Surprise - Home Sales Up
Topic: Real Estate Market
Sales of existing homes rose in February following five months of decline. David Lereah, chief economist for the National Association of Realtors, said mild weather appears to be responsible for some of the gain.

Total existing-home sales -- including single-family, townhomes, condominiums and co-ops -- increased 5.2 percent to a seasonally adjusted annual rate of 6.91 million units in February from an upwardly revised pace of 6.57 million in January, but were 0.3 percent below a 6.93 million-unit level in February 2005.

"Weather conditions across much of the country were unseasonably mild in January and likely were a factor in higher levels of buyer activity, which boosted sales that closed in February," Lereah said.

"Higher interest rates had been tapping the brakes, notably in higher-cost housing markets since mortgage interest rates trended up last fall, but we're seeing signs of stabilization in the market now with the sales rebound. Home sales should level-out in the months ahead."

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.25 percent in February, up from 6.15 percent in January; the rate was 5.63 percent in February 2005.

NAR President Thomas M. Stevens said comparisons with market performance over the last five years distort what people should expect from housing as an investment.

"Housing is simply returning to a normal market, where annual home prices will rise a little faster than the overall rate of inflation," said Stevens.

"However, in looking at total returns, you need to consider that the typical buyer is making only a modest down payment but enjoys a return on the full value of the home, which is many times the actual cash investment. In other words, normal is pretty good for the typical homeowner, and that's what we expect for the foreseeable future."

Stevens noted that price appreciation has yet to cool significantly. "We're still seeing double-digit annual price gains, but we should get down to single-digit appreciation fairly soon," he said.

The national median existing-home price for all housing types was $209,000 in February, up 10.6 percent from February 2005 when the median was $189,000. The median is a typical market price where half of the homes sold for more and half sold for less.

Total housing inventory levels rose 5.2 percent at the end of February to 3.03 million existing homes available for sale, which represents a 5.3-month supply at the current sales pace -- the same as in January.

Single-family home sales increased 4.7 percent to a seasonally adjusted annual rate of 6.06 million in February from 5.79 million in January, and were 0.2 percent below the 6.07 million- unit pace in February 2005. The median existing single-family home price was $208,500 in February, up 11.6 percent from a year ago.

Existing condominium and cooperative housing sales rose 8.8 percent to a seasonally adjusted annual rate of 850,000 units in February from a level of 781,000 in January. Last month's sales pace was 1.5 percent below the 863,000-unit pace a year ago. The median existing condo price was $214,300 in February, up 3.5 percent from February 2005.

Regionally, existing-home sales in the Northeast jumped 19.2 percent to an annual sales rate of 1.18 million units in February, and were 2.6 percent higher than February 2005. The median price in the Northeast was $263,000, which is 5.2 percent higher than a year ago.

Total existing-home sales in the Midwest rose 11.1 percent to a pace of 1.60 million in February, and were 1.9 percent above a year earlier. The median existing-home price in the Midwest was $160,000, up 3.9 percent from February 2005.

In the West, existing-home sales increased 5.1 percent to an annual pace of 1.44 million in February, but were 10.6 percent below February 2005. The median price in the West was $306,000, up 12.1 percent from a year ago.

Existing-home sales in the South fell 2.5 percent in February to a level of 2.69 million, but were 3.1 percent higher than a year ago. The median price in the South was $182,000, up 11.7 percent from February 2005.

Decline in pending home sales eases
Topic: Real Estate Market
WASHINGTON -- March 7, 2006 -- A slide in pending home sales is beginning to level out, an indication of a more sustainable level of home sales in the months ahead, according to the National Association of Realtors? (NAR).

The Pending Home Sales Index (PHSI), based on contracts signed in January, slipped 1.1 percent to a level of 116.3 from an upwardly revised index of 117.6 in December, and is 4.8 percent below January 2005. After hitting a record of 128.2 last August, the index declined at a more rapid pace through December, averaging nearly 3 percentage points per month.

The index is derived from pending sales of existing homes. A sale is listed as pending

when the contract has been signed but the transaction has not closed; pending home sales typically are finalized within one or two months of signing.

An index of 100 is equal to the average level of contract activity during 2001, the first year to be examined, and was the first of five consecutive record years for existing-home sales.

David Lereah, NAR’s chief economist, had foreseen a flattening in the index. "This looks like we’re touching down for the soft landing we’ve been expecting," he said. "We are at a much more sustainable level of home sales now -- a welcome cooling from the super-heated conditions that were driving exceptional price gains. This will give people the time to be more thoughtful about a process that is the biggest single investment most of us make in our lifetime."

"Home sales at this level are historically strong and provide a solid foundation for the overall economy," he said. "Business spending will lead economic growth this year, and housing wealth will help to support consumer spending."

Regionally, the PHSI in the Midwest rose 6.0 percent in January to 114.3 but was 1.0 percent below January 2005. In the Northeast, the index increased 0.4 percent to 94.8 but was 12.0 percent below a year ago. The index in the West declined 1.9 percent to 115.8 in January and was 13.6 percent lower than January 2005. The index in the South dropped 5.1 percent to a level of 128.6 in January but was 2.0 higher than a year ago.

? 2006 FLORIDA ASSOCIATION OF REALTORS

Affordable Waterfront Properties
Topic: Real Estate Market
Waterfront properties in the Keystone Heights region are still among the most affordable in the state.
Known as north central Florida's Lake Region, there are muliple lakes with beautiful views, white sandy beaches and gorgeous rolling terrain.
Waterfront PropertiesContact Me for more info.

Florida real estate taxes remain the nation's highest
Topic: Money
TALLAHASSEE, Fla. -- March 7, 2006 -- While overall state and local taxes in Florida are reasonable compared to the other 49 states, the state's per capita documentary stamp and real estate transfer taxes -- already the nation’s highest -- rose another 28 percent in 2004, according to Florida TaxWatch'sannual report.Florida TaxWatch, a private, non-profit, non-partisan research institute, provides independent research and education on government revenues, expenditures, taxation, public policies and programs.

While the tax cost of buying and selling real estate remains high, per capita local property taxes collections compare reasonably well. Florida property owners pay an average of $918.81, and the state ranks No. 21 nationally. At No. 1, New Jersey residents pay an average of $1,870.85 in local property taxes while last-ranked Arkansas residents pay $190.85.

From 2000 to 2004, Florida’s total state tax collections grew 24 percent, third largest in the nation; nationally, growth averaged 10 percent.

Looking at the state tax burden, Florida ranked No. 35 per capita, which is five points higher than one year earlier. When combined with local taxes, the tax burden on Floridians ranks at No. 32 in the most recent study.

Other findings:

• State taxes take 6.0 percent of Floridians' personal income, and state and local taxes combined take out 9.4 percent. This compares to the national average of 6.5 percent and 10.5 percent, respectively.

• Transaction taxes (general and selective sales taxes) account for 77 percent of all Florida's state tax collections, compared to the national average of 49 percent. Sales tax revenue is the third-highest in the nation, though that cost is offset by the lack of a personal income tax.

• Florida is one of seven states without a personal income tax. Of the four largest states, Florida and Texas have no personal income tax.

• Businesses pay nearly half (48 percent) of all state and local taxes in Florida. This is the 13th highest percentage in the nation and higher than the national average of 43 percent.

To read the full report from Florida TaxWatch, visit their Web site (http://www.floridataxwatch.org) or download it directly in PDF format at http://www.floridataxwatch.org/resources/pdf/HFCfinal2706.pdf.

? 2006 FLORIDA ASSOCIATION OF REALTORS?

Mobile Home in Flagler County
Topic: Real Estate Market
1993 DWMH for sale in Flagler County, about 20 miles west of Flagler Beach and an easy commute to Palm Coast.
The home is on 2 1/2 parklike acres with lawn, trees, and a beautiful pond. for more info please go to: Home for Sale

Tips for selling a house that won't sell
Topic: Real Estate Market
MIAMI -- Jan. 24, 2006 -- Young buyers like a pretty house, so if a house won’t sell, Mark Nash, author of 1001 Tips for Buying and Selling a Home, urges home sellers to make these simple cosmetic updates.

• Expose hardwood floors and buff them until they shine. Nash, who sells homes in the Chicago area, says an increasing number of younger buyers dislike homes with wall-to-wall carpeting. ''It's amazing how often I hear from young clients who won't even look at a place unless it has hardwood floors,'' he says.

• Remove antiquated furnishings. Many young buyers have eclectic tastes. Get rid of matched sets of look-alike furniture from the ’70s and ’80s then rearrange what’s left to make the house feel more contemporary.

• Take down your old draperies and light fixtures, including old-style track lightings. Nash says outdated lighting and heavy, elaborate draperies (the kind with swags and valances) turn off young buyers.

• Remove wallpaper. Young buyers are unwilling to purchase any home that needs wallpaper removal—it’s just too daunting.

• Repaint your walls. Nash encourages home sellers to stick with neutrals or calm earth tones, like a light sage green. Using bold tones can be very tricky, he cautions. “I call these ‘commitment colors.’ Chances are good that your buyers won't like them as much as you do,'' he says.

Source: The Miami Herald, Ellen James Martin (01/22/06)

Ameriquest to pay $325m settlement
Topic: Mortgage News
LOS ANGELES -- Jan. 23, 2006 -- The parent company of mortgage lender Ameriquest has agreed to pay $325 million to settle investigations into its practices by attorneys general in several states.

Ameriquest lends to people with poor credit and modest incomes. It is the nation's largest sub-prime mortgage lender. Civil lawsuits by consumers in California and other states claim a pattern of fraud, bait-and-switch sales tactics and other violations. Accusations include forging documents to lying about borrowers' income to qualify them for loans they can't afford.

The settlement involves 30 states and is expected in the end to include all 49 states where the company operates, according to a statesperson.
It's parent company has agreed to many changes in company practices, including providing borrowers with clearer disclosures on the terms of their loans.

Under the terms of the settlement, Ameriquest will have to reform its business practices, including...

• A clearer form that explains in simple language the terms of a loan, including rates, points and penalties, if any.

• Giving borrowers notice before closing on their loan if any changes are made to the loan terms.

• Verbal disclosures by loan officers to ensure borrowers are clear on the financial terms of their loans.

• Borrowers applying for stated income loans, or loans in which borrowers don't offer proof of income, will have to sign statements certifying they're telling the truth.

• Ameriquest also agreed to use independent closing agents and to select appraisers randomly, in order to eliminate potential conflicts of interest with lending agents.

Strong Economic Growth for 2006
Topic: Real Estate Market
MILWAUKEE -- Jan. 6, 2006 -- America's 2006 economy will be markedly better than 2005, despite a softer housing market, a panel of trade-group economists said Thursday.



"The U.S. economy is kind of a juggernaut," said Paul Merski, chief economist for Independent Community Bankers of America. "Look at the last few quarters, how it shook off oil price spikes and hurricane shocks."

Merski predicted a 3.8 percent economic growth rate this year, with 2 million new jobs and an unemployment rate dipping to the 4.8 percent to 4.9 percent range.

As for inflation and interest rates, "we'll have to wait to see how hot the economy is" and how heavy a hand Federal Reserve Board officials use in managing it. He predicted the Fed will raise the benchmark federal funds rate, which banks charge each other for overnight loans, from its current 4.25 percent to 4.75 percent by April.

Merski declared the nation's housing boom over - "frankly, that's a healthy thing, since we were running into affordability problems in many areas"- and predicted shrinkage in the mortgage market this year too.

The banking official's comments came at a Webcast conference hosted by the Homeownership Alliance in Washington, D.C., which also featured chief economists of mortgage financiers Fannie Mae and Freddie Mac, the National Association of Home Builders and the National Association of Realtors. His was among the sunnier forecasts.

"We're certainly more pessimistic," said Fannie Mae's David W. Berson. "We predict an 8 percent drop in home sales, with price gains of only 3 percent (but) the job market's going to be pretty good." He expects 2.4 million new jobs this year and a long-term economic boost from immigration.

Realtors' economist David Lereah predicted a 4.1 percent economic growth rate this year, a 4 percent to 5 percent drop in housing resales and bigger drop in new home construction. The housing market may only be taking a one-year breather, he said, "but the risks I see is that slower housing activity will inhibit consumer spending and job creation."

Builders' economist David Seiders said this is the year that "housing turns from being the economy's power growth engine to a slight drag," a gloomy role it may continue in 2007.

Two housing bright spots: Manufactured home sales will surge, courtesy of rebuilding efforts in Gulf Coast areas damaged by 2005 hurricanes, and consumers will continue to spend freely on remodeling, "supported in part by the tremendous equity they've built in their homes," Seiders said.

So when does the housing slowdown hit?

It probably already has, said Freddie Mac economist Frank E. Nothaft.

"The housing sector probably crested in the fall of '05," Nothaft said. Year-end figures aren't in, but are likely to show a fourth-quarter sales slump, he said.

All five economists see mainly good times for most Americans in coming months - barring unforeseen catastrophes.

Among the scenarios the economists believe could trip up the economy: a sudden end to heavy foreign investments here; another major increase in oil prices; a sudden Federal Reserve shutoff of borrowing ability to combat rising inflation; widespread dumping of investment properties.

"This is nothing I see happening," Merski emphasized, and the others agreed. "But it is a risk."

(c) 2006, Milwaukee Journal Sentinel, Michele Derus, Jan. 5, 2006. Distributed by Knight Ridder/Tribune News Service.

Get tax credits for energy improvements
Topic: Energy Efficiency
WASHINGTON -- Dec. 16, 2005 -- If the thought of rising energy bills has you rushing out to buy insulation, hold off until after Jan. 1, 2006, when the recently enacted Energy Tax Incentives Act of 2005 kicks in.

The act includes incentives to make your home more energy efficient and give solar a try. They come in the form of tax credits, reducing federal tax bills dollar for dollar. Unlike many federal programs, they are not phased out for higher incomes.

The most generous credits are available for those who add solar water, heat or power to their homes. It wasn't very long ago that installing virtually any kind of solar device was a labor of love without much economic value. But with the federal incentives -- combined in many places with utility and state incentives -- solar is looking like a much better deal.

The new energy law encourages taxpayers to claim a tax credit each year in both 2006 and 2007 for these expenses: 30 percent of the cost of solar water-heating equipment, up to a $2,000 maximum tax credit for each tax year; 30 percent of the cost of solar equipment that generates photovoltaic electricity, up to a $2,000 maximum tax credit for each tax year; and 30 percent of the cost of a fuel-cell power plant, up to a $500 maximum tax credit for installation in a taxpayer's principal residence. This new technology converts fuel into electricity using electromechanical methods and meets other detailed requirements. But don't get too excited about this one. This technology isn't yet available for practical use to residential consumers. On top of that, it's not likely to be available within the next two years, which is the duration of this tax credit. But if you are interested in being on the cutting edge, check out Plug Power and Ballard Power Systems. These companies, according to their spokespeople, are within a few years of offering systems that are available for residential use.

The best solar deal

Solar equipment -- particularly solar water heaters -- is a lot more reasonably priced, easier to install and generally more practical than it's ever been.

While installing photovoltaic systems can be pricey with payback in the distant future, installing a solar hot-water system can pay for itself quickly and, as energy prices rise, continue to save a homeowner increasing amounts of money.

"I think that even without the tax credit, solar hot-water systems are economical. You'd almost be crazy not to get a solar hot-water heater right now -- especially with natural gas prices going up," says Noah Kaye, policy and communications coordinator for the Solar Energy Industries Association.

Solar hot-water systems rely on relatively simple and cheap technology to circulate water through panels that face the sun, supplementing, and in some cases replacing, conventional water-heating systems.

The most common type of solar thermal system involves copper pipes that wind back and forth through a flat plate collector, typically mounted on a roof. The heated water is collected in an auxiliary water tank, or it can be routed straight into the main water tank, where it is either heated further by conventional means or is ready for use at the spigot or in a radiant, or radiator heating system.

Kaye estimates that a reliable system installed by a professional can cost as little as $3,500, with systems climbing to as much as $6,000 in cold climates where freezing is an issue. Once it's installed, the ongoing costs are near zero with only very occasional maintenance needed.

The federal tax credit will pay as much as one-third of that upfront, but in many states, such as California and New Jersey, there are other incentives available that pay as much as 60 percent. The Interstate Renewable Energy Council, funded by the U.S. Department of Energy and managed by the North Carolina Solar Center, provides an inclusive list of incentives.

But be sure to talk to your accountant. How the credits add up will depend on your location and your personal tax situation.

Solar hot water can be a do-it-yourself project if you are very handy and are willing to commit enough time and energy to learn to do it right. But considering the complexity and the likelihood that a rebate will pay for installation, turning to an expert installer might actually save you money. Several solar organizations provide lists of qualified installers in areas all over the country, including Homepower Magazine, Renewable Energy Access and Solar Energy Industries Association.

Adding solar power

A much more extensive and expensive proposition would be to add a grid-tied solar-electric system to your home. This photovoltaic, or PV, system is made of a complete set of components for converting sunlight to electricity, storing that electricity and delivering it to its end use. The system could produce some or all of the electricity that your home requires. In addition, it can allow you to sell the excess back to your utility company.

Figuring out whether it makes economic sense for you can be accomplished by gathering up a few electric bills and showing them to a qualified solar installer who can do the calculations for you. Or you can try to estimate the return on investment yourself using a guide published in Homepower Magazine or by using a calculator offered by BPSolar.

The price will depend on how much electricity your home and lifestyle require, the amount of sunlight your region gets each day during peak sun hours, how sunny the location of your property is and how much money is available to you from state and utility rebates.

Just to give you a ballpark figure: George Douglas, a spokesman for the National Renewable Energy Laboratory, says experts at this federal research facility estimate that in New Jersey, purchasing and installing a photovoltaic system costs $9 per watt, and the average home requires 4,000 watts per year for a total cost of $36,000. This is offset by state incentives that can be as large as 70 percent, with the federal rebate on top of that. Plus the homeowner can sell back excess power to the utility company at rates that are about 50 percent of retail.

New Jersey and California are the two most progressive states when it comes to encouraging alternative energy, with Maryland, Pennsylvania and New York close behind. Other states have less generous alternative-energy rebates and the utility power buyback price is much lower.

Douglas suggests that you do the math, keeping in mind that energy prices are much more likely to go up than down; photovoltaic systems are usually under warranty for 30 years and biting off the entire job at once isn't necessary. You can add solar in affordable chunks.

BPSolar is selling photovoltaic kits at Home Depot in California, New Jersey and some areas of New York. Home Depot will do the installation. The price varies enormously, based on what you buy and your locale.

Do the basics first

Before you leap into the brave new world of alternative energy, consider taking advantage of the other half of this energy bill -- a 10 percent tax credit with a lifetime cap of $500 for improving the energy efficiency of conventional technology in your home. A homeowner would have to do $5,000 worth of work to get the full amount. This is in addition to the solar credits.

Eligible purchases include:

Insulation materials. This includes exterior doors and certain metal roofs with special coatings designed to reduce heat loss and gain. If your home is more than 20 years old, its insulation probably no longer meets minimum code. Spending money to improve it can pay off in heating and air conditioning costs.

Replacement windows. No more than $200 can be credited against the cost of replacement windows, including skylights. This isn't much, but something's better than nothing when you undertake this effective but expensive upgrade.

Energy-efficient heating and cooling systems. Up to $300 for high-efficiency electric heat pumps and central air conditioners -- those meeting the 2006 Consortium for Energy Efficiency specifications, expected to be 15 SEER and 13 SEER. (SEER is an acronym for seasonal energy efficiency rating, and is a gauge of efficiency and performance for residential air conditioners and heat pumps.)

High efficiency conventional furnaces. Up to $150 can be claimed by homeowners who install a highly efficient furnace or boiler with annual fuel efficiency of 95 or better, or a gas, oil or propane hot water heater with an energy factor of .80. A storage water heater's energy factor is a measure of its overall efficiency based on the use of 64 gallons of hot water per day. To achieve an energy factor of .80, you must buy a condensing water heater.

A credit of $50 is available for installing a whole house circulating fan. This is a much more powerful version of a ceiling fan, which draws hot air out through the attic or the roof.

The costs of installation as well as equipment are included in calculating the price of these energy improvements. The solar systems can be installed in either a principal residence or a second home as long as it is located in the United States. The systems can't be used to heat a swimming pool or hot tub.

In most cases, you can claim the credit both years if you have two properties - use it one year for a main residence and the second year on a vacation home -- even a recreational vehicle or boat could count if you can live aboard. But you can't take the credits twice on the same property. You can, however, spread the credit over two years by doing some of the work one year and some of the work the next. If you owe too little in taxes to take the entire credit in one year -- even though you've done the work -- then you can carry forward the portion of the credit you were unable to claim and deduct it in the following year.

A caveat: the IRS still hasn't released the final set of regulations on this new energy bill. While big changes are not expected, there's always the possibility of minor differences that might impact your tax return. Check with your accountant.



? 2005 Bankrate.com

Survey: Delinquent borrowers don't ask for help
Topic: Mortgage News
McLEAN, Va. -- Dec. 16, 2005 -- The first step in helping homeowners avoid foreclosure is to understand the problem. To do that, Freddie Mac conducted a survey and found that nearly two-thirds of delinquent borrowers don't know they will be offered help simply by contacting their lender and asking for it. In over half of al foreclosure cases, the borrowers never contact their lender, and the survey was undertaken to help find out why.

The survey found that 75 percent of the delinquent borrowers surveyed recall being contacted by their mortgage servicers. But, a substantial percentage gave a variety of reasons for neglecting to follow-up with their servicers to discuss workout options. Mortgage servicers collect monthly housing payments on behalf of Freddie Mac or other investors.

Specifically, 28 percent said there was no reason to talk to their servicers or that their servicers could not help them, 17 percent said they could take care of their payment problems without any help, and 7 percent said they didn't call because they didn't have enough money to make the payment. Other reasons for not calling included embarrassment (6 percent), fear (5 percent) or not knowing whom to call (5 percent).

The lack of borrower follow-up may help explain why more than six in 10 (61 percent) of late-paying borrowers said they were unaware of a variety of workout options that could help them overcome short-term financial difficulties. At the same time, 92 percent said they would have talked to their servicers had they known these options were available to them.

The survey found no significant statistical difference in the responses given by white, black, Latino, male or female borrowers indicating an almost universal need for more borrower education about workout options and foreclosure avoidance.

Freddie Mac requires mortgage servicers to explore several workout options with late-paying borrowers. These options include forbearance, which temporarily delays or reduces payments, and loan modifications, which can restructure the payment terms for a fixed period. Many servicers typically describe these options in their collection letters. However, it is up to borrowers to follow-up with their servicers to learn more about these options.

"Part of the problem is that the data shows that there's a knowledge gap: People's interest in the options available to them is quite high, but their awareness of these options is quite low," says Elizabeth Armet, Vice President, Senior Account Executive at Roper Public Affairs.

While the likelihood of a successful foreclosure avoidance depends upon each individual borrower's financial situation, a 2004 Freddie Mac study concluded that repayment plans could lower the probability of home loss by 80 percent among all borrowers, and by 68 percent among low-to-moderate income borrowers.

Other notable findings from the Freddie Mac/Roper survey:

• Eighty percent of delinquent borrower households included at least one employed individual and only five percent said someone in their household was unemployed. Seven percent of the respondents said they were retired.

• Among homeowners in good standing, 62 percent were employed, 32 percent were retired, and only two percent were unemployed.

• Delinquent borrowers earned slightly less than borrowers in good standing. The median annual income among delinquent borrowers was $52,400 compared to $56,700 a year for homeowners in good standing.

• Forty seven percent of the defaulters were first-time homeowners but 62 percent of the homeowners in good standing had owned a home in the past.

? 2005 FLORIDA ASSOCIATION OF REALTORS?