Mischer News

According to HoustonFacts.org, now is the time to buy. Unlike the booming years where the sellers were the ones in control; today the buyers are calling the shots. All the components are in a buyer’s favor. Homes are competitively priced, interest rates are lower, and sellers are willing to negotiate.

"If my neighbor sold his house for $250,000 six months ago, why should I have to settle for $225,000 today?"

Attempting to regain this loss could cost more in the long run because it’s not so much a loss on the current home as it is a discount on the new, upgraded home. When the market comes back on an upswing, the new home’s value will increase, greater than the value of the original home. Purchasing a home has tax benefits and is usually one of the best financial investments. The national average of appreciation is between 5 to 6 percent, meaning every 13 years the value of a home doubles.

To learn more and to find a neighborhood that's right for you, visit Mischer Investments planned communities.

According to the Houston Business Journal, "sales of single-family homes in Houston in June totaled 5,422, the highest number since August 2008, according to statistics released by the Houston Association of Realtors." A healthy real estate market normally has six month inventory of home, Houston has an almost eight month supply! The median home price as of June was $164,500 which is up 2.8 percent from June 2008.

The national median price is $173,000 according to the National Association of Realtors. Year to date sales continue to rise at 0.6 percent with single-family homes sales in Houston totaling 5,571 in June, the highest number since August 2008.

"The Houston real estate market has shown incremental improvement each month this year, both in terms of sales volume and the pricing stability that others around the country envy," said Vicki Fullerton, HAR chair and broker of record at Re/Max of The Woodlands & Spring.

Amidst the recent housing bubble, an unpredicted buyer has emerged – Women.

Women, in particular younger women, are finding their most opportune shot at home ownership. In recent years, more men than women lost their jobs by a ratio of almost three to one, in the financial and manufacturing sectors.

Ellen Iggulden, a 27-year-old Chicago-based auditor, says “most of my guy friends are sitting on the buying sidelines. But among my female college pals, (I) was actually one of the last to take the real estate plunge.” Hearing about their successes, she says, was empowering - “If they can do it, so can I!”

And, according to the National Association of Realtors, women now sign on the dotted line in nearly a quarter of all U.S. home deals - up from 14 percent in just 10 years ago. As a result, new home sales teams are incorporating sales tactics including expanded “paint-color psychology” and hosting spa nights, instead of the traditional open house, in an attempt to do everything they can to eliminate the “intimidation factors” associated with females perceived purchase process. Home-marketing consultant Sara Lamia addressed a gathering at the International Builders’ Show by summing up this theory, stating, “If Mama ain’t happy, you’re dead in the water!”

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If you are considering a home improvement, retirement, sending a child off to college, or any other unexpected expenses, you may want to consider a home equity loan.

A home equity loan is basically borrowing against the equity you’ve already paid into your home. Generally a borrower can request a loan in any amount up to 80 percent of their equity. Just like your existing mortgage, you will incur a fixed or variable interest rate, and in some cases, fees and closing costs.

The Pros of a Home Equity Loan

Home equity loan interest is tax deductible up to $100,000 and often the money can be borrowed at a lower interest than conventional loans or credit cards. Also, if you have tremendous card debt AND the interest on a home equity loan is less than what the credit cards are charging AND you have exhausted all efforts to negotiate a lower rate with them, then you may want to consider using your home equity to pay it off.

The Cons of a Home Equity Loan

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As the spring winds blow in, the home buying season starts to heat up too. Just remember to plan for the less obvious costs associated with your purchase.

Thanks to continued low interest rates and an abundance of newly constructed homes, there are definitely bargains to be found. Even with those bargains, doo you have enough in your account to handle closing costs? Do you have cash on hand for the appraisal, necessary inspections and earnest money?

Here is a quick breakdown of the costs you can expect during the home purchase process, how to minimize them and whether you or the seller will be expected to cover these expenses.

Buyer:

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Freddie Mac (OTC: FMCC) has released the results of their Primary Mortgage Market Survey (PMMS). The survey outcome shows mixed results for both long- and short-term rates, with 30-year rates increasing slightly and the 15-year rates decreasing just as a modestly. The full details of the findings are as follows:

30-year fixed-rate mortgages (FRM) averaged 4.74 percent with an average 0.8 point for the week ending January 20, 2011, up from last week when it averaged 4.71 percent. Last year at this time, the 30-year FRM averaged 4.99 percent.

15-year FRM this week averaged 4.05 percent with an average 0.8 point, down from last week when it averaged 4.08 percent. A year ago at this time, the 15-year FRM averaged 4.40 percent.

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.69 percent this week, with an average 0.7 point, down from last week when it averaged 3.72 percent. A year ago, the 5-year ARM averaged 4.27 percent.

1-year Treasury-indexed ARM averaged 3.25 percent this week with an average 0.6 point, up from last week when it averaged 3.23 percent. At this time last year, the 1-year ARM averaged 4.32 percent.

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Although the housing market was down in 2010, builders are planning to listen to buyers and make some changes to attract shoppers in 2011. The houses that will continue to be built across the nation, especially those for first-time buyers, will address the buyer’s limitations in both budget and size but still maintain creature comforts and family livability.

From front to back, here are the top two things experts say are trendy in new homes for 2011.

1. Smaller homes that live the same.

According to David Barista, editor-in-chief of Professional Builder and Custom Builder magazines, "one big trend is the smaller homes." In fact, according to the magazine, the median size of new U.S. homes fell from 2,277 square feet in 2007 to 2,135 square feet in 2009, and is speculated to drop again in 2011.

Builders are not seeing the number of rooms in a home being reduced, but instead, the size of the rooms — and the overall home size — is shrinking 10% to 15%. These changes also bring down the price, which is crucial in a market in which new houses are competing against foreclosures and short sales.

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Freddie Mac recently announced that their maximum conforming loan limits for the first three quarters of 2011 will remain the same as the 2010 loan limits. Below the specific limits are outlined:

2011 Freddie Mac Loan Limits for the non-high-cost area:

• $417,000 for mortgages on one-unit properties;
• $533,850 for mortgages on two-unit properties;
• $645,300 for mortgages on three-unit properties; and
• $801,950 for mortgages on four-unit properties.

 According to Freddie Mac, the highest loan limit for a high-cost area is $729,750. This is for a 1-unit single family property. Loan limits for a specific high-cost area may be lower than this amount. You can check the Freddie Mac website to learn more about the current Texas limits in your city.

You can also learn more about the Freddie Mac conforming loan limits by visiting the website of the Federal Housing Finance Agency at www.fhfa.gov. This is the agency that currently oversees both Fannie Mae and Freddie Mac.

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Do cities have a future? Pessimists point to industrial-era holdovers like Detroit and Cleveland. Urban boosters point to dense, expensive cities like New York, Boston and San Francisco. Yet if you want to see successful 21st-century urbanism, hop on down to Houston and the Lone Star State.

You won't be alone: Last year Houston added 141,000 residents, more than any region in the U.S. save the city's similarly sprawling rival, Dallas-Fort Worth. Over the past decade Houston's population has grown by 24%--five times the rate of San Francisco, Boston and New York. In that time it has attracted 244,000 new residents from other parts of the U.S., while older cities experienced high rates of out-migration. It is even catching up on foreign immigration, enjoying a rate comparable with New York's and roughly 50% higher than that of Boston or Chicago.

So what does Houston have that these other cities lack? Opportunity. Between 2000 and 2009 Houston's employment grew by 260,000. Greater New York City--with nearly three times the population of Houston--has added only 96,000 jobs. The Chicago area has lost 258,000 jobs, San Francisco 217,000, Los Angeles 168,000 and Boston 100,004.

Politicians in big cities talk about jobs, but by keeping taxes, fees and regulatory barriers high they discourage the creation of jobs, at least in the private sector. A business in San Francisco or Los Angeles never knows what bizarre new cost will be imposed by city hall. In New York or Boston you can thrive as a nonprofit executive, high-end consultant or financier, but if you are the owner of a business that wants to grow you're out of luck.

Houston, however, has kept the cost of government low while investing in ports, airports, roads, transit and schools. A person or business moving there gets an immediate raise through lower taxes and cheaper real estate. Houston just works better at nurturing jobs.

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As of March 1, 2011, the Texas Real Estate Commission will be implementing their newly adopted changes to the contract used by a large majority of homebuyers and sellers across the state of Texas.

“When I bought my first house, the contract was four pages long. Now it's eight” states a local RE/MAX realtor. The constant contractual changes are complicated enough for a seasoned realtor, but can get very confusing to a buyer or seller.

It is the job of licensed Texas realtors to decipher these contracts and forms and to explain the changes to their clients - they take classes on them and read industry publications about proper use. They do this to help buyers and sellers meet their real estate goals and minimize the common risks associated with such a large transaction.

There are many intricate elements associated with a real estate transaction that you do not want to get wrong. None is more important than the contract, so make sure to ask your realtor about any questions you may have regarding the upcoming changes.

Source: Texas Real Estate Commission

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