way too early - there are two full months before inauguration day in January.
But between now and then, there are going to be some important indicators. Tops on the list: What gets done -- if anything -- during the upcoming lame duck session?
Officially Congress is scheduled to come back the week of November 17 to finish up loose ends on the legislative calendar.
Democratic leaders in both the House and Senate have said they'd like to push through an ambitious emergency economic stimulus plan - portions of which are likely to be aimed at keeping financially-distressed home owners out of foreclosures, and pumping up housing sales.
During the closing days of the campaign, Senator Obama did not say whether he favors trying to pass a stimulus bill through a lame-duck Congress where Republicans could influence or sabotage the results.
The logical alternative to that would be to put together his own plan and come back in January, with heavy Democratic majorities, and push it through as a dramatic way to jump-start his new administration.
But whatever the timing, you can count on several major Obama priorities:
Number one: Large-scale, systematic mortgage relief for home owners behind on their loans.
That package could include a freeze on all foreclosures by lenders for 90 days or more; mandates for banks and loan servicers to modify the terms of mortgages to prevent foreclosures; plus new powers for bankruptcy court judges to require lenders to reduce loan balances owed or cut interest rates.
The banking and mortgage lending industries strongly oppose changes like these -- and that could be one of the first big battles the Obama administration wages on Capitol Hill.
You can count on quick passage of long-stalled Democratic bills on predatory lending, appraisal reform, plus a major effort to consolidate and strengthen the powers of financial regulatory agencies to oversee the mortgage and banking industries.
Don't be surprised if you see President-elect Obama name some of his key cabinet members early -- especially his nominee for Treasury secretary. This would allow the outgoing Bush officials to work with the incoming leaders on programs such as mortgage relief, and to have an orderly transition.
Published: November 10, 2008
Realty Times Inc
What's an Obama administration, plus heavy new Democratic majorities in the House and Senate, going to mean for housing and real estate?
That's the trillion dollar question in Washington this week -- and nobody can give you the answers for sure. It's way too early - there are two full months before inauguration day in January.
But between now and then, there are going to be some important indicators. Tops on the list: What gets done -- if anything -- during the upcoming lame duck session?
Officially Congress is scheduled to come back the week of November 17 to finish up loose ends on the legislative calendar.
Democratic leaders in both the House and Senate have said they'd like to push through an ambitious emergency economic stimulus plan - portions of which are likely to be aimed at keeping financially-distressed home owners out of foreclosures, and pumping up housing sales.
During the closing days of the campaign, Senator Obama did not say whether he favors trying to pass a stimulus bill through a lame-duck Congress where Republicans could influence or sabotage the results.
The logical alternative to that would be to put together his own plan and come back in January, with heavy Democratic majorities, and push it through as a dramatic way to jump-start his new administration.
But whatever the timing, you can count on several major Obama priorities:
Number one: Large-scale, systematic mortgage relief for home owners behind on their loans.
That package could include a freeze on all foreclosures by lenders for 90 days or more; mandates for banks and loan servicers to modify the terms of mortgages to prevent foreclosures; plus new powers for bankruptcy court judges to require lenders to reduce loan balances owed or cut interest rates.
The banking and mortgage lending industries strongly oppose changes like these -- and that could be one of the first big battles the Obama administration wages on Capitol Hill.
You can count on quick passage of long-stalled Democratic bills on predatory lending, appraisal reform, plus a major effort to consolidate and strengthen the powers of financial regulatory agencies to oversee the mortgage and banking industries.
Don't be surprised if you see President-elect Obama name some of his key cabinet members early -- especially his nominee for Treasury secretary. This would allow the outgoing Bush officials to work with the incoming leaders on programs such as mortgage relief, and to have an orderly transition.
Published: November 10, 2008
Saturday, November 8, 2008
2008 Patriot Season Video To be Released
If you enjoyed the Super Bowl Video... You'll really love the season on tape! The 2008 Patriot Season Video will be released by December 10 2008. I am currently working on a documentary for Doherty Football in the interim. Feel free to check back here to find out when the film will be ready. Great Season Everyone!
Adam Pasquale
Wednesday, November 5, 2008
The New Construction Update
New Construction
by Adam Pasquale and Realty Times Inc
According to the National Association of Home Builders (NAHB) -- sales of "newly build" single-family homes posted a gain in September.
Regionally, sales activity gained 22.7 percent in the West and 0.7 percent in the South in September, but at the same time declined 21.4 percent in the Northeast and 5.8 percent in the Midwest.
Despite these positive statistics, NAHB Chief Economist David Seiders, put things in perspective saying, "Today's gain in new-home sales followed a downward revision for August and was almost entirely concentrated in the West region, where sales bounced back from a very low level in August. The fact is that housing demand remains fundamentally weak and the housing contraction continues to weigh heavily on the financial markets and the overall economy. Without question, an additional economic stimulus package – including substantial measures to spur home buying and limit foreclosures – is necessary to support home prices, stabilize financial markets and limit the severity of recession."
by Adam Pasquale and Realty Times Inc
According to the National Association of Home Builders (NAHB) -- sales of "newly build" single-family homes posted a gain in September.
Regionally, sales activity gained 22.7 percent in the West and 0.7 percent in the South in September, but at the same time declined 21.4 percent in the Northeast and 5.8 percent in the Midwest.
Despite these positive statistics, NAHB Chief Economist David Seiders, put things in perspective saying, "Today's gain in new-home sales followed a downward revision for August and was almost entirely concentrated in the West region, where sales bounced back from a very low level in August. The fact is that housing demand remains fundamentally weak and the housing contraction continues to weigh heavily on the financial markets and the overall economy. Without question, an additional economic stimulus package – including substantial measures to spur home buying and limit foreclosures – is necessary to support home prices, stabilize financial markets and limit the severity of recession."
Market set to rebound. Here is how it happens!!!
Market conditions: Adam Pasquale courtesy of Realty Times
According to a recent statement, the National Association of Realtors has "stepped up its challenge to lawmakers encouraging them to take new, decisive actions to address the continuing problems in the housing industry, as well as the ongoing economic crisis."
NAR provided an economic analysis demonstrating that a reduction, or a buydown, of interest rates by just 1 percentage point could result in up to 840,000 additional home sales and reduce the inventory of homes by as much as 20 percent. Inventories currently at 9.9 months’ supply would decrease to approximately a 7.5 month supply.
Reducing the interest rate, combined with removing the home buyer tax credit repayment, would result in an additional 10 percent reduction in inventory, down to a 6.5-month supply, and would produce modest home price gains of 2 to 4 percent. Such price gains would provide up to $760 billion in housing equity recovery for the nation’s 75 million homeowners.
Wednesday, October 29, 2008
Mortgage Market Rebound
National Mortgage Application Up in Weekly Measure
October 29, 2008 11:39am
Adam Pasquale
The Market Composite Index, a measure of mortgage loan application volume compilied by the Mortgage Bankers Association, rose nearly 17 percent last week on seasonally adjusted basis.
The Index rose to 476.7 from 408.1 in the week prior. On an anadjusted basis, the Index increased 29.6 percent compared with the previous week, but was down 30 percent with the same week one year earlier.
October 29, 2008 11:39am
Adam Pasquale
The Market Composite Index, a measure of mortgage loan application volume compilied by the Mortgage Bankers Association, rose nearly 17 percent last week on seasonally adjusted basis.
The Index rose to 476.7 from 408.1 in the week prior. On an anadjusted basis, the Index increased 29.6 percent compared with the previous week, but was down 30 percent with the same week one year earlier.
Howeowner Bailouts are happening!
FHA “Hope for Homeowners” Refinancing Program Launched
HUD’s new HOPE for Homeowners Program, under which the Federal Housing Administration (FHA) will insure refinance mortgages for borrowers who are having difficulty making their payments, began on October 1, 2008 and will end September 30, 2011. HUD has created a HOPE for Homeowners website with information for both borrowers and lenders.
The program is available only to owner-occupants of one-unit properties who can afford a new loan and will offer 30-year fixed rate mortgages. If borrowers are unable to refinance the entire amount due, banks will have to write down the existing mortgage to 90 percent of the new appraised value of the home. To be eligible, the property must be the borrowers primary residence (they can’t have an ownership interest in any other residential property, such as second homes and their existing mortgage has to have been originated on or before January 1, 2008, and they must have made at least six payments. In addition, they must be unable to pay their existing mortgage without help (as of March 2008, their total monthly mortgage payments due must be more than 31 percent of their gross monthly income).
Again, where is the press on the one? If you know someone who needs this program, send this blog to him/her.
Adam Pasquale, Achieva Realty
Great News for Worcester!!!
This is great news for Worcester. Yet another Company pledges to invest in this community.High paying jobs relocating here is awesome.
Adam Pasquale
Tuesday, October 28, 2008
The True Picture of National Real Estate
These graphs were just published by The National Association of Realtors !
2008 is actually a good year in comparison to the last 18 years! Don't believe the hype from the media. House's are still selling.
Sunday, October 26, 2008
What is a Short Sale?
Buyers pursue short sales to get a good deal. So when you see a price listed for a home that you think is too low for the neighborhood, before you jump on that price like hot fudge on a sundae, ask your agent to call the listing agent to find out if the home is a short sale. Because you might want to think twice about making an offer on a pre-foreclosure, short sale home. It's not as simple as you may believe, and very few can close in 60 days or less. In my experience, it takes about 4-6 months at least.
What is a Short Sale?
A short sale means the seller's lender is accepting a discounted payoff to release an existing mortgage. Just because a property is listed with short sale terms does not mean the lender will accept your offer, even if the seller accepts it.
A lender is not going to agree to a short sale unless the seller has no equity and is unable to repay the difference between your sales price and the existing loans. Sellers need to provide a hardship letter to the lender. Sellers may also owe taxes on the amount of debt that is forgiven.
What is a Short Sale?
A short sale means the seller's lender is accepting a discounted payoff to release an existing mortgage. Just because a property is listed with short sale terms does not mean the lender will accept your offer, even if the seller accepts it.
Be aware that the seller need not be in default -- to have stopped making mortgage payments -- before a lender will consider a short sale. A lender may consider a short sale if the seller is current but the value has fallen. The seller may have over-encumbered, owe more than the home is worth, so a discounted price might bring the price in line with market value, not below it.
Check Public RecordsDo your research before making an offer to purchase. Your agent can find out who is in title, whether a foreclosure notice has been filed and how much is owed to the lender(s). This is important because it will help you to determine how much to offer.
Prepare the Seller for Lender DemandsIf there are two loans, you could have a problem. The first mortgage lender's position is protected by the second lender, unless the second lender does not want to foreclose. If a seller owes $160,000 on the first and $40,000 on the second, offering $160,000 leaves nothing for the second. The first will need to give something to the second to gain its cooperation.
Hire an Agent with Short Sale Experience
It's one strike against you if the listing agent has never handled a short sale, but it's even worse if your own agent has no experience in that arena. You need an experienced short sale agent.An agent with experience in short sales will help to expedite your transaction and protect your interests. You don't want to miss any important detail due to inexperience or find out your transaction is not going to close on time because no one has followed up in a timely manner.
A lender is not going to agree to a short sale unless the seller has no equity and is unable to repay the difference between your sales price and the existing loans. Sellers need to provide a hardship letter to the lender. Sellers may also owe taxes on the amount of debt that is forgiven.
A seller I know once demanded that the buyer slip the seller $1,000 to be given the right to purchase the seller's property. We said no. This is fraud. The lender legally pursued that seller. Do not be lured by sellers who suggest this practice. In a short sale, the seller receives no money because the lender is losing money.
If you have further questions about Short Sales, call Adam Pasquale. AchievaRealty.comMulti Family market crash! 50% loss!
Some of you may disturbed by the the following fact: In 2006, between the peak selling season of April-October, the average selling price for a 3 family home in Worcester was $304,540. 95 units were sold.
In 2008, during the peak selling period of April-October, the average selling price for a 3 family home in Worcester was $142,402. 121 units were sold.
It is interesting to note that the volume of sales were up 20%. This research was compiled by using MLS data. The question is ....why are the values so low? The answer is simple. Most, if not all of the 3 family homes that were sold were under financial duress. The sales were either short sales or REO's (Real Estate Owned by the bank).
Savvy investors are buying a lot of Real Estate in Worcester! Let's do the math. Let's pretend each unit is paying $650 a month in rent. $1,950 comes in every month and the mortgage payment is about $1,200 a month! This scenario provides positive cash flow of $750 a month. That's plenty of money to address any repairs!
If you or someone you know is interested in learning more about how to create a Real Estate Pension! Call Adam Pasquale for a Real Estate review!
In 2008, during the peak selling period of April-October, the average selling price for a 3 family home in Worcester was $142,402. 121 units were sold.
It is interesting to note that the volume of sales were up 20%. This research was compiled by using MLS data. The question is ....why are the values so low? The answer is simple. Most, if not all of the 3 family homes that were sold were under financial duress. The sales were either short sales or REO's (Real Estate Owned by the bank).
Savvy investors are buying a lot of Real Estate in Worcester! Let's do the math. Let's pretend each unit is paying $650 a month in rent. $1,950 comes in every month and the mortgage payment is about $1,200 a month! This scenario provides positive cash flow of $750 a month. That's plenty of money to address any repairs!
If you or someone you know is interested in learning more about how to create a Real Estate Pension! Call Adam Pasquale for a Real Estate review!
Thursday, October 16, 2008
Real Estate Market Defying Odds
Provided to you by Adam Pasquale
Real Estate Outlook: Real Estate Market Defying Odds
Real Estate Outlook: Real Estate Market Defying Odds
by Kenneth R. Harney
The panic and fear that have been shaking Wall Street aren't translating into negative numbers for real estate -- in fact, it's been the reverse.
While the Dow Jones index peeled off a record fourteen hundred points in a matter of days, the latest pending home sales index was moving in the opposite direction -- up strongly to its highest level in more than a year.
Pending sales jumped by 7.4 percent in the latest month, according to the National Association of Realtors.
Financial industry analysts had forecast a one and a half point DECLINE in the index for the month, but pent-up demand for housing, plus rock bottom bargain prices in many markets, convinced buyers that this is a good time to get off the sidelines and get into the game.
The pending home sales index measures new contracts for home purchases that haven't yet gone to closing, but should do so in the near future. It's a widely accepted predictor of sales activity two to three months down the road.
Mortgage rates and new loan applications also defied the negative spiral in the stock market: Applications for home purchases to be financed with conventional mortgages jumped by three percent last week, and new FHA applications were up by nearly 10 percent, according to the Mortgage Bankers Association's national survey.
Interest rates on 30 year fixed rate loans dropped to 5.9 percent and 15 year rates hit 5.7 percent.
Why the sharp divergence in performance between home real estate and Wall Street?
One key reason is that real estate -- which helped trigger the financial crisis through lending abuses and fraud -- has been undergoing its own correction on pricing and underwriting practices for the past two and a half years.
It's already taken its lumps, and has now reached a point where prices in former boom markets are so affordable that smart buyers are swooping in.
Also - although we keep hearing about the global credit squeeze and banks' unwillingness to lend money, that's definitely NOT the case in the mortgage market. There's plenty of money available - as long as you have a solid credit history and some downpayment cash.
Fannie Mae, Freddie Mac and the FHA now account for well over 90 percent of home financing volume, and all three are backed by the federal government.
They've got a direct and virtually unlimited pipeline into the capital markets.
And with mortgage rates under 6 percent, no wonder consumers are shopping for -- and buying -- houses at great prices.
Published: October 14, 2008
Comments from Adam Pasquale on this article: Here in Worcester County the market is gaining significant momentum! In fact, many Bank Owned properties that are coming on to the market are going on deposit within days! The reason is simple... the properties are priced to sell fast!The days of competing offers driving the selling price up are returning! In Worcester during the month of September, 15 houses sold over asking price within 5 days of coming on the market. My staff is very busy showing and selling houses this week despite what the news is reporting!
TheBuyWorcesterNow.com program is an excellent vehicle for many 1st time home buyers! Adam Cammosse from Homeinex is a home inspector and he is reporting that his activity is through the roof! Perhaps Global Warming is effecting the Real Estate market also. It feels like Spring Market is upon us in November. Thank you for supporting local business!
Adam Pasquale
Wednesday, October 15, 2008
Skipping a mortgage payment without hurting your credit??
Fannie Mae's New Loan Program Breaks The Oldest Rule of Lending
by Kenneth R. Harney
A new mortgage plan now available from a handful of lenders around the country allows home buyers and refinancers to break the oldest rule of lending: Borrowers can skip monthly payments periodically without hurting their credit standing, angering the bank, or getting hit with a late fee.
Known as "Payment Power", the plan is being field-tested by at least six lenders under arrangements with Fannie Mae, the giant Washington, D.C.-based home loan investor. Under the new mortgage's terms, borrowers can opt to miss up to two monthly payments per year, or as many as 10 payments over the full 30-year term of the loan. The missed payments--including principal, interest, taxes and other escrowed items--are rolled into the remaining principal balance of the mortgage. The principal balance is then amortized without increasing the term of the loan--in effect, financing the unpaid amounts via slightly higher monthly payments over the regular term of the mortgage. There are no balloon payments involved, nor can the number of months remainng on the loan be increased.
On a $100,000 30-year loan at 7 percent, for instance, the first skipped payment would add less than $9 to the monthly mortgage bill for the remaining term of the loan. Further skips would raise payments by additional amounts. Lenders are required to report missed payments as on-time payments to credit bureaus, provided the borrowers requested the skip in advance, and were authorized by the lender to do so.
To qualify for the loan, buyers or refinancers will need strong credit histories at application, (does that make sense???..... The people who need help are struggling)and will need to make on-time payments in all months except those where they opt to skip a payment. The idea, according to lenders in the field test, is to provide flexibility for borrowers in several categories:
Home buyers or refinancers who simply have some doubts about the sagging economy, and who'd like a little cushion built into their mortgage, just in case.
The new "payment power" loans--which may be marketed under different brand names--carry interest rates and other terms identical to regular conventional mortgages purchased by Fannie Mae. The main differences are the contractual right to skip that is spelled out in the loan documents, and a small upfront participation fee (about $600 on a $100,000 mortgage) that can be paid by the borrower or split with someone else, such as a builder, a Realtor or private seller. The program will be available on 1-2 unit homes and on condominiums.
Toledo's Northern Ohio Investment Co. already has begun marketing the new program under the name "Rainy Day" mortgage. Giant Countrywide Home Loans, based in Calabasas, California, says it plans to roll out its version of the mortgage in December. Other participating lenders, according to Fannie Mae, will be kicking off marketing campaigns in the coming weeks.
Could a "payment power" loan be in your future? If Fannie Mae's field tests demonstrate that the skip feature is a sound investment, look for it to become available everywhere, as a standard mortgage option.
Published: October 14, 2002
Opening Announcement
Welcome to The Achieva Factor !!!
This is your Real Estate information Center for what's happening in Worcester County!
This blog will be updated everyday and all subscribers will have information before it hits the news!
When comes to Real Estate.... access to information is how informed decisions are made!
About the Red Sox.... "Boston is a baseball town with a drinking problem"
Adam Pasquale
Subscribe to:
Posts (Atom)
Posts
