Sunday, February 7, 2010

Top 10 Home Features New Buyers Want

Here is a quick list of the top 10 homes features buyers look for when walking scoping out a new home!

1. Large Kitchens, With an Island
Granite countertops are a must for move-up buyers and buyers of custom homes, as this area becomes the new-grounds for entertaining and spending time with family.

2. Energy-Efficient Appliances, High-Efficiency Insulation and High Window Efficiency
Among the "green" features touted in homes, these are the ones buyers value most, he said.

3. Home Office/Study
People would much rather have an extra room utilized for this space rather than, say, a formal dining room.

4. Main-Floor Master Suite
Gaining quickly in popularity for 2-story homes, this is a must feature for empty-nesters and certain other buyers who expect to have an “extended-family” situation.

5. Outdoor Living Room
The popularity of outdoor spaces continues to grow, and is even more popular than an outdoor cooking area, meaning people are willing to spend more time outside.

6. Ceiling Fans
Buyers look for upgraded high quality ceilings fans, as they try and save costs on air-conditioning and electricity.

7. Master Suite Soaker Tubs
Whirlpools are still desirable for many home buyers, but if the spa-tub is not in the budget, and oversize shower with seating areas are also moving up in popularity.

8. Stone and Brick Exteriors
Get rid of the stucco and vinyl don't make the cut. However, keep in mind, “hardscaping” can be one of the most expense upgrades. To save costs focus on a section of the exterior, rather than the complete remodel.

9. Community Landscaping, With Walking Paths and Playgrounds
The golf courses, swimming pools and clubhouses are great amenities for the neighborhood, but Buyers in large planned developments prefer walking trails and lush greenery.

10. Two-Car Garages A MUST
First time buyers want this space, and recognize the value of storage and inside-parking after years of apartment style living. Direct access has greater appeal. Move up buyers will prefer to the three-car garages, in which the third bay is more often used for additional storage and not automobiles.

4 Demographic Trends That Will Affect Housing In New Decade

The Urban Land Institute cites four major U.S. demographic trends that will have a major impact on housing as we enter into 2010 and begin a new decade.

1. Aging baby boomers (ages 55 to 64 years old):
They will keep working, and many will be forced to stay in their suburban homes until values recover. Those who are able to move will choose mixed-age living environments that cater to active lifestyles. Walkable suburban town centers also will appeal to this group.
Younger baby boomers (46 to 54 years old):
They are now entering their prime earning years but they will lack home equity and unlike the older members of their generation, they won’t be able to purchase second homes. This will likely curb the prospects for the second-home market.

2. Gen X (age 30-45):
Fueling the first-time buyer and move-up market, Gen Xers love social spaces. Most are willing to give up square footage for location. This generation has also waited longer to have children, and once they do have a family, the emphasis is being on “super-parent.” A neighborhood’s walkability is huge for Gen Xers, as is community, outdoor space, sustainable elements, and kids’ spaces.
3. Generation Y:
They are larger than the baby boom generation (with a population of about 86 million). As they enter the housing market, they are less interested in homeownership than their parents were when they were young adults. “They will be renters by necessity or choice for years ahead,” says John K. McIlwain, author of the report.

4. Immigrants
Both legal and illegal: They are nearly 40 million strong. They often prefer multi-generational households and if they can afford them, larger homes in neighborhoods with a strong sense of community.

Source: The Urban Land Institute (01/27/2010)

FHA Contributing To New Wave of Foreclosures?

For the past year, The FHA tried to prop up the housing market by backing home loans the most banking institutions would not lend too, but it might have caused more foreclosures in the process.

The FHA has helped people get loans who otherwise would not qualify as credit markets have dried up. But at the same time, the FHA has insured loans for people who couldn't afford them and has artificially propped up the housing market.

However, now, FHA's is joining the bad-loans club, as 9% of FHA borrowers have missed at least three payments (up from 6.5% a year ago), and experts say that means a new wave of home foreclosures is coming, according to The Washington Post.

The problem lies in the low down payment program offered by FHA for there borrowers, asking as little as a 3.5% down payment for a home purchase (lenders like JPMorgan Chase, for example, turned their nose at anything less than 20%).  Additonally, FHA allowed sellers to pay for some of the down payment as well, meaning buyers had no "skin in the game,".  Hence leaving FHA borrowers an easy exit and allowing them to walk away from the debt.

Bottom line? In its efforts to keep the housing market going, the FHA might have inadvertently caused a new crush of foreclosures.

The FHA is not a lender, but it insures lenders when mortgages go sour. And it's had to pay out so much that its cash reserves are dangerously low -- far lower than the mandated minimum.

Things have become so bad that the FHA is expecting to pay out on one out of every four loans made in 2007, the Post reports. That's the worst rate in decades.

Source: Washington Post  and NAR news
Kim Peterson on Tuesday, February 2, 2010 12:14 PM

January Real Estate Recap!

Here are some of the headlines that made real estate news in January 2010 -

Housing Gets Little Mention in Obama Speech
Some listeners criticized President Obama for failing to pay more attention to the housing crisis in Wednesday night’s State of the Union message. Obama promised to “step up refinancing so that home owners can move into more affordable mortgages,” but he didn’t offer any details. There was no mention at all of addressing falling home values, restoring the mortgage-backed securities markets or shoring up FHA, critics said. Nor did he mention expiring housing tax credits.

Existing-Home Sales Down, but Prices Rise
Sales of existing homes fell from November to December due to the rush to meet the tax-credit deadline. However, annual sales improved in 2009. Read more from NAR's latest housing report.

FHA 90-Day Anti-Flipping Rule Waived
The Dept. of Housing and Urban Development (HUD) announced recently that it will eliminate for one year the Federal Housing Administration (FHA) 90-day anti-flipping rule.

Report: Record Year for Foreclosures Predicted
The highest 2009 foreclosure rates were in Las Vegas, followed by Florida and California, according to the RealtyTrac report. Analysts predict another 3 million foreclosures nationwide in 2010.

White House Lost Value in 2009
Even the home of America's First Family isn't immune to the economic downturn. The price of the property has decreased 5.1 percent, according to the online housing site Zillow.

Big Test Ahead for Mortgage Market
When the Federal Reserve stops buying mortgage backs in a couple of months, buyers, sellers, and owners will soon find out if the market has legs or not.

Timeshare Industry Hit Hard by Recession
Experts predict that sales will remain flat in 2010 for the timeshare industry.

China Slaps Buyers With Hefty Downpayment
The Chinese government wants to put a cap on the country's rising real estate prices so it's now requiring buyers of second homes to put down 40 percent of the purchase price.

Mortgage Cancellation Relief Still in Effect
In recent weeks, calls to NAR have shown some confusion as to whether the tax relief for cancellation of mortgage debt rules remain in effect. The short answer: YES – Through Dec 31, 2012

Foreign Buyers Taking Advantage of Slashed Prices
International investors bought 154,000 homes and condos in the 12-month period ending in May, and are continuing to take advantage of the weak dollar.