buyers
Moody's economists report to Forbes.com the recovery of the real estate market. Some analysts are predicting the National market to hit bottom by mid 2010. Predictions indicate that from 2009 to 2014 - an 11.35% increase in prices. Good news indeed! It is a great time to buy with LOW interest rates and LOW prices.
Here is the full
Forbes.com article.
Interest rates popped down to 4.75% yesterday for 30 year fixed conforming loans! WOW! Great time to buy - lower purchase prices - low interest rates! AND if you are a first time buyer or haven't owned primary house in past 3 years - you may be eligible for $8,000 tax credit if you close by 11.30.09!
Email me with questions and for more information!
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The NAR - National Association of Realtors - announced the pending home sales show an uptrend for the past four consecutive months. They attribute favorable housing affordability and 1st time buyer tax credits as boosting the latest survey. The June Pending Homes Sales Index increased 0.1% to 90.7%. The last time there were four consecutive monthly gains was in October 2004. Closed existing-home sales are improving but they are coming in lower than expected because of delayed closings or falling through due to financing qualifications or road blocks with the new appraisal rules in place. According to Lawrence Yun, NAR chief economist, "Rises in contract activity show buyers are becoming more active even as they face much more stringent loan underwriting standards. Speedy clarification of the appraisal rules could smooth a housing market recovery and support the overall economy".
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Today's post comes from my friends at Eric & Adam at
KronbergWall . They are architects and fellow eco enthusiasts. They can help you with your ho
me designs and renovations.
The recently signed American Recovery and Reinvestment Act of 2009 makes federal energy efficiency tax credits available for your home renovations if you make them in 2009 and 2010.
Specific types of high efficiency furnaces, air conditioners, and tankless gas water heaters qualify. Certain energy efficient doors, windows, roofing, and insulation also qualify. You are eligible to receive a credit for these upgrades if they are installed in existing homes that are primary residences. The tax credit has been raised to 30% of cost up to a total credit of $1500.
There are even greater tax credit opportunities for solar water heaters, geothermal systems, and photovoltaic systems. You can receive a tax credit of up to 30% of the total cost of these systems, and it is not limited to the $1500 cap. In addition to existing primary residences, the credit is also available for vacation homes, rentals, and new construction.
Eric Kronberg, AIA, LEED AP
Adam Wall, AIA, LEED AP
Gov. Sonny Perdue signed on Monday Bill 261 into law. The law offers a tax credit of 1.2 percent of the purchase price of a single-family home currently on the market. The credit tops out at $1,800 and will be taken over three years. Georgia taxpayers have six months starting now to qualify for up to $1,800 in income tax credits by buying a home.
For first-time home buyers, the state credit would be in addition to a federal credit offered through the federal stimulus act. That credit is worth up to $8,000. The new state credit, however, applies to
any home buyer, not just first-timers. Read more about the $8,000 federal tax
here.
Interest rates remain low! As of today - conforming loans (under $417k) remain at 4.375%. FHA rates remain at 4.5%. And jumbo rates for qualified buyers remain as low as 5.5% with equity and excellent credit.
I ran some numbers to see what kind of savings you would have with these low rates. WOW - over the life of the loan you can save tens of thousands of dollars. On a loan amount of $200,000 - the monthly mortgage payments on a 30 year fixed (does not include taxes, insurance) are:
| Interest Rate |
|
Monthly Payment |
|
Monthly Savings compared to $998.57 |
| 4.375% |
|
$998.57 |
|
not applicable |
| 5.375% |
|
$1,119.84 |
|
$121.27 |
| 6.375% |
|
$1,247.75 |
|
$249.18 |
Aside from the monthly savings - an interest rate of 4.375% vs. 5.375% could save you $43,693.91 over the life of the loan. And an interest rate of 4.375% vs. 6.375% could save you $89,700.94. WOW.
FMLS Area Codes for Intown
| FMLS Area |
Neighborhoods |
| 21 |
Buckhead neighborhoods including Chastain Park |
| 23 |
Midtown, Morningside, Virginia Highland, Inman Park, Piedmont Heights |
| 24 |
Druid Hills, Candler Park, Lake Claire, Kirkwood, Edgewood, East Atlanta, East Lake, Oakhurst |
| 31 |
Capitol View Manor, Sylvan Hills, College Park, Adair Park, West End, Jefferson Park |
| 32 |
Grant Park, Ormewood Park, Glenwood Park |
| 52 |
Decatur, Clairemont, Toco Hills, Oakhurst, East Lake, Kirkwood |
If you don't see your neighborhood ~ let me know. Some neighborhoods may appear in 2 different areas.
FHA loans have been around since 1934 but in previous years we haven't needed them with all of the other financing options available. With the recent tightening of credit terms, FHA loans are back and can be a great option for buyers who might not otherwise be able to purchase a home. FHA stands for Federal Housing Administration. FHA doesn't actually lend the money but insures the loan for your lender. There are caps on the amount of an FHA loan and it is based on the lending area.
In Metro Atlanta - the loan limit is $346,250. The loan limit does change from time to time and it can be higher in more expensive markets and less in lower priced markets. As of today - the FHA rate was VERY competitive - 4.5% for a year 30 year fixed compared to 4.375% for a non-FHA loan.
Advantages of FHA loans:
- Down payment as little as 3.5% of the sales price. Most conforming loan programs require a minimum of 5% down.
- Lower credit scores for buyers. 600 minimum
- Easy qualifying guidelines. Gift/Grant funds may be allowed for down payments.
- Non-occupying co-borrowers allowed. Perfect for a buyer just starting out in the job market and who may not yet have established credit. A parent can co-sign the loan and not have to live in the property!
- Seller Contributions can be up to 6% of the sales price. Helps a buyer who is short on cash as a seller can contribute towards closing costs & pre-paids (interest, property taxes) also called escrows.
- Has a fixer- up loan program. Great option for some of the homes presently on the market.
- You may even be able to include energy improvements into an FHA-Efficient Mortgage
FHA loans aren't for everyone but a great opportunity for many buyers.
FHA website has more information for you or
contact me and we'll find a lender who will help you decide which loan program is best for you.
Top Economists Say Recovery Has Begun
Economic recovery is about making people feel more confident, says Mark Zandi, chief economist of Moody's Economy.com.
Zandi evidenced increasing home sales and gains in the stock market are some promising signs that the worst is over and people will start spending again.
"We're starting to see some pent-up demand for goods," he says.
But Zandi warns that the situation is still fragile. "Confidence is a very fickle thing. It can go from abject pessimism that pervades now to a more balanced view of the world rather quickly."
Robert Brusca of FAO Economics is predicting strong growth in the last half of the year and a quick recovery for the labor market. "You've lost 5 million jobs. It shouldn't be hard to put 2.5 million jobs back on rather quickly after you hit bottom," he said.
Joseph Carson, chief economist at AllianceBernstein, calls improving home sales, a rising stock market, and better-than-expected retail sales in February and March good signs of a turnaround. By the time President Obama's stimulus package takes effect, the economy will be ready, he says.
"The stimulus has a much better chance of working if trends are already turning up than if it needs to halt a decline," he said.
Source: CNNMoney, Chris Isidore (04/06/2009)
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