Real Estate November 2012 Update

November 2012 Numbers

MARKET SNAPSHOT AS OF TODAY

Currently Active (Residential)                                                  3453 Currently Under Contract (Pending & Contingent)    1122 Sold This Month                                                                        245

Grace & Peace

 

 

Skip Geiser

(850) 221-6442

SkipGeiser@Live.com

www.SkipGeiser.com

The Geiser Team with Main Street Properties

 

 

Sitting the fence or MISSING the boat?

"Skip, I know home prices and interest rates are at all-time lows, and we've looked at a lot of homes and this last one was the best one yet!  But I'm thinking we should take a couple of days to think about it before we make an offer. What do you think?"

Ok, I'm with you--don't jump into something to quickly and allow a snap decision to get you into trouble.  Let's take a step back and look at this with the big picture in mind. If you are looking at homes and have taken the time to get a pre-approval lettter from your lender, you've already given a lot of thought to this idea of buying a home, right?  Most likely you have spent nights thinking about this and have decided, "This is it, we are going to do it!"  So tell me what is going to happen if tomorrow morning you lose this home to someone who was ready to make the decision--you know, "pull the trigger"? 

"But Skip, buddy, this home has been on the market for three months and no one has snapped it up yet. I think I have a couple of days, really, what is the rush?"

Well, I realize it has been on the market for a while, but in that time there have been other people looking. If they are like you, they wanted some time to think about it, and they may be ready to put their offer in.  Plus as you stated, you have seen the other homes in the area that compare to this one, and it is the one that is the best value in a grerat location.  If you have come to that conclusion, so have three other couples! 

My best advice? If you have thought this through and you are ready to buy a home, you have done your homework, you know a good deal when you see one. . . go ahead make the offer!

 

Grace & Peace....

Skip Geiser

(850) 221-6442

SkipGeiser@Live.com

www.SkipGeiser.com

The Geiser Team with Main Street Properties

  

First Time Home Buyers...Stepping Stone or Home of my Dreams?

Home of your dreams is the 5 bedroom 4 bath  home on the lake you picture yourself in when you close your eyes and see the perfect Christmas. Mmm the smell of fresh baked cookies!  The stepping stone home is the 2 bedroom 2 bath home in town that is a little less than perfect. Aah the fresh smell of paint!
As I look at homes with first time home buyers I find that usually the expectation is set at the home of our dreams. 

Let's meet these first time home buyers...I usually find they are a young couple who have a child and are thinking they will be having more.  They may even be thinking mom may be staying home to raise the children.  As they drive up, our young first time home buyers get out of a three month old minivan, still equipped with that "new car" smell.   Our young couple tells me they are looking at some where around the 2000 square foot range and they will have to have four bedrooms with a big back yard.

Keep in mind real estate is usually the largest investments you will ever make, so planning and consulting is a great move before you purchase.  In our example above we find that this young couple is "ready" to take the next big step...buy a home!  As I step back and look I can see we need to asses our goals and sharpen our view to keep the final goal in mind..."The dream home".  Every long journey starts with a step and sometimes there are a lot of steps on our journey. Here is where there seems to come disappointment in the eyes of our young couple, though there need not be.  They find  they need to back down to that 2 bed 2 bath home and make it a stepping stone on the road to that dream house on the lake.  A few points we mentioned earlier, they really want to have mom stay home and raise the kiddos so there may soon be a loss of income, getting into a big mortgage is very likely to kill that dream.  They have also already obligated themselves to a "new car smell" payment.  This in and of itself my not be a bad thing but you must keep your dept to income ratio in check, ie enough money at the end of the month to meet your obligations and still have money for the grocery store.

So Skip what are you saying they can't have their dream home?  No, not at all...they just have to wait a little bit so they can save up and maybe even use the equity they are gaining in the starter home to step up to a little bit better home in a few years. Knowledge is the key...So if you are a first time home buyer or maybe just stepping up give me a call, lets take the next step together!

 

Grace and Peace...

Skip Geiser

(850) 221-6442

http://www.skipgeiser.com/

SkipGeiser@live.com

The Geiser Team with Main Street Properties

             

First time home buyer want vs need....

 The first-time home buyer's wants vs. needs list is a tricky, or maybe I should say sticky, topic. After years of working with first-time home buyers, I have found that most seem to want to find their "forever home",  you know, the one they will be raising their 2.5 children in, and then retire in, and so on.  Is this really realistic in today's society?  I mean, statistics show the average family moves every three to five years. Yes, I know there is someone reading this right now that is saying, "well, we have lived in our home for the past 20 years."The question is, is that the norm? And the answer is no!  "So, what is the big deal Skip? I mean, what do you care if the first-time buyer buys a house that they can 'grow into'?"  Well, let's just say our first-time buyers buy that big home the can "grow into"--is it going to be more or less expensive to heat and cool? Or let's talk taxes--are they going to be more or less? We could go on, but you get the point. If they buy a home that is going to fit them for the next few years, they most likely will have a lower initial purchase price and a newer home (with less maintenance) that will fit their budget.  With the current market the way it is, they will also be taking advantage of historically low interest rates, coupled with competitive home prices.  These two factors put together should, in a few years, equal a nice profit for them to apply to their next home.

Grace and Peace.....

 

Skip Geiser

(850) 221-6442

www.SkipGeiser.com

SkipGeiser@live.com

The Geiser Team with Main Street Properties

The home of our dreams vs. the dump that has a low price!

How low can ya' go?

Skip, we have found the home of our dreams, and we have decided to offer 50K under what they are asking because it is a "buyers market"!  Let's ask a few key questions before we go too far...
1. Are the sellers close to the true market value?
2. Do the sellers hold a mortgage that will prevent them from accepting a low offer?
3. Have the sellers done improvements to justify their price? 
4. Has the seller gone through multiple price reductions, and when was the last reduction ?
5. If you were the seller, how would you react to your offer?

 "Hey Skip, isn't any offer is better than no offer?"....Yes!  I have heard this statement a lot with the economy like it has been in the last few years.  Any agent who has some experience under their belt will tell you that AN offer is better than NO offer; just keep in mind, this is a place to get the negotiations started.
"I have been listening to the media, and they are saying the deals are better than they ever have been in years past, so I think I should come in really low and get a steal of a deal."  Yes, I agree, so let's just take a scenario to illustrate my point...the sellers of the home you have fallen in love with have been reducing the price of their home with the fall of the market, and I show that to you by showing you their price drops over the time the seller has had the home listed.  I, as your agent, have shown you the Current Market Analysis which reveals the sellers have the price very close, or below, it's true SOLD value.  You also note that the home has a long list of upgrades like granite countertops, hardwood flooring, sprinklers, etc., and has been well-maintained, which does not seem to match the other homes you have been looking at in your price range. So now, you tell me, is the 50K under asking price offer a reasonable expectation on our part, as a potential buyer?  I would say no.  If you offer something that low, you should expect the seller to come back really strong on their original price, with the thought you are not a serious buyer.  If you want to come in really low on an offer, one way to shore up the seller's confidence in your offer is to increase your Ernest Money Deposit or EMD, which is usually 1% or $1000, to let's say $5000, which would make the seller think you were more serious and really capable of purchasing their home.  Make sure you have a proof of funds and/or a pre-qualification letter from your lender to show your ability to purchase their home. Keep in mind some of this is a mind game on our par,t and if we can stack the cards in our favor, we should.  This is a wonderful time to buy with interest rates so low and the home prices really low.  It has never been a better time to buy.  Just keep in mind you need all the facts to really get the best deal out there!

Grace and Peace...

  

 

Skip Geiser

(850) 221-6442

www.SkipGeiser.com

SkipGeiser@live.com

The Geiser Team with Main Street Properties

        

      

Buying our first home.....scary or an exciting new step?

 

   "Skip, I am looking to buy our first home but I just don't know how this process works...Can you Help?"  Wow, I am glad you asked!  When you have a buyer's agent working for YOU, what you get is a partner that is going to look out for your best interests.  "But, Skip, I don't think I can afford to pay you to help me...I mean, I am on a budget, and I want to get the most bang for my buck!"  I agree, and that is why you need to have a full-time Realtor working just for you...so you can get the most house for your money.  I mean do you want to look at foreclosures, short sales or typical owner-occupied homes?  Does your mortgage allow you to get a home that may need repairs, and which repairs?  What if you qualify for a reduced rate on your mortgage, and which homes will qualify for these programs?  You see, you as the buyer you do not pay the agent...the seller is typically responsible for that fee.  So, as a buyer, you are leaving money on the table, so to speak, by not having a professional working for you.  "But what about the for-sale-by-owners, will I be missing out on them?"  No,  if you have a buyer's agreement with your agent, you get all the homes on the market.  Plus, how do you know if you are you are getting a good deal when working with a for-sale-by-owner?  I, as your agent, can help make sure you are protected.  As a Realtor, I took an oath to hold my clients' best interest above my own, and I believe we, as Realtors, offer a very valuable service...This is most likely the largest asset you will own in your lifetime, GET SOME HELP!  Think about it.  I don't cost you anything, and have the potential of saving you thousands of dollars. How much are you willing to lose?

Grace & Peace...

Skip Geiser

(850) 221-6442

www.SkipGeiser.com

The Geiser Team with Main Street Properties 

 

First Time Home Buyers

Because of the drop in housing prices and the interest rates still being low, now is a super-great time to buy! I know many have waited for more signs that the market has “bottomed out”, but will you be risking more money in the long run?

I’ve heard it projected that housing prices may continue to fall over the next year, but interest rates are also projected to be rising this year. Over the life of a 30-year loan, you need to weigh the benefits of going ahead and purchasing your home now at the lower rates rather than waiting for a possible “bottoming out” of the housing prices.

There are some terrific deals on the market right now that you could take advantage of. Make sure you are staying on top of the real estate market as well as the mortgage market as you consider the purchase of your first home! Your dream of home-ownership may be closer than you think!

FHA releases info about premium increase

We received word of this today...

WASHINGTON – Feb. 22, 2011 – Effective April 18, the average FHA-backed mortgage will cost new borrowers about $30 more per month. In a letter sent yesterday, Assistant Secretary for Housing/Federal Housing Commission David H. Stevens explained the change, which will increase the mortgage insurance premium (MIP) on all 30-year and 15-year loans by a quarter of a percentage point (.25).

The increase impacts FHA loans with a case number assigned on or after April 18, 2011.

According to Stevens, FHA must increase its Mutual Mortgage Insurance (MMI) fund reserves – a two percent capital reserve ratio – to comply with current law.

“The MMI fund has been below the two percent threshold in our last two annual actuarial reports to Congress,” Sevens says; and that at the current rate, MMI will not meet its mandated level until at least 2015. “Raising the annual premium will enable FHA to increase revenues … Based on current volume projections, the annual MIP increase would generate an additional $2.5 - $3 billion annually.”

Stevens defended the increase’s unveiling during a down real estate market by calling the quarter-point increase “a responsible step towards meeting the two percent threshold, while allowing FHA to remain the most cost-effective mortgage-insurance option for borrowers with lower incomes and lower downpayments.

“I understand the concerns of those in the industry about this increase,” he says. “While I do not expect all to agree, we have made these moves to protect FHA so that it can continue its vital mission.”

While the monthly payments on the average FHA loan will go up about $30, it shouldn’t impact closing costs. The upfront MIP remains unchanged at one percent.

To read the Department of Housing and Urban Development’s Mortgagee Letter explaining the change (PDF format), visit HUD’s website.

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