Walter Molony 202-383-1177 wmolony@realtors.org
Pending Home Sales Jump in October
Washington, DC, November 30, 2011
Pending home sales rose strongly in October and remain above year-ago levels, according to the National Association of Realtors®.
The Pending Home Sales Index,* a forward-looking indicator based on contract signings, surged 10.4 percent to 93.3 in October from 84.5 in September and is 9.2 percent above October 2010 when it stood at 85.5. The data reflects contracts but not closings.
Lawrence Yun, NAR chief economist, said improved contract activity is a hopeful sign. “Home sales have been plodding along at a sub-par level while interest rates are hovering at record lows and there is a pent-up demand from buyers who normally would have entered the market in recent years. We hope this is indicates more buyers are taking advantage of the excellent affordability conditions,” he said.
“Many consumers are recognizing that home buyers in the past two years have had one of the lowest default rates in history. Moreover, continued inventory declines are another healthy sign for the housing market,” Yun added.
The PHSI in the Northeast surged 17.7 percent to 71.3 in October and is 3.4 percent above October 2010. In the Midwest the index jumped 24.1 percent to 88.7 in October and remains 13.2 percent above a year ago. Pending home sales in the South rose 8.6 percent in October to an index of 99.5 and are 9.7 percent higher than October 2010. In the West the index slipped 0.3 percent to 105.5 in October but is 8.1 percent above a year ago.
For more on this go HERE
Thursday, December 1, 2011
Thursday, August 25, 2011
Monday, August 15, 2011
Are Appraisals Holding Us Back?
Here's an interesting WSJ article that talks about how appraisals are affecting the sales of homes across the country because the appraisals will come back at a lower price point than the agreed upon purchase price between a buyer and a seller.
http://online.wsj.com/article_email/SB10001424053111904006104576500170808091148-lMyQjAxMTAxMDEwMzExNDMyWj.html?mod=wsj_share_email
Unfortunately, the appraisers have to stick to strict guidelines given to them by the banks for whom they are doing the appraisal for. They may not have many comparable sales to choose from to support the purchase price and have to make do. Some of these comparable sales may have been foreclosures or short sales; this has really been a big issue nationwide. A foreclosure price may be much less than market value and it brings down the neighborhood's values.
The bottom line is that we all have to deal with appraisals if a buyer is getting a loan from a bank so the best thing to do is have the listing agent meet the appraiser at the property, provide comparable sales and tell the appraiser everything that is positive about the home and property to make sure the home appraises at the purchase price or higher.
http://online.wsj.com/article_email/SB10001424053111904006104576500170808091148-lMyQjAxMTAxMDEwMzExNDMyWj.html?mod=wsj_share_email
Unfortunately, the appraisers have to stick to strict guidelines given to them by the banks for whom they are doing the appraisal for. They may not have many comparable sales to choose from to support the purchase price and have to make do. Some of these comparable sales may have been foreclosures or short sales; this has really been a big issue nationwide. A foreclosure price may be much less than market value and it brings down the neighborhood's values.
The bottom line is that we all have to deal with appraisals if a buyer is getting a loan from a bank so the best thing to do is have the listing agent meet the appraiser at the property, provide comparable sales and tell the appraiser everything that is positive about the home and property to make sure the home appraises at the purchase price or higher.
Thursday, July 7, 2011
Large Loan Limits on the Herizon; Take Advantage Now!
Check out this Wall Street Journal article "Sellers Brace for New Mortgage Caps"
If you are a buyer looking to borrow between $417,000 and $535,900 to buy your next home, you better hurry. There are reports that anything borrowed over $417,000 will be considered a jumbo loan and the rates will be higher. You can currently borrow up to $536k at the lower rates.
If you are a buyer looking to borrow between $417,000 and $535,900 to buy your next home, you better hurry. There are reports that anything borrowed over $417,000 will be considered a jumbo loan and the rates will be higher. You can currently borrow up to $536k at the lower rates.
Thursday, June 9, 2011
Richmond Association of Realtors Legislative Committee Meeting
Hey All!
Big morning over at the Board of Realtors- We approved the Richmond Association of Realtors legislative package that will be sent to the Virginia Association of Realtors and pushed into the General Assembly next year. One of the items we are pushing for is that condo associations must disclose how many units are in default on their association dues within the first 14 days after a signed contract. The lenders need this information to provide the financing, so we would like to have it available early so buyers don't loose a lot of time if the lender won't except the association's bad blood. The way we want to deal with this is to make it required that the home owners' associations make this information available in the HOA package. Just looking out for the consumer! See all the fun stuff we get to deal with!
Graham Johnson ABR,CNS
Coldwell Banker Johnson & Thomas
504 Libbie Avenue | Richmond | Virginia | 23226
O 804.288.4163 | M 804.873.3504 | F 804.285.9328
www.richmondvahomesearch.com
Big morning over at the Board of Realtors- We approved the Richmond Association of Realtors legislative package that will be sent to the Virginia Association of Realtors and pushed into the General Assembly next year. One of the items we are pushing for is that condo associations must disclose how many units are in default on their association dues within the first 14 days after a signed contract. The lenders need this information to provide the financing, so we would like to have it available early so buyers don't loose a lot of time if the lender won't except the association's bad blood. The way we want to deal with this is to make it required that the home owners' associations make this information available in the HOA package. Just looking out for the consumer! See all the fun stuff we get to deal with!
Graham Johnson ABR,CNS
Coldwell Banker Johnson & Thomas
504 Libbie Avenue | Richmond | Virginia | 23226
O 804.288.4163 | M 804.873.3504 | F 804.285.9328
www.richmondvahomesearch.com
Tuesday, June 7, 2011
Some Lender Finance Insight
Hey Everyone!
Very interesting stuff! Just had a meeting with one of our preferred lenders, Andy Mahoney at MetLife Home Loans and learned a lot about the underwriting of loans. Wanted to give you (the consumer) some insight on what lenders are dealing with these days. When a buyer or someone who is looking to refinance their home calls a lender to talk about their loan options, they are asked specific questions about their current financial situation and the answers are plugged into an automated system called Desktop Underwriter. This system is specific to Fannie Mae backed loans and will determine what financing options a borrower may have when purchasing a home or lowering their current monthly payment.
The Desktop Underwriter will assess the borrower in 6 different categories, like assets and liabilities, then software will help determine what loan products the borrower can qualify for and the basic underwriting is done. The crazy thing is, the system requires so much verification of paperwork and where money is coming from that it makes obtaining a loan take longer. One of the items I found intriguing was if a good faith deposit made on a purchase contract equals or exceeds 2% of the purchase price (if the purchase price of a home was $200,000 then a 2% deposit would be $4,000 and the underwriter program would see that as excessive). The Desktop Underwriter would require the borrower to provide verification of where the money came from, ie. printing out bank statements and faxing/scanning to the lender. If the deposit is 1.99% of purchase price, then the borrower won't have to deal with providing extra paper work and will save time.
Another aspect of the meeting that I found interesting was some banks have more restrictive underwriting requirements than stated by Fannie Mae and can reject a loan that may normally be approved through the Desktop Underwriter process. An example of this is the number of credit sources a borrower may have- only one credit source is required by Desktop Underwriter like a car payment, while some banks require at least three sources, like two credit cards and a car payment. This seems odd to me because you would think that the banks would prefer you to not have debt. They want to verify you have debt so that you are proven to make payments on time-crazy!
Here's another tidbit that could hurt you or help you depending on the number of debt sources you keep on your balance sheet. If you have 10 months or less left on a car payment, then the bank will not count this debt against you which mean you would be able to borrow more for your mortgage. It's also possible that child support would fall under this category as well.
Many folks find this information hard to listen to, but the ins and outs of the underwriting system will either enable you to borrow more money or as Chris Farley from SNL said, "be living in a van, down by the river." If you have any questions or need guidance to make sure you're not hearing the rapids of the James River when you wake up in the morning, give me a call.
Graham Johnson ABR,CNS
Coldwell Banker Johnson & Thomas
504 Libbie Avenue | Richmond | Virginia | 23226
O 804.288.4163 | M 804.873.3504 | F 804.285.9328
www.RichmondVaHomeSearch.com
Very interesting stuff! Just had a meeting with one of our preferred lenders, Andy Mahoney at MetLife Home Loans and learned a lot about the underwriting of loans. Wanted to give you (the consumer) some insight on what lenders are dealing with these days. When a buyer or someone who is looking to refinance their home calls a lender to talk about their loan options, they are asked specific questions about their current financial situation and the answers are plugged into an automated system called Desktop Underwriter. This system is specific to Fannie Mae backed loans and will determine what financing options a borrower may have when purchasing a home or lowering their current monthly payment.
The Desktop Underwriter will assess the borrower in 6 different categories, like assets and liabilities, then software will help determine what loan products the borrower can qualify for and the basic underwriting is done. The crazy thing is, the system requires so much verification of paperwork and where money is coming from that it makes obtaining a loan take longer. One of the items I found intriguing was if a good faith deposit made on a purchase contract equals or exceeds 2% of the purchase price (if the purchase price of a home was $200,000 then a 2% deposit would be $4,000 and the underwriter program would see that as excessive). The Desktop Underwriter would require the borrower to provide verification of where the money came from, ie. printing out bank statements and faxing/scanning to the lender. If the deposit is 1.99% of purchase price, then the borrower won't have to deal with providing extra paper work and will save time.
Another aspect of the meeting that I found interesting was some banks have more restrictive underwriting requirements than stated by Fannie Mae and can reject a loan that may normally be approved through the Desktop Underwriter process. An example of this is the number of credit sources a borrower may have- only one credit source is required by Desktop Underwriter like a car payment, while some banks require at least three sources, like two credit cards and a car payment. This seems odd to me because you would think that the banks would prefer you to not have debt. They want to verify you have debt so that you are proven to make payments on time-crazy!
Here's another tidbit that could hurt you or help you depending on the number of debt sources you keep on your balance sheet. If you have 10 months or less left on a car payment, then the bank will not count this debt against you which mean you would be able to borrow more for your mortgage. It's also possible that child support would fall under this category as well.
Many folks find this information hard to listen to, but the ins and outs of the underwriting system will either enable you to borrow more money or as Chris Farley from SNL said, "be living in a van, down by the river." If you have any questions or need guidance to make sure you're not hearing the rapids of the James River when you wake up in the morning, give me a call.
Graham Johnson ABR,CNS
Coldwell Banker Johnson & Thomas
504 Libbie Avenue | Richmond | Virginia | 23226
O 804.288.4163 | M 804.873.3504 | F 804.285.9328
www.RichmondVaHomeSearch.com
Tuesday, January 25, 2011
Housing Industry Looking Much Brighter in 2011
By Julie Schmit, USA TODAY
The housing industry is poised to gain strength this year after coming off one of its worst years ever in 2010, economic forecasts and new data released Wednesday show.
One cause for optimism: Building permits for new single-family homes rose 5.5% last month, the third consecutive monthly increase and the strongest showing since March, the Commerce Department said.
That sets the stage for more home construction later this year as the economy improves, says Celia Chen, economist at Moody's Analytics.
"The trend is up," Chen says.
But it'll be a slow slog. The previous two years have been the worst on record for home builders in at least 50 years. Nationwide, home prices are down almost 30% from their 2006 peak. A new USA TODAY survey of 44 top economists finds that 48% say average home prices won't hit bottom until sometime this year, and 27% say it'll take longer.
The housing market recovery "will be two baby steps forward and one backward," says Joel Naroff, chief economist at Naroff Economic Advisors.
The theme of slow improvement is likely to be repeated in December's existing home sales data, to be reported today. A small gain is expected over November, says IHS Global Insight economist Patrick Newport.
He also says that December's permit numbers indicate that housing construction "may be set to grow again." But some of December's jump may have been driven by builders trying to get permits ahead of 2011 building code changes in California, New York and Pennsylvania, the Commerce Department said.
Newport also cautions that home-building numbers "are still really awful." Housing starts, for example, fell 4.3% in December as cold weather and snow delayed construction. But Newport says other factors will continue to depress housing starts.
Those include low prices on foreclosed homes, which makes it hard for builders to turn profits on new homes, and tight financing for home builders and buyers. What's more, the recession sharply reduced the rate of household formation, which means that more families are doubling up in homes vs. each getting their own, Newport says.
Moody's doesn't see home construction getting back to more historically normal levels until at least 2012, Chen says. USA TODAY's economist survey indicates that 669,000 new home starts are likely this year, up 15% from 2010.
The key is job creation, says Lawrence Yun, chief economist with the National Association of Realtors. When more people are working, and earning higher incomes, home buying increases. IHS expects the economy to add 2.5 million jobs this year and 2.7 million next year.
"The (housing) market appears to have hit bottom, and now we're trying to get back to normal," Yun says.
The housing industry is poised to gain strength this year after coming off one of its worst years ever in 2010, economic forecasts and new data released Wednesday show.
One cause for optimism: Building permits for new single-family homes rose 5.5% last month, the third consecutive monthly increase and the strongest showing since March, the Commerce Department said.
That sets the stage for more home construction later this year as the economy improves, says Celia Chen, economist at Moody's Analytics.
"The trend is up," Chen says.
But it'll be a slow slog. The previous two years have been the worst on record for home builders in at least 50 years. Nationwide, home prices are down almost 30% from their 2006 peak. A new USA TODAY survey of 44 top economists finds that 48% say average home prices won't hit bottom until sometime this year, and 27% say it'll take longer.
The housing market recovery "will be two baby steps forward and one backward," says Joel Naroff, chief economist at Naroff Economic Advisors.
The theme of slow improvement is likely to be repeated in December's existing home sales data, to be reported today. A small gain is expected over November, says IHS Global Insight economist Patrick Newport.
He also says that December's permit numbers indicate that housing construction "may be set to grow again." But some of December's jump may have been driven by builders trying to get permits ahead of 2011 building code changes in California, New York and Pennsylvania, the Commerce Department said.
Newport also cautions that home-building numbers "are still really awful." Housing starts, for example, fell 4.3% in December as cold weather and snow delayed construction. But Newport says other factors will continue to depress housing starts.
Those include low prices on foreclosed homes, which makes it hard for builders to turn profits on new homes, and tight financing for home builders and buyers. What's more, the recession sharply reduced the rate of household formation, which means that more families are doubling up in homes vs. each getting their own, Newport says.
Moody's doesn't see home construction getting back to more historically normal levels until at least 2012, Chen says. USA TODAY's economist survey indicates that 669,000 new home starts are likely this year, up 15% from 2010.
The key is job creation, says Lawrence Yun, chief economist with the National Association of Realtors. When more people are working, and earning higher incomes, home buying increases. IHS expects the economy to add 2.5 million jobs this year and 2.7 million next year.
"The (housing) market appears to have hit bottom, and now we're trying to get back to normal," Yun says.
Friday, January 21, 2011
Back to the Blog!
Hey Everyone!
I have returned to my blog. Tell you the truth, I actually forgot I even had it; I couldn't even remember what blog site I used. Now that I've found it, I intend to use it and hopefully share information that will be helpful, interesting and fun to read.
As you may have noticed, my last post was in 2007 (seems like a very long time ago, especially if you are counting in real estate years). The market has been through some changes since then (most people are trying to forget them) but it's important to stay ahead of the market and I feel like we were able to do that; I had my most productive years since 2007 and I'm happy to say I've helped many new clients as well as repeat clients with all their real estate needs. 2010 was a great year, but I am really looking forward to 2011. Our office has already seen a boost in activity since the first of the year, there's more people out looking to buy and sellers are feeling a little more confident. We're excited about the future! I'll be updating you on the Richmond, VA housing market over the next few weeks, so keep checking back in so you stay ahead of the game!
Best,
Graham
I have returned to my blog. Tell you the truth, I actually forgot I even had it; I couldn't even remember what blog site I used. Now that I've found it, I intend to use it and hopefully share information that will be helpful, interesting and fun to read.
As you may have noticed, my last post was in 2007 (seems like a very long time ago, especially if you are counting in real estate years). The market has been through some changes since then (most people are trying to forget them) but it's important to stay ahead of the market and I feel like we were able to do that; I had my most productive years since 2007 and I'm happy to say I've helped many new clients as well as repeat clients with all their real estate needs. 2010 was a great year, but I am really looking forward to 2011. Our office has already seen a boost in activity since the first of the year, there's more people out looking to buy and sellers are feeling a little more confident. We're excited about the future! I'll be updating you on the Richmond, VA housing market over the next few weeks, so keep checking back in so you stay ahead of the game!
Best,
Graham
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