How to Determine the Price of Your Home

http://www.realtor.com/ has great tips for sellers as well as buyers. I found a great article on how to determine the price of your home. To break it down: Call a Realtor! We do CMAs (Comparative Market Analysis) for free, as part of a listing presentation. That will give you a good idea of the price that similar homes, in your area, have actually sold for in the past few months. Unlike just looking at what is on the market, looking at what homes have sold for gives you a better idea of how to price your home competitively. Unlike during the boom years, there is a difference in what is asked for a home, and what is actually paid for a home. http://www.realtor.com/ suggests that sellers do their own research as well, and go into your neighbors homes if they are for sale and have open houses. You will be able to see how your direct competition looks, and any improvements you can make to your home to make it more desirable.

http://www.realtor.com/home-finance/sellers-basics/how-much-is-your-home-really-worth.aspx

Condo vs. House- 5 Factors

A common question for first time buyers- Should I buy a house or a condo? Many factors should be considered in this important decision. Five main things should be considered before jumping into buying either one.

1. Location- Do you prefer living in the city center or in a more residential area?

2. Privacy- Do close neighbors bother you or do you find it a comfort?

3. Responsibility- Do you want to be independent, or have a group of neighbors to discuss problems and decisions regarding the property?

4. Maintenance- Do you love having a landlord to call when anything goes wrong? Do you like working in the yard?

5. Budget- Depending on the area, there can be a big difference in the cost of a condo vs. a house, in square feet, in maintenance, in upgrades, and don't forget HOA fees!

Financal Calculators

Yesterday one of my recommendations of things to do before you buy was to use an online calculator to get an idea of what you can afford. http://www.realtor.com/ has a bunch of great ones, including Home Affordability, Mortgage Calculator, Remodel or Move, and Rent vs. Buy.

Check them all out, plus more at the link below!

http://www.realtor.com/home-finance/financial-calculators/default.aspx

Top 10 Things to Know Before You Buy

A lot of pressure is being put on potential first time home buyers by everyone involved in real estate and finances, we don't want anyone to miss out on the $8000 tax credit! Knowing if you are really ready to buy is important; here are 10 things to know and think about now, before you start house hunting.

1. Don't Buy if You Aren't Ready to Settle Down. You are going to need to stay in the same house for 3 years to keep the tax credit, so be ready to commit to that time!

2. Check Your Credit. Make sure that your credit history is clear, and that you are current on all payments and student loans.

3. Know What You Can Afford. Use an online calculator to get a rough idea of your price range.

4. You Don't Need to Put 20% Down. Advice from parents and bosses can be good, but they often think that all buyers have to have a 20% down payment. That is no longer true, many loan programs work with 3.5% to 10% down. You can no longer expect 0% down though, those days are long behind us!

5. Find the Good Schools. Even if you don't have kids, plan on having kids, or want kids, buy in an OK district, when you go to resell it will make a difference, and the whole neighborhood usually reflects how the schools are doing.

6. Hire A Pro. Realtors spend all day every day working in the market and can help you get a great deal. We are know the buying process, which has multiplied in complexity in the last several years. We also help buyers think of things that don't normally come to mind.

7. Points vs. Rates. Talk to a mortgage broker about what is appropriate to consider in your specific situation.

8. Get Pre-Approved First. The first step in buying house is to actually go turn in all your financial information to a mortgage broker and get pre-approved, not just pre-qualified, for a mortgage.

9. Know the History of the Market in Your Target Area. This is where a Realtor comes in. In addition to just having general knowledge of the areas market, we do specific research on the street, blocks and neighborhood where you want to buy to know what a good offer is.

10. Home Inspectors are Your Friends. After you have a deal for a house, you have to, have to, have to get a home inspection. It's not required by law, but unless you are planning on tearing down the house, it's a good idea to spend a few hundred dollars and have some one tell you exactly what is going on with the property. Also, the report is the basis for asking for repairs from the seller, and the more costly they are the more likely the seller is going to want to have an inspection report to show where you got the idea that you need a whole new heating and air conditioning system!

Record Home Sales!

The National Association of Realtors released great news this morning: existing home sales are up 7.2% in July from June, and up 5% from a July 2008. This has lead many people to say that the bottom has hit! I agree, especially in the Northwest, were home prices and sales never dropped as much as in many other states. This is the biggest month to month jump in existing home sales since the NAR started recording such data in 1999. A combination of home affordability and first time buyers have caused the numbers to be better, and maintain the increases over the last 4 months.

http://money.cnn.com/2009/08/21/real_estate/home_sales_rise_in_July/index.htm?section=money_realestate

Fannie Mae and Freddie Mac Homes for Sale

Just like banks that foreclose on a property, Fannie Mae and Freddie Mac foreclose on properties where the mortgage isn't paid, and then they sell them. Programs for each government agency help buyers through the process, and offer great deals! HomeSteps for Freddie Mac gives great terms for loans including a 2 year home warranty, 3.5% of purchase price to go toward buyers' closing costs, and an appliance discount. HomePath for Fannie Mae gives even better terms! Buyers only need a 3% down payment, which can come from gift money from family and friends, there is no mortgage insurance, which lowers monthly payments, and they don't charge appraisal fees, which start at about $400. Both programs have great websites: www.homesteps.com and http://www.homepath.com/. Many lenders also work with them, check and see if your lender is qualified!

Battle of the Sexes?

My lovely real estate company, Coldwell Banker, just did an awesome study on how men and women each view home buying.

Some of the interesting things found in the survey were:

1. Women make up their minds about a home more quickly than men.


2. Women would rather live close to their family than to their work.


3. Home security is equally important to men and women.


4. 70% of both men and women living with their partner agree that decision making making is mutual.


5. More men than women want an extra room to be used for entertaining, as opposed to an office or spare bedroom.

http://www.finchannel.com/news_flash/R-Estate/45225_Coldwell_Banker_Real_Estate_Surveys_1,000_to_Discover_Gender_Differences_in_the_Home-Buying_Process/

FHA Loans on the rise

FHA loans weren't very popular when 100% financing was easy to obtain, but now that you have to have more than a pulse to get a loan, they are on the rise again. Needing just 3.5% of the purchase price for a down payment, as opposed to 5,10, or 20%, is a big draw, as is the rehabilitation loan- called the 203(k) loan. With this option buyers can finance the cost of repairs, and then have a contractor perform them and get paid once they are complete. This is especially attractive to buyers who are interested in older homes that need big fixes, such a heating systems, roofs, and new flooring. The buyers have 6 months after closing to have the repairs finished. In 2008 only 6,700 203(k) loans were done, but so far in 2009 over 11,000 of them have been taken advantage of.

July Median Sales Prices

The monthly recap of the real estate market in Portland Oregon came out from the RMLS this week. My favorite part is the map of the areas and the median sale price of home their. In addition to comparing Vancouver to Portland, and Hillsboro to Lake Oswego/West Linn, I also like to go back a month and see if prices are up, down, or pretty much the same. This time I'm going back even further, comparing May, June and July 2009. Instead of just tracking the difference from one month to the next, it's going to be a three month check up, and looking at the volatility of these numbers, it's important to see the bigger trends.

North Portland: May- $229,000; June- $229,900; July- $234,500 - up $5,500

NE Portland: May- $255,000; June- $258,000; July- $244,000 - down $11,000

SE Portland: May- $219,000; June- $237,500; July- $215,800 - down $3,200

West Portland: May- $367,500; June- $350,800; July- $363,300 - down $4,200

Lake Oswego/West Linn: May- $350,000; June- $398,000; July- $355,000 - up $5,000

Milwaukie/Gladstone/Boring/Clackamas/Estacada:May- $265,000; June- $249,500; July- $275,000 - up $10,000

Looking at June, most of the big differences have evened out, most median price differences were only up or down $5000, instead of the huge jumps and drops we saw last month.

Top Small Towns: West Linn and Lake Oswego

The smugness grows even as I write this. CNN Money Magazine ranked West Linn as the #64 in the top 100 US small cities to live in. Lake Oswego came up as #79. Lots of factors make the area loved by residents, including low crime and taxes, and high median incomes and home values. According to an article in the Oregonian, residents really love the quality of education their children receive, and the close knit neighborhoods. http://www.oregonlive.com/living/index.ssf/2009/08/affluent_west_linn_ranks_as_a.html

I'm all about community pride, but I cringe when I read things like this, because these communities already think they are the most awesome. Why doesn't CNN Money Magazine look into real quality of life issues, such as walk-ability, diversity, and how the residents rank themselves on a happiness scale? I think that fewer wealthy, gated, suburban towns would make the list and more rural, independent, and unique villages would.

South Waterfront Condo Still Not Selling

As I have mentioned before, Portland's South Waterfront has not developed quite in the way that city leaders and investors had hoped. Two of the main towers have fallen into a bit of trouble, due to a lack of sales and empty units the lenders for the John Ross and Atwood buildings have taken over control. While owners residents won't see any difference, buyers now have to have the lenders signatures on sales, which will probably slow down closing dates. Many people don't think this will be an issue, as a buyer's agent I can tell you that buyers don't want to wait too long to move into a new place, or to hear back on whether an offer is going to be accepted. This may turn off more buyers than the empty units and lack of development in the South Waterfront.
http://blog.oregonlive.com/frontporch/2009/08/story_archive_south_waterfront.html#more

Portland Development Commission

The PDC is awesome, especially for first time buyers. Check out their website for tons of info!http://www.pdc.us/housing_services/home_buyer/default.asp

Unemployment Rates Will Affect the Real Estate Market in Portland

12.1%- Oregon's current unemployment rate, 4.7%- Multnomah County's current unemployment rate, which doesn't seem so bad compared to the state as a whole or to the country. As all the big media sources keep telling us, it will get worse before it gets better. How will that affect the real estate market in the Portland Metro area? Well, it's pretty simple logic: the more people lose their jobs, and can't afford their present home or to buy a new one, the more people are afraid they could lose their job, the less the look for a first or new home. It's bad for real estate. Portland has been seeing a leveling off of the drop in sales and prices, but they could go down even farther if this fear becomes a reality.

FHA-HAMP

If you have an FHA loan and are having a hard time scraping together your payments, a new modification program is being launched this month that might help you out. FHA-HAMP, FHA-Home Affordable Modification Plan, is set to be running August 15th, will permanently reduce monthly payments. The extra amount is deferred to be due when the loan is paid off, and does not earn any interest until that time. That means that the home owner still owes the difference in what they original loan amount, and the amount they are paying off now, but that is only due when they sell the home, or eventually pay off the mortgage. The government initiated the FHA-HAMP due to the overwhelming interest in the Making Homes Affordable program.