GOOD TIME TO BUY A HOUSE

We’ve all experienced that “If only I would have” moment in our lives and with out a doubt we are at the threshold of another of another one of those times with respect to home ownership. We are seeing home prices at levels not seen for more than 12 years. Foreclosures are the primary driver for this phenomenon and the banks are accepting offers at $50 to $60 dollars per sq ft all over town. With out a doubt Now is the time to buy to avoid another “If only” moment. Give us a call 505-220-9193 or start your search on our website.

Housing Recover Expected (Hoped for) in 2011

Survey Reveals 58% of Americans Expect Housing Marketing to Recover After 2012by: Sharon GoWith the start of a new year, many are questioning if 2011 will be the bearer of better news when it comes to the state of our economy. Trulia, in conjunction with RealtyTrac, recently conducted a survey of American adults to see what their thoughts are regarding this situation. "Today, Trulia and RealtyTrac, the leading online marketplace for foreclosure properties, released the latest results of an ongoing survey tracking homebuyers' attitudes toward foreclosed homes. Results of the survey conducted online from November 2-4, 2010 by Harris Interactive on behalf of Trulia and RealtyTrac showed that Americans continue to grapple with uncertainty about the housing market, with 58 percent of U.S. adults expecting recovery to take at least another two years..."

My January is starting off really busy with Buyers and Sellers starting to get more active. This, I believe, is a good sign. Call me if you want to get ready to buy or sell...... 505-220-9193 or contact me by email at Judy@Judypierson.com.

ABQ Real Estate Prediction

Well, here goes....... my personal Crystal Ball for 2011. What is the good news? Prices will continue to stabilize and inch up month by month. Mortgage rates will go up to 5% which still is terrific. All and all, it will be a good time to buy because buyers can have some confidence that if they make an investment now, the value will hold and begin to appreciate over the next five years. Already, I have more buyers who want to purchase in this first quarter than I have had in the last two years. I sense that people are more secure in thier jobs as the mass layoffs have all but disappeared, and the stock market is positive so no more losses are expected in that arena. Retail sales are up and real estate is next, I think. For sellers, the time to sell will be better in 2011. Prices won't be up from the past two years, but the slide downward in value has largely stopped. There are foreclosures that will need to be sold this year and those are tough competition, but that too shall end. The thing I see is the return to a "Fair Market" value. Not that buyers won't still come in with low offers, but they quickly up the offer when the Seller counters at a reasonable price. Homes that are selling are selling at fair prices. Homes that are in good condition and fairly priced sell within 60 days. The days of wildly inflated prices, and profits, from real estate may be over, but property once again will be a good, reliable investment for the future. I am forecasting an improved market. There it is..... my Crystal Ball. Call me if you want to discuss your particular situation. 2011 will be the year to make a move!

GREAT TIME TO BUY A HOME!

Now is the best time to buy in the last thirty years!!! And we are seeing more buyers. For one, the interest rates are in the mid-4% which is unheard of. The jumbo loans are back and even some equity lines to avoid the need to come up with 20% down. Secondly, there are some great houses at good prices. The Sellers who still have homes on the market have to sell so as we say are "motivated" to provide Buyers with good value. Those Sellers who don't have to sell are able to negotiate. And there are still some good Short Sales and Foreclosures for the Buyer who is not in a rush since those deals may take up to six months to close.
We are seeing more Buyer activity in all price ranges. ABQ and Rio Rancho's economic situation has stabilized and has even had some new job development which is raising everyone's confidence. Personally, I think the worst is over. We have hit bottom, are showing slight increases from that 50% drop in sales last year, and may even begin to see small appreciation on some homes. Life is good.

GREAT TIME TO BUY!!!

So whereas the announcement below may seem to be negative, for buyers it is great news. With demand low and interest years at a twenty year low, it is a terrific time to buy. As the article below indicates, homeowners who can want to just refinance but for those who need to sell, and are therefore more motivated, they are more willing to negotiate to get the deal done.


The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending May 28, 2010. "With another week of historically low mortgage rates, the trend from the prior three weeks continued, as refinance applications increased while purchase applications dropped. Purchase applications are now almost 40 percent below their level four weeks ago, while the refinance share, at 74 percent, is at its highest level since December," said Michael Fratantoni, MBA's Vice President of Research and Economics. "In addition, the ARM share dropped last week to its lowest level since March of this year, as borrowers took the opportunity to lock in at historically low fixed mortgage rates."The Mortgage Bankers Association application survey covers over 50% of all US residential mortgage loan applications taken by mortgage bankers, commercial banks, and thrifts. The data gives economists a look into consumer demand for mortgage loans. In a low mortgage rate environment, a trend of increasing refinance applications implies consumers are seeking out a lower monthly payment which can increase disposable income and consumer spending (or give consumers a chance to pay down other debts like credit cards). A falling trend of purchase applications indicates a decline in home buying interest, a negative for the housing industry and the economy as a whole.

Interest Rates set to Rise - Buy Now

Interest rates throughout 2009 were artificially low. That's because in late 2008, the Federal Reserve put into place a program for purchasing Mortgage Backed Securities with the intention of lowering mortgage rates. They were successful with reported rates by Freddie Mac falling below 5.00% several times in 2009.
Without this program mortgage rates would have been at least 1.00% higher, and potentially even higher than that. Did you know that a change of 1% in a home loan rate impacts the amount someone can borrow by roughly 10%? For example, if rates are in the low 5.00% range today and they shoot up to the low 6.00% range, $250,000 home buyers may become $225,000 home buyers.
Look for rates to return to 2008 and previous levels as the Fed ends the program on March 31, 2010. While rates will not immediately increase to 6.00% or higher, know that without additional intervention, rising rates are inevitable. Expect that under worst case scenarios, rates could dance around the 7.00% range.

Great Home Loan Rates!

Finally, money is available for homes over $300,000! The high end market has been stalled out as secondary lender market did not want to buy the "jumbo" loans. But now, some local lenders have more than twenty options the rates are around 5.4%. Ready to buy a beautiful high end home? Call me 220-9193. Just listig a million dollar one in High Desert in NE Albuquerque.

Housing Sales up for 3 Months

Record low mortgage interest rates boosted pending home sales for the third consecutive month, with some benefit now from the first-time buyer tax credit, according to the National Association of Realtors®.
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in April, rose 6.7% to 90.3 from a reading of 84.6 in March, and is 3.2% above April 2008 when it was 87.5.
Lawrence Yun, NAR chief economist, said buyers are responding to very favorable market conditions. “Housing affordability conditions have been at historic highs, but now the $8,000 first-time buyer tax credit is beginning to impact the market,” he said. “Since first-time buyers must finalize their purchase by November 30 to get the credit, we expect greater activity in the months ahead, and that should spark more sales by repeat buyers.”
The Pending Home Sales Index in the Northeast shot up 32.6% to 78.9 in April and is 0.8% above a year ago. In the Midwest the index rose 9.8% to 90.4 and is 11.1% above April 2008. The index in the South slipped 0.2% to 93.0 in April but is 3.5% higher than a year ago. In the West the index rose 1.8% to 94.8 but is 2.9% below April 2008.
NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth, said there are numerous buyer assistance programs around the country. “Some states are offering bridge loans that allow first-time buyers to use the tax credit for downpayment and closing costs, but there are many other local government and nonprofit programs available to buyers, depending on location,” he said.
“Just last week, HUD announced that qualifying buyers can use the tax credit for closing costs on FHA loans, to buy down the interest rate or make a larger downpayment. Buyers who are wondering about their options should contact a Realtor®, who can advise consumers on the housing assistance programs and resources available in a given area.”Read more: "Pending Home Sales Up for Three Months in a Row RISMedia" - http://rismedia.com/2009-06-02/pending-home-sales-up-for-three-months-in-a-row/#ixzz0HNbSYHWN&A

BEWARE OF LENDER QUOTES ON HOME PURCHASES

STRAIGHT SCOOP ON PRICING ADJUSTMENTS AND PAYING POINTS

In response to the higher mortgage default rates being experienced by Fannie Mae and Freddie Mac (the largest buyers of 30 year fixed, conforming mortgages), “Risk Based Pricing” was established during 2008. Before this was announced, a 30 year fixed loan was basically the same price for any borrower with a credit score of 660 or higher and a loan amount up to 95% of the home value. But now, Fannie and Freddie require pricing “add-ons” using a matrix of credit score and loan to value percentages. This risk based pricing is MANDATED by Fannie and Freddie, and is required of ALL lenders originating a conforming 30 year fixed.

Sometimes the interest rate can be increased to cover these add-on’s without having to pay them out of pocket, but that is becoming increasingly difficult in today’s market. Investors have changed the way they create rate sheet options, and they offer very little in the way of what is called “premium pricing”, which used to allow options for closing costs or points to be covered in return for a higher interest rate. But in today’s environment, sometimes the add-on’s must be paid in the form of points – to either keep the rate and corresponding payments as low as possible, or sometimes because there simply is no other way they can be covered.

The bottom line is – smart consumers can’t just call a lender and say “what’s your rate and closing costs?” There are simply so many unknowns with the combination of credit score, loan to value percentages, property type, etc… that any reputable lender should be upfront, and be clear that any quote given is based on an assumption of certain parameters.

REFI WITH LOWER RATES IN ABQ, NM

The lenders are swamped refinance everyone and their uncle with the new lower home loan rates. One lender told me, however, that rates for jumbo loans, so homes over $500,000 are still high. Call me if you want some recommendations on good lenders!

For buyers, especially first-time homebuyers, the market couldn't be better. Rates are incredible and sellers are eager to sell. We see buyers waiting to see if "we have hit" bottom but we have pretty much stabilized here in ABQ. We didn't depreciate like other cities although our sale prices went down around 4-6% depending on the area of the city and price range. Homes in the range of $200,000 are particularly good deals now.

Give me a call and I'll get you in a house!!

GOOD REAL ESTATE NEWS IN ALBUQUERQUE

Smart Money magazine last month rated our fine city as one of the top cities in the nation ready to rebound in the housing market. We sure are seeing more showings in the last week with interest rates down.

Housing Predictor forecasts our city as one of the Top 10 Most Promising Housing Markets too. They base that on our healthy economy and strong potential for increasing prosperity. We are affordable compared to the average earnings which has been a positive for our market.

So let's go Buyers!!!!

INTEREST RATES COMING DOWN!

From my favorite Countrywide lender, Jason Pike:

We are starting to see interest rates head downward. Buyers appear to be warming up and starting to realize that the world is not ending. Sellers are starting to realize the truth about the market and are staring to pricing according! Sellers are starting to see the light and are no longer blaming the agents for the reason their house is not selling! Interest rates are currently under 6.00% at an affordable price. Simulate your listings - offer seller paid points for a permanent interest rate buy-down for potential buyers. This seems to be working in many markets. The cost of a buy-down equates to four times the amount borrowed. In other words, if the cost of the buy-down is $2,500, the borrower may borrow $10,000 at the same payment without the buy-down.

RATE NEWS

This just in from my friend, Jason Pike, at Countrywide:

Good morning: Global banks, in an unprecedented move, cut short-term interest rates in order to ease the current credit crisis. The Fed reduced its benchmark rate to 1.5 percent. The ECB's main rate is now 3.75 percent; Canada's fell to 2.5 percent; the U.K.'s rate dropped to 4.5 percent; and Sweden's rate declined to 4.25 percent. China cut interest rates for the second time in three weeks, reducing the main rate to 6.93 percent. I would expect more rate cuts are in the cards as global banks continue to try and spur lending. The impact of this move on mortgage-backed securities and Treasury obligations is fairly neutral. As many of you know, and as I addressed previously, future traders at the Chicago Board of Trade had already priced in a 100 odds of a 50 basis point cut by the Fed. This move however clearly signals the Fed will go lower for its target fed funds rate. The next FOMC meeting is scheduled for Oct 29th. Question is can we wait????

MONEY IS AVAILABLE TO BUY!!

This just in from Jack Thompson, President of Legacy Mortgage:
• Mortgage loans are still available in abundance to the qualified borrowers. • Even though interest rates have increased slightly, FHA, VA, Conventional, and Jumbo loans are at historical lows• Politics aside, Dave Ramsey, a popular Radio and TV financial advisor, said: “In this current market turmoil, where would you advise people to invest their money?” He said, without hesitation: “The real estate market. There are great buys out there. There is an abundance of money available for those who qualify (have you heard that before) and the rates of return, purchased wisely, can be remarkable.”
•Forbes.com reports: o Starting in 2010, housing price appreciation in metro Albuquerque is projected to lead the nation, due to job and economic growth, along with other factors. Housing starts are anticipated to increase by 26.6%, with single family increases of 26.4% and multi-family increases of 27.1%. o Money will be coming into the metro economy from baby boomer parents who move once the last child departs the nest. Albuquerque placed seventh on the list of cities attractive to this target group, due to our outdoor activities, arts, and moderately priced homes.
So buyers, get on out there and we will find you a great buy here!!!!

BUY! BUY! BUY!

So the mortgage rates are dropping still with the lowest rate we have seen in seven months following the government taking over Freddie Mac and Fannie Mae. The 30-year fixed declined to 5.78 percent this week. We are seeing more buyers out there although the gap between the deal the buyers think they can get and the amount the sellers are willing to take is still quite wide. There is a psychological balance that needs to be restored. I would expect that some people will take money out of their stocks right now and put it in real estate especially with all this good deals.

Bring it on! Call me if you want to buy or sell.