An interview of Alan Slone of Furtune Magazine By Adriene Hill:
Later this morning, we’ll get new mortgage numbers and new data from the National Association of Home Builders. The housing market bubble has many folks more comfortable renting than buying these days.

Fortune magazine’s Allan Sloane joins us now to talk about the reluctance to sign that mortgage. Good morning Allan.

Allan Sloan: Good morning, Adriene.

Hill: So how does the price of renting compare to the price of owning right now?

Sloan: Well right now, the price of owning the average house is lower than the average rent, which is a relatively recent phenomenon.

Hill: And how does that compare historically?

Sloan: Well historically, the cost of owning a house, you know, the basic payments on the house and the taxes were considerably higher than the average rent. About three years ago, the lines crossed, and the gap has been widening. This is very unusual. Back during the housing bubble, houses were 20, 30 percent more than renting. Now the difference is the other way.

Hill: Now, does it mark some bigger shift in how people think about the value of the property or even the value of mobility in this day and age when it’s hard to sell a house quickly?

Sloan: I think it may mark more fear than anything else. During what we are now calling the bubble for five years, the price of houses went up to levels that were insane, but everyone was running in to buy houses because they figured if they wouldn’t get it now it would be more expensive next year or next week. For the past few years, with houses going down, people don’t want a house because they figure it’ll be cheaper to buy next year, ‘why should I buy it now and take a risk?’ And sooner or later, this is all going to average out, but I’m not sure when.

Hill: I guess that’s my last question: How long might this take? If this is a market overreaction, if people are responding with fear, how long does it take to resolve, maybe compared to the housing bubble?

Sloan: Now, you see, if I knew that, Adriene, I would be so smart and so rich that I wouldn’t have to write for a living, I would just be a real estate investor. The answer is: I don’t know.

Hill: Allan Sloan, senior editor-at-large at Fortune. Thanks so much.

WWW.BOBSHOMES.NET

Altos Market Reasearch recently shared the following:
It turns out that if you watch the prices of the properties that enter the market each week, you can get a real sense for the quality of the demand in a local market.

Also notable is that the spring housing market starts the second week of January. Like clockwork.

Realtors, it turns out, in aggregate are quite sensitive to where homes should be priced. They tend to price homes very close to where they’ll sell. When they’re sensing healthy demand, they price more aggressively. When they sense weakness, they’ll price lower so the property will move. They’re pretty clever, those Realtors. Here’s what they’re telling us today:

Median price of new listings. Single Family Properties across 20 major US metro markets. Source: Altos Research

The data-point we’re looking at is at the far right side of the red line, that’s the weekly number, for January 13, 2012. Notice every 2nd week of January we get an uptick. This year is a nice strong move above the recent trendline (that’s the green). This move, while admittedly only one data point, is the very first signal of the new year.

It’s not aggressively bullish, mind you. But it implies US home price stability through the first quarter. And that’s encouraging.

Stay tuned.

Homeowners who have resisted the urge to refinance their mortgages until now could be rewarded for their willpower. Mortgage rates have fallen to new lows—and banks are rolling out incentives to win business.
Economic uncertainty in Europe and slow growth in the U.S. are prompting investors to pile into ultrasafe U.S. Treasurys. That, in turn, is pushing down mortgage rates, which are tied to Treasurys.
The average interest rate on a 30-year mortgage fell to 4.05% for the week ended Dec. 23, the lowest in 60 years, according to HSH Associates, a mortgage-data firm. And rates on jumbo mortgages—private loans that in most parts of the country are larger than $417,000—also have hit new lows, averaging 4.61%.
“It’s hard to argue rates will get much lower than they are today,” says Stuart Gabriel, director of the Ziman Center for Real Estate at the University of California, Los Angeles.
That’s good news for homeowners. A person who refinanced a $400,000 30-year mortgage in February would pay an interest rate of 5.04% on average, according to HSH Associates, and fork over $2,157 a month; at the current rate of 4.05%, he’d save $236 per month, or $2,830 per year.
[More from WSJ.com: The Investing Landscape for 2012 Could Be Rough]
What’s more, demand for refinancing is declining, since many homeowners already took advantage of lower mortgage rates. Applications for refinancing are 17% below this year’s peak in September, according to the latest data from the Mortgage Bankers Association.
That and other factors have prompted some lenders to offer incentives to win new business—particularly regional and community banks, which are focusing more on jumbo mortgages, says Stu Feldstein, president at SMR Research, which tracks the mortgage market.
The discounts can be sizable. Regional bank Valley National Bank charges homeowners in New Jersey and eastern Pennsylvania a flat fee of $499 for closing costs on mortgages as large as $1 million. Since average closing costs on a refinance run about 2% of the total loan amount, a person with an $800,000 mortgage could save about $15,500.
[Click here to check home equity rates in your area.]
A spokesman for the bank says it is aggressively marketing the discount in part to bring in more customers.
While many lenders don’t refinance mortgages that are larger than about $2 million, Union Bank—which has branches in California, Oregon and Washington—refinances up to $4 million at no extra cost. (Many banks that refinance multimillion-dollar mortgages tack up to an extra quarter of a percentage point on the interest rate.)
Since November, Union Bank has also allowed borrowers to roll the costs of a refinance, like the appraisal fee and loan processing fee, into the mortgage. And borrowers whose original mortgage is from Union Bank don’t have to provide all of the income documentation that other customers do in order to refinance.
In part, the bank’s goal is to develop relationships with high-net-worth clients, says Stuart Bernstein, national production manager of residential lending at Union Bank.
Despite the incentives, many would-be applicants remain sidelined because they can’t meet the long list of qualifications.
[More from WSJ.com: Aging and Broke, More Lean on Family]
The home-equity requirement is one of the toughest hurdles, says Mr. Feldstein. Homeowners with at least 10% home equity make the cut, but people with less have a tougher time.
Borrowers with 10% to 19% equity in their home usually have to buy private mortgage insurance, whose cost varies based on many factors, including their credit score. A borrower with 15% equity and a FICO credit score above 720 could pay 0.44% of the total loan amount, says Keith Gumbinger, vice president at HSH Associates. On an $800,000 loan that would be $3,520 a year—eating into the potential savings of a refinance.
In December, the federal government rolled out a revamped version of the Home Affordable Refinance Program with relaxed home-equity requirements, to allow more borrowers to refinance. To qualify, the current mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae, and borrowers need to be mostly current on payments.
For regular refinancing, applicants need a FICO credit score of at least 740 to get the best rates, says Mr. Gumbinger. And they must provide copious documentation, including at least two years’ worth of tax returns and proof of income as well as recent statements for assets such as retirement and brokerage accounts.
[More from WSJ.com: Price of Getting a Credit Card Is Paying Expired Debt]
After clearing those hurdles, you might wait about 60 days for refinancing to be completed, says Mr. Gumbinger—longer than the typical 45 days. While some lenders are offering 60-day rate locks for free, others charge a quarter of a percentage point of the total loan amount for the service. On an $800,000 mortgage, that’s $2,000.
Or you could opt to take your chances with a free 45-day lock and hope rates don’t spike between day 46 and the date your loan closes. With the euro zone still in economic crisis and global investors rushing to the safety of U.S. Treasurys, housing-market analysts say it could be at least six months before rates rise significantly.

WWW.BOBSHOMES.NET

Housing Market for July 2011

Bob Idakaar

PRUDENTIAL NJ PROPERTIES

WWW.BOBSHOMES.NET

The Northeast mainly concerning tri  state areas of Connecticutt, New York and New Jersey seems to be better than many other places in the country.   There still are jobs here and thank GOD for the Pharma  Companies and Economic  strengths of the suburbs of NYC
The Easy answer that everyone agrees to is the  creation of jobs will truly help the overall economy which will in turn affect the housing sector and the financial strength we once had.

Here are the Worst Housing Markets For The Next Five Years

The worst place to invest: Miami, Florida

Cumulative growth from 2005 to 2011: -54.3%
Annualized growth from 2011 to 2016: -0.7%The second worst place to invest: Atlantic City, New Jersey

Cumulative growth from 2005 to 2011: -34.05%
Annualized growth from 2011 to 2016: 0.2%

#3 Nassau County, New York

Cumulative growth from 2005 to 2011: -27.3%
Annualized growth from 2011 to 2016: 0.7%

The next three are tied for #4

#4 (tie) Fort Lauderdale, Florida

Cumulative growth from 2005 to 2011: -52.9%
Annualized growth from 2011 to 2016: 0.8%

#4 (tie) Midland, Texas

Cumulative growth from 2005 to 2011: -40.95%
Annualized growth from 2011 to 2016: 0.8%

#4 (tie) Washington, D.C.

Cumulative growth from 2005 to 2011: -28.1%
Annualized growth from 2011 to 2016: 0.8%

#5 Abilene, Texas

Cumulative growth from 2005 to 2011: -18.9%
Annualized growth from 2011 to 2016: 1.0%

#6 Morgantown, West Virginia

Cumulative growth from 2005 to 2011: -4.15%
Annualized growth from 2011 to 2016: 1.1%

The next two are tied for #7

#7 (tie) Austin, Texas

Cumulative growth from 2005 to 2011: 2.63%
Annualized growth from 2011 to 2016: 1.2%

#7 (tie) Waterloo-Cedar Falls, Iowa

Cumulative growth from 2005 to 2011: -2.73%
Annualized growth from 2011 to 2016: 1.2%

The next five are tied for #8

#8 (tie) Baton Rouge, Louisiana

Cumulative growth from 2005 to 2011: -14.48%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Amarillo, Texas

Cumulative growth from 2005 to 2011: -10.5%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Lancaster, Pennsylvania

Cumulative growth from 2005 to 2011: -5.15%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Monroe, Louisiana

Cumulative growth from 2005 to 2011: -11.31%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Shreveport, Louisiana

Cumulative growth from 2005 to 2011: -10.38%
Annualized growth from 2011 to 2016: 1.4%

Although there is little projected growth in these specific locations, many like Austin, and Baton Rouge and others experienced far lighter price declines than in the more œpopular areas such as Arizona, New Mexico, Florida, and the like.

Additionally, even in the hardest hit areas, housing prices are low compared to the rents that many are paying for decent housing. That factor is not often mentioned in the press. Another rarely mentioned fact: if you are planning to be in a location for some time, today™s low mortgage rates (yes, if you qualify) combined with today™s distressed housing prices (look for foreclosures  and short sales if you can) make for a once in a lifetime opportunity to acquire housing at a reasonable price for the LONG TERM.

Yes the long term“another item not often mentioned. Even in the areas mentioned in this article which are œonly projected to grow under 2% over the next 5 years, at least there is POSITIVE growth projected. Where else can you provide a life necessity (housing) that one can acquire and get tax advantages (deduct interest) vs. renting? And let™s look at renting; again, if you have plans to stay in the locale where you are, then renting is a guaranteed outflow of money with no return. With buying at today™s levels, even the dismal articles one now sees show stability or small growth in upcoming years. That sounds like a recipe for the right time to buy to me.

Out of chaos comes opportunity. And don™t forget it™s human nature to flee in the wrong direction at the wrong time. For instance, buying when stocks are surging vs. acquiring equities for the long run in a systematic way over time regardless of current price levels“translation: most people buy when the hype is high and sell when stocks are plunging; exactly opposite of what they should be doing to better themselves. I believe that housing correlates well with this stock analogy: buying housing or rental units now, if it™s right for you, is buying into and/or after the bulk of the plunge has taken place. Growth in value may be slow, but relative stability is not a bad thing. It is highly likely that housing will prove to be a great current investment for the 10-20 years that lay ahead as our population continues to support household formation.
WWW.BOBSHOMES.NET

TOLL FREE 1-877-744-4663

Housing Market for July 2011

Bob Idakaar

PRUDENTIAL NJ PROPERTIES

WWW.BOBSHOMES.NET

The Northeast mainly concerning tri  state areas of Connecticutt, New York and New Jersey seems to be better than many other places in the country.   There still are jobs here and thank GOD for the Pharma  Companies and Economic  strengths of the suburbs of NYC
The Easy answer that everyone agrees to is the  creation of jobs will truly help the overall economy which will in turn affect the housing sector and the financial strength we once had.

Here are the Worst Housing Markets For The Next Five Years

The worst place to invest: Miami, Florida

Cumulative growth from 2005 to 2011: -54.3%
Annualized growth from 2011 to 2016: -0.7%The second worst place to invest: Atlantic City, New Jersey

Cumulative growth from 2005 to 2011: -34.05%
Annualized growth from 2011 to 2016: 0.2%

#3 Nassau County, New York

Cumulative growth from 2005 to 2011: -27.3%
Annualized growth from 2011 to 2016: 0.7%

The next three are tied for #4

#4 (tie) Fort Lauderdale, Florida

Cumulative growth from 2005 to 2011: -52.9%
Annualized growth from 2011 to 2016: 0.8%

#4 (tie) Midland, Texas

Cumulative growth from 2005 to 2011: -40.95%
Annualized growth from 2011 to 2016: 0.8%

#4 (tie) Washington, D.C.

Cumulative growth from 2005 to 2011: -28.1%
Annualized growth from 2011 to 2016: 0.8%

#5 Abilene, Texas

Cumulative growth from 2005 to 2011: -18.9%
Annualized growth from 2011 to 2016: 1.0%

#6 Morgantown, West Virginia

Cumulative growth from 2005 to 2011: -4.15%
Annualized growth from 2011 to 2016: 1.1%

The next two are tied for #7

#7 (tie) Austin, Texas

Cumulative growth from 2005 to 2011: 2.63%
Annualized growth from 2011 to 2016: 1.2%

#7 (tie) Waterloo-Cedar Falls, Iowa

Cumulative growth from 2005 to 2011: -2.73%
Annualized growth from 2011 to 2016: 1.2%

The next five are tied for #8

#8 (tie) Baton Rouge, Louisiana

Cumulative growth from 2005 to 2011: -14.48%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Amarillo, Texas

Cumulative growth from 2005 to 2011: -10.5%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Lancaster, Pennsylvania

Cumulative growth from 2005 to 2011: -5.15%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Monroe, Louisiana

Cumulative growth from 2005 to 2011: -11.31%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Shreveport, Louisiana

Cumulative growth from 2005 to 2011: -10.38%
Annualized growth from 2011 to 2016: 1.4%

Although there is little projected growth in these specific locations, many like Austin, and Baton Rouge and others experienced far lighter price declines than in the more œpopular areas such as Arizona, New Mexico, Florida, and the like.

Additionally, even in the hardest hit areas, housing prices are low compared to the rents that many are paying for decent housing. That factor is not often mentioned in the press. Another rarely mentioned fact: if you are planning to be in a location for some time, today™s low mortgage rates (yes, if you qualify) combined with today™s distressed housing prices (look for foreclosures  and short sales if you can) make for a once in a lifetime opportunity to acquire housing at a reasonable price for the LONG TERM.

Yes the long term“another item not often mentioned. Even in the areas mentioned in this article which are œonly projected to grow under 2% over the next 5 years, at least there is POSITIVE growth projected. Where else can you provide a life necessity (housing) that one can acquire and get tax advantages (deduct interest) vs. renting? And let™s look at renting; again, if you have plans to stay in the locale where you are, then renting is a guaranteed outflow of money with no return. With buying at today™s levels, even the dismal articles one now sees show stability or small growth in upcoming years. That sounds like a recipe for the right time to buy to me.

Out of chaos comes opportunity. And don™t forget it™s human nature to flee in the wrong direction at the wrong time. For instance, buying when stocks are surging vs. acquiring equities for the long run in a systematic way over time regardless of current price levels“translation: most people buy when the hype is high and sell when stocks are plunging; exactly opposite of what they should be doing to better themselves. I believe that housing correlates well with this stock analogy: buying housing or rental units now, if it™s right for you, is buying into and/or after the bulk of the plunge has taken place. Growth in value may be slow, but relative stability is not a bad thing. It is highly likely that housing will prove to be a great current investment for the 10-20 years that lay ahead as our population continues to support household formation.
WWW.BOBSHOMES.NET

TOLL FREE 1-877-744-4663

Housing Market for July 2011

Bob Idakaar

PRUDENTIAL NJ PROPERTIES

WWW.BOBSHOMES.NET

The Northeast mainly concerning tri  state areas of Connecticutt, New York and New Jersey seems to be better than many other places in the country.   There still are jobs here and thank GOD for the Pharma  Companies and Economic  strengths of the suburbs of NYC
The Easy answer that everyone agrees to is the  creation of jobs will truly help the overall economy which will in turn affect the housing sector and the financial strength we once had.

Here are the Worst Housing Markets For The Next Five Years

The worst place to invest: Miami, Florida

Cumulative growth from 2005 to 2011: -54.3%
Annualized growth from 2011 to 2016: -0.7%The second worst place to invest: Atlantic City, New Jersey

Cumulative growth from 2005 to 2011: -34.05%
Annualized growth from 2011 to 2016: 0.2%

#3 Nassau County, New York

Cumulative growth from 2005 to 2011: -27.3%
Annualized growth from 2011 to 2016: 0.7%

The next three are tied for #4

#4 (tie) Fort Lauderdale, Florida

Cumulative growth from 2005 to 2011: -52.9%
Annualized growth from 2011 to 2016: 0.8%

#4 (tie) Midland, Texas

Cumulative growth from 2005 to 2011: -40.95%
Annualized growth from 2011 to 2016: 0.8%

#4 (tie) Washington, D.C.

Cumulative growth from 2005 to 2011: -28.1%
Annualized growth from 2011 to 2016: 0.8%

#5 Abilene, Texas

Cumulative growth from 2005 to 2011: -18.9%
Annualized growth from 2011 to 2016: 1.0%

#6 Morgantown, West Virginia

Cumulative growth from 2005 to 2011: -4.15%
Annualized growth from 2011 to 2016: 1.1%

The next two are tied for #7

#7 (tie) Austin, Texas

Cumulative growth from 2005 to 2011: 2.63%
Annualized growth from 2011 to 2016: 1.2%

#7 (tie) Waterloo-Cedar Falls, Iowa

Cumulative growth from 2005 to 2011: -2.73%
Annualized growth from 2011 to 2016: 1.2%

The next five are tied for #8

#8 (tie) Baton Rouge, Louisiana

Cumulative growth from 2005 to 2011: -14.48%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Amarillo, Texas

Cumulative growth from 2005 to 2011: -10.5%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Lancaster, Pennsylvania

Cumulative growth from 2005 to 2011: -5.15%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Monroe, Louisiana

Cumulative growth from 2005 to 2011: -11.31%
Annualized growth from 2011 to 2016: 1.4%

#8 (tie) Shreveport, Louisiana

Cumulative growth from 2005 to 2011: -10.38%
Annualized growth from 2011 to 2016: 1.4%

Although there is little projected growth in these specific locations, many like Austin, and Baton Rouge and others experienced far lighter price declines than in the more œpopular areas such as Arizona, New Mexico, Florida, and the like.

Additionally, even in the hardest hit areas, housing prices are low compared to the rents that many are paying for decent housing. That factor is not often mentioned in the press. Another rarely mentioned fact: if you are planning to be in a location for some time, today™s low mortgage rates (yes, if you qualify) combined with today™s distressed housing prices (look for foreclosures  and short sales if you can) make for a once in a lifetime opportunity to acquire housing at a reasonable price for the LONG TERM.

Yes the long term“another item not often mentioned. Even in the areas mentioned in this article which are œonly projected to grow under 2% over the next 5 years, at least there is POSITIVE growth projected. Where else can you provide a life necessity (housing) that one can acquire and get tax advantages (deduct interest) vs. renting? And let™s look at renting; again, if you have plans to stay in the locale where you are, then renting is a guaranteed outflow of money with no return. With buying at today™s levels, even the dismal articles one now sees show stability or small growth in upcoming years. That sounds like a recipe for the right time to buy to me.

Out of chaos comes opportunity. And don™t forget it™s human nature to flee in the wrong direction at the wrong time. For instance, buying when stocks are surging vs. acquiring equities for the long run in a systematic way over time regardless of current price levels“translation: most people buy when the hype is high and sell when stocks are plunging; exactly opposite of what they should be doing to better themselves. I believe that housing correlates well with this stock analogy: buying housing or rental units now, if it™s right for you, is buying into and/or after the bulk of the plunge has taken place. Growth in value may be slow, but relative stability is not a bad thing. It is highly likely that housing will prove to be a great current investment for the 10-20 years that lay ahead as our population continues to support household formation.
WWW.BOBSHOMES.NET

TOLL FREE 1-877-744-4663

The latest Fannie Mae rules eliminate buildings involved in litigation and require additional scrutiny for condo conversions.These days, when you want to get a loan to buy a home, you can expect the lender to scrutinize your credit and your finances.  If you’re buying a condo, the lender is going to scrutinize every aspect of the building and the association, as well. That’s making condos harder to buy and sell.

• Delinquent condo dues pressure fellow owners

Fannie Mae, Freddie Mac and the Federal Housing Administration all have standards that condo developments must meet for the government  to back loans on them. That has always been true. But those standards have been tightened considerably since the real-estate bust, and two new Fannie Mae requirements took effect March 1.  The strict rules mean it’s nearly impossible to get a mortgage to buy in many buildings, Mary Ellen Podmolik says in the Chicago Tribune. She explains:Among the deal-killers: too many renters in a building, pending litigation, inadequate association reserves and delinquent assessments. Those are some of the criteria lenders must look at in order to sell the loan to Fannie Mae or Freddie Mac, the troubled, government-sponsored entities, and the Federal Housing Administration, the first choice for many first-time homebuyers. Combined, the three agencies account for about 90% of the secondary-loan market.Fannie Mae, for example, requires that no more than 15% of owners are delinquent on their maintenance fees. Many buildings have a much higher percentage, as owners slip into foreclosure.  Some lenders will hold loans for nonwarrantable condos  in their portfolio,  but those loans are rare.

• 6 new hurdles for home financing

Steve Bergsman at Inman News outlines the latest Fannie Mae requirements:

• The association cannot be involved in any litigation that involves “safety, structural soundness, habitability or functional use of the project.” That would include lawsuits against an insurance company, developer or remodeling contractor.
• Buildings that were converted from rentals into condos required additional inspection via Fannie Mae’s Project Eligibility Review Service. Some associations don’t want to do that, because Fannie Mae charges lenders $1,200 plus $30 per unit.

The rules also affect current owners who want to refinance.

• Condo shopping? Ask these 7 questions before you buy

Some of the worst abuses of the real-estate bubble came when developers bought up decrepit apartment buildings, slapped on a coat of paint and sold the units as condos. Many owners discovered after they moved in, and after the association took over maintenance of common areas from the developer, that the buildings needed a lot of expensive work.  Fannie Mae doesn’t want to get involved with those types of buildings. You probably don’t, either.

• Find a new home or condo

Russell Martin, a Chicago loan officer, refers to buildings that don’t pass muster as “zombie buildings.”  He told Podmolik: “Not only are the banks protecting themselves, but they’re protecting the borrower.  There’s a reason the bank doesn’t like that building.”  If you want to buy a condo, start your search by asking whether the building has FHA, Fannie Mae or Freddie Mac approval. If it doesn’t, keep looking unless you plan to pay cash.WWW.BOBSHOMES.NET  

Posted By The KCM Crew On January 2011

We believe that things are usually as they seem. We are not the type of organization that believes in conspiracies. However, there is something interesting in some of the housing price studies we are seeing in our research. It seems that some of the groups making the predictions are the same ones that have the greatest power to affect the prices they are projecting.

Most housing analysts warn that the heaviest downward pressure on prices will be created by distressed properties and the speed at which they will be released to the market. Research shows that ˜short sales™ sell at a 20% discount and foreclosures sell at a whopping 40% discount. Obviously, when and how much discounted real estate enters the market will have a major impact on prices of surrounding properties.

Back to our research

We are now seeing that a certain segment of those projecting future pricing have two things in common:

1. They believe prices will fall rather dramatically in the first half of 2011
2. They have control of the flow of discounted properties to the market

Predictions for the first half of 2011 by firms that fall in the above category:

• Bank of America projects that prices will fall 3.7%
• Fannie Mae predicts that median prices will drop $12,500
• Wells Fargo reported that they feel home prices will drop 8%

Not a  coincidence

We are beginning to realize this is not a coincidence. The organizations which should best know when the surge of foreclosures will be released are saying house prices will be hit the hardest in the first half of the year. We are not asserting that there is anything devious in what we have found. We are just reporting that those who have control over the flow of distressed properties must think/know that inventory is about to be released. Why else would so many of them be predicting a sharp decline in home values in the next 120 days?

Bottom Line

If you currently have your house on the market and are hoping that you will see a better price after the snow melts or the temperature warms up (aka Spring), BE CAREFUL! Those in the know are warning you the best price might be attained TODAY!

WWW.BOBSHOMES.NET

 Is the housing market on the verge of recovering? Is it recovering already? If you’re not sure whether you believe the economists and pundits who think they can see the future, here are some tools that will help you make up your own mind.

In Pictures: 5 Simple Ways To Invest In Real Estate

Pending Home Sales
According to the National Association of Realtors, pending home sales, or the number of homes that are under contract and in the process of selling, rose by 8.2% in February (the most recent month for which data are available). The index is also an encouraging 17.3% over what it was a year ago.

Pending home sales are considered a leading indicator, meaning that they can forecast the direction the economy is headed. Leading indicators cannot truly predict the future, though, so they should be taken with a grain of salt. (To learn more about leading indicators, read Leading Economic Indicators Predict Market Trends.)

The increase in pending home sales could be less indicative of a genuine improvement in the housing market, however, and more indicative of the pending expiration of the homebuyer tax credit, which requires homes to be under contract by April 30. (To learn more about the homebuyer tax credit, read Claim the Homebuyer Tax Credit Before It Expires.)

Housing Starts
Housing starts are an important leading indicator of not just the housing market, but the economy as a whole, because people are more likely to start new residential construction projects when things are looking good. Housing starts don’t look promising right now – the U.S. Census Bureau reported that privately owned housing starts in February were 5.9% below January and 0.2% above February 2009. (Learn more about housing starts in Economic Indicators: Housing Starts.)

New and Existing Home Sales
New home sales reached a record low in February with 308,000 sales, according to the National Association of Home Builders (NAHB). In 2005, 1,283,000 new homes were sold per month on average. The good news is that new home sales increased by 20.8% in the West, one of the regions hardest hit by the housing crisis.

More good news comes from statistics on existing home sales. About 5 million existing homes were sold in February, up from about 4.7 million a year ago. (For more on this subject, read Economic Indicators: Existing Home Sales.)

Home Inventory
Home inventory is another leading economic indicator. A greater supply of homes-for-sale indicates weak market conditions. The NAHB also reported that as of February 2010, there were 236,000 new homes, or 9.2 months’ supply, on the market, the worst number since May 2009. There was also 8.6 months’ supply of existing homes on the market, the worst number since August 2009. However, these numbers are better than those from a year ago, when the supply was 11.1 months for new homes and 9.7 months for existing homes.

Housing Affordability
The National Association of Realtors reports that in February 2010, the median price of an existing home in the United States was $164,300 and the average mortgage rate was 4.99%. With median family income at $60,498, a family’s housing payment would only be 14.2% of its income, well below the 25% cap many financial experts recommend for keeping the monthly budget under control.

Compare these figures to 2007 averages, when a house cost $217,900, mortgage rates were 6.52% and median incomes were about the same at $61,173. While falling home prices aren’t good, improved home affordability could help the recovery by putting home ownership within reach for more families, especially the first-time buyers who have historically helped end housing slumps.

However, credit is still difficult to obtain, and unlike investors, most families can’t buy homes without a mortgage. What’s more, despite how far prices have fallen, there are still plenty of people in high-cost-of-living cities who can’t afford to buy anything.

Mortgage Applications
The Mortgage Bankers Association (MBA) issues its Weekly Mortgage Applications Survey that reports on the number of people applying to borrow money to buy a house. For the week ending April 9, mortgage applications declined by 9.6% over the previous week. The four-week moving average, which is helpful in smoothing out the ups and downs of the weekly figures, was down 6.2%. The MBA stated that an increase in mortgage insurance premiums for FHA loans, which are attractive to buyers because of their low down payment requirements, may have contributed to this decline.

Mortgage Interest Rates
For the week ending April 9, the MBA reported that the average contract rate on a 30-year fixed-rate mortgage was 5.17%. Mortgage rates have been at historic lows for months, wavering between 5% and 6%. Low mortgage rates help entice buyers, but they can’t fix a bad housing market on their own. The Consumer Confidence Index, a survey of how optimistic or pessimistic people feel about the economy, has been up and down in 2010, and consumers still feel pessimistic about the job market. The thousands of Americans who are unemployed couldn’t get a mortgage even if rates were 1%. (For related reading, see Consumer Confidence: A Killer Statistic.)

Real Estate Mutual Funds
According to Morningstar, real estate mutual funds returned 9.4% in the first quarter of 2010, one of the highest return of any mutual fund category. Over the last year, they have also led all mutual funds with a gain of 105.3%. Shares of Vanguard’s REIT ETF (VNQ), which invests in a wide range of real estate companies, gained 10% in the first quarter of 2010 and over 69% in the last year. These returns show investor confidence in the overall real estate market.

REITs are not limited to investing in the residential housing market, however; VNQ’s largest holdings, for example, include Simon Property Group, which owns numerous shopping malls; Vornado Realty Trust, the owner of many office and retail buildings; and Public Storage, the well-known storage unit rental company.

Mixed Signals
Major housing market indicators currently provide mixed signals about how the housing market is doing. High unemployment rates, the continued difficulty of obtaining credit and the pending expiration of the homebuyer tax credit make it hard to tell where the housing market is headed at the moment. Keep an eye on these indicators and wait for clear and consistent signals to emerge before you consider the housing market to truly be recovering.

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Original story – 8 Signs Of A Real Estate Rebound

Morris County NJ Ranks #7 in Forbes’ “Richest Counties in America” List

Forbes Magazine has ranked Morrris County, NJ, as seventh-wealthiest county in America. Two other New Jersey counties, Hunterdon (# 4) and Somerset (#5) also made Forbes’ list of “America’s 25 Richest Counties,” released March   2010.

 Morris County, sometimes known as œThe Crossroads of the American Revolution, has a rich history dating from Colonial days. Morristown, the county seat, was the site of George Washington™s winter headquarters during the American Revolution and remains the cultural and commercial center. The town is now home to a variety of industries, including financial services, real estate, pharmaceuticals and high-tech research. Proximity to New York City, an excellent transportation system and other assets have attracted Fortune 500 companies. Drew University, Fairleigh Dickinson University and the College of St. Elizabeth, as well as the County College of Morris, are located here. New Jersey Transit serves the regions, with Midtown Direct service to Manhattan. Bus service links the county™s 39 municipalities to the rest of the metropolitan region. Despite its renowned as a business, cultural and historic center and its easy accessibility, many regions of the county, including Boonton Township and Mendham, have retained their rural character.A great place to live!

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