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Thanks and I hope you enjoy these wonderful tools!

Michael Novia

10 Reasons to Buy a Home

Be sure to click the registration link below to register for a free online event on September 28, featuring Howard Glaser, principal, The Glaser Group and Lawrence Yun, chief economist, NAR.

Time magazine is being overly pessimistic in its recent cover piece that called into question the benefits of homeownership. In fact, now is a great time to buy. And, what’s more, tomorrow will be a great time to own, because the fundamental strength of homeownership hasn’t changed.

Why is now a great time to buy? Here are 10 reasons:

1. You can get a good deal. Prices are down 30 percent on average. They’re at a level that makes sense for people’s income.
2. Mortgages are cheap. At 4.3 percent on average for a 30-year fixed-rate mortgage, your costs to own are down by a fifth from two years ago.
3. You can save on taxes. When you add up the deductions for mortgage interest and others, the cost of owning can drop below renting for a comparable place.
4. It’ll be yours. The one benefit to owning that never changes is that you can paint your walls orange if you want (generally speaking; there might be some community restrictions). How many landlords will let you do that?
5. You can get a better home. In some markets, it’s simply the case that the nicest places are for-sale homes and condos.
6. It offers some inflation protection. Historically, appreciation over time outpaces inflation.
7. It’s risk capital. If the economy picks up, you stand to benefit from that, even if you’re goal is just to have a nice place to live.
8. It’s forced savings. A part of your payment each month goes to equity.
9. There is a lot to choose from. There are some 4 million homes available today, about a year’s supply. Now’s the time to find something you like and get it.
10. Sooner or later the market will clear. The U.S. is expected to grow by another 100 million people in 40 years. They have to live somewhere. Demand will eventually outpace supply.

Source: Wall Street Journal, Brett Arends (9/16/10)

[Editor’s note: To learn about the homeownership issues being raised in the media and what the facts are, REALTOR® Magazine is hosting a webinar Tuesday, Sept. 28, at 3 p.m. Eastern Time, with NAR Chief Economist Lawrence Yun and housing policy analyst Howard Glaser of the Glaser Group. Registration link.]

Going Back Home!

I am returning to South Beach Real Estate (sort of). Recently Pacific Union International acquired South Beach Real Estate and I am very pleased to say that I have been asked to rejoin the team under the Pacific Union International & Christies Great Estates umbrella. In addition the former owner of South Beach Real Estate, Sean Dwyer, has asked me to become his business partner which I am very excited about. Together with our expertise and dedication to our clients best interests we are going to make a great team!

New Online Help from Fannie Mae

Since the start of the housing downturn, the number of Web sites and foreclosure-prevention companies claiming to offer help to struggling borrowers has greatly increased. While some of the businesses are legitimate, others are fraudulent and offer services that consumers may be eligible to receive free of charge.

KEEP THIS IN MIND

• This month, Fannie Mae – the government-sponsored entity that helps set lending standards for most mortgages—started a Web site, KnowYourOptions.com. The site contains elements distinguishing it from those aiming to prevent foreclosure. All of the information on the site is available in Spanish or English.

• KnowYourOptions.com provides video explanations of what users might accomplish in each of the tabbed section of the site. In the “Take Action” section, for example,” struggling homeowners are advised that the first step to take in seeking help with their mortgage is to contact their mortgage company.

• Other features of the site include contact information for mortgage companies and loan counselors, calculators to determine if the borrower is eligible for assistance, and information on commencing short sales or deeds-in-lieu of foreclosure.

• Another helpful Web site for consumers is Hope LoanPort, which allows struggling homeowners and housing counselors to submit financial documents to mortgage companies and track the status of their efforts to avoid foreclosure. Hope LoanPort was created by Hope Now, a consortium of 12 mortgage companies and 250 counseling agencies.

Housing Market Plunged in July

Big headlines these past couple of days. Here are the numbers for San Francisco.

July 2010 vs. July 2009

Single Family Homes
197 Sold/Median Price $775k vs. 249 Sold/$780k Median Price. Supply is +6% & Demand is -21%

Condos
165 Sold/$700k vs. 155/$650k. Supply is +11% & Demand is +6%

Lofts
14/$594k vs. 15/$580k. Supply is -21% & Demand is -7%

Looking forward into August – 128 SFH’s have sold compared to 152 last year with another 200 pending. For Condos 89 have sold compared to 107 last August with another 116 pending. And for Lofts 12 have sold vs. 7 last year with another 8 pending.

In the second quarter of this year we experienced the highest volume for Single Family Home & Condo sales in San Francisco since the second quarter of 2007.

New Price Reductions

Links have been updated.

Appraisal Sites on Net often fail to pin down accurate prices

Over the last five years, one of the newest developments in real estate is the ability for home buyers and sellers to search online for a home’s value. Popular Web sites such a Zillow.com, Cyberhomes.com, and Eppraisal.com offer free home estimates, but some consumers and real estate industry professionals say the values calculated often are inaccurate and misleading.

KEEP THIS IN MIND

• Online home appraisal Web sites assign home values without knowing the features or upgrades of a home or the neighborhood in which it is located. Some Web sites offer a price range of $20,000 – $40,000 more or less than the actual value of the home.

• Since housing markets are local and not every home of a certain size is the same value, consumers can be misled into believing a home is worth more or less than the actual value. Working with a local REALTOR® can help minimize inaccuracies in home values. REALTORS® can provide local housing market data and show homeowners and buyers recent sales of comparable homes in the area, to help determine an accurate list or offer price.

• While some agents report that Web estimates can educate clients and provide a reasonable assessment of market conditions and the home-buying process, working with a local REALTOR® is the best option.

Source: California Association of Realtors

New Price Reductions

Links have been updated.

42,000 of California’s jobless will get help with mortgages

The U.S. Treasury Dept. recently announced that it is providing additional funding to a California program to help homeowners struggling to make their mortgage payments due to unemployment. The program, administered through the California Housing Finance Agency (CalHFA) will assist struggling borrowers make up to six months of mortgage payments. Lenders will be asked to match the government contribution.

The program aims to help 19,000 unemployed borrowers in California between its November launch and next July. An additional 23,000 borrowers will receive help over the next two years, according to CalHFA estimates.

To qualify for the program, borrowers must be unemployed and eligible for unemployment benefits, and live in the home tied to the mortgage. Borrowers must be fewer than 90 days behind on mortgage payments and meet low- and moderate-income guidelines. Income requirements can be found at http://keepyourhomecalifornia.com/income.pdf.

CalHFA is focusing on providing aid to unemployed borrowers struggling with purchase loans, excluding refinanced loans. According to CalHFA officials, it is too difficult to decide who “cashed out for a good reason and who didn’t.”

More information about the CalHFA program, including eligibility, program summary, income requirements, and frequently asked questions, can be found at http://keepyourhomecalifornia.com/.

Source: California Association of Realtors

NAR: Home Prices Are Firming

Lawrence Yun, NAR chief economist, says the correction in home prices appears to have ended in 2009. “All year we’ve been seeing relatively flat national home prices, which appear to be supported by market fundamentals,” he said. “Prices in some areas remain below replacement construction costs, so even with an elevated supply of existing homes on the market we don’t expect any consequential movement in home prices for the foreseeable future. Very low inventory of newly built homes also will help to support home values.”

Yun urged caution on interpreting price data. “The median price is influenced by the mix of homes that were sold and do not reflect pure appreciation or depreciation,” he says. “The recorded home prices in many markets were significantly depressed last year because of a large percentage of distressed homes sold at discount. Now as more normal, non-distressed home sales are occurring, the median price in many areas is showing higher values.”

Total state existing-home sales, including single-family and condo, rose 9.1 percent to a seasonally adjusted annual rate of 5.61 million in the second quarter from 5.14 million in the first quarter, and were 17.3 percent above the 4.78 million-unit pace in the second quarter of 2009.

Source: NAR