Still a tough market. 

Words of wisdom:  Listen to your Realtor.  If he or she isn’t talking – get a new one.  

Getting your home sold requires effort.  If you have your home on the market and there are no showings – there could be a number of things wrong. Price, condition (people see the photos online), poor marketing (poor photos), bad location or all of the above.

To get your home sold now for TOP DOLLAR, your home has to have “WOW” factor.  No “wow” factor and you’re just a plain Jane!

Granite, travertine, stainless appliances, iron stair railings, pendant lighting, paint that “pops”, exciting decor all sell homes.  Have one but not the other?  Probably not enough WoW to be considered.  How about your furniture?  Not up to par?  Then get new or vacate.  You’re not selling your furniture but neither are the new home builders.   They’ve got furniture and they didn’t put in the old stuff.

It costs to sell a home.  It may cost you even more if you don’t get everything done.  Reduce the price by $10,000 after 90 or 120 days?  Why not spend that up front and get the home sold NOW!

I can Help you!  We can get estimates for everything. We can install.  You’ll be on your way to selling your home in no time!  Improving your odds to sell is the smartest and best way to outsmart the competition.

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Mortgage Market Report - Weeks Wrap Up
  _____  

Not much news this week, aside from the Lebron James announcement...he's
going to Miami if anyone cares...

The biggest news this week was the Initial Jobless Claims report on
Thursday which was a little better than expected.  "Just" 454,000 people
filing first time unemployment benefits .  But that was a bit better
than the expected 465,000 and somewhat better than last weeks 472,000
first time filings.  And with tensions simmering down overseas, the
stock market mustered a rally and has closed today above 10,000 again,
settling at 10,198 ( DOW Index ). 

Boosting stocks were also comments coming from the Wall Street Journal
that chances of a double dip recession are "exaggerated.  Normally,
soaring stock prices are a damper for bonds and mortgage rates, but
mortgage bonds held their own.  The employment market is still vastly
week and still no real signs of economic improvement which is keeping
bonds favorable and rates low.  However, these ultra low rates will not
last forever and any catalyst seen with economic improvement will send
rates upward and possibly in a hurry.  

I expect to see a continuing see-saw with stocks and bond prices in
coming weeks which should keep mortgage rates at bay.  The markets are
itching for any reason to rejoice and just a glimmer of hope will send
stocks higher as we saw this week.  But until we see data that shows
sustained improvement, bonds and mortgage rates will benefit.

The Obama Adminstration lost its bid to reinstate the moratorium on
offshore drilling in Federal Appeals court.  However, Interior Secretary
Kenneth Salazar, plans on coming up with a new plan and issue a new
moratorium.  While the 33 exploratory wells could resume drilling,
companies may not bother with the expense of start up costs with the
future still in limbo. As such, the threat of additional lawsuits to
reinstate the moratorium is effectively establishing a de facto
moratorium.

Stay tuned, next week we have Retail Sales Report and the Consumer and
Producer Price Index which are always tide changers.  Plus, the reality
is that Europe still has a long way to go and now whispers that Italy
may be the next European country to announce debt problems.
  _____

Let’s face it - it’s been a tough real estate world out there.  Foreclosures are high, Short Sales are up, values are down.   The incentive programs by the Obama Administration helped temporarily, but mostly the homes in the lower price ranges.

Market Situation:   Homes are sitting on the market longer, competition is fierce, buyers are more scarce.  So what can You do to ensure the sale of your home?  Follow these rules – get your home sold.   Think that your home is so special – you get to keep it (hey, if it’s that special, maybe you really don’t want to sell….)

Rules:

1)  Your home has to be PERFECT.  That means perfectly clean, perfect yard maintenance, perfect paint job, perfect smelling, perfectly staged.

2) No, you Don’t live there. “But we have to live here too”….  No you don’t.   Move out if you have to.  If you cannot live neatly, if your pets, little league, scrap booking, hobbies etc. take up your life then take off $10,000 to $20,000 from the price to ensure your sale, otherwise make the appropriate changes in your lifestyle to ensure that your home looks like a model home.

3) The value of your neighbor’s home does NOT translate into the value of yours. (especially if they sold for a great price).    Does your home have granite, travertine, wood flooring, new carpet, new roof, new a/c like other homes in the neighborhood?  Is yours professionally decorated like theirs?  Don’t expect the sales price of your home that may not be updated to be anywhere near the other homes that have been updated.   Their final sales price will help you in the appraisal process, but not in the sales process.

4) Price your home to SELL at the onset.  If everyone else is marketing their home for $250,000, then undercut them immediately and sell yours (all other things being equal) for $225,000.   Pricing yours at $249,900 will not do anything to bring the buyers to yours instead of the other homes.  Then they will start dropping theirs to $239,900 then you’ll drop yours to $238,000 then someone drops theirs to $230,000 and you’ll finally drop yours to $225,000 hoping that they don’t drop it also.  This may be a several month process where you may miss the selling season and may ultimately sell your home for the same amount or even less months later.  You may have missed purchasing the home of your dreams because you couldn’t act fast enough.  Not to mention the months of keeping your home perfect for showings.

5) Hire the right Realtor – and then Listen to him/her! Is selling real estate your business?  Are you not paying your Realtor (at closing)?  Then why not take advantage of his/her years of marketing and marketing knowledge?  How do you know you are hiring the right Realtor?   Many publications and on-line sources give you questions to ask.  So generic.   How long have you been selling homes in my area?  blah, blah, blah.   The number one reason a seller hires a particular Realtor is price.   A seller is always impressed with a high price – not marketing, not length of service.  Then the home sits on the market.   Instead, a homeowner should take the approach that a Realtor that knows the market and is honest enough to give a real evaluation of the home is the man/woman for them.  Experience is key.  A seasoned Realtor will know the other homes in the neighborhood. They will know what and where the competition is and how your home stacks up.  They will know how to stage your home to compete.  The Realtor’s purpose is to SELL your home – not to list it and have it sit on the market.

Norman Frenk, author of SellThisPlaceNow.com blog has been in the Houston metro real estate market for 18 years. Norman holds an M.B.A. and is accredited with an I.R.E.S. designation (International Real Estate Specialist).  He works with Prudential Gary Greene Realtors and is consistently To producer and the Top Listing agent in the office

Go Boldly NASA

Write a Letter to Congress : 56,883 Letters Sent So Far

Currently, the United States stands as the leader in human space exploration. However, the President’s recently proposed NASA budget will forfeit that leadership. The proposed budget cancels the Constellation Program, the only current replacement for the Space Shuttle, in the very same year that the Space Shuttle will be retired. This cancellation effectively ends our country’s human exploration program beyond Low Earth Orbit. It also places our ability to perform human spaceflight on the Russians as well as the shoulders of an immature and unproven commercial space market. The development of commercial spaceflight is good for our country, but not at the sacrifice of our human space exploration program. At a time when job creation is highest among our nation’s concerns, the President’s proposed NASA budget would cut many thousands of high tech jobs across the country. Once NASA loses these highly skilled workers, their years of practical knowledge and experience will leave a gaping hole in the agency’s capabilities. NASA pushes the frontiers of exploration and discovery, boldly taking on seemingly impossible challenges. No other nation has ever placed a person on the moon. People all over the world admire NASA for its courage, innovation, and persistence: a representation of America itself. NASA’s pioneering in human space exploration provides inspiration to continue to develop innovative concepts in healthcare, energy, education as well as many other fields. It is critical to our country’s success to remain the leader in human spaceflight; however, the President’s proposed 2011 budget for NASA leads the United States into an uncertain future in space. Therefore, I urge you to grant NASA the charter to build on the current successes of our nation’s human space program. The responsibility now lies with this Congress to provide the leadership and resources necessary to move beyond Low Earth Orbit and solidify America’s leadership in space exploration. Thank you for your consideration.

Click this Link to enter your ZIP CODE:  http://bit.ly/cvDzXH

Those Who Wait Will Pay Thousands More This Spring 

Waiting a few extra days or weeks to purchase a home this spring could
cost buyers thousands of extra dollars as the office of Housing and
Urban Development (HUD) implements several changes for loans guaranteed
by the Federal Housing Authority (FHA).

Coming just weeks before the April 30 deadline for the Home Buyer Tax
Credit and just days after the March 31 expiration of the Federal
Reserve Board's mortgage backed securities purchase program (which has
kept home loan rates artificially low for over a year), these FHA
changes make it even more important to act now to save big.

Here are a few reasons why:

On April 5th, the cost of required up-front mortgage insurance for loans
guaranteed by the FHA will increase from 1.75% to 2.25%. For a borrower
purchasing a $200,000 home with a $7,000 down payment, the up-front
mortgage insurance will increase by $965. Up-front mortgage insurance is
typically financed in the final loan amount so the impact to a monthly
payment will be minimal but overall, the increase is still borne by the
borrower both upfront and monthly.

It is important to note that in order to be eligible for the lower cost
up-front mortgage insurance, a lender has to order a case number from
the FHA before April 5th. A case number can only be generated for loan
applications where a property is involved and a fully executed purchase
contract exists. Home buyers who have been pre-approved but are not
under contract will not be eligible for the reduced premium effective
April 5th.

Later this spring, the amount of money that a seller can return to the
buyer from their sale proceeds will be reduced from 6% to 3%. The
reduction in these "seller concessions" can increase the amount of cash
a buyer will be required to pay at closing by $6,000 for a home purchase
of $200,000.

There is only one way to avoid being affected by all of these costly
changes that lie ahead - submit all FHA mortgage applications by the
last week of March. 

There you have it. How can I help you to save money and get into your dream home?

Call me at 713.818.0829........ and hurry!

February 16, 2010

Mortgage Market Conditions  

Markets were closed yesterday in observance of President's Day.
Today's market news was the manufacturing index which showed improved
numbers from last month, increase in business activity and business
leaders forcasting better economic conditions in the coming months.
Stocks off to a good start precipitated by the report with the DOW up
just over 100 points ( 10:00AM CST ).  Mortgage bonds relatively flat
and holding, providing some stability in mortgage rates for the time
being.  The recent trend of economic reports have been encouraging but
for all the fluffy forecasts to come to fruition, the job situation has
got to improve and some actual job growth created.

Interesting World news:  

Greece is in dire financial straits...Why?  Because for many years they let their debt grow
completely out of control.   Wow...what a shock... anyone see any resemblance to what's going on here in the US?  And by the way, they
have hefty public entitlement programs that are adding to their significant financial burdens.  Now why would such a small country on
the other side of the world be of any concern to us?  Aside from the potential impact on currency strength of the US Dollar abroad, some of
the same problems that are creating problems in Greece could come to fruition here at home.  Just something to think about...

Mortgage rates remain stable with 30 year rates still hanging at or just below 5%.  Most likely rates will remain in this range in the coming
weeks.  Main variables that could cause changes are the stock market and economic reports - if reports continue favorable and stocks begin to
rise again, most likely this will have an adverse effect on mortgage bond prices and interest rates.  The Producer Price and Consumer Price
Index reports are due out end of the week.  These two indexes provide an insight to inflationary concerns and as we all know, inflation is
kryptonite to interest rates.

More FHA Changes Effective Today:  Lender Restrictions Imposed on Appraisal Requests


Seems like something new every day lately...actually, this ruling was supposed to go into effect January 1, 2010.  However, HUD postponed the
ruling until February 15, 2010.  We are all familiar with Fannie Mae's Home Value Code of Conduct ( HVCC ) and now HUD has started their own
version.  Mortgagee Letter 2009-28 reads as follows: 

Historically FHA prohibited mortgagees from accepting appraisal reports completed by an appraiser selected, retained or compensated, in any
manner by real estate agents. To ensure appraiser independence,FHA-approved lenders are now prohibited from accepting appraisals
prepared by FHA Roster appraisers who are selected, retained or compensated in any manner by a mortgage broker or any member of a
lender's staff who is compensated on a commission basis tied to the successful completion of a loan. 

Long story short...neither loan officers nor processors may order FHA appraisals directly hence forth.  As with conventional appraisals, they
will order through our appraisal management company.

February 11, 2010

Mortgage Market Conditions

Mortgage bonds lost some steam and have put a bit of a damper on the previous rally.  Looking at the bonds you can see  that in the last 3 days, bonds have fallen in price. And, as we all know by now, falling bond prices are adverse to mortgage rates…remember, opposite relationship of bond prices and interest rates.  Although stocks have remained volatile and have not regained much of recent losses, bonds have not done their usual rally in the wake of stagnant stocks.  This may be attributed to the chitter chatter coming from the Fed.  Although Chairman Ben Bernanke has not laid down his hand regarding credit tightening ( raising rates ), other Fed members have expressed concerns that there may be a need to raise rates sooner than later.  We need to keep in mind that one of the Feds primary objectives is to control inflation, and raising interest rates is the primary method of controlling inflation.

Although we still have yet to see any real signs of inflationary concerns, their have been a few indicators that the
economy may be beginning to breath a few signs of life.  Next week the Consumer and Producer Price Indexes will be released which are gauges of inflation.  In any event, it does appear that the Feds are beginning to
get their ducks in a row for an exit strategy from from the current accommodative and low rate policies.

_____

Feds Seeking Measures to Control How Loan Originators are Compensated…

Speaking of the Fed, their latest target is now being directed at Loan Originators and are looking at proposals to limit compensation and/or control how Loan Originators are paid.  Hearing from Paul Mondor, Attorney for the Federal Reserve Board, Division of Consumer and Community Affairs – one would be surprised and find the news
down right frightening as well as eye opening.  It is becoming quite apparent that the Federal Reserve, who controls many of the lending regulations and policies including Regulation Z, have no clue what goes on in the lending  industry.  However, I can assure you if the Fed’s get their way and begin limiting compensation of loan officers, there will be a huge shortage of quality loan officers.  Be prepared for nothing but paper pushers, lengthy closings, delayed closings, poor to zero service and a host of unhappy consumers.  Naturally, we’ll be monitoring developments with this matter and keep everyone up to date.

New Job Report – a Mixed Bag of Treats ( or Tricks)

The Labor Department, today, released the latest government data for Non-farm payrolls ( employment data ) which revealed jobs losses of 20,000 for January. This was a surprise as the consensus expected a gain of 15,000 – 20,000 jobs. Surprisingly, the unemployment rate dipped to 9.7%. However, employment numbers for December were revised to 150,000 job losses as compared to initial reportings of 85,000. Furthermore the Business Survey threw in another revision that indicated an ADDITIONAL 900,000 job losses from March 2008 – March 2009 from what was previously report.

Oh well, so what are we to believe when every time we turn on the TV we hear nothing but rhetoric, propaganda, politicking, etc. However, all in all the job market does appear to be “improving”…at least there is definite signs of reduction in the number of job losses each month. But the fact remains is that the labor market remains weak. So what does this mean for the mortgage market and interest rates?

Mortgage Rates:

Mortgage rates continue to be favorable and in most cases, dipped back below 5%. Most likely contributing factor to this has been the string of losses with the stock market since the January 19th. Since reaching a peak of 10725 ( DOW index ), stocks have fallen to under 10,000 for the first time since November 2009. Aside from the employment situation there is a lot of unknown weighing on investors, and as is generally the case, the stock market is adverse to the unknown. With continued uncertainty and Capital Hill floundering about, stocks may continue to waiver which could be a boon for bond prices and interest rates.

NASA:

Well, we all heard it – The Shot Heard ‘Round Clear Lake’ – Obama’s budget that pulled the rug      out from under NASA and the Constellation Project. I am sure that this is not the end of it and  the fight may just be beginning. This may not be good news for the greater Houston area and especially the Clear Lake/Bay Area, but keep in mind this is a fight that has been going on each and every year – should we fund more NASA projects or take the money for something else.   The average has always been that NASA stays around and is healthy.  That’s not to mean we don’t have  work ahead of us. Each of us can do our part by continuing the fight – contact our Congressmen and Senators, the louder we are, the better we’ll be heard.

Market Predictions:

This is a tough one now…so many variables. On the bright side, I think it is a safe bet that mortgage rates will continue to be favorable throughout the first quarter of the year. The downside is that buyers may be more skiddish, even with the home buyer Tax Credit extended through April 30, 2009. Nevertheless, we continue to remain optimistic as market conditions remain optimal for home buyers.

More Changes?

Not yet! I am sure that everyone is aware of the GFE (Good Faith Estimate) and HUD changes. So far the transition has not been quite as difficult as I expected. It does, however, add quite a bit more time and detail of explanation to our clients to be sure that they have an understanding of the new processes.

FHA announced increase in the upfront Mortgage Insurance Premium from 1.75% to 2.25% effective for new FHA case numbers on or after April 5, 2010. In reality this will make very little difference to the buyers costs or payments. But, there are other changes that will have more of an impact in the very near future, including but not limited to a reduction in allowable seller contributions from 6% down to 3%.

January 26, 2010

_____

More FHA News: HUD increases upfront Mortgage Insurance Premium;
announces additional changes forthcoming

_____

On Wednesday, January 20, 2010 FHA Commissioner David Stevens announced
several upcoming changes designed to strengthen FHA’s capital reserves,
which have fallen well below acceptable levels due to rash of mortgage
defaults. In any event, these changes were widely expected and so far,
there have been no additional surprises.

_____

Mortgagee Letter 2010-02 – increases Upfront MIP

Thursday, January 21, FHA released Mortgagee Letter 2010-02 which
increased the upfront mortgage insurance premium from 1.75% to 2.25%.
This is very insignificant for homebuyers, but huge for bolstering FHA’s
capital reserves. For a $200,000 sales price with minimum 3.5%
downpayment, the increased upfront MIP makes a $5/month difference in
the monthy payment. There is no change to the monthly MIP. The change
goes into effect with new FHA Case numbers assigned on or after April 5,
2010.

_____

More to come…

_____

Commissioner Stevens also announced reduction in seller contribution
from 6% down to 3%. However, this will not likely go into effect until
early summer. The good news is that there was no mention of increased
down payment requirements.

_____

Market and Interest Rate News

_____

Market conditions and bond prices have improved slightly thus keeping
mortgage rates in check. Rates continue to hover in 5% range for 30
year fixed rate versions. Bond prices are showing an upward trend which
if continues would help pressure rates lower. However, as we all know,
any wind can blow and change the course. We can breath easy at the
present but not get too complacent. Buyers that have been fence sitters
should take heed and consider that the Homebuyer Tax Credit will expire
4/30/2010 and that these rates will not remain low forever. It will be
interesting to see how home sales develop from now through April 30th.
With rates as low as they are and the impending tax credit expiration,
we should see the best months of 2010 and possibly an indicator of how
the rest of the year may go.

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