Time is Running out for your $8,000 Tax Credit

The days are numbered for the $8,000 federal tax credit for first-time homebuyers.

The credit expires on November 30 - a deadline that's putting pressure on would-be homeowners trying to take advantage of a real-estate market on the mend.

Most first-time homebuyers understand that time is running out. Now they need to understand how little time is left to get into the action.

In the current housing market, it takes about 45 to 60 days to close on a home from the time you have an accepted offer. So buyers should have their offer accepted no later than mid-October if they are trying to make the November 30 deadline.

Several bills have been introduced in Congress to extend the credit by six months to give the real-estate market another boost, though they are still up for debate. The National Association of Realtors estimates that the credit has generated 350,000 homes sales this year.

The process of buying a home is neither quick nor easy. Compiling your financial paperwork, applying for a loan, negotiating an offer and signing contracts can take months. And that's if everything goes smoothly. There are many ways homebuyers, especially novices can get tripped up by the process.

Here are four strategies that can expedite a closing:

1. Make sure you're liquid

When it's time to make a down payment, homebuyers should make sure they have enough cash available. Their funds should not be tied up in a stock portfolio, 401(k) plan or other investment that could delay the money by days.

2. Forget about short sales

A short sale occurs when a homeowner is no longer able to make his mortgage payments and owes more on his home loan than what it can fetch in the current market. They are attractive from a price point, but they can take months to close.

3. Don't go on a shopping spree before you close

Refrain from making big purchases on a credit card before closing on the home and completing the transaction. Big buys can trigger concerns because a buyer's debt-to-income ratio is usually the most important factor lenders use to determine how much they can borrow. This ratio compares the amount you earn to the amount you owe. Once you enter into the loan application process, that ratio is set.

4. Be aware of closing costs

Each state has its own closing requirements, and first-time buyers should know in advance what and how much they're reqired to cover. In most states, the buyer and seller share the costs.

Information reprinted from Smartmoney.com

Little fixes can make buyers take notice

Even with a budget of $1,000 or less, sellers are not priced out of making improvements that can help their home stand out among the competition.

In fact, real-estate experts say there are many relatively small upgrades that can go a long way toward attracting buyers.
"There are a lot of things that you can do that won't cost a lot of money but will sure make your home look a whole lot more appealing," said Gwyn Thorne, owner of Staged Appeal Homes in Fairfax, Va.

Among Thorne's top suggestions for a thousand-dollar budget:
• Swap out old light fixtures to modernize the feel of the interior. Flush-mounted fixtures for bedrooms and hallways can go for as little as $20 a pair, Thorne said. "Because a lot of the light fixtures that are in the older houses haven't been changed, they have a very outdated look," she said.
• Buy a new bathroom vanity. Vanities start from only about $200. Add a new faucet and relatively inexpensive peel-and-stick tiling, and the bathroom looks like new, Thorne said. "Bathrooms and kitchens are probably the two most important rooms in the house," she said.
Nicci Parrish, co-owner of Impress Me Home Staging in Bowie, Md., said sellers should focus on the exterior. "If it doesn't look good on the outside, buyers are going to have a negative opinion before they get inside," she said. Some of her favorite touches:
• Add colorful flowers in a planter on the front porch.
• Buy a new mailbox to replace a shabby old one.
• Touch up paint on the door and shutters.
All are relatively inexpensive improvements that can help would-be buyers feel more comfortable, Parrish said. "When someone is coming up to your house, it just makes it a little bit more warm and inviting," she said. And make sure house numbers are clearly visible, she added. Sellers know where they live; buyers don't.
Deborah Gorham, a real-estate agent with Long & Foster in Centreville, Va., said sellers should start simple. Painting, she said, is the best investment a seller can make. She offers some specific tips:

• Apply neutral-colored paint with white trim to help the home's architectural details stand out and remove the seller's style, which might conflict with buyers' preferences. Painting can be cheap, she said. "I say this in all due kindness: Most people can figure out how to paint and do it themselves," Gorham said.
• Replace the oldest kitchen appliance. Specifically, replacing a dishwasher — often viewed as the most unsanitary kitchen appliance — can go a long way with buyers, Gorham said.
"If they have the funds to do it, a dishwasher is the kitchen appliance that takes the most use and abuse," she said. The kitchen is a room buyers obsess over, she said, and they "just want new."
• Have the air ducts cleaned. "You can literally look in the intake vents and see how dirty is," Gorham said.
Alongside de-cluttering, comprehensively cleaning is the other most fundamental task sellers should take on, said Elaine Quigley, owner of Topline Home Staging in Burke, Va., and president of the local chapter of International Association of Home Staging Professionals. Quigley has some do-it-yourself suggestions:
• "Clean it beyond what they can imagine cleanliness is," Quigley said. "The tracks in the windows, get every cobweb, every piece of dust, get in there with a toothbrush." As with painting, sellers can keep cleaning costs down by doing it themselves.

reprinted: Washington Post

It's September

Today is the 1st day of September. I hope you have enjoyed the Summer weather as the sunshine has been great and it truly has been a "one of a kind" season. Now if the Mariner's had a chance to get into the playoffs . . . Oh well, it was a great Summer.

I always love September weather and as we transition into a new season, I wanted to remind you and reach out to you that now is SUCH a good time to buy or sell a home. Rates are low; they are probably going to have to raise the rates in a few short months but not too much, I believe. Prices are relative and the buyers are really coming out! You can sell and buy in a relative market. By that I mean, there is time to think, get your home sold and lock up a great price on your next real estate purchase. It is still a challenging lender climate, but I have a team of professionals that will bend over backwards to help you achieve your goals. There is also the first time buyer $8,000 tax credit that will definitely not be available next year. That deal expires in November!

I look forward to hearing from you and answering any questions you may have. To get a feel for the value of your home, give me a ring or shoot me an e-mail to assess where your home fits into the current market. We can get together then and discuss YOUR goals and objectives. You can always ring me @ 206-799-2891. Cheers!!!

ps: the photo above is a listing of mine that SOLD in 2 DAYS!!!

New U.S. home sales rise for third straight month
Associated Press WASHINGTON —

New home sales rose last month at the fastest clip in more than eight years as buyers eagerly took advantage of bargain prices — a clear sign, economists said, that the real estate market may finally be bouncing back.Historically low interest rates and a federal tax credit for first-time homeowners also helped push home sales to their highest level since November, the Commerce Department reported Monday.While home prices are still falling around the country, sales have now risen for three months in a row. Construction of new homes is at the busiest level since last fall. And home resales rose in June for the third straight month.

Home sales in Snohomish County also showed some recovery in June with a 30 percent increase in pending sales in comparison to the previous year.“The worst of the housing recession,” said David Resler, chief economist at Nomura Securities, “is now behind us.” And as with the overall economy, the “recovery” is likely to be slow and arduous, he said.Put in perspective, the improvement in sales is modest. The pace of sales for new homes in June was still 72 percent below the peak of four summers ago, and there is still an enormous inventory of homes lingering on the market.“There’s been signs of improvement, but we’re a long ways off from being back to a normal market,” said Corey Barton, president of CBH Homes in Meridian, Idaho. Sales were up there in June, but Barton stressed: “It wasn’t our biggest jump in eight years.”But there were clear signs the housing market is showing more than life than it has at any point since the recession began. Keystone Custom Homes of Lancaster, Pa., which was founded in 1992, had its best June ever. July is looking good, and president Larry Wisdom expects an even stronger August.“We doubled our sales in May, and then in June it took off,” he said.New home sales for June clocked in at a seasonally adjusted annual rate of 384,000, blowing past the expectations of economists surveyed by Thomson Reuters, who were looking for 360,000.The figure is up 11 percent from May, and May’s number of 346,000 was higher than previously thought. The increase is the largest since December 2000, when investors scarred by the tech-stock bubble were looking for more stable places to put their money.Sales were strongest in the Midwest, where they jumped 43 percent from May’s total. Sales climbed 29 percent in the Northeast and 23 percent in the West. They declined slightly in the South.

The median sales price was $206,200, down from $234,300 a year ago and $219,000 from May. That compares to $307,000 in Snohomish County, a drop of 11.6 percent from a year ago.Economists expect home prices to continue falling until the competition from low-priced foreclosures ebbs sometime next year.

reprinted from Associated Press - 7/28/09

Short Sales

WHAT IS A SHORT SALE ???

A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold. In a short sale, the bank or mortage lender agrees to discount a loan balance because of an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank's loss mitigation or workout department. The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt. In such instances, the lender would have the right to approve or disapprove of a proposed sale. Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market and the borrower's financial situation.

Short Sales are a part of today's market nationally and it is unfortunately a part of our local market here in Seattle. I have had some experience dealing with Short Sales and it is no easy task getting them closed. I thought I would write a few points about them and hopefully it will be of use for you in your next purchase. It may be worth your while to take a look at short sales - there may be some tremendous opportunities for you!!!

1. Have patience. It takes at least 20% longer as there is a bank negotiator who requires more detailed appraisals and sometimes underlying title issues appear.

2. Avoid properties that have a 1st and a 2nd that are different lenders. This is really difficult because you have to get the 2nd to accept a really low amount in order to release their position.

3. Have a good Escrow representative involved. This is really important as the escrow company must be in communication with the bank and negotiator.

4. Make sure that you have an experienced and trustworthy agent. It is A LOT more work for the agent and so let them go to work for you!

Summary: We will be dealing with Short Sales for some time. My belief is they will be a significant part of our Real Estate Market for the next 12-15 months and as the market heals the number of Short Sales will evaporate. If you would like more information and details, please feel free to call me @ 206-799-2891 or e-mail me at jay@jaymcginnis.com. Have a great week.

Is the Market Heating Up???

Last week, The Seattle Times reported that June home sales were the highest in King County since October, 2007. Is this a sign that things are starting to re-adjust and people are feeling more comfortable jumping into the Real Estate Market? I think it's really encouraging, but these Summer months will tell. Many of the sales that closed were negotiated in April and May when interest rates were at a 40 year low. With the threat of a hike in interest rates looming, this may likely get buyers making offers so they get in on these low rates.

The housing market in Snohomish County showed signs of recovery in June, driven by first-time buyers shopping for homes at burst-bubble prices. The Northwest Multiple Listing Service reported that pending sales in June increased 30 percent over the same month last year, giving real estate agents a reason to hope that a full recovery isn't far away. More than 1,190 sales were pending in June, up from 915 last year. Pending home sales also increased in May and April in Snohomish County, compared to the same months in 2008. However, completed home sales increased less than 1 percent in the county compared to June 2008.

Nathan Gorton, Executive Officer for the Snohomish County-Camano Association of Realtors said, that the somewhat timid resurgence largely stems from first-time buyers looking to snatch up inexpensive homes and low prices. Closed condo sales were up 6.78 percent from June of 2008 -- further reinforcing the theory that buyers who haven't previously owned are driving the county's sluggish real estate recovery. The federal government's $8,000 tax credit for first-time buyers was the push many on-the-fence buyers needed, Gorton said. "About 50 percent of the market is first-time home buyers taking advantage of that $8,000 tax credit," Gorton said. "And they tend to gravitate toward condos, because they're usually the most affordable home on the market.

So, there you go! Some updated information on the "State" of the Market here in Western Washington. Let's hope it continues to heat up - get out there and enjoy Summer here in the Pacific Northwest. Until next week . . .

My New Real Estate Blog

To blog or not to blog??? That is the question. So, after a lot of chat and anxiety about how this blogging thing works, I decided to jump in with both feet. So, today is the beginning of a whole "new me" in terms of technology and how I can effectively correspond on a weekly basis about the state of the Real Estate Market.

My thought is that I would write about how the market is going especially in these uncertain times. But I would also use this space as way of showcasing my own Listings and featuring some properties that I think are pretty special.

I hope you'll join me on this journey as I hone my skills as a blogger and real estate professional. Ready or not, here I go!!!