2010-2011 Costs Vs. Value: Home & Design: REALTOR Magazine
Indianapolis Real Estate
Wednesday, December 29, 2010
Wednesday, December 22, 2010
The Size of Home That Buyers Say They Most Want
The “small home” craze continues as buyers say they find less square footage more desirable. Nearly half of Americans say their ideal home size would range from 1,000-1,999 square feet, according to a recent survey by Relocation.com of nearly 1,500 home owners and buyers.
Just five years ago, the National Association of Home Builders reported the average home size to be 2,400 square feet — that’s 400 square feet larger than what buyers say they now want.So what’s to happen to all the McMansions out there from just a few years ago when big homes were in their heyday?
Naturally, you would assume that the cost of homeownership has gotten buyers thinking smaller. But according to this survey, when asked whether cost was a main deciding factor in choosing a home, most respondents said it wasn’t very important. In fact, only 29 percent of survey respondents said that living costs was the most important reason when considering a move.
So why have buyers gotten so practical with their home buying decisions?
“As home owners rethink how much space they need, I think we’ll continue to see more innovative approaches to living well and sustainably within a smaller footprint,” said Sharon Asher, Relocation.com chairperson and founder, in a public statement about the survey results.
Other notable findings among the survey results:
- Sububia reigns: The Relocation.com survey also found that 54 percent of Americans continue to find a home in the suburbs the most desirable. They want to live near the city but prefer the peace and quiet of the suburbs. Urban and rural neighborhoods were only preferred by 24 percent and 22 percent, respectively.
- Main priorities in selecting a home: Neighborhood safety was an important factor in choosing a home. Buyers judged neighborhood safety by the upkeep of homes and front lawns in the neighborhood, word of mouth reputation, and local crime reports and statistics. Besides neighborhood safety, respondents also ranked proximity to decent shopping and having a large backyard as important factors in selecting a home.
- Most sought-after features: Survey respondents said the most desirable features of a new residence are central air conditioning (87 percent); custom, walk-in closets (50 percent); and “top of the line” dishwasher and/or refrigerator (43 percent).
- Least sought-after features: The least desirable home features were custom window coverings, followed by an in-ground pool or spa.
Indianapolis Real Estate
Monday, December 20, 2010
No Foreclosures Over the Holidays
Fannie Mae and Freddie Mac are freezing all foreclosure evictions on the mortgage loans they own or back from Dec. 20 through Jan. 3.
"If the property is occupied, our foreclosure attorneys will suspend the eviction to provide a greater measure of certainty to families during the holidays," says Anthony Renzi, executive vice president of single family portfolio management at Freddie Mac.
"If the property is occupied, our foreclosure attorneys will suspend the eviction to provide a greater measure of certainty to families during the holidays," says Anthony Renzi, executive vice president of single family portfolio management at Freddie Mac.Most of the large banks, including Bank of America, J.P. Morgan Chase, and Wells Fargo, already observe a moratorium through the New Year, unless the foreclosure involves an investor who chooses not to observe the holiday policy.
Monday, December 13, 2010
Carmel Proposes New Sign Regulations
Recently, Carmel City Councilor Joe Griffiths introduced a proposal to amend the sign regulations in Carmel that would allow open house directional signs to be placed in the public right-of-way during the weekend. Many may think that placing signs in the right-of-way on the weekend is already allowed because they often see signs there. However, any sign placed anywhere other than the actual property listed for sale/rent/lease is currently prohibited. In fact, these restrictions are common across most of the MIBOR area with a very few exceptions.
On Monday December 13, there will be a committee hearing of the Carmel City Council at 5:30 pm at City Hall. MIBOR will be offering input on the proposal based on feedback from REALTORS® and REALTORS® are strongly encouraged to attend in order to show their support. While there are some minor changes that will be suggested to the current proposal, this ordinance is a very positive step for REALTORS® and to people buying and/or selling their home.
Based on feedback received to this point, suggestions will be offered to change the allowable sign size to six square feet and time to 5 pm Friday to 6 pm Sunday.
Indianapolis Real Estate
On Monday December 13, there will be a committee hearing of the Carmel City Council at 5:30 pm at City Hall. MIBOR will be offering input on the proposal based on feedback from REALTORS® and REALTORS® are strongly encouraged to attend in order to show their support. While there are some minor changes that will be suggested to the current proposal, this ordinance is a very positive step for REALTORS® and to people buying and/or selling their home.
Based on feedback received to this point, suggestions will be offered to change the allowable sign size to six square feet and time to 5 pm Friday to 6 pm Sunday.
Thursday, December 9, 2010
Wednesday, December 8, 2010
Small Business Jobs Act enacts new provision: 1099s will be required for 2011 payments
The recently enacted Small Business Jobs Act includes a provision related to reporting requirements of rental property expense payments. After Dec. 31, 2010, the new law requires those who receive rental income from real property to file 1099s with the IRS for service providers such as plumbers, painters and accountants, who receive more than $600 in payments over the course of the year. Even though the 1099 forms will not need to be issued until early in 2012, it will be necessary to begin keeping track of payment information on Jan. 1, 2011, and to collect completed w-9 forms from service providers to obtain their names, addresses and taxpayer identification numbers. Exceptions are provided for individuals renting their principal residences (including active members of the military), taxpayers whose rental income doesn't exceed an IRS-determined minimal amount, and those for whom the reporting requirement would create a hardship (under IRS regulations).
Included in the provision is an increase in penalties for failure to file 1099s with the IRS. For further information, contact your tax accountant.
Indianapolis Real Estate
Thursday, December 2, 2010
Money Saving Heating and Cooling Tips
According to the U.S. Department of Energy, heating and cooling your home uses more energy and drains more energy dollars than any other system in your home. Typically, 43% of your utility bill goes for heating and cooling. With the high temperatures we experienced this past summer and the cold temperatures that are sure to follow this winter, it's important to get the most out of your heating and cooling systems. You can save on your energy bills by properly maintaining and upgrading your equipment, but that alone is not as effective as combining it with a whole-house approach.
Tips for Heating and Cooling
Use a programmable thermostat as you only need your air conditioner or furnace to run when you are home. Set timers to come on no more than 30 minutes before you arrive at home. Try to keep your summer thermostat at 78 degrees or higher and your winter at 68 degrees or lower to maximize your energy savings. Avoid placing lamps and televisions close to your thermostat as the heat from these appliances may cause your air conditioner to run longer.Use draperies or window shades to capture or repel heat. In the winter, use heavy drapes to block drafts. Open them when the sun is shining to draw in the solar heat and close them when it is dark and cloudy outside to trap heat in the room. Keep your window coverings closed during the summer to offset the increase in heat from the sunlight pouring in. However, if the outside air is cooler than the inside and humidity is low, by all means, open the windows and let nature be your air conditioning!
Insulate your doors and windows against heat and cold. Seal any drafts around doors and windows with weather-stripping. If air is still flowing, cover the windows with plastic in the winter. Proper insulating is just as important in the summer to keep the heat out.
Plant trees and shrubs to shade your home. Deciduous trees planted on the south and west sides will keep your house cool in the summer and allow the sunlight to warm the house during the winter. For example, just three trees, properly placed around a house, can save between $100 and $250 annually in cooling and heating costs.
Maintenance : There are many safety items and operational devices in your home comfort system. According to the E.P.A. you should have your heating system checked and serviced annually to keep it safe and operating as efficient as possible. In most cases the cost of this service will be saved in lower operating expenses, less likelihood of equipment malfunction, not to mention that you will know you are protecting your family.
Air Filters : Your home furnace filter needs to be changed on a regular basis. How often depends on variables such as type of filter, operating time of system, and occupancy of home. Your filters main objective is to protect your comfort system from harmful dirt and particles. With many type of filters you can receive the added advantage of helping resolve allergy and other health issues your family may have. As a rule less expensive 1" filters should be changed monthly and other filters can last from 90 days to 1 year.
Try out some of these handy tips for summer and winter and watch your energy bill fall and your comfort level rise!
Indianapolis Real Estate
Wednesday, December 1, 2010
Central Indiana Back on Top of Affordability
According According to the National Association of Homebuilders/Wells Fargo Housing Opportunity Index, Indianapolis retains the #1 spot as the most affordable major U.S. housing market again in the 3rd quarter of 2010. Findings were released Nov. 18. Tuesday, November 30, 2010
Foreclosure Frustrations
Many homeowners facing foreclosure who are frustrated with their loan servicers turn to for-profit foreclosure consultants whose advertisements often promise any home can be saved from foreclosure and their services are 100% guaranteed. On October 21, 2010, the OAG filed ten lawsuits against companies making such claims, calling these assertions false and illegal.
The lawsuits were filed in nine different Indiana counties including Shelby, Marion, Lake, Knox, Johnson, Elkhart, Clinton, Clay and Allen. The coordinated filing was done in an effort to raise awareness of the pitfalls of hiring for-profit foreclosure rescue companies.
The Federal Trade Commission announced a new rule on October 20, 2010, prohibiting debt relief organizations from collecting up-front or advance fees for services yet to be rendered. The rule took effect on October 27, 2010, and will be an additional enforcement measure the OAG may use to stop unlawful foreclosure consultants.
To date in 2010, the Indiana Attorney General’s Office has filed lawsuits against or reached settlements with
27 foreclosure consultants located in states around the nation.
Anyone with knowledge of an individual or entity engaging in illegal foreclosure consulting activities is encouraged to file a Consumer Complaint Form, available on http://www.indianaconsumer.com/, with www.IndianaConsumer.com, with the OAG.
Indianapolis Real Estate
The lawsuits were filed in nine different Indiana counties including Shelby, Marion, Lake, Knox, Johnson, Elkhart, Clinton, Clay and Allen. The coordinated filing was done in an effort to raise awareness of the pitfalls of hiring for-profit foreclosure rescue companies.
The Federal Trade Commission announced a new rule on October 20, 2010, prohibiting debt relief organizations from collecting up-front or advance fees for services yet to be rendered. The rule took effect on October 27, 2010, and will be an additional enforcement measure the OAG may use to stop unlawful foreclosure consultants.
To date in 2010, the Indiana Attorney General’s Office has filed lawsuits against or reached settlements with
27 foreclosure consultants located in states around the nation.
Anyone with knowledge of an individual or entity engaging in illegal foreclosure consulting activities is encouraged to file a Consumer Complaint Form, available on http://www.indianaconsumer.com/, with www.IndianaConsumer.com, with the OAG.
Indianapolis Real Estate
Monday, November 29, 2010
REAL Trends Housing Market Report – October 2010
Housing slumps in year over year comparison to tax credit fueled October 2009 home sales rate. Seasonally adjusted annualized rate of new and existing home sales falls to 4.327 million from 4.650 million in September
New and existing housing sales in October 2010 declined 25.4 percent from October 2009 while the
average price increased 8.2 percent from the same month a year ago.
The REAL Trends Housing Market Report for October 2010 showed that the seasonally adjusted annualized rate of the combination of new and existing housing sales decreased to 4.327 million from the 4.650 million recorded in September 2010. Overall housing sales fell for the fourth month in a row when compared to the same months in 2009. October 2010 unit sales fell 25.4 percent from October 2009. The average price of all sales increased 8.2 percent from October 2009, a positive point in otherwise disappointing results.
Housing unit sales for all regions fell in the last twelve months with the Midwest showing the greatest decline of 32.7 percent followed by the Northeast which saw unit sales fall 27.8 percent from October 2009. The West had the smallest decline at 19.6 percent.
Average prices of homes sold in October 2010 increased 8.2 percent compared to October of 2009 on a national basis. Every region showed increases in the average price with the Northeast showing the greatest improvement with a 12.3 percent increase in the average price of homes sold. The South showed the smallest increase at 1.9 percent improvement.
“These results were somewhat expected as October was the first month a year ago when a surge of home sales was fueled by the first round of tax credits. The annualized rate fell less than 5 percent from last month which is actually less of a decline than many expected. The average price of a combination of new and existing homes rose stronger than at any time in the last four months indicating that the mix of homes being sold is moving up,” said Steve Murray, editor of the REAL Trends Housing Market Report.
“The downside is that on a year over year basis housing sales continue to fall. We expect that the unit sales rate will continue to show year over year declines for the remainder of the year and into the first half of 2011 as the 2010-2011 results will be compared against sales that took place during the first wave of tax credit fueled housing sales in the fourth quarter of 2009 and the first two quarters of 2010. The declines will be partially offset by improvement conditions in the overall economy.”
Indianapolis Real Estate
New and existing housing sales in October 2010 declined 25.4 percent from October 2009 while the
average price increased 8.2 percent from the same month a year ago.
The REAL Trends Housing Market Report for October 2010 showed that the seasonally adjusted annualized rate of the combination of new and existing housing sales decreased to 4.327 million from the 4.650 million recorded in September 2010. Overall housing sales fell for the fourth month in a row when compared to the same months in 2009. October 2010 unit sales fell 25.4 percent from October 2009. The average price of all sales increased 8.2 percent from October 2009, a positive point in otherwise disappointing results.
Housing unit sales for all regions fell in the last twelve months with the Midwest showing the greatest decline of 32.7 percent followed by the Northeast which saw unit sales fall 27.8 percent from October 2009. The West had the smallest decline at 19.6 percent.
Average prices of homes sold in October 2010 increased 8.2 percent compared to October of 2009 on a national basis. Every region showed increases in the average price with the Northeast showing the greatest improvement with a 12.3 percent increase in the average price of homes sold. The South showed the smallest increase at 1.9 percent improvement.
“These results were somewhat expected as October was the first month a year ago when a surge of home sales was fueled by the first round of tax credits. The annualized rate fell less than 5 percent from last month which is actually less of a decline than many expected. The average price of a combination of new and existing homes rose stronger than at any time in the last four months indicating that the mix of homes being sold is moving up,” said Steve Murray, editor of the REAL Trends Housing Market Report.
“The downside is that on a year over year basis housing sales continue to fall. We expect that the unit sales rate will continue to show year over year declines for the remainder of the year and into the first half of 2011 as the 2010-2011 results will be compared against sales that took place during the first wave of tax credit fueled housing sales in the fourth quarter of 2009 and the first two quarters of 2010. The declines will be partially offset by improvement conditions in the overall economy.”
Indianapolis Real Estate
Tuesday, November 23, 2010
Mortgage Update
As reported in last week’s Indianapolis Business Journal, on a seasonally adjusted basis, the pace of mortgage loan activity increased 5.8 percent for the week ending Nov. 5. This is a finding of the Mortgage Bankers Association. The rate for 30-year mortgages was unchanged at 4.28 percent. The rate for 15-year mortgages remained at 3.64 percent.
Monday, November 22, 2010
Housing Remains Highly Affordable For Seventh Consecutive Quarter
Housing affordability remained near its highest level nationwide for the seventh consecutive quarter as interest rates dipped below 5 percent for the first time since the series was first compiled nearly two decades ago, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI) released today.
The HOI indicated that 72.1 percent of all new and existing homes sold in the third quarter of 2010 were affordable to families earning the national median income of $64,400. The index for the third quarter almost equaled the record-high 72.5 percent set during the first quarter of 2009 and marked the seventh consecutive quarter that the index rose above 70 percent. Until 2009, the HOI rarely topped 65 percent and never reached 70 percent.
"With interest rates remaining at historically low levels, and house prices starting to stabilize, homeownership is within reach of more households than it has been for almost 20 years,," said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. "While these favorable conditions are beginning to draw home buyers back into the market, builders continue to have major problems in obtaining credit for new-home construction, and this obstacle must be overcome if builders are to respond to improving demand moving forward."
Indianapolis-Carmel, Ind., was the most affordable major housing market in the country, regaining the top ranking it held for nearly five years after being edged out by Syracuse, N.Y., last quarter. In Indianapolis, 93.3 percent of all homes sold were affordable to households earning the area's median family income of $68,700.
Also near the top of the list of the most affordable major metro housing markets were Youngstown-Warren-Boardman, Ohio-Pa.; Grand Rapids-Wyoming, Mich.; and Dayton, Ohio, and Wichita, Kan.
Among smaller housing markets, the most affordable was Kokomo, Ind., where 96.1 percent of homes sold during the third quarter of 2010 were affordable to families earning a median-income of $61,400. Other smaller housing markets near the top of the index included Mansfield, Ohio; Lima, Ohio; Monroe, Mich.; and Bay City, Mich., respectively.
New York-White Plains-Wayne, N.Y.-N.J., continued to lead the nation as the least affordable major housing market during the third quarter of 2010. In New York, 22.6 percent of all homes sold during the quarter were affordable to those earning the area's median income of $65,600. This was the 10th consecutive quarter that the New York metropolitan division has occupied this position.
The other major metro areas near the bottom of the affordability scale included San Francisco; Bridgeport-Stamford-Norwalk, Conn.; Los Angeles-Long Beach-Glendale, Calif.; and Santa Ana-Anaheim-Irvine, Calif., respectively.
Santa Cruz-Watsonville, Calif. was the least affordable of the smaller metro housing markets in the country during the third quarter. Other small metro areas ranking near the bottom included San Luis Obispo-Paso Robles, Calif.; Santa Barbara-Santa Maria-Goleta, Calif.; Ocean City, N.J; and Napa, Calif.
Please visit www.nahb.org/hoi for tables, historic data and details.
Indianapolis Real Estate
The HOI indicated that 72.1 percent of all new and existing homes sold in the third quarter of 2010 were affordable to families earning the national median income of $64,400. The index for the third quarter almost equaled the record-high 72.5 percent set during the first quarter of 2009 and marked the seventh consecutive quarter that the index rose above 70 percent. Until 2009, the HOI rarely topped 65 percent and never reached 70 percent.
"With interest rates remaining at historically low levels, and house prices starting to stabilize, homeownership is within reach of more households than it has been for almost 20 years,," said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. "While these favorable conditions are beginning to draw home buyers back into the market, builders continue to have major problems in obtaining credit for new-home construction, and this obstacle must be overcome if builders are to respond to improving demand moving forward."
Indianapolis-Carmel, Ind., was the most affordable major housing market in the country, regaining the top ranking it held for nearly five years after being edged out by Syracuse, N.Y., last quarter. In Indianapolis, 93.3 percent of all homes sold were affordable to households earning the area's median family income of $68,700.
Also near the top of the list of the most affordable major metro housing markets were Youngstown-Warren-Boardman, Ohio-Pa.; Grand Rapids-Wyoming, Mich.; and Dayton, Ohio, and Wichita, Kan.
Among smaller housing markets, the most affordable was Kokomo, Ind., where 96.1 percent of homes sold during the third quarter of 2010 were affordable to families earning a median-income of $61,400. Other smaller housing markets near the top of the index included Mansfield, Ohio; Lima, Ohio; Monroe, Mich.; and Bay City, Mich., respectively.
New York-White Plains-Wayne, N.Y.-N.J., continued to lead the nation as the least affordable major housing market during the third quarter of 2010. In New York, 22.6 percent of all homes sold during the quarter were affordable to those earning the area's median income of $65,600. This was the 10th consecutive quarter that the New York metropolitan division has occupied this position.
The other major metro areas near the bottom of the affordability scale included San Francisco; Bridgeport-Stamford-Norwalk, Conn.; Los Angeles-Long Beach-Glendale, Calif.; and Santa Ana-Anaheim-Irvine, Calif., respectively.
Santa Cruz-Watsonville, Calif. was the least affordable of the smaller metro housing markets in the country during the third quarter. Other small metro areas ranking near the bottom included San Luis Obispo-Paso Robles, Calif.; Santa Barbara-Santa Maria-Goleta, Calif.; Ocean City, N.J; and Napa, Calif.
Please visit www.nahb.org/hoi for tables, historic data and details.
Indianapolis Real Estate
Thursday, November 18, 2010
Doors and Windows: Architecture Coach: REALTOR® Magazine
From restoration projects to energy efficient upgrades, improvements to a home's doors and windows can create a more comfortable living environment and eye candy curb appeal.Monday, November 15, 2010
How Rising Interest Rates Will Impact Affordability
In a recent Forbes blog post, multimillionaire hedge fund manager John Paulson declared that today’s record-low interest rates made this the best time to buy homes in fifty years. “If you don’t own a home, buy one,” Paulson said. “If you own one home, buy another one, and if you own two homes, buy a third and lend your relatives the money to buy a home.” Why should we care what Paulson thinks? Well, he was among the few to accurately predict the subprime collapse and, while no one has a crystal ball, a closer look at the numbers supports his call to action.
Historically low interest rates are the key…and they aren’t likely to hang around for long.
As we wrote in SHIFT, buyers who “choose to wait until prices come down more” are gambling that interest rates will hold steady or drop. The truth is even a 10 percent drop in home prices is nullified by a 1 percent increase in interest rates. The figure below illustrates how this works for a $250,000 home purchase and the relative likelihood of each scenario.
To figure out which was a smarter bet–counting on home prices to fall further or interest rates to rise–our research department took the last ten years of monthly home price and mortgage interest rate data and ran the numbers to see which was more likely: an increase in mortgage rates or a further drop in home prices. Here’s what we found:
1. A one percent increase in mortgage rates is ten times more likely to happen than a ten percent drop in home prices.
2. A one percent rate increase more than offsets a ten percent reduction in home prices.
3. When interest rates fall by one percent, the total interest paid is almost three times more than the interest savings from a ten percent drop in home prices.
4. The probability of both happening at the same time is ridiculously small, and homeowners would still pay 15 percent more in interest over the life of the loan.
Interest rates have dominated the news in recent months as we’ve shattered record low after record low. Potential home buyers need to understand the positive financial impact low interest rates have on the cost of home ownership and the thousands of dollars that can be saved over the life of a typical mortgage loan. For those who can afford to buy, trade up, or invest, our current market presents a lifetime opportunity.
Original artical available at: http://blog.kw.com/2010/11/11/how-rising-interest-rates-will-impact-affordability/
Indianapolis Real Estate
Historically low interest rates are the key…and they aren’t likely to hang around for long.
As we wrote in SHIFT, buyers who “choose to wait until prices come down more” are gambling that interest rates will hold steady or drop. The truth is even a 10 percent drop in home prices is nullified by a 1 percent increase in interest rates. The figure below illustrates how this works for a $250,000 home purchase and the relative likelihood of each scenario.
To figure out which was a smarter bet–counting on home prices to fall further or interest rates to rise–our research department took the last ten years of monthly home price and mortgage interest rate data and ran the numbers to see which was more likely: an increase in mortgage rates or a further drop in home prices. Here’s what we found:
1. A one percent increase in mortgage rates is ten times more likely to happen than a ten percent drop in home prices.
2. A one percent rate increase more than offsets a ten percent reduction in home prices.
3. When interest rates fall by one percent, the total interest paid is almost three times more than the interest savings from a ten percent drop in home prices.
4. The probability of both happening at the same time is ridiculously small, and homeowners would still pay 15 percent more in interest over the life of the loan.
Interest rates have dominated the news in recent months as we’ve shattered record low after record low. Potential home buyers need to understand the positive financial impact low interest rates have on the cost of home ownership and the thousands of dollars that can be saved over the life of a typical mortgage loan. For those who can afford to buy, trade up, or invest, our current market presents a lifetime opportunity.
Original artical available at: http://blog.kw.com/2010/11/11/how-rising-interest-rates-will-impact-affordability/
Indianapolis Real Estate
Friday, November 12, 2010
Thursday, November 11, 2010
Carmel Clay School Redistricting
Carmel Clay Schools is in the process of redistricting. New school boundaries are being drawn to become effective for the 2010-11 school year. The first proposal for the new elementary boundaries can be viewed at http://www1.ccs.k12.in.us/district/student-services/redistricting. The Elementary School Parent Advisory Committee (PAC) is currently evaluating the proposal.
The mission for the Middle School PAC is somewhat different. We have been asked to look at the current “feeder system” which sends each of our 11 elementary schools to a designated middle school. The possible outcomes of our committee meetings would be a recommendation to the School Board to a.) keep the current feeder system in place, b.) modify the current system, c.) eliminate the feeder system entirely and move to an alternate system of placing students in a middle school.
The mission for the Middle School PAC is somewhat different. We have been asked to look at the current “feeder system” which sends each of our 11 elementary schools to a designated middle school. The possible outcomes of our committee meetings would be a recommendation to the School Board to a.) keep the current feeder system in place, b.) modify the current system, c.) eliminate the feeder system entirely and move to an alternate system of placing students in a middle school.We need your feedback to help us decide which option best serves our students and families. Please visit the CCS website (http://www1.ccs.k12.in.us/district/student-services/Clay-Middle) to view minutes from the first meeting and click the Clay Middle School link on the far left column under Redistricting to send your e-comments to us. Although we will not be able to respond to each of you personally, we will be compiling a spread sheet which will allow us to share your input at our next meeting on November 2nd. Your comments are critically important because we are very committed to accurately conveying to the Middle School PAC the thoughts and opinions of our Clay Family, both present and future. You are welcome to attend the bimonthly PAC meetings, however be aware that there is no opportunity for public comment.
The Carmel Clay Administration shared 2 pieces of information which may be of interest in formulating your feedback. 1.) If the current elementary proposal is adopted and the current feeder system remains in place, the overcrowding at the west side middle schools will be alleviated. 2.) If Mohawk were to be united at either Clay or Carmel Middle School, the population of one school would be about 1600 and the other school 1000.
Indianapolis Real Estate
Wednesday, November 10, 2010
Marion County Tax Appeals Notice
The 2010 Form 11 (Notice of Assessment) was mailed on October 13, 2010. The Form 11 was only mailed for those properties that experienced a change in assessment from 2009 to 2010.
The deadline to appeal the 2010 Assessment depends on whether you received a Form 11 notice. If you received a Form 11 notice, the deadline to appeal is November 30, 2010. If you did not receive a Form 11 notice, you will have 45 days from the date tax bills are mailed in the spring of 2011.
For more information about appealing assessments in all counties click on http://www.in.gov/dlgf or contact the county assessor.
Indianapolis Real Estate
The deadline to appeal the 2010 Assessment depends on whether you received a Form 11 notice. If you received a Form 11 notice, the deadline to appeal is November 30, 2010. If you did not receive a Form 11 notice, you will have 45 days from the date tax bills are mailed in the spring of 2011.PLEASE NOTE: When the Form 11 notices were sent, the cover letter incorrectly stated the deadline. IF YOU RECEIVED A FORM 11 NOTICE OF ASSESSMENT, YOUR DEADLINE TO APPEAL IS NOVEMBER 30, 2010.
Indianapolis Real Estate
Tuesday, November 9, 2010
If you don’t own a home buy one...
It could be time to sell your low-yielding bonds and replace them with higher-yielding common stocks.
Multibillionaire hedge fund operator John Paulson, the investment genius who made a killing going short subprime mortgages a few years ago, told a standing room only crowd at New York’s University Club that double-digit inflation is about to rear its ugly head by 2012, killing the bond market, and restoring strength to equities and gold.
Paulson’s warning to sell U.S. government bonds is one of the latest signs that the most successful investors of this generation believe the run up in bonds is over. Paulson especially underscored the attraction of equities with earnings yields of 7%-8% compared to the 2.6% pittance available on 10-year Treasuries.
Paulson listed his favorite blue-chip stocks; JNJ (Johnson& Johnson) at a 3.8% yield; KO(Coca Cola);PFE, 4% yield., as well as C (Citigroup), BAC (BankofAmerica) and STI (Suntrust Banks) and RF (Regions Financial).
Paulson is a pro at buying the distressed bonds of bankrupt companies, and then converting the debt to equity in reorganization and benefiting from the potential run up. He mentioned one of his greatest plays — K-Mart, which emerged from bankruptcy at $10 a share and then skyrocketed to $190 a share.
His crystal ball is for 2% GDP growth for 2011 and 2012 and he warns that the Fed’s promise of quantitative easing should contribute to double-digit inflation over the next few years.
As this is the best time in 50 years to buy homes, Paulson advised his listeners, crowded into 3 separate dining rooms, to issue 30 year mortgages to buy a home as “your debt and interest payments get locked in at record lows, while the price of your home will rise.”
“If you don’t own a home buy one,” Paulson recommended; ” if you own one home, buy another one, and if you own two homes buy a third and lend your relatives the money to buy a home.”
Indianapolis Real Estate
Multibillionaire hedge fund operator John Paulson, the investment genius who made a killing going short subprime mortgages a few years ago, told a standing room only crowd at New York’s University Club that double-digit inflation is about to rear its ugly head by 2012, killing the bond market, and restoring strength to equities and gold.
Paulson’s warning to sell U.S. government bonds is one of the latest signs that the most successful investors of this generation believe the run up in bonds is over. Paulson especially underscored the attraction of equities with earnings yields of 7%-8% compared to the 2.6% pittance available on 10-year Treasuries.
Paulson listed his favorite blue-chip stocks; JNJ (Johnson& Johnson) at a 3.8% yield; KO(Coca Cola);PFE, 4% yield., as well as C (Citigroup), BAC (BankofAmerica) and STI (Suntrust Banks) and RF (Regions Financial).
Paulson is a pro at buying the distressed bonds of bankrupt companies, and then converting the debt to equity in reorganization and benefiting from the potential run up. He mentioned one of his greatest plays — K-Mart, which emerged from bankruptcy at $10 a share and then skyrocketed to $190 a share.
His crystal ball is for 2% GDP growth for 2011 and 2012 and he warns that the Fed’s promise of quantitative easing should contribute to double-digit inflation over the next few years.
As this is the best time in 50 years to buy homes, Paulson advised his listeners, crowded into 3 separate dining rooms, to issue 30 year mortgages to buy a home as “your debt and interest payments get locked in at record lows, while the price of your home will rise.”
“If you don’t own a home buy one,” Paulson recommended; ” if you own one home, buy another one, and if you own two homes buy a third and lend your relatives the money to buy a home.”
Indianapolis Real Estate
Monday, November 8, 2010
Bring Out the Best in Basements
Basements can adopt a split personality. On the one hand, it’s a sweet storage space with minimal décor and a high tolerance for accumulating dust. Yet when it’s time to sell — especially in a competitive real estate market — or expand the home’s livable square footage, the basement needs a little dressing up. That’s when home owners and real estate pros can work together.
One approach is to think big and transform this below-ground level into higher-end living space, whether that's a family room, children’s play area, or guest bedroom. “I have seen people take a basement and turn it into a family room, put in nice carpeting, and even build a little room around the utilities,” says Chobee Hoy of Chobee Hoy Associates in Brookline, Mass. “Hanging pictures … anything that looks pretty.”
It might encourage a sale. Yet it might not up the asking price, says Hoy. Many times a basement is not included in a home’s total square footage of livable space. “The square-foot value is not as high as the second or third floors. Don't put in the fanciest bathroom you can, because you might not get your money back,” she says. “You might have trouble selling the house for what you think it will sell for.”Still, buyers want more room for the asking price, and a basement provides that option.
“Sometimes if a buyer needs extra space, and that’s the only space that’s available, that’s attractive,” says Hoy. She’s seen photographers gravitate towards homes with sizeable basements simply because they make great darkrooms and studios.
A listing for a home that Steve St. Arnault, an associate with Newbury Properties in Quincy, Mass., is attempting to sell has a basement that could be a model for all the dark, damp basements out there. In fact, he says, “it’s a bright and sunny spot.” The home owners painted the exposed pipes a brilliant shade of copper. Travertine flooring is a step above concrete or cheap carpet. “They wanted to encourage resale,” he says. “They also added a master bedroom suite on the top floor and granite countertops in the kitchen.”
But for basements that need just a little decorating rescue, there's a lot of hope.
“Make the basement a place that you want to go to,” suggests Peter Jeswald, author of Basement Ideas That Work: Creative Design Solutions for Your Home (Taunton Press, 2007). “So often, basements are associated with low-quality, cheap hung ceilings, wood paneling, and inexpensive carpet on the floor. Treat it no differently than you would the first floor of your house.”
Home owners should start by upgrading the basement's entryway and gradually work their way through the space, with the end goal a lighter, brighter, and cleaner basement. If it’s down a dark, narrow stairwell, open up that stairwell or — at the very least — install brighter lighting. In lieu of opening up the staircase, which can be quite expensive, Jeswald suggests add a half wall or creating an open railing. “Make it so that you’re no longer traveling through a narrow door to this narrow, dim-lit stairway,” he says. “Long, narrow spaces accentuate the feeling of being depressed.”
But if the end goal isn't more square footage but simply a cleaner basement, there are many inexpensive approaches to consider, starting with a broom and dustpan.
“The best thing you can do is clean it up,” Hoy says. “Get rid of the cobwebs. Whitewash the walls. Do whatever you can to make sure it has a good smell.”
Eliminating moisture may require the installation of gutters or a French drain. “Vapor can migrate through the walls and come up through the floor,” says Jeswald. Installing a dehumidifier should eliminate this problem.
The No. 1 problem with basements is a lack of adequate lighting. While the natural-lighting flow can't be altered because the space is underground, plenty of lights will create a sense of open, airy space on a par with the rest of the house.
“You want to get light into the basement and then you want to spread it around, to penetrate the space,” Jeswald says. Adding a table lamp here and there is probably not going to be sufficient. Adding larger windows is the best bet.
Creating larger window wells adds light — and offers an additional safety feature. “Nowadays most window wells have a ladder,” Jeswald explains, “so not only are you adding light but you’re adding an element of safety, especially if it’s a bedroom or recreation space.”
If either or both of these fall outside of the budget — but increasing light remains a priority —there are other options that are more about cosmetic fix-ups. These include installing French doors, which help divide the space, or putting up opaque walls that allow sunlight to bounce around.
Artificial lighting should be a last resort, Jeswald says.
Even more inexpensive are these two tips he offers on how to deal with the infrastructure of piping and columns by integrating them into the design. Create a bookshelf by installing flat boards between two columns. Turn an awkward pole into a bistro table by featuring a flat surface that juts out from it.
“If your budget is limited,” says Jeswald, “integrate these two into the design.”
And don’t forget about any exterior entryway to the basement. Even if it's rarely used, it's still going to be examined by potential buyers. It also could discourage people from coming into the basement if it’s not attractive. “Sometimes the door leaving the basement isn’t very attractive and people don’t put a lot of thought into it, but they should,” says Hoy.
Friday, November 5, 2010
3 Solutions for the Foreclosure Crisis
Analysts say that despite all the fuss over foreclosures, there are really only three solutions. None of them will please everyone.
1. Refinance everybody at today’s ultra-low rates. The result would put money in people’s pockets and that would boost consumer spending. The downside is that some people would still be underwater, plus taxpayers aren’t in the mood to spend any more money.
1. Refinance everybody at today’s ultra-low rates. The result would put money in people’s pockets and that would boost consumer spending. The downside is that some people would still be underwater, plus taxpayers aren’t in the mood to spend any more money.2. Lean on lenders to forgive principal. Lenders have been opposed to this even when the government stepped in and shared the losses. Also, this solution makes many investors very unhappy.
3. Do nothing and let the market heal itself. Supporters say an improving job market should erase part of the problem. The big downside to this strategy is the possibility that the market will slide back into recession.
Indianapolis Real Estate
Tuesday, November 2, 2010
Time Is Right to Buy a Retirement Home
Money Magazine is urging people a few years from retirement who plan to move when they quit work to consider buying now while home prices and mortgage rates are low.
Buyers who intend to use the place as a second home will pay the same rate as they would pay for a primary residence. If they intend to rent the property out until they retire and they need the rental income to qualify for the mortgage, lenders will consider that an investment property and charge a half to a full percentage point more.
Still, the idea remains are "pretty compelling," says Justin Krane, a certified financial planner in Los Angeles.
Indianapolis Real Estate
Buyers who intend to use the place as a second home will pay the same rate as they would pay for a primary residence. If they intend to rent the property out until they retire and they need the rental income to qualify for the mortgage, lenders will consider that an investment property and charge a half to a full percentage point more.Still, the idea remains are "pretty compelling," says Justin Krane, a certified financial planner in Los Angeles.
Indianapolis Real Estate
Monday, November 1, 2010
September Existing-Home Sales Show Another Strong Gain
Existing-home sales rose again in September, affirming that a sales recovery has begun, according to the National Association of Realtors®.
Existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, jumped 10.0 percent to a seasonally adjusted annual rate of 4.53 million in September from a downwardly revised 4.12 million in August, but remain 19.1 percent below the 5.60 million-unit pace in September 2009 when first-time buyers were ramping up in advance of the initial deadline for the tax credit last November.
Lawrence Yun, NAR chief economist, said the housing market is in the early stages of recovery. “A housing recovery is taking place but will be choppy at times depending on the duration and impact of a foreclosure moratorium. But the overall direction should be a gradual rising trend in home sales with buyers responding to historically low mortgage interest rates and very favorable affordability conditions,” he said.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.35 percent in September from 4.43 percent in August; the rate was 5.06 percent in September 2009.
The national median existing-home price2 for all housing types was $171,700 in September, which is 2.4 percent below a year ago. Distressed homes3 accounted for 35 percent of sales in September compared with 34 percent in August; they were 29 percent in September 2009.
NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said opportunities abound in the current market. “A decade ago, mortgage rates were almost double what they are today, and they’re about one-and-a-half percentage points lower than the peak of the housing boom in 2005,” she said. “In addition, home prices are running about 22 percent less than five years ago when they were bid up by the biggest housing rush on record.”
To illustrate the jump in housing affordability, the median monthly mortgage payment for a recently purchased home is several hundred dollars less than it was five years ago. “In fact, the median monthly mortgage payment in many areas is less than people are paying for rent,” Golder said.
Housing affordability conditions today are 60 percentage points higher than during the housing boom, so it has become a very strong buyers’ market, especially for families with long-term plans. “The savings today’s buyers are receiving are not a one-time benefit. Buyers with fixed-rate mortgages will save money every year they are living in their home – this is truly an example of how homeownership builds wealth over the long term,” Golder added.
Total housing inventory at the end of September fell 1.9 percent to 4.04 million existing homes available for sale, which represents a 10.7-month supply4 at the current sales pace, down from a 12.0-month supply in August. Raw unsold inventory is 11.7 percent below the record of 4.58 million in July 2008.
“Vacant homes and homes where mortgages have not been paid for an extended number of months need to be cleared from the market as quickly as possible, with a new set of buyers helping the recovery along a healthy path,” Yun said. “Inventory remains elevated and continues to favor buyers over sellers. A normal seasonal decline in inventory is expected through the upcoming months.”
A parallel NAR practitioner survey shows first-time buyers purchased 32 percent of homes in September, almost unchanged from 31 percent in August. Investors were at an 18 percent market share in September, down from 21 percent in August; the balance of purchases were by repeat buyers. All-cash sales were at 29 percent in September compared with 28 percent in August.
Single-family home sales increased 10.0 percent to a seasonally adjusted annual rate of 3.97 million in September from a pace of 3.61 million in August, but are 19.5 percent below the 4.93 million level in September 2009. The median existing single-family home price was $172,600 in September, down 1.9 percent from a year ago.
Existing condominium and co-op sales rose 9.8 percent to a seasonally adjusted annual rate of 560,000 in September from 510,000 in August, but are 16.2 percent lower than the 668,000-unit level one year ago. The median existing condo price5 was $165,400 in September, down 6.2 percent from September 2009.
Regionally, existing-home sales in the Northeast increased 10.1 percent to an annual pace of 760,000 in September but are 20.8 percent below September 2009. The median price in the Northeast was $239,200, which is 1.4 percent below a year ago.
Existing-home sales in the Midwest jumped 14.5 percent in September to a level of 950,000 but are 26.4 percent below a year ago. The median price in the Midwest was $139,700, down 5.2 percent from September 2009.
In the South, existing-home sales rose 10.6 percent to an annual pace of 1.77 million in September but are 14.9 percent lower than September 2009. The median price in the South was $149,500, down 2.6 percent from a year ago.
Existing-home sales in the West increased 5.0 percent to an annual level of 1.05 million in September but are 16.7 percent below a year ago. The median price in the West was $213,600, which is 4.9 percent lower than September 2009.
Full article available at: http://www.realtor.org/press_room/news_releases/2010/10/sept_strong
Indianapolis Real Estate
Existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, jumped 10.0 percent to a seasonally adjusted annual rate of 4.53 million in September from a downwardly revised 4.12 million in August, but remain 19.1 percent below the 5.60 million-unit pace in September 2009 when first-time buyers were ramping up in advance of the initial deadline for the tax credit last November.
Lawrence Yun, NAR chief economist, said the housing market is in the early stages of recovery. “A housing recovery is taking place but will be choppy at times depending on the duration and impact of a foreclosure moratorium. But the overall direction should be a gradual rising trend in home sales with buyers responding to historically low mortgage interest rates and very favorable affordability conditions,” he said.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.35 percent in September from 4.43 percent in August; the rate was 5.06 percent in September 2009.
The national median existing-home price2 for all housing types was $171,700 in September, which is 2.4 percent below a year ago. Distressed homes3 accounted for 35 percent of sales in September compared with 34 percent in August; they were 29 percent in September 2009.
NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said opportunities abound in the current market. “A decade ago, mortgage rates were almost double what they are today, and they’re about one-and-a-half percentage points lower than the peak of the housing boom in 2005,” she said. “In addition, home prices are running about 22 percent less than five years ago when they were bid up by the biggest housing rush on record.”
To illustrate the jump in housing affordability, the median monthly mortgage payment for a recently purchased home is several hundred dollars less than it was five years ago. “In fact, the median monthly mortgage payment in many areas is less than people are paying for rent,” Golder said.
Housing affordability conditions today are 60 percentage points higher than during the housing boom, so it has become a very strong buyers’ market, especially for families with long-term plans. “The savings today’s buyers are receiving are not a one-time benefit. Buyers with fixed-rate mortgages will save money every year they are living in their home – this is truly an example of how homeownership builds wealth over the long term,” Golder added.
Total housing inventory at the end of September fell 1.9 percent to 4.04 million existing homes available for sale, which represents a 10.7-month supply4 at the current sales pace, down from a 12.0-month supply in August. Raw unsold inventory is 11.7 percent below the record of 4.58 million in July 2008.
“Vacant homes and homes where mortgages have not been paid for an extended number of months need to be cleared from the market as quickly as possible, with a new set of buyers helping the recovery along a healthy path,” Yun said. “Inventory remains elevated and continues to favor buyers over sellers. A normal seasonal decline in inventory is expected through the upcoming months.”
A parallel NAR practitioner survey shows first-time buyers purchased 32 percent of homes in September, almost unchanged from 31 percent in August. Investors were at an 18 percent market share in September, down from 21 percent in August; the balance of purchases were by repeat buyers. All-cash sales were at 29 percent in September compared with 28 percent in August.
Single-family home sales increased 10.0 percent to a seasonally adjusted annual rate of 3.97 million in September from a pace of 3.61 million in August, but are 19.5 percent below the 4.93 million level in September 2009. The median existing single-family home price was $172,600 in September, down 1.9 percent from a year ago.
Existing condominium and co-op sales rose 9.8 percent to a seasonally adjusted annual rate of 560,000 in September from 510,000 in August, but are 16.2 percent lower than the 668,000-unit level one year ago. The median existing condo price5 was $165,400 in September, down 6.2 percent from September 2009.
Regionally, existing-home sales in the Northeast increased 10.1 percent to an annual pace of 760,000 in September but are 20.8 percent below September 2009. The median price in the Northeast was $239,200, which is 1.4 percent below a year ago.
Existing-home sales in the Midwest jumped 14.5 percent in September to a level of 950,000 but are 26.4 percent below a year ago. The median price in the Midwest was $139,700, down 5.2 percent from September 2009.
In the South, existing-home sales rose 10.6 percent to an annual pace of 1.77 million in September but are 14.9 percent lower than September 2009. The median price in the South was $149,500, down 2.6 percent from a year ago.
Existing-home sales in the West increased 5.0 percent to an annual level of 1.05 million in September but are 16.7 percent below a year ago. The median price in the West was $213,600, which is 4.9 percent lower than September 2009.
Full article available at: http://www.realtor.org/press_room/news_releases/2010/10/sept_strong
Indianapolis Real Estate
Tuesday, October 26, 2010
REALTORS® RELEASE “INDIANA REAL ESTATE MARKETS REPORT” FOR SEPTEMBER
Average sale price of homes up; median sale price, number of closed and pending sales down
(INDIANAPOLIS, IN) – The Indiana Association of REALTORS® (IAR) today released its monthly “Indiana Real Estate Markets Report” as a continuation of its “Indiana is Home” project. Statewide, when comparing September 2010 to September 2009:
Karl Berron, Chief Executive Officer, reminded consumers and members of the media alike that activity was uniquely strong last year at this time due to the approaching deadline of the federal homebuyer tax credit, which was later extended to April 30, 2010.
“It bears repeating from last month that nationally, the real estate market is adjusting after the expiration of the federal tax credit,” said Berron. “Year-over-year comparisons are distorted, especially those of pending and closed sales. It will be months until we’re again comparing apples to apples, at which time we’ll be able to fully assess the impact of the tax credit.
“Reviewing housing data in the long-term is a more healthy way to study the market and when you consider the extraordinary circumstances of the last couple of years, we should widen the lens even more,” continued Berron. “The fact remains that the market we’re currently in – both statewide and in most localities – has many advantages, more supply, historic low interest rates and less buyer competition.”
Berron said that REALTORS® are watching two metrics carefully, that of months supply of inventory and the number of new listings.
(INDIANAPOLIS, IN) – The Indiana Association of REALTORS® (IAR) today released its monthly “Indiana Real Estate Markets Report” as a continuation of its “Indiana is Home” project. Statewide, when comparing September 2010 to September 2009:
The average sale price of homes increased 1.3 percent to $130,823;
- The median sale price of homes decreased 2.7 percent to $109,000;
- The number of closed sales decreased 17.6 percent to 4,685; and
- The number of pending sales decreased 21.3 percent to 4,740.
Karl Berron, Chief Executive Officer, reminded consumers and members of the media alike that activity was uniquely strong last year at this time due to the approaching deadline of the federal homebuyer tax credit, which was later extended to April 30, 2010.
“It bears repeating from last month that nationally, the real estate market is adjusting after the expiration of the federal tax credit,” said Berron. “Year-over-year comparisons are distorted, especially those of pending and closed sales. It will be months until we’re again comparing apples to apples, at which time we’ll be able to fully assess the impact of the tax credit.
“Reviewing housing data in the long-term is a more healthy way to study the market and when you consider the extraordinary circumstances of the last couple of years, we should widen the lens even more,” continued Berron. “The fact remains that the market we’re currently in – both statewide and in most localities – has many advantages, more supply, historic low interest rates and less buyer competition.”
Berron said that REALTORS® are watching two metrics carefully, that of months supply of inventory and the number of new listings.
“If homes aren’t selling, but listings remain fairly flat or increase, inventory will climb and prices may adjust downward,” warned Berron. “Balanced supply and demand, as always, is the ultimate goal.”
Full article available at:indianaishome.com
Indianapolis Real Estate
Monday, October 25, 2010
HUD: Banks Will Be Held Responsible
U.S. Secretary of Housing and Urban Development Shaun Donovan said Wednesday that the onus is on banks to fix whatever foreclosure-related problems are found.
Donovan, who made the statement during a White House briefing about the matter, said problems found thus far haven’t appeared to be very serious, but the full investigation won’t be finished until the end of the year. If more serious problems are found, possible penalties could include fines and a ban against writing mortgages for more serious violations, he added
Bank of America and GMAC Mortgage have ended their foreclosure freeze because they didn’t find significant problems. Donovan said the government wasn’t involved in those decisions.
Full article at: http://www.realtor.org/rmodaily.nsf/pages/News2010102201?OpenDocument
Indianapolis Real Estate
Donovan, who made the statement during a White House briefing about the matter, said problems found thus far haven’t appeared to be very serious, but the full investigation won’t be finished until the end of the year. If more serious problems are found, possible penalties could include fines and a ban against writing mortgages for more serious violations, he added
Bank of America and GMAC Mortgage have ended their foreclosure freeze because they didn’t find significant problems. Donovan said the government wasn’t involved in those decisions.
Full article at: http://www.realtor.org/rmodaily.nsf/pages/News2010102201?OpenDocument
Indianapolis Real Estate
Friday, October 22, 2010
Create a Whole New Market for Yourself with Fix-and-Flips
Foreclosures are everywhere and the market is unsettled. Does this mean that we don’t have a good way to create business? Certainly not!
Consider the fix-and-flip market for a moment. Now many of you are probably thinking: "Fix-and-flips? In this market? You're insane!" And in most circumstances, this would be true. But let's approach this from a different perspective for a moment. There are always people who, due to their unique circumstances, can do something that everyone else would find prohibitive. And this is true for the fix-and-flip market, too.Unique Circumstances
What if you had really cheap or free labor, reduced or nonexistent property taxes, a ready fund of cash so that you weren't paying a lot in mortgage payments, and the ability to have people live in houses that were completed but not sold on a short-term basis who were willing to vacate on a moment's notice? Would you still think that fix-and-flips were an “insane” prospect?
Religious Institutions Have an Edge
In fact, all of the above apply to federally certified religious institutions that perform regular fund-raising and have an active congregation. So why wouldn't they want to do fix-and-flips as a way to raise even more funds? If you can help them buy the property at the right price, they really have a great chance of building their nest egg for the future.
Here are the main advantages for working with religious institutions on fix-and-flips:
•They have cash to spend most of the time, which puts them ahead of the game for bidding on property.
•They can pay slightly more than most investors and still come out ahead, because they can get free or inexpensive labor from the congregation.
•The right seller might preferentially choose them over another buyer because they want to support their mission.
•You might be able to structure a deal as part donation and part sale price if the seller needs the tax break. (Check with the seller's accountant on this one.)
•Readymade buyers: If the institution has a member who is looking to buy property in the next few months, they can buy something and rehab it to that person's specifications. Buyers get exactly what they want, while the institution gets ready buyers.
•Institutions can take a longer view, so even if they need to sit on the property for a couple of years, they can do that without it being too much of a hardship — especially if they rent it out to a member of the group. This gives them the advantage of the rehab plus the benefit for the appreciation that is destined to come in the next few years.
•Timing: They don't have to buy right now, but they are ready when the right deal comes along. They don't have another property to sell, either.
Advantages for the Institution
There are many ways in which this project can create benefits for the institution, and they aren't just financial:
•Community building: The group gets a way to bond over a shared project, and the larger community of the town or city gets a vacant house off the books and improved property values in the neighborhood.
•Awareness building: The group is likely to be able to get coverage of their creative approach to fund-raising. Perhaps someone will see a news story or TV segment about it, and will donate their next property.
•Mission and fund building: With the publicity and the income from the project, the group will be able to further its mission and improve its ability to raise funds in the future.
What They Need From You
•They need the idea, first and foremost. They aren't likely to come up with this idea on their own.
•They need to find the right properties at the right price. Chances are, you know at least one property right now that would be great for a fix-and-flip.
•They need to know what improvements are worth making so that they don't make the mistake (like most first-time investors) of overimproving the property.
•They need a recommendation for a good licensed contractor to serve as the construction supervisor and oversee the project.
•They need someone to facilitate the sale. If they don't have an in-house buyer, then they’ll need help selling the property.
What You Get Out of the Process
You may be thinking that this seems like a lot of work for what will be a relatively small commission up front, but think a little broader. Let's say that several of the institutions you work with also have missions around getting the homeless off the streets or improving their community or helping out working families. You could work with several of those groups and create a regular source for affordable housing. This means that you could build a list of buyers looking for affordable housing and sell the houses to your buyers.
Now, we’re talking about three commissions on the sale of one property. Is it starting to look better? And then, you could even take this group of institutions and buyers to a bank with a lot of REO property and talk to them about listing it for sale to these groups. That could be four commissions on each property now — and the knowledge that you've done right by your community. What could be better than that?
Full article available at: http://www.realtor.org/rmosales_and_marketing/salescoach/columns/1011_salescoach_fixandflips
Thursday, October 21, 2010
Home Ownership Matters: Home Ownership and Parenting
The impact of home ownership on children has been documented in numerous academic studies, many of which have found that home ownership has a wide range of positive effects. The positive outcomes include: better health; fewer behavioral problems; greater achievement in math and reading; lower high school dropout rates; fewer teen births; more years of schooling by age 25; and higher high school graduation rates1. Although it is has been debated whether home ownership itself, or the residential stability and positive neighborhood characteristics that accompany it are the main underlying factors contributing to better outcomes; some research has shown that home ownership has a significant effect on children’s success2. Those studies argue that it is the positive behavioral characteristics required of home owners that get passed onto their children which contribute to their success. Since a home purchase is one of the largest financial commitments most households will undertake, home owners are invested in minimizing bad behavior by their children and those of their neighbors that might negatively impact the value of homes in their neighborhood. Second, homeowners are required to take on a greater responsibility, including the duties associated with home maintenance and acquiring the necessary financial skills to handle mortgage payments. The life management skills they acquire through these responsibilities may get transferred to their children and may contribute to their success.Others though argue that home ownership brings residential stability3, and it is the stability that impacts children positively. And, some suggest that it is neighborhood quality which enhances the positive outcomes. They show that access to economic and educational opportunities are more prevalent in neighborhoods with high rates of home ownership and community involvement4.
But in the last several years, with availability of better data and methods, researchers have begun questioning the existence of a home ownership effect. In other words, when they compared home owners and renters who had similar characteristics—income, education, length of time in the same residence, assets—they didn’t find a significant difference in the effects on children5. These researchers concluded that home ownership did not have an independent effect on improved life of children, but rather that the impact is made through other factors such as home environment and neighborhood quality6. The difficulty in analyzing this question is derived from the fact that home ownership is accompanied by a collection of characteristics, in addition to neighborhood characteristics and residential stability, that are difficult to disentangle. Additional characteristics that impact children are related to the home itself, including housing quality, crowding, the presence of subsidized assistance, and equity. It also includes characteristics of parents and/or caregivers, such as saving behavior, nurturing abilities, propensity to invest, and goal attainment7. Yet, these personality traits of home owner characteristics are most often not captured in the available data. As a result, it may be that the positive impact on children is not directly related to home ownership, but is influenced by parents who are more involved with their children and are also more inclined to purchase a home8.
A recent study by a group of researchers from the University of North Carolina at Chapel Hill and the University of Michigan approached this question from a different perspective. Instead of trying to account for unobserved characteristics of homeowners, they examined whether there is a relationship between home ownership and engaged parenting behaviors in the home, school, and wider community for low to moderate income households. The authors used survey data on families who purchased homes through the Community Advantage Program (CAP). CAP is a secondary mortgage market program developed though a partnership between the Ford Foundation, Fannie Mae, and Self-Help, a community development financial institution in North Carolina. The goal of this program was to underwrite 30-year fixed-rate mortgages for families who would have otherwise received a sub-prime mortgage or been unable to purchase a home at all.
Researchers focused on four variables: parental school involvement, frequency of reading to child, child's participation in organized activities, and child's screen time (television viewing and playing videogames). Altogether, these measures reveal parenting behaviors broadly believed to be associated with positive child outcomes. The authors propose that home ownership provides for engaged parenting practices in two ways: economic and psycho-social. The economic impact of home ownership refers to the positive impact of nurturing neighborhoods. While both home owners and renters may aspire to be engaged parents, home owners likely live in neighborhoods with more opportunities for school involvement or participation in neighborhood activities. The psycho-social component refers to the idea that being a home owner may limit the severity of economic hardships and the degree to which financial hardships result in psycho-social stress and disengaged parenting. This idea works through two channels. First, low- to moderate-income households that are able to buy a home have already found ways to manage their limited finances in order to become eligible for a mortgage. If such effective strategies are sustained, it could help reduce economic pressure. Second, they have greater access to formal credit to sustain the household during times of economic hardship, putting less strain on familial relationships and parenting. Home owners in this study have higher adjusted net worth and liquid assets than renters. The authors, therefore, assume that home ownership promotes parental engagement by giving parents more options for managing financial hardships and reducing the severity of financial hardships when they do occur, thereby reducing stress and disengagement from children. It is important to emphasize, especially considering the housing crisis, that all of the homeowners studied received prime fixed-rate 30-year mortgages with a 38% debt-to-income criteria. Therefore, these home owners have not experienced the financial shocks of interest rate adjustments or the stress of excessively high interest rates associated with many sub-prime mortgages.
The results of the study suggest that children of selected home owners are more likely to participate in organized activities and have less screen time when compared with renters. However, home owners were found less likely to read to their children than renters. There was no effect of home ownership on parental school involvement. On the whole, their findings suggest that home ownership and financial stability may create opportunities for parents to engage in some positive parenting behavior. As noted, the group of home owners surveyed in this study was less likely than renters to report financial hardships. The authors suspected that these financial stressors may reduce the ability of renters to afford organized activities for their child. Screen time, on the other hand, is relatively inexpensive for most families.
The findings of this research present more support for the idea that there are intangible benefits fostered through home ownership. And while these findings strengthen the policy case for encouraging sustainable and responsible home ownership, ultimately the question is how to arrive at sustainable and responsible home ownership. As the study reviewed here suggested, homeowners performed better financially because they were able to manage their limited resources. It appears that educating would-be homeowners in ways to effectively manage their resources may also help provide a positive environment for their children.
Read the full article at: http://tinyurl.com/2fu9dqq
Wednesday, October 20, 2010
Foreclosure Reviews: Navigating the Upheaval
Given the daily headlines on the foreclosure freeze it’s easy to lose sight of that fact that most lenders are not putting a halt to their foreclosure processing. Earlier this week I sat down with my colleagues Jeff LIscher, NAR’s managing director of regulatory policy, and Paul Bishop, NAR’s vice president of research, to get their take on what’s happening with the foreclosure freeze. (See the video.)
Jeff’s first point was that there are thousands of lenders and only a handful are freezing their foreclosures while they review whether their past foreclosures were handled correctly.
So far, only a few major banks are implementing a moratorium while they conduct their reviews. Bank of America is the biggest. It’s halting foreclosures in all 50 states. J.P. Morgan Chase is halting foreclosures in about half the states. Same thing with GMAC Mortgage. But Wells Fargo, another big lender, isn’t implementing a freeze.
This isn’t to say the problem isn’t big. It appears to be very big. But it’s not all-encompassing, and I think that was Jeff’s point.
Paul reinforced this point by making clear the bulk of foreclosures are concentrated in just a handful of states, with just two, California and Florida, accounting for a third of all foreclosures. And California isn’t a pure judicial foreclosure state. It’s a hybrid in its legal processes for foreclosures.
The fact that California isn’t a pure judicial foreclosure state doesn’t mean we can expect there to be fewer reviews there. Far from it. But it remimds us that this latest crimp in the housing market is as location-specific as the housing market itself. (In a judicial foreclosure state, foreclosures are processed through the courts. Here’s a chart for you to see what the procedures are in your state.)
One thing the conversation with Jeff and Paul made clear is that, if you’re working with a client that’s trying to buy a foreclosed property, your client would do well to talk to an attorney. You just want to make sure your client’s interests are protected if suddenly the bank says it’s taking the home off the market while it reviews the paperwork that was generated when the home was foreclosed upon.
Dorothy Buse, a sales associate in the Orlando area I spoke with two days ago, says she’s had about a quarter of her listings pulled off the market because of these reviews. When this happens, she says, she immediately removes the listing from the MLS. That way there’s no confusion over whether the property is available for sale or not. In about a quarter of these cases, she already has an offer on the property. In these cases, she gives buyers a choice: they can withdraw and get their earnest money deposit back, no questions asked, or they can hold on and wait for the property to come back on the market with the understanding that the timeframe is indefinite. She has no way of knowing how long the property will be off the market.
NAR has written the heads of the U.S. Treasury Department, HUD, and the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, saying the foreclosure problems give extra impetus to banks to redouble their efforts on loan modifications and short sales. Focusing on these options, NAR says, “will not only minimize losses to the owners of the mortgages, but also minimize harm to homeowners facing unprecedented financial challenges and avoid reversing gains being made towards the recovery of housing markets, especially in high foreclosure areas.”
With foreclosure problems mounting, emphasizing alternatives to foreclosure certainly seems like a win-win for banks and everyone else.
Access the article at: http://tinyurl.com/29du45q
Indianapolis Real Estate
Jeff’s first point was that there are thousands of lenders and only a handful are freezing their foreclosures while they review whether their past foreclosures were handled correctly.
So far, only a few major banks are implementing a moratorium while they conduct their reviews. Bank of America is the biggest. It’s halting foreclosures in all 50 states. J.P. Morgan Chase is halting foreclosures in about half the states. Same thing with GMAC Mortgage. But Wells Fargo, another big lender, isn’t implementing a freeze.
This isn’t to say the problem isn’t big. It appears to be very big. But it’s not all-encompassing, and I think that was Jeff’s point.
Paul reinforced this point by making clear the bulk of foreclosures are concentrated in just a handful of states, with just two, California and Florida, accounting for a third of all foreclosures. And California isn’t a pure judicial foreclosure state. It’s a hybrid in its legal processes for foreclosures.
The fact that California isn’t a pure judicial foreclosure state doesn’t mean we can expect there to be fewer reviews there. Far from it. But it remimds us that this latest crimp in the housing market is as location-specific as the housing market itself. (In a judicial foreclosure state, foreclosures are processed through the courts. Here’s a chart for you to see what the procedures are in your state.)
One thing the conversation with Jeff and Paul made clear is that, if you’re working with a client that’s trying to buy a foreclosed property, your client would do well to talk to an attorney. You just want to make sure your client’s interests are protected if suddenly the bank says it’s taking the home off the market while it reviews the paperwork that was generated when the home was foreclosed upon.
Dorothy Buse, a sales associate in the Orlando area I spoke with two days ago, says she’s had about a quarter of her listings pulled off the market because of these reviews. When this happens, she says, she immediately removes the listing from the MLS. That way there’s no confusion over whether the property is available for sale or not. In about a quarter of these cases, she already has an offer on the property. In these cases, she gives buyers a choice: they can withdraw and get their earnest money deposit back, no questions asked, or they can hold on and wait for the property to come back on the market with the understanding that the timeframe is indefinite. She has no way of knowing how long the property will be off the market.
NAR has written the heads of the U.S. Treasury Department, HUD, and the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, saying the foreclosure problems give extra impetus to banks to redouble their efforts on loan modifications and short sales. Focusing on these options, NAR says, “will not only minimize losses to the owners of the mortgages, but also minimize harm to homeowners facing unprecedented financial challenges and avoid reversing gains being made towards the recovery of housing markets, especially in high foreclosure areas.”
With foreclosure problems mounting, emphasizing alternatives to foreclosure certainly seems like a win-win for banks and everyone else.
Access the article at: http://tinyurl.com/29du45q
Indianapolis Real Estate
Monday, October 18, 2010
The Fastest-Growing Cities In The U.S. - Indianapolis
Thanks to a business-friendly attitude, inexpensive housing and a strong cultural community, Indianopolis' population--now at 1.7 million--has increased at a rate that is 50% higher than the national average. That's faster than hot spots Washington, D.C., and Seattle, and nearly as fast as urban-planner darlings Portland or Denver. But while Portland and Denver may attract more young singles, Indianapolis boasts a growing population of educated, young married couples--many coming from cities like Chicago for the shorter commutes and lower cost of living--an arguably more attractive demographic since they will most likely stay, raise families and invest in the communities, boosting the area's growth even more.Indianapolis Real Estate
Tuesday, October 12, 2010
Now is the Time to Buy a New Home!
When supply exceeds demand, buyers have the upper hand–and that’s where we are now! The current supply of homes for sale now stands at 12.5 months, meaning that at today’s pace of home sales, it would take 12 and a half months for the existing inventory to sell.For you as a buyer, this means lots of choices, lots of negotiating power and that smart sellers are fiercely competing for your business, both in terms of the price and the condition of their homes.
Indianapolis Real Estate
Monday, October 11, 2010
Foreclosure Update
It has been widely reported in the news that several of the large national lenders have stopped foreclosure proceedings in a number of states, including Indiana. This has resulted in some listings being withdrawn from the market and closing delays. MIBOR has been in continued contact with the National Association of REALTORS® Washington Lobbying Office, communicating the concerns of MIBOR members.
Up to this point, the following is what we have learned from NAR who is closest to this situation.
Indianapolis Real Estate
Up to this point, the following is what we have learned from NAR who is closest to this situation.
- There’s no way of knowing what percentage of foreclosures that were processed, were inappropriately or wrongly taken. The assumption is that for the most of them, this may only be a technicality and that the property ultimately would have been repossessed.
- For owners who believe that their home was wrongly foreclosed, they may wish to contact a real estate attorney to investigate the possibility of a property claim. However, that could prove costly and time consuming – regulations vary by state.
- For banks, it may make sense to modify loans or agree to short sales to expedite disposal of inventory.
- For buyers, the assumption is that listing foreclosures come with clear property title, but they should discuss any necessary contract contingency with their real estate agent. Foreclosures in limbo are likely to be withdrawn from the market.
- It’s too early to tell if there is an impact on the market, but we will be monitoring the situation.
Indianapolis Real Estate
Interest Rates - September 2010
Mortgage rates once again set new record lows in early September and remained below 4.4% throughout the month. As economic activity gains momentum, rates will rise to keep inflation at an acceptable level.
Indianapolis Real Estate
Indianapolis Real Estate
Saturday, October 9, 2010
Foreclosures Halted!
The foreclosure mess threatened to become full-blown chaos Friday as the nation's largest bank, Bank of America, halted all foreclosure procedures nationwide, raising the pressure on other lenders to do the same.
Bank of America is the first U.S. bank to institute a nationwide moratorium on foreclosures as anger grows at how lenders have prepared documents to support evictions. The halt on foreclosures will take effect on Saturday and also includes sales of foreclosed property.
Separately, PNC Financial Services Group Inc. is halting most foreclosures and evictions in 23 states for a month so it can review whether documents it submitted to courts complied with state laws.
An official at the Pittsburgh-based bank confirmed the PNC decision, which was reported earlier by the New York Times. The official requested anonymity because the decision hasn't been publicly announced.
The moves come amid mounting political pressure on big U.S. banks to examine foreclosure-documentation problems. Bank of America's decision comes amid revelations that the banking industry had used "robo-signers," people who sign hundreds of documents a day without reviewing their contents, when foreclosing on homes.
In a statement released Friday, Bank of America said it will stop foreclosure sales until “our assessment has been satisfactorily completed. Our ongoing assessment shows the basis for foreclosure decisions is accurate. We continue to serve the interests of our customers, investors and communities. Providing solutions for distressed homeowners remains our primary focus.”
Indianapolis Real Estate
Monday, October 4, 2010
Foreclosure Proceedings Come Under Fire
Mortgage industry heavyweights slow pace of properties entering REO pipeline
This temporary crackdown on the part of various states attorney generals is due to allegations that tens of thousands of foreclosure documents were essentially “rubber stamped” or signed without adequate review or scrutiny. Among the state officials who have initiated investigations, IllinoisAttorney General Lisa Madigan has demanded a meeting with JPMorgan Chase to address her concerns that the company violated the state's Consumer Fraud Act.
Vowing to hold banks accountable, Madigan said in a recent statement: “With JP Morgan now acknowledging possible abuses in preparing court documents, the impact on homeowners in our state and across the country could be great.”
Despite recent findings “that in some cases employees in our mortgage foreclosure operations may have signed affidavits about loan documents on the basis of file reviews done by other personnel – without the signer personally having reviewed those loan files,” Chase spokesman Tom Kelley, contends, “We believe the accuracy of the factual loan information contained in the affidavits was not affected by whether or not the signer had personal knowledge of the precise details.” He added that Chase has “begun to systematically re-examine documents we have filed in current foreclosure proceedings to verify that the affidavits and other documents meet the standard of personal knowledge or review where that is required.”
Chase has requested that the courts hold off on entering judgments in pending matters for a few weeks until their review process is completed.
Indianapolis Real Estate
Thursday, September 30, 2010
REALTOR® Magazine-Daily News-Foreclosure, REO Home Prices Rise
The average price of these homes in the second quarter was $174,198 nationwide, but was significantly higher in California where the average price, according to RealtyTrac, was $256,833. These prices reflected homes sold by lenders or by homeowners who had received at least one notice of default.
About 24 percent of all properties sold in the second quarter were REOs and foreclosures. Their prices were on average 26 percent lower than those of homes not in foreclosure, RealtyTrac reported.
RealtyTrac Senior Vice President Rick Sharga projected that it would be the end of 2013 before the housing marked works its way through the foreclosure inventory.
REALTOR® Magazine-Daily News-Foreclosure, REO Home Prices Rise
Indianapolis Real Estate
Monday, September 27, 2010
Fannie Mae Announces New Incentives for HomePath® Properties
Up to 3.5 Percent Seller Assistance; Selling Agent Receives $1,500 Bonus
"More than eighty-seven thousand families have purchased HomePath® properties in the first half of 2010 — nearly double the number of Fannie Mae foreclosed properties sold in the first half of 2009," said Terry Edwards, Executive Vice President of Fannie Mae's Credit Portfolio Management. "We continue to look for ways to stabilize neighborhoods and offer incentives to qualified buyers who will occupy these properties over the long-term and help support their communities."
WASHINGTON, DC — Fannie Mae (FNMA/OTC) today announced a seller assistance incentive on Fannie Mae-owned properties listed on the company's REO website, www.HomePath.com, and expands the initiative to offer an incentive to real estate agents and brokers. Qualified homebuyers who will be owner-occupants can receive up to 3.5 percent of the final sales price that can be used toward closing cost assistance, including a home warranty, if desired and available. In addition, selling agents representing owner-occupants will receive a $1,500 bonus. Eligible offers must be submitted on or after September 23, 2010, and must close by December 31, 2010. The sale must close within 60 days of the offer being accepted.
"More than eighty-seven thousand families have purchased HomePath® properties in the first half of 2010 — nearly double the number of Fannie Mae foreclosed properties sold in the first half of 2009," said Terry Edwards, Executive Vice President of Fannie Mae's Credit Portfolio Management. "We continue to look for ways to stabilize neighborhoods and offer incentives to qualified buyers who will occupy these properties over the long-term and help support their communities."HomePath properties are owned by Fannie Mae and include a wide selection of homes, including single-family homes, condominiums, and town houses. HomePath properties may also be eligible for special HomePath Mortgage and HomePath Renovation Mortgage financing.
Find the full article at: http://www.fanniemae.com/newsreleases/2010/5162.jhtml?p=Media&s=News+Releases
Indianapolis Real Estate
Indianapolis Real Estate
Tuesday, September 21, 2010
Wednesday, September 15, 2010
10 Markets Most Likely to Appreciate - Indianapolis
Forbes magazine turned to real estate research firm Local Market Monitor to figure out which markets have the greatest likelihood of price appreciation because they offer a mix of jobs weighted toward growth industries.
These are the top markets, the research company concludes:
1. Raleigh-Cary, N.C.
9. Springfield, Mo.
10. Indianapolis-Carmel, Ind.
Source: Forbes, Francesca Levy (09/13/2010)
Indianapolis Real Estate
These are the top markets, the research company concludes:2. McAllen-Edinburg-Mission, Texas
3. Austin-Round Rock, Texas
4. Nashville-Davidson-Murfreesboro-Franklin, Tenn.
5. San Antonio, Texas
6. Colorado Springs, Colo.7. Albuquerque, N.M.
8. Denver-Aurora-Broomfield, Colo.9. Springfield, Mo.
10. Indianapolis-Carmel, Ind.
Source: Forbes, Francesca Levy (09/13/2010)
Indianapolis Real Estate
Tuesday, September 14, 2010
Are You Considering Refinancing?
Weigh the cost of refinancing to determine whether a new mortgage will ultimately save you money. If you plan to move in a year or two, the cost of refinancing your home loan may not make it worth the expense.
Should you refinance?
Reducing the interest rate by a single point can make your payment more affordable. To quickly figure out the difference, note the savings between your current mortgage payment and the proposed new payment. Ask for a basic closing cost figure from the bank. Divide the closing costs by the savings between the two payment amounts. The resulting figure indicates the number of months required to break even to cover refinancing expenses.
What makes refinance worth it?
It depends on the homeowner. For some people, saving $150 per month is imperative. For others, $300 or more makes the expense worth it. Remember that many lenders include closing costs in the new loan to limit upfront expenses to customers.
Primary Mortgage Insurance (PMI)
Lenders require individuals to place a 20 percent down payment on the home. A down payment of less than 20 percent requires the homeowner to carry PMI. As you make monthly payments, you chip away at the mortgage principal. Over time, homeowners build up enough equity to eliminate the need for PMI. Address the issue of PMI during any refinancing discussions with your lender.
Where to refinance
Call your current mortgage company first to check refinancing options. Don't blindly assume they have the best rate. Investigate interest rates through the Internet and other banks. Some banks offer very low rates and extremely high closing costs. The flip side also features banks with no fees and a high interest rate. Check for loans that don't require the payment of points (one percent of mortgage value) to buy down the interest rate.
What are reasonable refinancing fees?
Basic mortgage fees include application costs ranging from $250 to $400. Home appraisal fees run from $300 to $500. A title search allows the mortgage company to determine your legal right to the property. Lender fees also include origination fees at one percent of the loan amount and attorney fees to cover the full loan process.
Indianapolis Real Estate
Subscribe to:
Posts (Atom)