Portland Real Estate

I Have a New Website!

2010-09-27T11:09:00.000-07:00

I have a new website, with a blog built in, so I will no longer be updating this site.
Visit me here: BETH'S NEW BLOG AND WEBSITE
You will get multiple pages, plus video blogs!!!
Hope to see you there!

10 Reasons to Buy a House Now!

2010-09-19T12:46:00.000-07:00

My sources are, as usual, the National Association of Realtors' Realtor Magazine, and the Wall Street Journal. Both push home ownership (I bet you can see their motivation) and so do I, but only for about 60% of the American population. Since WWII the homeownership rate hovered around that, but during the bubble of the mid 2000s it soared to 69%. So the 9% of Americans who were owning homes probably shouldn't have been. Now they have lost them, or are loosing them, and the real estate market is having to re-adjust. But on a lighter note:

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.

Portland's Median Sale Prices- Some Gains, Some Losses.

2010-09-17T11:45:00.000-07:00

North Portland: July: $227,000 August: $215,500 -$11,500
NE Portland: July: $251,500 August:$262,800 +$11,300
SE Portland: July: $197,700 August:$213,000 +$15,300
West Portland: July: $377,100 August:$353,000 -$ 24,100
Gresham/Troutdale/Sandy/Corbett/Fairview: July: $185,500 August:$205,000 +19,500
Milwaukie/Gladstone/Boring/Clackamas/Estacada: July: $240,000 August:$248,000 +8,000
Lake Oswego/West Linn: July: $416,500 August:$385,000 -$31,500
Beaverton/Aloha: July: $230,000 August: $209,500 -$ 20,500
Tigard/Tualatin/Sherwood/Wilsonville: July: $301,000 August: $275,000 -$26,000

Mortgage Defaults are Dropping, Repossessions are Rising

2010-09-16T11:58:00.000-07:00

Banks repossessed more homes last month than they have since the beginning of the housing crisis, even as the number of homes going into default continued to drop for the 7th month in a row, according to foreclosure listing firm RealtyTrac Inc. Banks have increased foreclosures to clear out their inventories of bad loans, but despite repossessing 95,364 homes last month, they still have thousands to go. Analysts predict that this shadow inventory will prevent home prices from bottoming out, despite a 28 percent decline in prices from 2006. “Whether it’s the sidelined, shadow, or current inventory, the issue is there’s more supply than demand,” said Oliver Chang, Morgan Stanley housing strategist. “Once you reach a bottom, it will take three or four years for prices to begin to rise 1 or 2 percent a year.”
Source: Realtor Mag

97213 Market Update

2010-09-15T13:02:00.000-07:00

Let's look at a super local market snapshot- the zip code 97213 in NE Portland Oregon. That's my zip code, and the average price and days on market are standing firm, but the buyer's market that we have had for the last few years is trending downward. This means that in NE Portland there are less buyers who are actually making purchases. For more information on home buying and selling in NE Portland, contact me at bethsilva@cbseal.com.

Short Sale Fraud- What to Look Out For

2010-09-13T14:04:00.000-07:00

There are always bottom feeders who will take advantage of people when they are at the lowest point of their life. In real estate it is no different. The latest scam is short sale fraud- real estate and miscellaneous agents are running 2 main schemes right now.
1. The agent negotiates for the seller with the lender to sell at a really low price, an accomplice of the agent, called a "straw man," buys at the low price, then the agent turns around and sells it for much more.
2. The seller has a friend or family member purchase the home from them as a short sale, then they turn it back over to the original owner. This may be seen by some as a way to have family "re-finance" the house, but it's fraud!
A review of sales nationwide by CoreLogic found that about 2% of short sales that sell are probably fraudulent. They looked at short sales that were flipped, and sold at a much higher price.
Since the number of short sales has risen dramatically- 400,000 so far in 2010 compared to 100,000 in 2008- more and more people could be at risk for this fraud, either as buyers or sellers.
Source: NYT 9-10-10 Bob Tedeschi

Ecotourism in Portland Or

2010-09-09T15:00:00.000-07:00

The fourth Ecotourism and Sustainable Tourism Conference (ESTC) is in Portland today and Friday. It has drawn about 340 delegates from over 20 countries. Put on by the International Ecotourism Society (TIES) the conference this year focuses on practical ideas. Local breweries, wineries, casinos, and institutions such as OMSI are involved. To learn more visit their website here.

New FHA Program to Help Underwater Homeowners

2010-09-08T13:17:00.000-07:00

FHA debuted a(nother) plan yesterday to help out homeowners who are underwater on their homes. The plan will allow lenders to refinance loans, and forgive up to 10% of the amount borrowed. Borrowers must be current on their mortgages, and owe at least 15% more than the current market value of the home. This is not a required program, and lenders do not have to apply it to any loans. The government estimates that between 500,000 and 1.5 million home owners will be helped, but Barclays' analysts doubt that even 300,000 will actually be helped. We can add this to the long list of programs that the government has proposed, we'll have to wait and see if it gets implemented, or has any affect on the economy or housing market.
Source: Alan Zibel AP 9-7-10

Understanding Capital Gains

2010-09-07T14:00:00.000-07:00

When you sell a stock, you owe taxes on your gain — the difference between what you paid for the stock and what you sold it for. The same holds true when selling a home (or a second home), but there are some special considerations.

How to Calculate Gain
In real estate, capital gains are based not on what you paid for the home, but on its adjusted cost basis. To calculate, follow these steps:

1. Purchase price: _______________________

The purchase price of the home is the sale price, not the amount of money you actually contributed at closing.

2. Total adjustments: _______________________

To calculate this, add the following:

Cost of the purchase — including transfer fees, attorney fees, and inspections, but not points you paid on your mortgage.
Cost of sale — including inspections, attorney fees, real estate commission, and money you spent to fix up your home just prior to sale.
Cost of improvements — including room additions, deck, etc. Note here that improvements do not include repairing or replacing something already there, such as putting on a new roof or buying a new furnace.

3. Your home’s adjusted cost basis: _______________________

The total of your purchase price and adjustments is the adjusted cost basis of your home.

4. Your capital gain: _______________________

Subtract the adjusted cost basis from the amount your home sells for to get your capital gain.

A Special Real Estate Exemption for Capital Gains
Since 1997, up to $250,000 in capital gains ($500,000 for a married couple) on the sale of a home is exempt from taxation if you meet the following criteria:

You have lived in the home as your principal residence for two out of the last five years.
You have not sold or exchanged another home during the two years preceding the sale.
You meet what the IRS calls “unforeseen circumstances,” such as job loss, divorce, or family medical emergency.

Source: Realtor Magazine

Staging Your Home

2010-09-07T10:44:00.000-07:00

How do Buyers Find Their House?

2010-09-02T15:04:00.000-07:00

The 2009 NAR survey found that buyers split the source of the home they purchase evenly between their Realtors and the internet. It does not qualify if their Realtor sent them the listings they are viewing online, which I do for all of my clients. No one found their house through a magazine of listings, which really makes me question why I'm paying monthly to have my listings put in one. Hmm. 6% found it through a friend, relative or neighbor, which I really like to see, because it let's people build their own neighborhood- have people you like move in next to you! 12% found it through a sign or open house, and I bet most of those buyers went home and checked it out online after they saw the sign, or called their Realtor.

Sellwood Bridge: New Design Vote

2010-09-01T11:12:00.000-07:00

The Sellwood Bridge is going to be replaced, with groundbreaking the summer of 2012. The current bridge is in such poor condition that it only scored a 2 out of 100 on the Federal Infrastructure scale. The bridge alos is very undersized for car, pedestrian, and bike traffic. The new bridge will cost $330 million, with Multnomah County picking up its share of the tab beginning this week with a new $19 vehicle registration fee increase. The citizen committee, along with architect Ricardo Rabines scored the 12 proposed designs for the bridge, using input from a 2400-person city-wide survey. The designs are all very different, ranging from the cheap and functional "Concrete Box Girder" to the iconic, highly-modern (and expensive) "Steel Extradosed." This one was deemed the Ugliest:

And this one the Most Beautiful:

I agree, the second option is vastly superior to the first, and is in line with the rest of the bridges in Portland.

4 FICO Schre Myths Busted

2010-08-31T09:46:00.000-07:00

Since I'm not a mortgage broker, and don't work at a bank, I rely on experts for financing information. One of my favorite recourses is Mint- an online money management website. I use it to follow my bank accounts, and I love their blog for the way it explaines complex financial rules and policies. This is today's post on FICO scores. You can also go to the website here.
"FICO scores have been around since 1989, but they weren’t thrust into the public’s eye until the mid 1990’s when Fannie Mae and Freddie Mac endorsed their use in the mortgage environment. And by “endorsed” I mean, “forced.”

Mortgage lenders had until the late 90’s to fully implement FICO scoring into their underwriting processes. I was at FICO (FICO) when this happened and one of my jobs was to criss cross the country speaking at mortgage broker and banker events teaching these really angry people about the new tool that just got shoved down their throats. Talk about being the least popular guy in the room.

This GSE “endorsement” also meant a whole lot of public scrutiny of a tool that had always remained a secret to consumers, albeit unintentionally. I mean, if you don’t sell something directly to consumers then why would consumers know about it? No, FICO’s entry into the mortgage market meant more press, more attention, more criticism, more work for me, and a whole lot of incorrect information being passed off as the truth.

So, here is a list of a few FICO score myths that I have run into over the past 12 years. And, the subsequent debunking. There are certainly many more, which I will address as time goes on.

FICO Scores Consider Income, Yes or No?

The answer is NO. The FICO scores that we’re all familiar with are credit bureau-based scoring models. That means they only consider information on your credit reports. And, guess what, your income is not on your credit reports. There are models that consider income, as listed on your credit applications, but these are not the FICO scores that we all know and love.

John’s Final Thought: Income is a measurement of capacity (whether or not you can afford your payment) not creditworthiness (whether or not you’ll choose to make your payment.)

Closing a Credit Card Will Improve Your FICO Scores, Yes or No?

The answer is NO. This makes common sense, less available credit means you can’t get into as much credit card debt and therefore you’re a better credit risk.

The problem with that hypothesis is that it’s incorrect. And, thankfully, credit score development isn’t a common sense exercise. The empirical evidence shows, and has shown for over two decades, that having a lot of “open to buy” (unused credit limits) equates to better credit risk. This is commonly referred to as “revolving utilization”, the percentage of your credit limits that you’re currently using. Closing cards can actually increase this utilization percentage and lower your scores.

There’s a secondary myth to this one that says keeping your utilization percentage at or below 30% is the best for your score. That’s also incorrect. Nothing magical happens at 30%. It’s better than 40% but not as good as 20%. In fact, according to FICO, consumers who have scores above 760 have an average utilization percentage of just 7%.

John’s Final Thought: Shoot for lowering your balances to $0 if you can but if you can’t, get them as low as you can and your FICO scores will benefit. NOTE: This only applies to credit cards, not installment loans.

Closing a Card Causes You to Lose the “Age” Benefit of That Account.

This is incorrect. One of the secondary factors in your FICO score is the average age of the accounts on your credit reports. The older the average, the better for your scores. There’s a myth that closing a credit card account will somehow remove that card from consideration in the average age calculation.

Here’s the real deal: FICO scoring considers open and closed cards when determining the average age of your accounts. Closing the card doesn’t remove it from your credit reports so it’s still going to be considered.

John’s Final Thought: Be careful when deciding to close credit card accounts. Re-read myth #2 above for the reason.

Spreading Balances Across Multiple Cards Helps Your Scores.

Incorrect. First off, there’s no hiding credit card debt by doing this. $10,000 on one card is still the same amount as $1,000 on 10 cards. The aggregate revolving utilization percentage (see #2 myth above) is that same either way so you gain nothing there. But, what you have just done is to increase the number of accounts you have with a balance greater than $0, which is going to lower your scores.

John’s Final Thought: Stop trying to beat the system. Do you think the folks at FICO are idiots? Pay off your credit card debt, stop trying to shuffle it around.

Keep your eyes open for episode #2 of FICO Mythbusters. Coming soon to a Mint near you.

John Ulzheimer is the President of Consumer Education of Credit.com and the author of the book “You’re Nothing But A Number.” He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO and Equifax, John is the only recognized credit expert who actually comes from the credit industry. He has served as a credit expert witness in more than 60 cases and has been qualified to testify in both Federal and State court on the topic of consumer credit."

What to Look for in a Builder

2010-08-30T11:36:00.000-07:00

New home construction is down right now, the market is already filled with newer homes that are short sales and bank owed, but if you are thinking about have a home custom built, here are some tips for vetting the builder.
   1. Hire a good real estate attorney who has experience with new-construction contracts, knows state law, and is familiar with the issues unique to the area in which the property will be built.
   2. Hire a Realtor who has experience with new home construction, and has worked with more than one builder.
   3. Talk to other customers. Ask how satisfied they are with the builder and how his projects have held up over time.
   4. Investigate. Search the builder’s name and company online and make sure that there aren’t lots of complaints about him.
   5. Expect him to negotiate. In this market, a potential customer should be able to expect that a builder will be flexible.
Source: Realtor.com

Facing Foreclosure in Oregon

2010-08-27T14:44:00.000-07:00

As I said earlier this week, I went to a class on short sales and foreclosures that made my head swim, there was so much information. I got this great handout from real estate attorney Ben Knaupp, which I thought I'd pass on to you all.

TMI!

2010-08-25T15:27:00.001-07:00

As in Too Much Information on Short Sales and Foreclosures. I just got back from a great, if challenging, class on the new mortgage relief, short sale, and foreclosure programs. Basically, the advise is: go see a real estate attorney! That's always been my motto, but now more than ever it is very important to have an attorney who know Oregon law, and a tax accountant, go over the options with you, and really figure out what is best for you. There are very few mortgage holders who will qualify for the alphabet soup that is the federal government's response to this mortgage crisis, but if you would like more info on HAFA, HAMP, HAUP, etc. check out www.knowyouroptions.com - a government site that will guide you through the preliminaries. One final note- if you can pay your mortgage, you will not get a short sale.

2010-08-25T08:53:00.001-07:00

heading off to the morning meeting at Elephant's Deli, too bad they don't give us food for free!

2010-08-24T14:58:00.001-07:00

Saw 6 new listings today on Eastside Tour- Prices are getting realistic! realestate pdx

41 Energy Saving Tips!

2010-08-24T10:39:00.000-07:00

5 Tips for Saving Energy in the Family Room
Reduce your electricity bills by systematically purging your family room of wasteful energy practices. Read
12 Tips for Saving Energy in Your Home Office
Cut your power consumption, lighting, and heating and cooling costs when you work from home. Read
7 Tips for Saving Energy with Home Lighting
Lighting eats up as much as 20% of your annual electric bill, but using energy-efficient bulbs and making other simple changes can cut lighting costs dramatically. Read
10 Tips for Saving Energy in the Kitchen
Maintain your large kitchen appliances is part of a smart home energy efficiency plan. Read
7 Tips for Saving Energy in the Laundry Room
Understanding your laundry room appliances is part of a smart plan to help you save energy in your home. Read

Visit houselogic.com for more articles like this.

Location vs Price

2010-08-23T15:08:00.000-07:00

I asked that question on Trulia.com last week- which is more important to first time buyers. A lot of other real estate agents answered. They didn't say anything, just blathered on about how both are important and people need to find the right location with the right price. Obviously. But I really want to know what others think about giving up on living in their favorite neighborhood because they can't afford it, and all that entails such as longer commutes to work, friends, family, not being in the preferred school district, or having access to amenities? And what about people that are willing to pay more than they would like to have those things- do they regret it? End up loosing the house? I know that when my husband and I bought our first house we ended up looking for over a year because we were unwilling to live in certain areas, and we ended up paying a little more that we had originally thought we would to be in a neighborhood of our choice. And we are still about 30 years away from being able to afford the kind of house we want in our dream neighborhood! Just as I was thinking about this issue I came across an article about this subject, below is an excerpt that I think looks at the issue logically, while not ignoring how people actually approach buying their first house (illogically).
"Although buying cheap housing may be a good strategy for some investors, buyers searching for a home they'll occupy should not let price be the primary factor influencing which home they buy.
A home that won't work for the long term is not a good deal even though it's cheap if you'll have to move again in a few years. In fact, you could lose money using this approach, particularly if home prices haven't stabilized by then.
It's also not a good idea to buy a home that's not quite right for you just to take advantage of today's low interest rates. The winning strategy for today's homebuyers is to buy and hold.
The homes with qualities that are in high demand are located near a major metropolitan center or have good public transportation to get there. They are close to shops, cultural venues, restaurants, parks, and have good public or private schools close by and good public services.
The location within a neighborhood, condominium complex or cooperative can make a big difference in value. A home on a quiet cul-de-sac will generally sell for more than one in the same neighborhood that's on a busy street. Premiums are paid for homes with views, leveled-out private backyards and good natural light.
Be wary of listings that appear to be underpriced. They could be priced low to generate multiple offers, so they might sell for more than the list price and more than you can afford to pay. Or, there could be other reasons why they are listed at a lower price.
Often the lower-priced homes in an area don't sell for more because they have incurable defects. An incurable defect is something you can't change like a shared driveway, close proximity to a freeway or an entry to the home that's two flights of stairs up from the garage.
These homes may sell well in a hot sellers' market when buyers overlook defects because prices are rising rapidly. But, these homes can be hard to sell in a down market when buyers are less forgiving and are willing to wait for the right house.
THE CLOSING: Ideally, you want to buy a home that will be in demand in any market. If you can't afford to buy one that's in move-in condition, it's better to buy a home you can afford and that needs only minor improvements than one that looks great but has an incurable defect like an unworkable floor plan." Source: Dian Hymer

Living Somewhere Affordable vs. Living Somewhere Desirable

2010-08-20T10:16:00.000-07:00

The age old real estate rule is "Location Location Location," which rings true not just within a town, but over the country as a whole. Let's say your requirement is that you must live in the United States- and get an average paying job. According to the CNNMoney Most (and Least) Affordable Cities you'll pick
1. Syracuse NY
2. Indianapolis IN
3. Detroit MI
4. Youngstown OH
5. Buffalo NY
Yes houses are cheap. Because so many banks own the houses because everyone lost their jobs and couldn't pay their mortgages. Not really a situation I would want to be moving into. Hopefully these towns will all see increases in their real estate values as jobs are created in industries that can adapt as times change.
Maybe I'm spoiled, but not all of their Least Affordable Cities seem that awesome!
1. New York NY
2. San Francisco CA
3. Santa Ana CA
4. Los Angeles CA
5. Honolulu HI
Okay, Honolulu would be nice. Houses in these locations are so expensive because there is little land to expand and build cheap houses on. Here in Portland with the firmly set Urban Growth Boundary we should expect to become more like San Francisco over the next 50 years- Yes you can move out of the city into a very nice suburb and commute, but do you really want to? Or will a large portion of the population pay more for less square footage and the convenience and pleasure of living in the city itself? I hope so! Portland does not make the ranking for Most or Least expensive, which is great!

3 Reasons to Buy Now- According to NAR

2010-08-19T13:05:00.000-07:00

And it's not like they have any vested interest in having people buy houses. Oh wait, they do! Anyway, I agree with their reasons, especially it it's the right time for you to buy.
• Desperate sellers: Both home owners and lenders are eager to unload a flood of foreclosed and underwater properties. Buyers with the patience to push through these complex deals can save a bundle.

• Little competition. Because most people don’t have what it takes to negotiate their way through short sales and REOs, patient investors are winners.

• Low rates. Mortgage rates are at their lowest level in 40 years. If you believe inflation is inevitable, lock in now.

Source: MarketWatch, Michael Murphy (08/19/2010)

Median Sale Prices by Portland Metro Area

2010-08-17T10:45:00.000-07:00

Once again, back by popular demand (of my own) is the RMLS Market Action Median Sales Price Map!
North Portland: $227,000
NE Portland: $251,500
SE Portland: $197,700
West Portland: $377,100
Gresham/Troutdale/Sandy/Corbett/Fairview: $185,500
Milwaukie/Gladstone/Boring/Clackamas/Estacada: $240,000
Lake Oswego/West Linn: $416,500
Beaverton/Aloha: 230,000
Tigard/Tualatin/Sherwood/Wilsonville: $301,000

Monthly Market Report from RMLS

2010-08-16T14:27:00.000-07:00

July Residential Highlights
When comparing sales activity in the Portland metro area in July 2010 to the same time last year, July 2009, closed sales declined 29%. Pending sales also decreased 24.9% and new listings rose 3.1%. On a month-to-month basis, when comparing July 2010 to June 2010, closed sales fell 29.8% (1,412
v. 2,012), while pending sales grew 0.7% (1,629 v. 1,618). New listings also fell 0.5% (4,029 v. 4,049). At the month’s rate of sales, the 15,271 active residential listings would last approximately 10.8 months.
Sale Prices
The average sale price for July 2010 increased 2.9% compared to July 2009, while the median sale price went down 1.6%. When comparing July 2010 to the month prior, June 2010, the average sale price increased 2.5% ($297,000 v. $289,000) and the median sale price also went up 2.5% ($246,000 v. $240,000).
Year-to-Date
Inc re a s e s a re s e en when comparing January-July 2010 with the same period in 2009. Closed sales were up by 22.5%. Pending sales also went up 9.1% and new listings grew 6.8%. RMLS Market Action Report

Repossessions are Up, Set Yourself Up for a Sluggish Recovery

2010-08-12T11:12:00.000-07:00

As the numbers and statistics do not improve for the economy, banks are acting like any business and clearing out their inventory- in this case bad loans. Lenders repossessed 92,858 properties in July 2010, up 9% from June 2010 and up 6% from July 2009. This means that they are not just letting people sit in homes that the foreclosure process has begun on, they are going out and taking the houses back. Luckily, there are less homes this year than last year that are receiving the initial default notice, the first step in the foreclosure process. It rose just 1% from June to July of this, and is down at whopping 28% from 2009. The states most affected by foreclosures continue to be: Nevada, Arizona, Florida, California, Idaho, Michigan, Utah, Illinois, Georgia, and Maryland.

Who's in the Mood for Free? I am!

2010-08-09T13:56:00.000-07:00

Free concerts are a great way to get out and about in PDX in the summer, and believe it or not but we do have several weeks left of summer.
These ones are all child-friendly, and I hope for my sake dog friendly too:
Kenton Park – N. Kilpatrick & Delaware, 6:00-8:00 PM

No food vendor: Bring your own picnic!
      Aug 17: Chata Addy & Susuma (Afro highlife)
      Aug 24: Portland International Raceway presents Hillstomp (bucket & stomp blues)
Ventura Park – SE 115 & Stark, 6:00-8:00 PM
Free art activities for children will begin at 6:00 PM each week.
Food vendors: Burgerville Nomad, Portland Ice Cream
      Aug 11: Joni Harms (country western)
      Aug 18: Aaron Meyer (rock violin)
      Aug 25: Conjunto Alegre (tropical dance party)
Couch Park – NW 20 & Glisan, 6:30-8:00 PM
Free art activities for children will begin at 6:00 PM each week.
Food vendors: Hot Dog Ernie’s, Island Daydream Natural Shave Ice
      Aug 5: Linda Hornbuckle & Friends (divas of soul)
      Aug 12: Freak Mountain Ramblers (Americana, bluegrass)

Free Portland Sunday Concert Series @ Rontoms- not child friendly, this laid back bar and concert venue is a great place to unwind. All concerts begin at 9pm.
8/08 :: Dat’r w/ Double Plus Good + Spain in the 70′s
8/15 :: Ramona Falls w/ Monarques + Dirty Mittens + Palmz
8/22 :: Portland Folk Fest w/ Celilo + Lee Corey Oswald + More
8/29 :: Iretsu w/ Yours, Sean Battles
9/05 :: Soundpool + Guests
9/12 :: Dolorean w/ Derby + Norman

I hope to see you all there!

Street of Dreams Part 2

2010-08-06T10:34:00.000-07:00

Main Floor

Lower Floor
It took me a little while to get around to it, but here is my second favorite house at the NW Natural Street of Dreams Portland 2010. Called Transitions (I know.) and built by Hearth & Home, this 2,800 square foot, 4 bedroom, 4.5 bathroom home is listed for $849,000. It's my second favorite house, behind Idea Box's Fortino, because the layout allows for so many different families to be comfortable. Each bedroom has it's own bathroom, and there are 2 each on the ends of the home, allowing privacy for older children, guests, or other family members to live with out being on top of each other. The finishes were also superb. Understated colors, beautiful tiles and and modern, simple lines. There are eco-friendly systems and finishes, and the landscaping was designed with bioswales to reduce storm water runoff.

My Favorite House on the Street of Dreams

2010-08-03T12:59:00.000-07:00

I went to the NW Natural Street of Dreams was the modular home by IdeaBox. The Fortino, pictured above, was built off-site, and installed in 2 weeks, which is a long time for them- usually installation is 3-4 days! Many people on the shuttle with me called it a "manufactured home," but this sleek, elegant, and high end small home is far from the parks you may be picturing. Think of a condo in the Pearl, but with your own lot. Think of a European boutique hotel, but your for all time. At only 1,250 square feet, this 2 bedroom, 2 bathroom, home is a marvel for $148,000, lot not included. I can see myself, and many of my friends and clients, purchasing a home like this. The interior is customizable, and I think it could be easy upgraded as you grew into the home. Perfect for first time buyers, down-sizers, as a vacation home, or a primary residence. I can picture this house at the beach or in the mountains as a vacation home, or a great alternative to a mobile home on acreage. I enjoyed the whole Street of Dreams this year, and I will highlight my other favorite home tomorrow, but I think that IdeaBox's Fortino was the most innovative and creative out of the 6 homes.

I'm Moving Uptown!

2010-08-02T10:31:00.000-07:00

I am pleased to announce that I have moved to the Uptown Office of Coldwell Banker Barbara Sue Seal Properties. I have been with Coldwell Banker Seal since I began my career, and I am thrilled to join this prestigious office. Located on the corner of W Burnside and NW 23rd Ave, the Uptown Office is known for it's urban feel, strong local history, and many know this office for the Seal on the roof. I am continuing to work in NE and SE Portland, as well as the greater Metro Area. If you or anyone you know would like to buy or sell a home, please call me at 503-367-1877, or visit my website at BethSilva.com.

Home Ownership Drops Dramatically, Media Continue to Freak Out

2010-07-28T14:20:00.000-07:00

Part of the Census Bureaus job is to gather extra information on all of us, including if you own, rent, or squat where you are currently living. As of this the second quarter of this year, 67% of Americans own homes, the lowest level since 2000. Out here in the West it's even more dramatic, with 61% of adults owning homes. Rental occupancy has also fallen, leaving us to ask: Where are people living? Since many people have lost homes due to foreclosure, and lost jobs and therefore had to short sell their homes, my guess is that people are living with family, friends, and renting illegally more than we have seen in decades. Many of my friends, even those with good jobs and prospering careers, continue to live cheaply and share houses and apartments. Generations within families are also co-cohabiting, either grown kids are moving home, or elderly parents are moving in with their boomer children. All of these moves are a return to a more conservative purchasing philosophy that has been lost on most Americans over the last few decades. Buying a home wasn't considered a right, it was a dream that had to be worked hard for. I for one am glad to see ownership rates settling back into a more realistic percentage of the population.

Green Roofs- The Next Improvement You Should Make?

2010-07-27T14:36:00.000-07:00

Photo: http://www.gamil.com/2008/07/15/why-does-portland-have-to-be-so-great/
Green roofs are popping up around Portland, which makes sense because things want to grow on our roofs whether we like it or not, but is this green trend right for you and your house? For the standard 3,000 square foot roof replacing it will cost about $20,000, about 3 times the cost of a new composite roof. According to Remodeling Magazine's 2009-10 Cost vs. Value Report you will recoup about 2/3 of the $20,000 when you sell. That may not seem like a good investment, especially if you are planning on selling in the next few years.

A green (or living) roof is become more practical to average homeowners each year, now you can use modular systems for easy installation. Plastic grids fit together, keeping soil and plants in place on sloped roofs. This costs about $10-30 per square foot, depending on whether they are pre-loaded or not. Check out LiveRoof for samples and to order. Read more about green roofs and other eco-friendly things to do to the top of your house here.

Short Sales and Bank Owned Properties In Portland

2010-07-24T12:21:00.000-07:00

When looking for a house these days it seems rare to find an actual person selling their house. Short sales and bank owned properties feel like they dominate the Portland market, but RMLS just compiled the stats, and found that they are actually a small percentage of homes for sale. Of all the listed houses on RMLS (31,762) 11.7% (3,731) are short sales and 5.4% ( 1,715 ) are bank owned. As you can see in the chart above, that doesn't seem so overwhelming. Houses actually getting sold is another thing, the percentage goes up for bank owned properties and down for short sales. Many short sales are never sold before the bank forecloses on them, and it is a very long and painful process to purchase a short sale, so it is no surprise that not as many are getting offers accepted (by the bank that holds the mortgage) or actually closing the deal.

Finally, for houses that are sold, of the 17,751 sold in the RMLS area from January 1, 2010 to June 30th, 2010, 9.1% (1,620) were short sales, and a whopping 19.3% (3,422) were bank owned.

June Market Action Report

2010-07-17T14:59:00.000-07:00

Prices are down, but sales are up. That is the Portland real estate market in a nutshell. From June 2009 to June 2010 prices are down 4%, which is not bad considering the rest of the country, and how many short sales and bank owned homes are in our market. The good news is that with prices dropping people have been buying houses. They may be first time buyers spurred on by the tax credit, or maybe they were moving up or down, but getting more house for their money, and more seller concessions. Below is the map with the median sale prices for the Portland Metro Area.

Appliance Rebate Expanded in Oregon

2010-07-13T14:07:00.000-07:00

As of July 1st, 2010, the Oregon Appliance Rebate Program expanded to now include dishwashers, refrigerators, hot water heaters, and washing machines. The program will rebate 70%, or $2000, of the cost of new Energy Star appliances to those that qualify. Check the chart to see if your income allows you to take Also, check out the Oregon Department of Energy's rebates, and The Energy Trust of Oregon for even more! There are lots of ways to save money on great appliances that will lessen your bills and your carbon footprint, as well as make your home more comfortable and desirable.

Home Repairs- DIY or Hire a Pro?

2010-07-12T14:45:00.000-07:00

I found a great article for the regular home owner on whether to attempt a repair project yourself, or to hire a professional. They rely heavily on the Home Depot, which is a store I frequent, but I think that you can find instructions on line or from a handy friend just as easily as going to an in store class. Check out Mint.com for the original post and for a bunch of other articles.
"Watch a few episodes of This Old House or Kitchen Impossible, and you may fancy yourself a competent carpenter or handyman. If TV hosts can do it in sixty minutes or less, how hard could it be, right?
Actually, some home repairs could be hard enough that you’d be better off hiring a professional. Even if it seems pricey, a botched DIY job can end up costing even more money in the long run. We asked Mike Albrecht, a division direction for installation at Home Depot, to help us figure out when to DIY and when to dial a pro. Albrecht oversees the store’s professional installers and has also worked with instructors helping do-it-yourselfers through in-store demos.
Albrecht says there are four main factors to consider with home repairs: cost, safety, permits/compliance, and time/convenience. The right decision depends on the individual’s skill level and desired results. Here are some additional factors to consider based on the project.
(Please keep in mind that the information in this article is intended to be informational only. When tackling your own home repair projects, follow instructions as outlined in your warranty or consult your local government for information on safety permits.)

Painting

“Painting’s a great DIY project,” says Albrecht. However, would-be painters should consider height and weather conditions, especially when planning exterior painting projects. “If you’re looking at painting a second story, then you probably want to consider a pro,” he says. “Height and safety concerns are the biggest factors.”
Whether you’re painting indoors or out, do your homework to make sure you’re using the right materials for your surface so you can get it right the first time. “[Painting] may be a waste of your time if it has to be redone and you have to go back and re-buy products,” says Albrecht.

Plumbing

Simple projects like installing a new faucet don’t necessarily require a plumber, but you’ll usually need to know how to shut off the water supply and turn it back on later. More complicated bathroom or kitchen remodels, like changing the location of a toilet or adding a vanity, require more specialized expertise (not to mention the proper permits).
The same goes for installing a new water heater. “In most cases, the DIYer will probably consult with a plumber,” says Albrecht. “If it’s gas, then you should definitely have somebody come out.”

Updating light fixtures or ceiling fans

Switching out light fixtures or installing a new ceiling fan are both doable for many DIYers, especially if the ceilings are eight feet or lower. However, if your project is more complicated or requires rewiring, you’ll need to worry about safety permits.
“If you’re extending the electrical service or adding a ceiling fan, and you need to be concerned about the framing or the electrical support, that’s when you want to call in a pro,” Albrecht says.

Retiling or reflooring

Adding a basic backsplash or ceramic tile floors are popular projects among DIYers. Some also tackle the installation of hardwood floors, but that can lead to problems in the future if they’re not properly installed.
“One of the bigger things that people don’t think about is warranties on kitchen cabinets or flooring,” Albrecht says. “Warranties require specific installation techniques, so a DIYer takes the risk of voiding the warranty.” For instance, if your home has moisture issues and you don’t create a moisture barrier or switch to ceramic tile, the wood could warp and the warranty could become invalid, potentially costing you thousands of extra dollars. “That’s the value of the pro with the flooring,” Albrecht says.

Carpentry projects

Most DIYers can successfully tackle projects like adding shelves to a closet or pantry. Since those areas will be hidden most of the time, mistakes don’t matter as much. Another simple DIY project is adding crown molding or chair rails.
However, “if you start talking about framing, redoing a deck or basement, or adding an addition, that’s where it gets more expensive,” says Albrecht. You’ll probably need expensive equipment, too (some of which you can rent). Since safety and precision are more important with structural projects, it may make sense to pay a professional and avoid putting family members at risk."

Buyers Trending Toward Urban Living Over Next 10 Years

2010-06-24T13:40:00.000-07:00

Housing researcher John McIlwain stated "the suburban century is over." He predicts that over the next 10 years economic, demographic and regulatory changes will create a "new normal" real estate environment across the country that focuses on city centers and close-in older neighborhood. As a senior fellow at the Urban Land Institute in Washington, D.C., and author of “Housing in America: The Next Decade,” McIlwain predicts that many central cities will experience strong demand for housing, with the strongest markets “in places that provide a vibrant 24/7 lifestyle.”Sounds like Portland! The trend is to be the highest in older baby boomers and millenials, and immigrants are 3 of the 4 main players in real estate, and they will all be aspiring for or forced to live an urban lifestyle. I have seen this in my own experience, buyers of my generation (the millenials) can't imagine living in the 'burbs, or if they do, they want to be close to mass transit to get back into the city on a weekly basis. I'm excited to see this prediction come true, the most vibrant cities around the world have people actually living downtown, and I think Portland can be one of those.

2010-06-22T13:08:00.000-07:00

Click for the Source

This infographic states right out that it is better to rent for 4-5 years than buy a house, which I patently disagree with! I think that if you were going to buy and own a house for a few years, then sell and rent again, it would be not such a good idea to buy. But if you want to buy a house, live in it for 2-5 years, then sell and move into a bigger house or more desirable area, then go for it! That's how people make money in real estate. The longer you own a home, the more equity builds up, unless you bought in 2007 at the top of the bubble! The more equity you have, the more cash you get back when you sell, which you can invest in a large down payment on your next home, or in a remodeling job. If you sell in less than 2 years you do have to pay capital gains tax, so unless you are flipping a home for an extremely large profit it's not really worth it. The majority of home owners are able to afford larger and nicer homes as they move up because they started with a small house, it gained equity, and then they kept moving every 2-5 years, sometimes very frequently, sometimes only 3-4 times over 40 years. The point of home ownership is too be able to do what you want in you house, which you cannot do in most rental situations. Disagree? Comment below and I'll respond!

RMLS Market Report

2010-06-21T13:15:00.000-07:00

Last week the Market Action Report came out for May 2010, I haven't had a chance to blog about it until now. There is good news and bad news, as it is with all real estate news these days. The good news is that the inventory is continuing to drop in Portland- down to 7 months of supply, compared to 12.6 months in January of this year. The bad news is that the median home price in Portland is down 4.4% from May 2009- $239,000 compared to $250,000. My favorite part of the Market Action is the map on pg 6 which shows the median sale price by region. What is median in NE or SE is completely different than Lake Oswego or West Portland. Here's the summary along with the change from May of 2009.

North Portland: May 2010: $234,900 May 2009: $229,000 Difference: +$5,400

NE Portland: May 2010: $248,300 May 2009: $255,000 Difference: -$6,700

SE Portland: May 2010: $214,500 May 2009: $219,900 Difference: -$5,400

West Portland: May 2010: $329,500 May 2009: $367,500 Difference: -$38,000

Beaverton/Aloha: May 2010: $211,500 May 2009: $224,500 Difference: -$13,000

Tigard/Tualatin/Sherwood/Wilsonville: May 2010: $277,000 May 2009: $270,000 Difference: +$7,000

Lake Oswego/West Lynn: May 2010: 358,000 May 2009: $350,000 Difference: +$8,000

Oregon City/Canby/Molalla/Beavercreek: May 2010: $242,000 May 2009: $220,000 Difference: + $22,000

Milwaukie/Gladstone/Boring/Clackamas/Estacada: May 2010: $260,000 May 2009: $265,000 Difference: -$5,000

Gresham/Troutdale/Sandy/Corbett/Fairview: May 2010: $206,300 May 2009: $223,400 Difference: -$17,100

10 Things Buyers Look for Today

2010-06-15T13:05:00.000-07:00

Buyers in 2010- according to ZipRealty- are looking for these 10 things:
1. Garage or parking space: 86.8%
2. Master suite: 78.9%
3. Ample storage space: 72%
4. Large or walk-in closets: 66.5%
5. Guest bedroom: 66.4%
6. Outdoor entertainment area: 64.3%
7. Gourmet or updated kitchen: 60.6%
8. Breakfast room or eat-in kitchen: 55.8%
9. Large yard: 43.2%
10. Wood floors: 40.8%
The 3 Biggest Turnoffs:
1. Bad Oders
2. Busy Street
3. Awkward Floor Plan

Source: ZipRealty.

Seriously People, the FBI is Going to Get You if You Lie

2010-06-14T14:53:00.000-07:00

Mortgage fraud seems like it would be really hard to pull off these days, but the FBI is gearing up for a major crackdown because it's still a huge issue. Lying about your income, debt, or falsely applying for mortgage relief programs are the main issues, and the FBI reported that they have set up 23 mortgage fraud task forces across the country. They stated that the housing bubble was caused by homes being bought with fraudulently acquired loans- brokers and banks gave mortgages without verifying income and to people with incredibly low credit scores. Read more here.

2010-06-11T16:22:00.001-07:00

Q&A: Emergency Preparedness for Homeowners
HouseLogic talks to Red Cross disaster response expert Court Ogilvie about emergency preparedness for homeowners. Read
Is the Cost of Hurricane Insurance Worth It?
Decide whether to buy hurricane insurance long before the storm clouds appear. Read
Give Your Community the Gift of Emergency Preparedness
Creating a neighborhood disaster preparedness plan can safeguard your family, neighbors, and property, while strengthening and unifying your neighborhood. Read
Create a Home Emergency Preparedness Kit
Having a home emergency preparedness kit could be the key to your family’s safety if disaster strikes. Read
Insuring Against Natural Disasters
Your homeowners insurance covers many of life’s disasters, just not some natural disasters like earthquakes and floods, so consider supplemental policies. Read

Visit houselogic.com for more articles like this.

What is Appraised Value?

2010-06-11T13:08:00.000-07:00

Appraisals provide an objective opinion of value, but it’s not an exact science so appraisals may differ.
For buying and selling purposes, appraisals are usually based on market value — what the property could probably be sold for. Other types of value include insurance value, replacement value, and assessed value for property tax purposes.
Appraised value is not a constant number. Changes in market conditions can dramatically alter appraised value.
Appraised value doesn’t take into account special considerations, like the need to sell rapidly.
Lenders usually use either the appraised value or the sale price, whichever is less, to determine the amount of the mortgage they will offer.

Used with permission from Kim Daugherty, Real Estate Checklists and Systems, www.realestatechecklists.com

A Few Random Things...

2010-06-10T14:24:00.000-07:00

Not any major real estate news today, there are just a few things that I would like to pass on.
1. RMLS- our local multiple listing service- added a feature for the city and country entries on their listings. Now, if available, those entries have become links to the city or county's websites. If you are moving into a new area and want info on local services, news, and utilities, just click on the links for your favorite homes.

2. There is a cool blog called WebUrbanist that occasionally has real estate related posts, and I really like today's on 10 Tiny Houses. Think about how much square footage you have now, how much you really want, and how much you really need! I know I could never live in something so small, but it also confirms my belief that I don't need 5000 sq ft to be happy!

3. There is a new law in Oregon going into effect August 1st. Any home sold with a wood stove or wood stove insert must be sure that the stove was certified by DEQ at the time it was purchased. If it is not, then it must be removed and destroyed (similar to the cash for clunkers deal) before the sale is finalized. Read more about the new law here.

ReUse Week in PDX

2010-06-08T16:20:00.000-07:00

The week (June 9th-16th) is ReUse week in Portland, the second annual donation drive that is meant to bring attention to ReUse PDX- a network that includes Community Warehouse, Free Geek , the Habitat for Humanity ReStor, the ReBuilding Center, Schoolhouse Supplies and SCRAP. The highlight of the week will be Saturday the 12th, when there will be a gathering from noon to 4 p.m. in the parking lot of the Rebuilding Center at 3625 N. Mississippi Ave. to educate the public about what they do. To find out more about the Saturday event, click here, and to get info about what and where to donate click here.

1st Year in Your Home? Here's What It Costs

2010-06-07T13:55:00.000-07:00

I found a small survey and report on Realtor.com about the surprise costs first-time home owners encounter. The survey said that half of all first-time buyers were surprised at how expensive it was, even though 88% of them claimed to have done a good estimate on costs before buying. The study for BBVA Compass, a lender based in Alabama, concluded that most lenders don’t warn buyers that there will be costs beyond principal, interest, taxes, and insurance. Among those costs are utilities. The U.S. Department of Energy reported that the typical family spends $1,900 a year – $158 per month – on things like heat, air conditioning and power. The National Association of Home Builders calculated that the typical buyer of a new home spends about $8,640 within the first 12 months for furnishings, appliances, and home repairs and fix-ups, while the typical buyer of a resale home spends $6,540. What's the main lesson to be learned? Have a lot of extra $ in the bank. This usually means saving up for your down payment (a minimum of 3.5% if you are doing FHA financing), plus closing costs if the seller isn't paying for all of them, plus several months of mortgage payments, plus a reserve for unexpected repairs.

Source: United Feature Syndicate, Lew Sichelman (06/06/2010)

What Your Agent Should Ask the Seller's Agent in a Short Sale

2010-06-03T15:15:00.000-07:00

I have been frustrated with seller's agents many times when they cannot answer these questions, but I know what to be asking! I got this great list from a real estate agent and blogger in MA, check out the full post here.

Are you going to be negotiating the short sale for the sellers or is there an attorney or short sale specialist involved?

If the answer coming back on this one is the Realtor is going to be representing the seller you MUST find out if they have ever successfully completed a short sale transaction before. If the sellers Realtor has never done a short sale before you might as well have your buyer move on to another home! The probability of the sale ever getting to the closing table is slim. If they have completed a short short sale before ask them their success rate. In other words of the short sales they have listed, how many did not close?

Have you requested the short sale package from the lender and has the seller filled it out?

In order to complete a short sale every lender requires various documents that must be filled out and returned to them. They include:

A completed authorization form allowing communication directly with the lender.

The lenders name, account numbers, and customer service phone number.

A hardship letter discussing the exact reasons why you are not able to pay the mortgage going forward. This letter must be dated and signed.

A copy of the listing agreement from the Real Estate agent.

Proof of income ~ The lender is going to require a financial statement including copies of your two most recent bank statements, copies of your last 4 pay stubs, or if you are self employed, a copy of your most recent profit and loss statement. Lastly, you will need copies of your last two tax returns.

Also are there any other debts on the home or condo such as past due water and sewer bills, condo fees, outstanding taxes, IRS or other liens.

Who are the lender/lenders servicing the loan?

This is a basic question that they better know the answer too. You need to ask them their experience with this particular lender. There are some lenders that are very difficult to deal with most notably Bank of America (BOA). If BOA is servicing the loan you expect to be on the longer side of getting to the closing table. It is not crazy to think the transaction could take 6-12 months. I know you are probably thinking to yourself how is this possible? Believe me it is!

How many loans are on the property?

If there is more than one loan the transaction is more than likely going to be harder to complete. The agent is now going to need to have negotiation skills beyond just dealing with one lender. When there are two lenders both need to be satisfied. There are some lenders that will only allow a 2nd mortgage holder to get X amount of dollars. The agent representing the seller needs to know how to get past any difficulties that could arise between disagreements with the two lien holders.

How is the listing agent going to handle submitting offers to the bank?

This is an extremely important question to ask. The correct way to handle a short sale transaction is to have the seller sign an offer that makes sense and submit that to the lender. It should be no different than any other sale. The seller owns the home and they either accept or reject an offer that comes in.

If the listing agent tells you that they will be collecting offers and submitting all of them to the bank you might as well tell your buyer client not to get involved. This is a very big red flag! It shows that the agent is clueless and has no idea how to correctly represent a seller in a short sale. Without a signed offer neither the seller or the buyer has a contract. There is no obligation on the buyers part and the seller could be left with nothing. The bank does not want to be in a position of reviewing multiple offers either.

The other mistake I see short sale sellers agents making is submitting any offer to the lender for approval whether it makes sense or not. One thing you need to understand is the lender is not going to accept a short sale if the accepted sale price by the home owner is way under market value. The offer amount submitted to the lender needs to make sense! The lender will send out an appraiser to verify the value and if it does not meet the parameters it will be rejected.

How far away is the owner until foreclosure proceedings?

You obviously need to find this out for the sake of your buyer. There is no point in them spending money on inspections, lenders fees and other things if the sale is going to end up in foreclosure. Someone representing a seller in a short sale is going to need to make sure that foreclosure proceedings are put on hold.

These are just a few but very important questions that could help you determine if you have a shot at getting short sale approval. Ideally I would tell you that if an attorney with short sale experience or other type short sale specialist is handling the sale you probably have a better shot at getting the deal done.

5 Tips for Buying a Brand New Home

2010-06-01T13:52:00.000-07:00

New construction is a great choice for buyers who want to be able to have input on the finishes in their home, and that want to have a house that will not need upgrades or major repairs for many years. New home sizes and prices are coming down, and builders are eager to woo buyers with financing deals and quality construction. If you are thinking of buying a home before or while it is constructed, here are 5 tips for you.
1. Choose a Realtor Who Has New Home Sales Experience The builders agent or sales rep will not be representing you or your best interests. Everything you tell them will be communicated to the builder, so to make sure you are protected get your own agent, preferably one that has worked with buyers on new construction before.
2. Carefully Evaluate the Seller’s Lender before Committing Even though the mortgage interest rate may seem better than any other lender you have met with, be sure to compare the APR, and all fees and terms to make sure you are getting a good deal. Any experienced and qualified builder will let you use your own lender.
3. Check out the Builder’s Reputation Walk around the current and previous developments, and talk with people who live in the homes. Get your agent to call other agents who have worked with the builder to see how the experience was.
4. Hire a Home Inspector Even though the city will have inspectors checking to make sure everything is up to code, hire your own home inspector to look for issues before closing. City inspectors miss things, or the builder or subcontractors may have changed or missed things too. A full home inspection is the best $400 buyers ever spend.
5. Obtain Legal Advice before Buying a Brand New Home Have a real estate attorney look over the contract and addenda if they are not the customary ones used in your state. Anything that seems to good to be true probably is, and it is cheaper to hire an attorney for a few hours now then to go to court later.
Read more new home construction advice here.

Quarterly Case-Shiller Index Report

2010-05-26T14:05:00.000-07:00

Each quarter the Case-Shiller Index measures changes in the prices of single-family, detached residences using the repeat-sales method, which compares the sale prices of the same properties over time. The graph above shows how Portland (red) reached the peak of the market in the first quarter of 2008. It also shows that after being level for the last quarter of 2009 and first quarter of 2010, prices have dropped for the second quarter, which just ended.

Home Sales Are Up, Interest Rates Are Down

2010-05-24T14:13:00.000-07:00

Sounds like an economic recovery, doesn't it? Today the breaking news from NAR is that existing home sales in April rose 7.6% from March. That is homes that closed, not just that went pending, and included single family homes, townhouses, and condos. Due to the economic crisis in Greece and the instability of the national and international markets, interest rates also have fallen. Against all predictions of economists, Realtors, and mortgage brokers rates fell to well under 5%. This creates a perfect storm for the real estate market- the rates are low, inventory is still moderate to high, and sellers know that it's now or never if they want to unload their property. To read the articles from NAR, click here.

Sales are Way Up from This Time Last Year!

2010-05-17T10:22:00.000-07:00

The news is good for the monthly Market Action Report from RMLS. Comparing April 2010 with April 2009, closed sales increased 49.1%. Pending sales also jumped 60.8%, and new listings rose 23.8%. Prices are still going down, so far the average sale price for April 2010 decreased 3.1% compared to April 2009, while the median sale price went down 4%. This is much less than the national average. Prices should go down even farther this summer, since the April numbers reflect the tax credits for first time and moving buyers. I expect sales to go up in May, but down in June and July.

Economists Predictions on Housing Market

2010-05-14T12:07:00.000-07:00

At the National Association of Realtors® Midyear Legislative Meetings & Expo today two top economists gave their real estate market predictions. Lawrence Yun and Mark Zandi both put jobs at the center of the housing recovery, and said that the Fed will keep mortgage rates historically low for the near future, but differed on how foreclosures would affect the market recovery. Yun predicted that distressed properties (foreclosures and short sales) will make up 30-40% of the market for the remainder of 2010. Also he said that prices will stabilize this year, with a potential for 2-3% growth, and that will prevent more foreclosures and short sales from adding to the distressed properties over the next few years. Zandi has the opposite idea- foreclosures will rise until 2011, and home prices will drop farther this year.
Read more here.

Insure Whether You Rent or Own

2010-05-13T13:22:00.000-07:00

I always learn something when reading the Mint.com blog, and today is no different. Here's what they had to say about homeowners and renters insurance:

"Homeowners Insurance: What’s Covered
A home will likely be the biggest purchase in your lifetime and while having homeowners insurance in place is required of most buyers, making sure you have the right policy is equally important. It not only covers the structure of your home, but will also protect you if someone gets hurt or there’s damage to another person’s property. Also covered is the additional cost of living elsewhere if your home becomes uninhabitable, as are any medical expenses for others accidentally injured in your home or on the sidewalk outside it. (Medical Payments coverage doesn’t cover your or family members living in the home if they get hurt.) Keep in mind, flood insurance isn’t included in most policies and would result in an additional cost to the homeowner — unless you purchase separate coverage.
Rental Insurance: What’s Covered
For renters there are two types of insurance: the HO-4 for apartment renters and HO-6 for condo renters. Both cover damages from fire, lightning, windstorms, explosions, civil unrest, as well as damage caused by vehicles, smoke, vandalism, theft, pipes bursting and other damage from faulty appliances. Renters insurance also includes liability coverage in case someone gets hurt in your apartment. Living expenses if your place becomes uninhabitable are also covered. But like homeowners insurance, you’ll need a separate policy for floods and earthquakes if you live in an area prone to those events."
What they don't say is that it's much easier to get homeowners insurance if you have previously had renters insurance. When I was renting it was only an additional $10 a month, and that covered all of our electronics, as well as jewelry and furniture.
Read the rest of the article here.

NAR is a Lobby

2010-05-12T14:21:00.000-07:00

I hadn't really thought of the National Association of Realtors as a lobby before, but then I was reading a news release from NAR about all the things they are pushing Congress to do. I pay dues to be a member, and I generally support most of their ideas, like the $8000 tax credit, but I also feel like I have no say. It's not like a union where I get to vote on local representatives, they get appointed and hired by the higher ups. Here's what NAR is pushing for now:

"Big Push on Capitol Hill for Real Estate Reforms
REALTORS® are asking Congress to strengthen the Federal Housing Administration, extend the FHA's high-cost loan limits, and get flood and disaster insurance reforms passed as part of their push on Capitol Hill this week during NAR 2010 Midyear Legislative Meetings & Trade Expo.

Several thousand REALTORS® are in town and will be meeting with members of Congress over two days this week. Here's a look at some of REALTORS®' top legislative priorities:

Support for small business. REALTORS® would like the government to help small businesses get much-needed financing by allowing federal credit unions to loan a higher percentage of their assets than they can now. The increase is needed to help offset the difficulty small businesses are facing in getting loans from banks.

Stronger commercial market. Extending the Term Asset-Backed Securities Loan Facility (TALF) will help improve commercial mortgage market liquidity and push Congress to act quickly on reauthorizing funds for the popular Rural Housing Service (RHS) Sec. 502 loan guarantee program, which is on the verge of running out of money.

Various FHA reforms. Legislation to strengthen the FHA would allow the agency to increase its annual mortgage insurance premium, which borrowers can fold into the loan amount. FHA Commissioner David Stevens has said that once the agency has that authority, it’ll be able to reduce its upfront mortgage insurance premium, which it raised several months ago to meet congressionally mandated reserve requirements. The upfront premium hurts borrowers more because it has to be paid in full at closing.

The FHA legislation would also give the agency more tools for enforcing rules against bad lenders. The legislation has passed the House Financial Services Committee. NAR’s goal is to put the bill on fast-track passage in the House, then get it introduced and passed in the Senate as soon as possible.

NAR is also seeking to make the FHA’s high-cost loan limits permanent. The limits, now at $729,750, expire in the fall. If the limits aren’t extended, they would drop to about $417,000, too low to make the FHA a viable financing option in many larger metropolitan areas like Boston, San Francisco, Washington, and New York.

Flood and disaster insurance. The reforms NAR is seeking of the national flood insurance and disaster insurance programs aim to strengthen private insurers’ role in handling most disasters, reserving federal involvement as a backstop. REALTORS® will be asking their members of Congress to pass the legislation in the House before Memorial Day. Then attention would turn to the Senate.

Helping the commercial securities market recover. The commercial mortgage-backed securities (CMBS) market, which for years has been the principal means for getting financing into commercial markets, is starting to come back. Yet new CMBS issues remain only a fraction of the volume that’s needed to meet demand. NAR is calling on the government to extend its TALF program to the end of the year so investors will have low-cost loans available to them to invest in commercial securities at a time when a lot of uncertainty remains about the strength of the market.

Preventing bad amendments. The big focus of Congress now is financial services reform. The bill is huge in scope but only a part of it directly concerns real estate. REALTORS® have been successful in defeating draconian amendments, including one that would have required all borrowers to put down a minimum 5 percent. Supporters of that amendment and other tough measures that could hurt housing, including a defeated amendment that would have ended federal control of secondary mortgage market companies Fannie Mae and Freddie Mac in the near future, are expected to be introduced again at different junctures of the legislative process, so REALTORS® will be sharing with their members of Congress the danger the requirements would pose to the market now.

Careful treatment of Fannie and Freddie. NAR’s position on Fannie Mae and Freddie Mac reform is that it must be taken up separately, next year, and must be undertaken carefully. REALTORS® oppose ending federal control before a structure is in place to ensure the availability of mortgage financing in the market, in good times and bad, which is the role the two companies are playing today."
All sounds pretty good right? I'm going to keep a closer eye on what the national and regional Realtor Associations are doing.

Irvington Nominated to the National Register of Historic Places

2010-05-07T11:27:00.000-07:00

Jon Jensen for Renovation Style
This historic and beautiful neighborhood in NE Portland has finished the long and complex application for the National Register, and is the largest area in Oregon and one of the largest areas nationwide to do so. Red tape will be added to purchasing, remodeling or building in the neighborhood, but that will also preserve it's charm and beauty. Read more here.

NAR Reports Portland Prices are Still Falling

2010-05-05T10:38:00.000-07:00

This goes along with my own analysis of the Portland real estate market. NAR's Realtor Magazine reported today on 10 markets where prices are still falling:

Atlantic City/Hammonton, N.J.

Provo, Utah
Portland, Vancouver, Ore.
Glen Falls, N.Y.
Bellingham, Wash.
Flagstaff, Ariz.
Charleston/Sommerfield, S.C.
Eugene/Springfield, Ore.
Salisbury, Md.
Salt Lake City, Utah

Eugene/Springfield also made the list, with Bellingham WA rounding it out for the Northwest.

13 Hours Left for the Tax Credit!

2010-04-30T11:12:00.000-07:00

The first time home buyer and move up buyer tax credit expires tonight. If you don't have an accepted offer on a property by midnight, you won't qualify for $8000 or $6500. I have clients that just made it in, there was mutual acceptence yesterday! I'm glad that the whole tax credit will go away, now the market will actually adjust to what it should be. Forbes wrote today that Portland is one of the markets where the bottom has not hit yet, and I think that is partly due to the credit, and people feeling the need to buy now. I'm just glad that I won't have to remind people about the deadlines anymore!

How does Portland Rank Nationwide?

2010-04-29T13:12:00.000-07:00

Relocate America released it's 13th annual list of Top 100 Places to Live, and it's no suprise that Portland made the list. Several Top 10 Places were also released for subcatatories. Here are the one's Portland placed on:

Top 10 Earth Friendly Cities

Portland, OR
Boston, MA
Madison, WI
Boulder, CO
Austin, TX
Chicago, IL
Minneapolis, MN
Fort Worth, TX
Ann Arbor, MI
Huntsville, AL

Top 10 Single/Young Professional Cities

Washington, DC
Chicago, IL
Dallas, TX
San Diego, CA
Boston, MA
Austin, TX
Scottsdale, AZ
Minneapolis, MN
Portland, OR
Pittsburgh, PA

Top 10 Large Cities

Chicago, IL
Dallas, TX
San Antonio, TX
San Diego, CA
Austin, TX
Columbus, OH
Charlotte, NC
Boston, MA
Washington, DC
Portland, OR

Also, Corvallis Or made #6 in the Top 10 Recreation Cities, and Ashland Or made #6 in the Top 10 Small Towns.

Better Late Than Never!

2010-04-26T15:23:00.000-07:00

Usually the day the latest market report comes out I blog on it, but this month too many other interesting things have come up for me to write about. I took some extra time today to really explore March 2010s data, and a few intesting things popped up. First, North Portland homes are moving the fastest, with only 89 average days on the market, compared to the next quickest of SE Portland at 101 days. Prices in North Portland are about the same as SE and Gresham/Troutdale. North Portland average a sale price of $233,800 last month, SE was at $235,800 and Gresham/Troutdale was at $235,100. Like I've always said, those less expensive homes for first time buyers and investors move quickly. North Portland is also getting a better reputation around the greater Metro area, St Johns is turning into a really cute and walkable area, and University Park has always been nice, but people know about it now.

Understanding Home Loans

2010-04-23T13:43:00.000-07:00

About 90% of all home loans being taken out today are FHA loans. A few years ago they were almost all Conventional, with many of them 100% down, or 2 loans tied together, the first for the down payment of 20%, and the second for the balance of the purchase price. Since loan restrictions are getting tighter by the month, I thought I'd use the Mint.com blog post from a couple of days ago to explain the diffent loans. Here it is:
"Let’s say you’re ready to take advantage of low (and possibly rising) home loan rates and buy a little chunk of something to call your own.

Just three years ago, walking into the bank was like walking into the video store. You could go with Duplicity (a pay-option adjustable-rate mortgage) or Where the Wild Things Are(subprime). Home prices were going Up, and no one had any idea that we’d all end up in The Hurt Locker, and yes, I will now stop. Sorry.
Not any more. “In terms of product available, it’s very old-school at this point,” says Frank Ruzicka, a mortgage banker at Cornerstone Mortgage, Inc., in St. Louis. “Gone are the crazy things. You don’t see the pay-option ARMs anymore. You’re not doing subprime lending anymore.”
So what’s left? Here’s what you’re likely to find today.
Conventional fixed-rate mortgages
“The one product that is constant and still available everywhere is the traditional 30-year fixed-rate mortgage,” says Keith Gumbinger, VP at HSH Associates, which analyzes the lending market. “Thirty-year, 20-year, 15-year, still available in the marketplace. Those probably will never go anywhere.”
These are the safest, most boring loans around. To get one, you’ll need a good credit score–at least 680, according to Ruzicka, and a down payment. If you live in an area that saw major carnage in the housing market, that down payment will be at least 10 percent, and perhaps as much as 20 percent. In less exciting markets, like Ruzicka’s St. Louis, you can get away with 5 percent.
As always, if you put down less than 20 percent, you will be required to purchase private mortgage insurance, which adds a small chunk to your monthly payment until you hit 20 percent equity. Long gone are the “piggyback loans” that would let you duck this requirement. (If you don’t know what a piggyback loan is, trust me, you’re better off not knowing.)
Advantages: Fixed payment throughout the life of the loan; available everywhere.
Disadvantages: Need great credit to qualify; higher interest rates, on average, than adjustable-rate loans.
Adjustable-rate mortgages
ARMs have a bad reputation, but they’re actually a whole family of loans, and only some members of the family are bad apples. Those apples have rotted away now, and we’re left with mainly 5/1 and 7/1 ARMs (the good ones).
Both numbers are in years. The first refers to the length of the introductory interest rate period. So, if you get a 5/1 ARM advertised at 3.5 percent, you’ll pay a low rate for the first five years. After this, your interest rate will adjust every year for remaining 25 years of the mortgage. With a fixed-rate mortgage, your bank takes the risk that interest rates will rise over the course of the loan. With an ARM, you take the risk.
Exotic types of ARMs got people into a lot of trouble during the housing bubble. “ARMs were making up as much as about 40% of the marketplace in 2006,” says Gumbinger. That’s now down to about 6%. But plain-vanilla ARMs aren’t so dangerous: in fact, they’re the standard form of mortgage in that plain-vanilla country known as Canada.
Advantages: Low introductory rate; lower interest overall, on average, than fixed-rate loans; generally lower closing costs; good for buyers who plan to move within five years.
Disadvantages: Buyers tend to forget that the rate is going to adjust; high interest rates could send payments sky-high.
Government-insured (FHA and VA) mortgages
Who’s the biggest mortgage lender in the US? That would be Uncle Sam.
Buyers who would have been served by subprime lending–and many buyers with good credit, for that matter–are qualifying for loans insured by the Federal Housing Administration or Veterans Administration. Youneed a FICO score of 620 and a 3.5 percent down payment.
FHA lending is huge. Only 2% of the market in 2006, it has now surged to over 35%. The government wants a vibrant housing market and is putting its money where its mouth is. (Did you know the governmenthad a mouth? Its name is Rahm Emanuel. Sorry, political humor.)
“If you can’t scrape together tens of thousands of dollars for a down payment,” says Gumbinger, “you’re probably going to end up over in the FHA program, where you generally don’t need to.”
The FHA does have its own qualification standards. You can’t be carrying too much personal debt. You can’t take a huge loan; the maximum amount varies by county, and you can look up your maximum at the HUDwebsite. If you want to buy a condo, the building has to be FHA-qualified.
Advantages: Low down payment; low interest rate; available to buyers with good-but-not-great credit.
Disadvantages: Maximum loan amount tends to be lower than a conventional loan; must meet government qualifications; condo buildings may not be FHA-qualified.
Jumbo loans
Want to borrow more than the $417,000 maximum of a conforming loan? If you’re in a high-priced market, the FHA might lend you more than that. Most likely, though, you’ll be looking at a jumbo loan.
”Jumbos are definitely available,” says Gumbinger, “and the price of private market jumbo money is nearing historical lows.”
The catch–and you knew there had to be one, right?–is that you have to be Mr. or Ms. Clean to get one. That means at least FICO 720 (740 is better), a 20% down payment (even more in some markets), a reasonable debt-to-income ratio, and plenty of documentation.
If you think you can qualify, be sure to shop around. Jumbo loans vary a lot more in price (that is, points and interest rate)–even within the same city–than conforming or FHA loans. “Don’t assume that the first or even the second price you find is necessarily the only price you’ll find,” says Gumbinger.
Advantages: It’s a big pile of money, and rates are currently low.
Disadvantages: Rates and costs vary; tough to qualify.
What you won’t find
Subprime loans. “If you’re not dealing with at least a credit score of 680, you need to be going FHA,” says Ruzicka, “and if you don’t have a credit score of at least 620, you need to go to a credit repair place and get your credit straightened up. Because there really isn’t much of an option below 620.”
Option ARMs and interest-only ARMs. Want to see the principal on your loan go up over time instead of down? Me neither. “Pay-option ARMs have disappeared from the landscape,” says Gumbinger.
If you want excitement, go rent a movie, because you won’t find it in the home loan market. Isn’t that reassuring?
Matthew Amster-Burton, author of the book Hungry Monkey, writes on food and finance from his home in Seattle."

Today's Class on Selling REO Properties

2010-04-22T17:05:00.000-07:00

I spent 2 hot, stuffy, but informative hours, in a class on listing Real Estate Owned property today. That's bank owned homes, for you laymen. The big difference in getting a REO listing versus a traditional one is that the bank doesn't care about your personality, just about your statistics. Since I've never listed a REO property, I found this a little discouraging. The most interesting thing I learned today is that experts are predicting 70% of sales over the next 3 years to be bank owned or short sale homes. Also, that banks are working hard to make it easier to communicate with agents, and short sale home owners. They don't want to have too many homes and dump them all on the market at the same time. That will just drop prices and revenue for everybody. They are actively working on improving their procedures and methods for handling short sales and REO, and if that much of the business is going to be in their hands, they better do a good job!

6 Biggest Mistakes Buyers Make, Only 3 of Them Are True!

2010-04-19T11:54:00.000-07:00

CNNMoney has an article online about the 6 biggest mistakes buyers make. I agree with the titles of all of them, but the reasons they give do not prove to be true, at least based on Oregon real estate law, and the National Association of Realtors ethics. Here's the list, click here to read a few paragraphs on each one.
1. Not knowing your credit score- You'll need this before you even start to look at homes, if it's too low to get a good loan, you can bring it up with some smart changes to your spending and bill paying habits.
2. Buying a car before a house- This is true of about a year before you buy, and all the way up until you have the keys! If you buy a car now, and don't plan on buying a home for a few years, paying it off or making your payments on time will really increase your credit score.
3. Skimping on home inspection- Always, always, always get a home inspection by a licensed inspector, contractors don't look for the same things as inspectors, and sellers will not do repairs unless a reputable source calls for them.
4. No lawyer- The article claims that buyers agents are out to close any deal, even if it's not right for the buyer, so you better hire a real estate attorney to cover your butt. Hiring an attorney is always a good idea, especially if things start to go sideways. But, Realtors in general work off of referrals, as in if I screw you over you won't recommend me to anyone, and my business will die out and I will be done. And in debt. Most people get attached to their clients, and really just want to see them get into the prefect house for as little money as possible. We are in a service business, and nothing makes me happier than serving my clients well.
5. No contingencies- The article makes it seem as if buyers aren't writing the offer and setting the terms, which they do. In Oregon the real estate contract to purchase is 8 pages protecting both sides, and even more protections can be put in and often are. Ask your agent the worst case scenario when writing an offer up.
6. Not budgeting for insurance- Basic home owners insurance is covered in your monthly mortgage payment. It has to be set up before you can close on your new home. If you want extras, talk to your insurance agent, and you can always make it more inclusive later on.

Foreclosure Trends

2010-04-15T11:32:00.000-07:00

The mass media- my least favorite people for truthful real estate news- are all abuzz about foreclosures for March. Here's the truth from the foreclosure experts Realty Trac. 1 in 397 housing units in Oregon received foreclosure filing in March, which is higher than the national average of 1 in 351. That seems like a lot, and it is. Unemployment rates are still high, and the longer people are out of work the less savings they have, and the more likely they are to loose their homes. The foreclosures won't slow down until unemployment numbers fall and people have a chance to get back on their feet. Locally, the hardest hit areas are those that are most populated, and that saw the big boom in prices during the mid 2000s.

The good news in Oregon is that home appreciation has risen dramatically in the last couple of month. Even though foreclosures are still going up, less people will be underwater in their homes, and hopefully people will work harder to hold on to them knowing that the value is there.

Remodeling Gets Tough With New Lead Based Paint Restrictions

2010-04-13T14:08:00.000-07:00

18 years after a law was passed to toughen up on contamination of lead based paint during remodeling, the actual new conditions and requirements will come to pass on April 22nd, 2010. Basically, "a new federal law will require contractors to contain and clean lead dust more carefully during renovation, repair and painting work. Their workers will have to attend training, and the firms will have to earn certification to do the work." This is meant to lessen contamination from lead dust, which can cause developmental delays and disabilities, as well as seizures and potential death. Lead based paint pamphlets are required by law to be given to any home purchasers who buy a house older than 1978, when lead based paint was outlawed. Sellers also have to disclose if they know of any lead based paint in the home or have had is tested. As a Realtor, I tell my clients if the house is older than 1980 or so, there probably is lead based paint somewhere. As a common practice, don't let children or pets chew on painted wood, or get into chips that may fall on the floor or exterior of the house.Containment during scraping, remodeling, and any time wooden or wall surfaces are cut is a must.
Read more here.

John Ross Auction Summary- 50% Off On Luxury Condos!

2010-04-12T11:08:00.000-07:00

Randy L. Rasmussen, The Oregonian
More than 750 people gathered for the auction yesterday, and 47 condos sold, when one of the primary owners of the John Ross Building put up units that had never sold since it was completed in 2008. The average sale price on Sunday was $316,000, down from $711,000 at the height of the market. That's about a 50% discount... which shows how far the market in Portland has really fallen in the last few years. Condo are always harder to sell and resell, so it's no surprise that prices have fallen a lot more that single family homes. Also, the South Waterfront area has not boomed as many had promised or hoped. Empty buildings and continuing construction with little to no neighborhood development do not spur sales on. The John Ross is also become less expensive than the neighboring Atwater, with the Ross's average price per square foot at $200, and the Atwater's at $300.
Read more about the auction and the John Ross here.

New American Dream: Homeownership with Caution

2010-04-08T13:19:00.000-07:00

In a recent Fannie Mae national survey 65% of people, both homeowners and renters, still think that owning a home is important. But caution has crept into that American ideal. Since the bubble burst, prospective buyers have become more careful about the home they are purchasing, and about being financially prepared for the responsibility. Buyers are also moving away from the idea of flipping a few houses, now safety and schools top the list of priorities when shopping for a new house. People in general still think that a house is the safest investment that can be made, but the number is down from 2003. The good news for the mortgage industry and banks is that a majority of those polled thought that it is unacceptable for owners to stop making mortgage payments.
Read more here.

Stats I'm Too Busy to Make Myself

2010-04-06T11:33:00.000-07:00

I follow a bunch of real estate blogs and websites, and today a Portland blog posted a set of awesome graphs. They track average sale prices by zip code. I'm too busy to make my own, so click here to see what's happening in the zip you live in, or the one you want to move too.

HUD Redefines "Foreclosure" and "Abandoned" Houses

2010-04-05T13:32:00.000-07:00

In an effort to speed up the Neighborhood Stabilization Program- which helps low to median income families purchase and rehabilitate forclosed homes- the US Department of Housing and Urban Development is widening it's definitions for foreclosed and abandoned homes. Starting last month, homes that have been in default for 60 days or are 90 days behind on taxes are considered foreclosed. Also, homes that also are considered to not be habitable are now called abandoned. By making the definitions more flexible than they previously were, the NSP will be able to turn homes around more quickly and get buyers and families into them. There is nothing worse for a house, a neighborhood, or the real estate market than bank owned homes sitting vacant for months, or even years, so this change should help some of those properties become great homes for people.
You can read a much more detailed article here.

Fed is No Longer Purchasing Mortgage Backed Securities, World Has Not Ended

2010-04-01T11:14:00.000-07:00

Since the beginning of 2009 the Fed has been buying mortgaged backed securities, a total of $1.25 trillion has been spent, in order to keep mortgage rates low for buyers and re-finances. The program has worked really well, rates have been in the 4% to low 5% range for months and months. The Fed announced that it would be ending the program, and many economists and mortgage experts predicted that rates would jump up immediately because there wouldn't be any private investors buying the mortgage backed securities. Luckily, those private investors are starting to feel confidence in the market and have stepped up, and rates have remained basically the same, only up 1/4 to1/2%. Compared to the estimates of 6-7% rates, 5.25% isn't bad at all.

Read more from the New York Times.

Key Features of the New Housing Rescue Plan

2010-03-29T10:58:00.000-07:00

I got this great article from Realtor Magazine, which always simplifies complicated plans into something we can all understand:
"The government’s newest housing rescue effort, which was announced Friday, includes these key tenets:
As much as $14 billion of the Troubled Asset Relief Program (TARP) will be made available to pay for writing down second liens for loans whose borrowers refinance through the Federal Housing Administration.
Lenders that facilitate refinances through the FHA will be required to write down the principal of the first mortgage by at least 10 percent so the home owner has a loan-to-value ratio no higher than 97.75 percent.
Lenders of second liens will be offered incentives of 10 cents to 21 cents per dollar of principal they write down in connection with an FHA refinance.
Borrowers who lose their jobs can apply to have their mortgage payments reduced for three to six months while they search for a new job.
Borrowers with a payment still greater than 31 percent of income after they find a job will be considered for a permanent loan modification.
To encourage more short sales and “deed in lieu” of foreclosure transactions in which the lender settles the loan for less than is owed, the government will double assistance to borrowers to $3,000 and increase incentives to subordinate lien holders and investors to $6,000."

Source: Reuters News (03/26/2010)

Mortgage Defaults Only Getting Worse in Clackamas County

2010-03-26T09:57:00.000-07:00

With a week still left in the first quarter of 2010, mortgage defaults are up in Clackamas County. The area includes rural communities, as well as Oregon City, Lake Oswego, West Lynn and Wilsonville. From the first quarter of 2009 to 2010, defaults are up 18%, and from the last quarter of 2009 to now they are up 24%. In an area that was thought to be on the rebound as far as the real estate market is concerned, this is not good news. It means that residents are not making money like they used to, and they are probably underwater on their homes, so they are walking away from them. More bank owned homes on the market will keep competition high, and prices low.

White Collar Professionals Can't Afford Homes in Portland

2010-03-25T13:05:00.000-07:00

A major gauge of affordability and a realistic way to look at home values is to see if middle class, white collar, professional people can afford to by homes in the city on their salary. For Portland, the answer is no. The Center for Housing Policy released an in depth study on affordability around the nation, explore and read more here. Based on the graph above it It is easy to see that teachers, nurses and police officers cannot qualify for an average home in Portland on one income. With 2 of the fields dominated by women, this puts a major cramp on one of the largest groups of home buyers- single professional women. It is also easy to see that if you do not have a white collar job, such as janitorial work, there is basically no way that you can buy an average home, let alone as the sole breadwinner for a family. The drop in prices over the last few years has been seen as a crushing blow to the middle class, but I think it was necessary to make homes actually affordable for middle class families. If prices had kept going up, then families with 2 incomes in white collar positions wouldn't even be able to buy a nice home.

Bank of America Acts to Relieve Counrtywide Mortgages

2010-03-24T14:56:00.000-07:00

Bank of America announced that they will have a very limited relief program for those that obtained mortgages through Countrywide Financial, the most notorious for aggressive loans that backfired and toppled the industry. While the media has been hyping the program all day, it will only affect a small percentage of homeowners who might be foreclosed on. BofA explains the program this way: "A borrower owes $250,000 on a house now worth $200,000. Fifty thousand dollars of that balance would be moved into a special interest-free account.

As long as the owner continued to make payments on the $200,000, every year $10,000 in the special account would be forgiven until either the balance was zero or the housing market recovered and the borrower once again had positive equity."
On paper this plan sounds amazing, and will really keep people in homes and keep values from dropping even farther. Hopefully BofA will stick to the spirit of this program and modify as many loans as they can.
Read the New York Times article here.

Guide to Home Buyer's Tax Credit

2010-03-23T13:50:00.003-07:00

Click the image to enlarge

Source: Fixr

Portland is the Greenest City!

2010-03-17T10:06:00.000-07:00

The greater Portland Metro ranked first out of 43 U.S. metro areas in a report on America’s “green cities.”
The “Green Cities Index” ranks metro areas on a variety of environmental factors, including traffic congestion, transit use, water quality, carbon emissions, LEED-certified projects and number of “green” jobs. Our city did well for having LEED Certified buildings and building projects, and minimal sprawl, but didn't do as well for travel time for commuters.
The rest of the top 5 is: #2- San Francisco-Oakland-Fremont, Calif., #3 Honolulu, #4Austin, Texas, and #5 Boston.
Read the full article here.

Willamette National Forest is the Best in the Nation

2010-03-16T12:03:00.000-07:00

Oregonian file photo
The best at storing carbon, that is. Those of us who have spent time there will also agree that it is the best for hiking, skiing, camping, and sightseeing. The Wilderness Society ranked all federally owned forests, Willamette coming in #1, and 2-9 are also located in the Pacific Northwest. The Willamette National Forest ranks second in the world for carbons storage, behind Australia. Carbon storage is important because the forest takes the carbon out of the air, and keeps it until it is released through burning. The more forests that store carbon well, the healthier the environment is. Forest management to healthfully allow forest fires will in the long run let the forests store more carbon, and not have devastating fires that sweep through massive amounts of acreage at a time.

Mortgage Rates Will Rise in April

2010-03-15T11:10:00.000-07:00

The Federal Reserve is going to stop buying mortgage backed securities on March 31st, effectively stepping aside to let private investors start buying them again. Since the Fed started buying MBSs about 18 months ago mortgage rates have been incredibly low, around 5%. This has helped keep the real estate market moving, and let people refinance at more affordable rates than they might have been locked into. Once the Fed steps back, rates will rise. Experts are expecting them to go up to anywhere between 5.7% and 6.5%. While not has high as the market has seen before (15%!) this might slow down the market a bit. But, if rates continue to rise without slowing down, don't expect the Fed to stay out of it! They will step back in if rates go too high, in the long run they want the core financial industry of real estate to get healthy again, only then will consumer confidence really be back.
Read more info here.

USDA 100% Financing is Gone for 2010

2010-03-12T11:30:00.000-08:00

The last standing 100% financing option has run out of money for this year. The USDA Rural Housing Fund finances properties in rural areas, and is targeted for lower income buyers. But, with a giant increase in participation in the program, they will stop new mortgages in April. Most mortgage banks and brokers have already notified Realtors and clients that it will no longer be available. This is a really tough thing to have happen when the market for lower income buyers in rural areas was improving. With so many foreclosures and short sales out there, and the first time home buyer tax credit available, many people who never thought they would be able to own a home were shopping for houses. The rest of the month and April will see a major decline for the rural market, which is most areas outside of larger towns, so most of Oregon, Washington, the rest of the West will see a decline in purchases.
Read more here.

4 Online Tricks Not To Fall For

2010-03-10T13:14:00.000-08:00

Even the most savvy internet surfer can fall for tricks that Realtors and lenders use, even when they aren't meant to deceive. Here are some common things to watch out for:
1. Digital Deception: Realtors know how to use Photoshop, fish-eye lenses, and editing to make a home seem bigger, cleaner, newer, and generally nicer than it is. Go see the house in person before falling in love.
2. Zestimates: Ridiculous differences in values come from all the major real estate websites. The only real way to know the value of your home is to have a few Realtors do Comparative Market Analysis, or to hire an appraiser. Both will look at similar homes that have sold recently in your area, and based on how similar or different your home is, give a price to list or sell for.
3. Super Low Mortgage Rates: Lenders online and in real life will site mortgage interest rates that only the most qualified buyer can get. They are just a starting point, depending on your credit score, down payment, and income, the rate will be higher. This spring is probably the end of low rates though, so don't be discouraged.

4. Gorgeous Descriptions: In my experience, the nicer a house is, the less I have to say about how nice it is. I'm too busy listing all the features to embellish on the view, the neighborhood, or how it is the perfect home for any buyer. Drive by a house that sounds too good to be true. You know it will be.

Mint.com Has Changed My World

2010-03-09T09:06:00.000-08:00

I love love love Mint.com! Not only does it let me see all of my account activity on my phone, but it breaks it down into the best details. For instance, I can see how much money I have spent at my favorite coffee place in the last week, month, and year. It's a lot higher than I thought. For those of you unfamiliar with the site, it is a really private and popular site that lets you track your bank accounts, credit cards, loans, and spending. Also, if you have investments you can view them. I love the site for how simple it is, you don't even have to have your account numbers, just your online banking user names and passwords. I also follow their blog, which has a great post today. It's an interactive map with info on the best cities for working mothers, based on income, living expenses, unemployment, crime, schools, daycare, and several other categories. I'm always checking to see where Portland ranks on any "best" and "worst" lists. I think we could have done better on this one. Portland only made the top 10 in Lowest Property Crime (#4), Lowest Violent Crime (#1), Best Quality of Schools (#4), and Lowest Healthcare for Working Mothers (#6). Anyway, check out the post here to see all the best cities.

HOAs Want Banks to Pay Association Fees

2010-03-08T13:15:00.000-08:00

Home Owners Associations for condos and developments are hurting for fees due from bank owned units and homes. Traditionally, when a condo or house is foreclosed on the HOA doesn't have a way to make up for the lack of payments that property would have contributed. They often have to up the fees for all members to make up for the empty spots. Now HOAs are experimenting with a new method: reverse foreclosures. When a owner defaults on their mortgage and stops paying the bank and the HOA, they will no longer wait for the bank to foreclose, the HOA will file it's own foreclosure notice and take over the title to the property. The HOA can't sell the property, since the lender still has a lien on it for the original mortgage, so the HOA will go to court and ask a judge to give the property to the lender, in exchange for fees that cover the missing HOA payments. While any HOA could try this tactic, it is popular in condos with extremely high mortgage default and foreclosure rates.

Awesome Company and Product!

2010-03-06T15:00:00.000-08:00

I don't usually use this blog as a place to promote specific business not associated with real estate, but I am going to today! My husband, Schuyler Silva, has a custom tree house business, Elevated Living. He just had his image and website revamped. It's a really cool product, so check it out, become a fan on Facebook, tell all your friends, family, and neighbors with big trees exactly what they need. A tree house. The one in the photos above was installed near Sylvan Hill, in Portland. A family of 4 has a few wooded acres, and wanted something that the kids could play in now, but would also be elegant, durable, and accessable to adults for a long time. The deck is wide enough to have chairs, small tables, and 10 or so people on it comfortably. The railing makes it fairly safe, and umbrellas or canapies can be added for extra shade.

Buyer's Fatigue

2010-03-04T14:13:00.000-08:00

If you've been looking for a home for a while now, you may being getting exhausted and overwhelmed. I have been there personally, and I think the only way to recover is to take a step back, maybe a week off the hunt, and mentally restart your search:
1. Revisit your motivations for buying in the first place and either recommit to the process or move on, with a full understanding of what you are giving up.
2. Be decisive and move swiftly to make a strong offer, when you find a place that would meet your needs.
3. Be ready to compromise, and plan to put your tax-credit money to use bringing the cosmetics of your home in line with your vision.
Once you have been able to wipe your mind clean of some of the dozens of houses that you have seen, maybe the market won't look so tired and sad.

Clean Energy Works Portland

2010-03-03T12:12:00.000-08:00

300 lucky Portlanders who qualify with www.cleanenergyworksportland.org as lower income but needing to green up their homes will get help with reducing energy costs and carbon footprints. The pilot program will allow participants to pay for upgrades over a 20 year program on their utility bill. The program supports:
1. Weatherization, including insulation, air and duct sealing
2. Space heating, including high-efficiency heat pumps and furnaces
3. Water heating
So far 100 homeowners have participated, so don't delay!
Check out the website for more details, or call 503-546-8766.

Realtor.com and Move Inc Site Portland as One of the Greenest Cities

2010-03-02T15:22:00.000-08:00

It's no surprise to Portlanders that this is one of the greenest cities in the country. Other than a general feeling of conservation and preservation, what really makes it so eco-friendly here? Nicki Kipen of Move Inc has an article on Realtor.com that covers many cities, but Portland is at the top, and here's what he had to say:
"Affordable and accessible, this city straddling the banks of the Willamette River has long made sustainable living a priority. More than 30 years ago, with other cities in a freeway-building frenzy, Portland broke ranks and tore down a six-lane expressway to make room for a waterfront park. Since then the city has set an urban growth boundary to protect 25 million acres of forest and farmland, started a solid-waste program that recycles more than half of the city’s trash and erected more than 50 public buildings that meet tough standards set by the United States Green Building Council. One of the most bike-friendly cities in the U.S., Portland’s public transportation, Portland’s public transportation systems boasts a high rate of ridership. Add in one of the nation’s largest city parks – the aptly named Forest Park has 74 miles of running, biking and hiking trails – and Portland’s rep as the nation’s greenest city makes sense."

Move-Up Tax Credit Not Having Much Affect

2010-02-28T13:00:00.000-08:00

Unlike the $8000 First Time Home Buyer tax credit, the $6500 that move up buyers can receive is not making people buy. The reasons why current home owners are not making a move are simple: unemployment is high, consumer confidence is low, homes are not always worth what they were a few years ago when many people refinanced and borrowed against all the equity they had, which may be gone now, and $6500 is not necessarily enough to make people want to move. Unlike first time buyers, where there is a giant benefit of buying when the market is low, interest rates are low, and they can stop paying rent, move up buyers do not have the same motivation.

Entry Levels Homes Still Dominate Portland Market

2010-02-26T14:56:00.000-08:00

In January of 2010 there were 1,010 homes sold. 552, or 55% of those were for under $250,000, which is considered the lower or entry level market. This trend has been progressing, and bumped up by the First Time Home Buyers $8000 tax credit. A year ago, January 2009 50% of homes sold were in that price range, and in January 2008 40% were sold for under $250,000. As the price ranges get higher the number of buyers gets small, showing that the move up and luxury markets are still struggling. For instance, on 23 homes priced $751,00 and up were sold last month, compared to January 2008, when 59 sold.

5 Things You Can Learn About Credit From Gangster Movies

2010-02-25T10:51:00.000-08:00

Have you seen those terrible blog posts about learning about money from the "Real Houswives" reality show? I may watch it, but I don't think I'll be taking any serious tips from them! I just ran across a way better, and by better I mean more interesting, GANGSTER MOVIES! I love it. Check out number 1 below, but be sure to click here to see the full list.

The World Is Yours… If You Don’t Get Cocky

“Say hello to my little friend.” ~ “Scarface”
Like the submachine gun Tony Montana wielded in “Scarface,” your credit cards are powerful. They can open doors, but they don’t make you invincible.
Denise Winston, money expert for Money Start Here, says, “Just because you own a gun doesn’t mean you know how to use it.” The same principle applies to credit cards. “Respect it, practice using it, clean it, and keep it in a safe place… maybe even under lock and key.”
Having credit cards can lure you into a false sense of security. The best financial protection is a good credit score, which can “dictate the quality of your life – where you live, what job you have, and what you drive,” says Winston.. “Managing and protecting your credit score can make deals happen and command respect.”

% of Short Sales in Portland Decreases

2010-02-24T13:54:00.000-08:00

Short Sales are prevalent across the country, and can be a big issue when you are tying to buy a house. A short sale is when the house is listed for and worth less than the owner owes on the mortgage. Their lender, or lenders, have to approve the sale for less than is owed, and it can be a long and stressful process. Luckily, with home prices starting to stabilize, there are less short sales on the market now than in the spring of 2009. This week there are 13,058 active listings in the great Metro area, and 2,093 of them are short sales. That’s 16% (1 in 6 listings), which is better than May of 2009, when 18% were short sales.

What the IRS Needs from You to Get Your Tax Credit

2010-02-22T14:19:00.000-08:00

The IRS just clarified which documentation taxpayers need to submit to claim the First-time and Move-up home buyer tax credit.

While the IRS is still requiring the filing of Form 5405, it is not demanding that all parties’ signatures be on the HUD-1 settlement document in areas where requiring both the buyer and the seller to sign the document isn’t common.

The IRS clarification says: "In areas where signatures are not required on the settlement document, the IRS has clarified that it will accept a settlement statement if it is completed and valid according to local law. … The IRS encourages those buyers to sign the settlement statement prior to attaching it to the tax return.”

For repeat buyers, the IRS is seeking documentation that home buyers have lived in the previous property for a consecutive five of the past eight years. Proof can include property tax records, home owner insurance records, or mortgage interest statements.

More Home Construction, Fewer Permits Pulled

2010-02-18T12:09:00.000-08:00

New home construction starts rose higher than expected last month, while permits pulled for new home construction did not. What does this actually mean? Contractors and developers had permits from last year and they finally had the confidence to start construction. They did not need to pull new permits because they have existing ones that were sitting unused. This also means that while developers had the confidence to start projects that they had previously lined up, they did not see a big enough market to pull more permits. Since the first time and move-up buyer tax credits effectively expire at the end of April, contractors and developers are not seeing a big enough market to buy expensive permits at this time. If the economy continues to chug along, they might pull permits and start jobs only for signed buyers, and not build model homes and on speculation for a few years. This will be a positive, if conservative, move for the new home market.
Read more here.

Median Sale Prices for PDX Areas

2010-02-17T14:31:00.000-08:00

It's my favorite topic! The monthly Market Action Report is out from RM:LS, and the median sale prices for each Portland area and suburbs are my favorite section.

North Portland: $212,500
NE Portland: $242,500
SE Portland: $192,500
West Portland: $310,000
Beaverton/Aloha: $225,900
Hillsboro/Forest Grove: $220,000
Tigard/Tualatin/Sherwood/Wilsonville: $287,000
Lake Oswego/West Lynn: $355,000
Oregon City/Canby/Molalla/Beavercreek: $215,800
Milwaukie/Gladsone/Boring/Clackamas/Estacada: $249,000
Gresham/Troutdale/Sandy/Corbett/Fairview: $199,000

The cheapest area: SE Portland, and the most expensive: Lake Oswego and West Lynn. No surprises.

Avoid Buying Panic

2010-02-15T14:42:00.000-08:00

We have all had buyers remorse and made purchases at the last second, neither of which are a fun experience. To avoid a bad home buying experience, follow these guidelines:

Search for a real estate professional who has experience and knowledge with the location and property type you value.
Keep asking "why?" Challenge your thinking and assumptions, and those of the professionals you work with.
Get to know the neighborhood(s) you want to live in, so you can evaluate which streets carry the highest property values and the greatest potential for value growth. Within each neighborhood, there is a gradient of values. When abutting areas are of higher value, streets closer to this "better" neighborhood will carry higher values. The opposite is true for adjacent lesser areas.
Seek out a knowledgeable, reliable home inspector who can address quality of construction and property devaluators, such as out-dated electrical systems like knob and tube and aluminum wiring, and dangerous insulation like urea formaldehyde and Zonolite. Learn as much as you can about cost-to-correct for worn-out roofs, sagging eavestroughs and other standard home repair projects. This will allow you to estimate expenses over the first year or so of ownership. Your chosen real estate professional can also project potential maintenance and repair costs to enable you to accurately budget your purchase for sustainability.
Pre-qualify with a mortgage broker who can provide access to funds beyond traditional lenders. Mortgage brokers can usually arrange better mortgage terms with traditional lenders than an individual buyer can, but these brokers may also have private and less-traditional sources of funding. Their lending criteria may not be as rigid and their scope of properties greater.
Know what you "need" and what you "want" and how you'll prioritize the items on these two lists. Buying real estate is all about compromise. Doing this under pressure can be difficult. Taking the time to make these decisions beforehand can pay off.

Where are the Move Up Buyers?

2010-02-12T12:35:00.000-08:00

Move-up buyers are not taking the market back from first timers, like many predicted when the move-up buyer tax credit was introduced. Traditionally move-up buyers make up about 60% of the market, but in 2009 they only accounted for 53%. The problem isn't people not wanting to move now, it's finding a buyer for their current home. Without selling what they own now, the majority of move-up buyers cannot afford to buy a new house. For the last year the real estate industry has focused on first time buyers, highly publicizing the $8000 tax credit. Those ready to sell their current home have not been focused on, and that leaves large gaps in knowledge for move-up buyers. For instance, many do not know that they have to have owned their current home for 5 years, but can move to any new house, it does not have to be more expensive than their current home. Also, the new deadlines have not been clearly communicated to the public. Buyers need to have an accepted offer on a home by April 30th, 2010, and it needs to close by June 30th, 2010. So, for a move-up buyer this window from the middle of February to the end of April is small, but it can be done. Set your home at the right price, be flexible with the buyer's needs, and be realistic about what you can afford to move up to.
Read more about move-up buyers here.

Winter to Spring Home Maintenance

2010-02-10T11:48:00.000-08:00

Basic maintenance done at the right times of year will make your home more comfortable, make repairs easier, and save you money in the long run. As winter turns to spring, hopefully, here are some things to put on the list:
Winter

Check your furnace filter once a month during the heating season for excess dust; you'll want to change it once or twice a year so the unit operates more efficiently. Cost: $8 to $20 each.

Make sure your sump pump is clean and operating properly before spring rains arrive. Lift the lever on the sump to make the float go up and wait for the motor to click on. If you have a battery backup, unplug the unit and test the pump again.

Vacuum the refrigerator condenser coils -- usually located on the bottom or on the back of the fridge. (Unplug it first, then use your vacuum's brush attachment.)

Use your stuck-indoors time to knock off some annual fire prevention tasks. First, make sure your fire extinguishers haven't passed their expiration date. Next, replace ground fault outlet circuit interrupters that aren't working properly (when you hit the "Test" button the "Reset" should pop out; if it doesn't, you can buy a new one at a hardware store). Cost: less than $20 for a fire extinguisher and $10 to $12 for a circuit interrupter.

You need to change batteries ($6 for two nine-volt ones) in smoke detectors and carbon-monoxide alarms twice a year. An easy way to remember: Make the first switch on the same day you reset clocks to daylight saving time (March 14 this year), and again in mid-October. At the same time, test your smoke detectors; use a smoke-in-a-can product ($9) or blow out a candle underneath them.

Spring

Schedule an inspection and cleaning of your chimney once the heating season ends; that's when many sweeps offer a discount. Also make sure to remove fireplace ashes to prevent moisture buildup, which can damage masonry. Cost: $100 to $300, depending on the layout of your chimney.

Inspect your home's exterior for loose siding or trim, cracks, and crumbling mortar caused by harsh winter weather, and examine your attic for any signs of leaks. If you've got siding, give it a wash using a garden hose and a solution of a third of a cup of laundry detergent per gallon of hot water. Work from the bottom up with a soft nylon brush (top down can cause stains).

Wash and treat (or paint) wood decks to prevent cracking before barbecue season arrives. Cost: about $50 to $75 for five gallons of sealer.

Make an appointment to get your air-conditioning system professionally inspected and adjusted before the temperature hits 80°. Cost: $75 to $175 per year for an HVAC service contract.

Before watering season, check pop-up sprinkler systems for leaks or clogs and be sure the spray isn't going where it shouldn't.

Read about what you should do the rest of the year here.

10 Millions Solar Roofs? And the Gov't Will Pay for Half?

2010-02-05T13:45:00.000-08:00

Senator Bernie Sanders (I-VT) introduced a great new bill to Congress yesterday which would create incentives and tax rebates for solar roofs and solar water heaters. The bill aims to get 10 million solar roofs and 200,000 solar heaters up and running--producing a total of 30,000 megawatts--over the next 10 years.

Here's the gist of the bill:

the "10 Million Solar Roofs & 10 Million Gallons of Solar Hot Water Act" ... would provide rebates that cover up to half the cost of new systems, along the lines of incentive programs in California and New Jersey (not coincidentally, Nos. 1 and 2 in installed solar in the U.S.). It also includes measures to insure that those who receive assistance get information on how to make their buildings more energy efficient.

Such a generous tax break would make distributed solar extremely attractive, especially considering that the price of photovoltaic cells keeps on dropping. Additional benefits include the fact that distributed solar--like solar roof--projects can be easily linked to the grid, and can create jobs swiftly, thanks to the fact that there are relatively few assessment hurdles to be jumped.
Below is an excerpt from an interview Sen. Sanders gave:
On what the bill would cost:
Bernie Sanders: "We think this will cost between 2 and 3 billion dollars a year, and at the end of a 10-year period we are going to be producing 30,000 new megawatts of energy--the equivalent of what 30 nuclear power plants produce. This is a very cost effective way of producing that energy.
On the mechanics of the bill:
"Remember that there are already a lot of tax credits, federal and in many states. The federal tax credit would be up to 30 percent off the cost of a project. That's a lot. Let's say hypothetically you wanted to spend $40,000 on solar. If you take 30 percent off that, you're down to $28,000. If you get state help you're down to $25,000. Then the federal government would pay half of that.
"That's a pretty good deal! It could be a major incentive for people to use photovoltaics. And the more photovoltaics we use, the more will be built; the more that are built, the cheaper it becomes."

To read more, click here.

Predictions for the Next Decade in Real Estate

2010-02-03T13:19:00.000-08:00

The major news and opinion sites for real estate are making predictions for the next year, and the next decade. One of the shortest, and most interesting come from Inman.com, and news site for Realtors. They summarized a report from John McIlwain, a senior resident as the Urban Land Institute. McIlwain predicts that over the next 10 years home price appreciation will be between 1-2% each year, once the market recovers. Home ownership will drop from 67% to 62%. Also:

Older baby boomers to move to urban, mixed-use, mixed-age centers near family instead of retiring to Sun Belt communities;
Immigrants to snub the suburbs in favor of more close-knit communities;
Younger boomers to face the challenges of lost home equity and a smaller pool of move-up buyers;
Generation Y to rent for long periods by choice or because they are paying off student loans or have stagnant incomes.

It is good news for homeowners for prices to slowly, but steadily rise, not shoot up in a year, only to drop back down just as quickly.

Pre-Listing Home Inspections

2010-02-02T11:44:00.000-08:00

One of the things that Realtors, including myself, recommend to sellers is to have a home inspection prior to putting their home on the market. While this does cost a few hundred dollars, it has several benefits.

1) You decrease the likelihood of liability for undisclosed defects that might be discovered after the close of escrow.
2) You demonstrate an uncompromised willingness to disclose everything about the property.
3) You provide the basis for an as-is sale by disclosing all known defects at the outset of the transaction.
4) You avoid the need to renegotiate the terms of the deal after the buyers hire their own inspector.
5) You have the opportunity to know the issues, and have them fixed without being in a time crunch.

While many sellers balk at the idea of paying an extra fee upfront, it can save money in the long run. There is time to negotiate with contractors and find the best bid, and if the repairs are significant, the listed price might even be higher than you and your Realtor originally thought.

Bank of America Wants to PREVENT Foreclosures

2010-02-01T13:40:00.000-08:00

The largest mortgage lender in the country announced last week that it is willing to lower or eliminate payments on second mortgages. This is great news for all homeowners that got sucked in 0% down mortgages, where they took out two separate loans, on for the down payment and one for the balance of the purchase price. One of the biggest issues in real estate right now is short sales, and often the sellers have a second mortgage. The holder of the second mortgage often wants to be fully paid, and can block a sale if they don't agree to the terms. For such a large lender as BofA to announce that it sees the issue, and is willing to change there policy is a large step forward. Now we just have to wait and see if this will speed up short sales, or prevent foreclosures.
Read more here.

News Roundup

2010-01-28T11:07:00.000-08:00

I got so many email updates on news for buyers, sellers, and home owners this morning I'm just going to list it all out!

Banks will go after people that walk away from mortgages or sell in short sales- they have up to 6 years in Oregon to take a former mortgage holder to court and get a settlement to pay the difference. Numbers of banks doing this actively will likely increase after the foreclosures ramp up this year.
20% of home buyers are single women, and they are focusing on eco-friendly homes- consider this when making upgrades or buying new appliances!
Fannie Mae homes sold under the HomePath program will come with 3.5% of closing costs paid for buyers, and the option of using some of that money to buy new Whirlpool appliances. The sales must close by May 1st, way before the first time home buyer tax credit expires. This program works with the $8000 First Time Home Buyer tax credit, or the $6500 Moving Buyer tax credit.
Interest rates have been hovering around 5% for FHA and VA loans, a little lower for conventional financing, but economists and loan officers expect them to shoot up to 6-7% this summer.

Northwest Dominates Overvalued Markets List

2010-01-27T14:01:00.000-08:00

According to CNNMoney.com Atlantic City NJ is the most overvalued city in America, but the rest of the list is dominated by Oregon and Washington. Based on the percentage of homes valued over the median home price, here's the list:

Metro area	Median home price	Percent overvalued 2010	Percent overvalued 2006
Atlantic City, N.J.	$232,100	30.2%	59%
Wenatchee, Wash.	$240,900	28.9%	13%
Ocean City, N.J.	$294,800	26.6%	47%
Longview, Wash.	$184,700	22.3%	24%
Honolulu, Hawaii	$605,300	21.9%	31%
Asheville, N.C.	$172,900	21.8%	24%
Portland, Ore.	$267,600	20.8%	35%
Bellingham, Wash.	$280,200	20.0%	43%
Corvallis, Ore.	$266,400	18.9%	14%
Salem, Ore.	$201,000	18.2%	25%

Source: PNC Financial Services and IHS Global Insight

I knew that Corvallis would be on the list, I was born and raised there, and my family still lives there, and compared to the home prices in even just the Willamette Valley, Corvallis is ridiculous. The good news is that Portland is much less overvalued than it was in 2006, down about 15%. The market is evening itself out, settling back into an affordable range.