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HoMe Price Continue to Increase


Home price growth projected to exceed 7% in 2013


Source: Housing Wire


Home prices could grow as high as 7.2% in 2013, JPMorgan Chase concluded in a new report.

Analysts with the bank claim prices are posting historically strong gains as the market moves into the more active summer season.

With high investor demand contributing to booming home prices as well as growth in prices of lower-tiered units posting stronger gains than higher-tiered units in major metropolitans, JPMorgan ($54.36 0%) is confident in its 7.2% growth projections.

Furthermore, the banking giant has revised its projections to 3.9% in 2014 and 3.2% in 2015, with surprises likely to be on the upside.

"Despite the lack of data for investor demand, we saw all-cash sales remain higher than 30% of housing sales," analysts at JPMorgan ($54.36 0%) said.

Given the limited housing inventory, net demand in April has climbed to the highest level since 2006.

At the same time, the market share of distressed sales declined below 20% for the first time since 2008, accounting for 18% of Aprils sales, which is 10% lower than last year, JPMorgan explained.

Meanwhile, the Federal Housing Finance Agency recently announced the extension of both the Home Affordable Modification Program and the streamlined modification initiative through the end of 2015, boosting the housing market.

HAMP, which was originally scheduled to expire this year, has helped homeowners who are struggling to keep their loans current or who are already behind on their mortgage by lowering monthly payments.

The streamlined modification initiative gives borrowers who are at least 90 days delinquent another option to avoid foreclosure and lower their monthly payments without requiring documentation of financial hardship.

Recent housing and economic indicators have remained mostly positive as net demand climbed, distressed sales decreased and builders confidence improved, the JPMorgan analysis concluded.

For instance, the National Association of Realtors existing home sales index edged up 0.6% in April to a seasonally adjusted annual rate of 4.97 million.

After improving 22 consecutive months on a year-over-year basis, Aprils sales number is at the highest pace since Nov. 2009 when the market spiked to 5.44 million in response to the homebuyer tax credit, the report said.

"Despite an increase in inventory, net demand climbed to the highest level since 2006 at 3.3 million in April, pointing to a continuous recovery in home prices over the next few months," the report added.

Oakland County Update for May


Oakland County Real Estate Update

Can you believe its already June?! Half the year is almost gone. The good news is, in that half year, the Real Estate market has done nothing but improve! Were still experiencing Sellers Market conditions with more buyers then inventory available. Mortgage rates remain low, but it is anticipated that that will soon change. Lets take a look at what happened last month.

West Bloomfield, Michigan
68 Homes sold last month! The average time on market was 70 days with the average sold prices coming in at $104/sqft. The lowest priced home sold was $50,000 with the highest at $1.3 Million! The median sales price was $242,500.

Average Sales Price History  2011:  $80/SqFt    2012:  $90/SqFt    April 2013:  $101/SqFt
Farmington Hills, Michigan
73 Homes sold in May! The average time on market was just over 2 months, with the average sales prices coming in at $94/SqFt.  Sales prices ranged from $43,000 $700,000.  The median sale price was $204,000.

Average Sales Price History  2011:  $72/SqFt    2012:  $77/SqFt    April 2013:  $87/SqFt
Commerce Township, Michigan
46 Homes sold last month with an average sales price of $103/SqFt. The average time on market was just under 3 months. The lowest priced home was $13,000 with the highest sale coming in at $912,000. The median sales price however, was $243,500.

Average Sales Price History  2011:  $87/SqFt    2012:  $93/SqFt    April 2013:  $115/SqFt
Bloomfield Township, Michigan
60 Homes sold over in Bloomfield. The average time on market was just over 2 months, with the average sales price at $154/SqFt. Home Sales ranged from $134,900 $1.2 Million.  The median sales price was $353,500.

Average Sales Price History 2011:  $117/SqFt    2012:  $129/SqFt  April 2013:  $156/SqFt
Birmingham, Michigan
53 Homes sold last month with an average sales price of $231/SqFt. The average time on market was 46 days! The home sales ranged in price from $155,000 $3,000,000 with the median sales price being $465,000.

Average Sales Price History 2011:  $157/SqFt    2012:  $181/SqFt    April 2013: $221

Novi, Michigan
There were 41 homes sold in Novi last month with an average sales price of $140. The average days on market came in under 2 months!! The sales ranged in price from $97.000 $1.6 Million. The median sold price was $310,000.

Average Sales Price History  2011:  $105/SqFt     2012:  $114/SqFt   April 2013:  $128/SqFt

If you would like a market analysis of your home, FREE, contact me anytime!!

Prices are up, but homes are in short supply


The supply of homes for sale has been shrinking for six months and shows no improvement so far in January a bad sign for buyers. New listings of existing homes for sale were down 14% year-over-year in the first two weeks of January, according to, which tracks 143 markets nationwide.

In Phoenix, where prices were up 24% in November from a year earlier, new listings through the first three weeks of January hit their lowest level in 13 years, says Mike Orr, real estate expert at the W.P. Carey School of Business at Arizona State University.

That's bad news for buyers, and it means "prices need to go up more" to bring more sellers to market, Orr says.

Nationwide, the supply of existing homes for sale fell to 4.4 months in December, based on the current monthly sales pace, says the National Association of Realtors. That's the lowest level in more than seven years. A six-month supply is generally considered balanced between buyers and sellers.

Home prices in November were 7.4% higher on average than a year earlier, according to CoreLogic. Real estate experts had expected that rising prices would spur more sellers trapped by years of falling prices.

Instead, January's listing data "is the same sad story," says Glenn Kelman, CEO of online brokerage Redfin. If sellers don't have to sell, "they're holding on, thinking they'll wait for prices to go up even more."

Redfin's data, covering 19 major markets mostly in the West, shows new listings down 29% the first two weeks of January vs. last year.

Scarce sellers aren't the only driver of shrinking supplies. There are fewer distressed properties for sale. Foreclosure sales were down 7% through the first nine months of last year from the same period in 2011, RealtyTrac says.

Meanwhile, demand is up. Existing home sales were up 9.2% last year, NAR's preliminary data show. New-home sales rose almost 20% in 2012, the government reported Friday, while supply fell to 4.9 months in December from 5.4 months a year before.

New home construction is still weak. In each of the past three years, builders completed fewer than 500,000 single-family homes. That's less than half the number built annually between 1993 and 2007, according to the Census Bureau.

Home builders would need to double production this year to alleviate the tight supply, estimates Lawrence Yun, NAR's chief economist. That's not expected. Home supplies nationally will stay at about the five-month level much of the year, Yun predicts. Some markets are far below that. California's supply of existing single-family homes for sale stood at 2.6 months in December, the California Association of Realtors says.

"Nobody is selling because no one has anywhere to go," says Barbara Hendrickson, of Red Oak Realty in Berkeley, in the San Francisco Bay Area, which had a 1.8-month supply in December.

The low supply is feeding bidding wars. One of Hendrickson's clients recently lost a bid despite offering $130,000 above the home's $775,000 asking price, Hendrickson says.

Whether the supply of homes for sale will expand to meet rising demand is a "big question for the market" in 2013, says Jed Kolko, economist with real estate website Trulia.

This year is also the first since the housing bust began that falling inventories are not necessarily a good thing, he says.

Listings may still swell in time for the busy spring selling season, says Stan Humphries, Zillow economist.

He says listing activity next month will be key. If it doesn't pick up by then, the spring season is likely to bring a lot of price increases, he says.

Source: USA Today

How 'Fiscal Cliff' Could Affect Mortgage Interest Deduction


It is arguably one of the most popular U.S. tax deductions, and for some it is necessary stimulus to buy a home.

The mortgage interest deduction, however, is now at risk, due to negotiations over the so-called fiscal cliffthe year-end deadline for large spending cuts and the expiration of tax cuts.

While it is impossible at this point to know what the outcome will be, it is certainly worth running through the possibilities. 

First, lets do a primer on the deduction as it stands now:

The deduction lets homeowners reduce their taxable income by the amount of interest paid on their mortgage. This can be on the principal residence or a second home, but not on multiple investment properties. Taxpayers are eligible for this deduction only if they itemize. Finally, the interest deduction is capped at $1 million of your mortgage.

This deduction, which is the largest housing-related subsidy in the U.S. tax code, reduced income-tax revenue by $79.9 billion in fiscal year 2007, according to the Office of Management and Budget.

So what is that in real cash savings to taxpayers? Number crunchers at the Wharton business school did the math:

For those making less than $40,000 a year, the average tax savings is about $100. But in that bracket less than one-quarter of homeowners itemize deductions, so most dont get anything. 

For those earning up to $250,000, the average savings, based on average mortgage amounts, would be $1,200-$2,600 a year. For those earning more than $250,000, and 100% of them itemize, the average savings is $5,400 a year.

Now to the proposalsand they are many.

One, released by the Simpson-Bowles commission, would cap the mortgage interest deduction at $500,000 of the homes value and limit the deduction to primary residences.

A bipartisan plan from Domenici-Rivlin would limit the deduction to just $25,000 worth of mortgage interest.

Other proposals include eliminating the deduction only for taxpayers earning $250,000 or more, ending the benefit for second homes, ending the deduction entirely or limiting the amount of all itemized deductions to $25,000. That last one was advocated by Mitt Romney, but apparently some Democrats on Capitol Hill are starting to espouse it.

Without one proposal leading the pack, again, it is impossible to boil down the real cost to homeowners, but suffice it to say that anyone in the business of home ownership is opposed to reducing the mortgage interest deduction.

Its chilling the market, said Jerry Howard, CEO of the National Association of Home Builders.  Whenever there is uncertainty surrounding the value of an American home, why would you expect people to go out and buy a home? Or, just as much to the point, when theres uncertainty about the value of a home why would someone put their house on the market to sell it, thats why this whole debate to me is counter-productive and is only retarding the nations economic recovery.

The mortgage interest deduction is vital to the stability of the American housing market and economy, and we will remain vigilant in opposing any future plan that modifies or excludes the deductibility of mortgage interest," said Gary Thomas, president of the National Association of Realtors.

Whatever the arguments for or against the mortgage interest deduction, two things are indisputable.  Going over the fiscal cliff will kill the housing recovery, but said recovery is already so tenuous that yet another barrier to entry will hurt.

Source: CNBC


10 Most Common Mistakes by Sellers


Here are the 10 most common responses from buyers agents when asked about the worst mistakes they see when presenting for-sale homes to clients:

1. Leftover home owners

By far, one of the top offenses cited by buyers agents was home owners still lingering around when agents arrived with clients to preview the home. Awkward encounters ranged from buyers finding sellers taking a shower, asleep in the bed, to even the stalker sellers who liked to follow buyers and the agent all over the home to see what they thought.

With the exception of the stalker seller, many of the home owners who were still at home blamed their listing agent for not giving them enough advance notice about the appointment prior.

2. Pets and their messes

Numerous agents also cited the not-so-friendly dog and kitty encounters as a top offense. Even pets left in a crate can pose a distraction since they might make noise the entire time others are in the house. Plus, if they seem mean, the buyer might not even step in the room.

Vicki Robinson, ABR, CRS, broker with Fonville Morisey Realty in Raleigh, N.C., says she recently was given showing instructions from a listing agent who told her the familys friendly dog would be at home. But when Robinson unlocked the front door with her client for the showing, a pit bull was staring down at them from the top of the staircase, growling. We closed the door and left! she says.

3. Bad smells

A displeasing smell can really turn buyers off. Common offenses include cooking smells lingering around the home, such as garlic, fried bacon, or fish. Also, watch for cigarette smoke and animal smells, agents say.

Sellers get immune to the smell that their pets have embedded on their property, says Halina Degnan with Gables&Gates, REALTORS®, in Knoxville, Tenn. Anyone opening the door will smell it immediately -- even if there are air fresheners trying to cover up the smell. If you have a pet, there will be an odor. Dont send your buyers away: Paint and clean the carpeting. Take the odor seriously and do what is needed, even if it means replacing the carpet.

4. Critters running wild

Wild animals and pests roaming around is a surefire way to send buyers running. Agents described worms crawling on the floor and bats and raccoons lounging in the attic. I showed a house in Utah once with a baby alligator/crocodile [in a cage] in the dining room, Kristi Hutchings, ABR, SFR, with the Wendy K Team The Real Estate Group in Utah.

5. Odd home makeovers

Do-it-yourself disasters were also prevalent, like doors opening the wrong way or unprofessional paint jobs. Also, rooms not being used for their intended purposes can confuse buyers, such as an office being used as a bedroom even though it has no closet, says broker Elaine Byrne with Elaine Byrne Realty in Austin, Texas.

6. Dirt and clutter

There were a number of offenses cited when it came to cleanliness: Dirty laundry piles, unflushed toilets, dishes on the counter or in the sink, unmade beds, clothes scattered about, soiled carpets, dirty air conditioner filters, and overflowing trash cans.

7. Personal information left in plain sight

Sellers should be careful not to leave in plain sight important documents that may pique buyers curiosity. Some agents say theyve seen personal information like bank and credit card statementseven mortgage payoff noticesleft on the kitchen counter.

8. Too dark

Dark or dimly lit houses arent showing the home in the best light.

Particularly [homes lit with] CFL bulbs, says Yvette Chisholm, ABR, CRS, associate broker with Long&Foster Real Estate in Rockville, Md. By the time [the bulbs] light up, the buyer is gone. Energy efficient bulbs need time to warm up before they are at their brightest, so staging professionals usually recommend agents arrive early to a showing to turn on any light fixtures with CFL bulbs at least 10 minutes prior.

9. Keys missing from lockboxes

All too often, agents arrive at a listing appointment with their client only to find theres no key to get in. I actually had a [sellers] agent who wanted me to open the door for my clients by going through the dog run as a large dog barked like crazy, says Hutchings.

10. Distracting photos

Watch the photos displayed on the walls too, agents warn. Tara Hayes, ABR, e-PRO, with Rector-Hayden, REALTORS®, in Winchester, Ky., recalls showing a family a home that had life-sized, nude photos hanging, which left her clients racing for the door covering their eyes.

Source: Realtor Magazine

First Time Steps for First Time Landlards


Pre-closing homework

First up, at the home inspection make sure to really take a hard look at what will need to be repaired or replaced once you take ownership of the property. Possible tasks include changing out the toilets to low-flow models, strapping the water heater, changing the door locks, fixing broken doors or windows, repairing damaged drywall and probably just a good old-fashioned scrubbing of the entire property.

Even before you close escrow, you should start making a list of the above items and others that need to be fixed. This will allow you to go home improvement store shopping to figure out a better budget than you previously estimated. (Dont forget to check popular home improvement store websites for coupons, military discounts and other promotions.) It should also assist you in determining who will be doing the work and getting bids for projects.

Also, if theres a good tenant already in place, youve done yourself a huge favor because youll get a security deposit and pro-rated rent at closing. So you possibly dont have to go in and fix a bunch of items. Make sure to get an estoppel certificate signed by the current landlord and tenant verifying the tenants rent and other lease information once you go into escrow.

Essential upgrades

Water: Because water issues are prevalent in rentals, its a good idea to have a plumber change out all the water valves, hose bibs, water supply hoses, washing machine hoses, dishwasher hoses, etc. In most rentals, its probably time to replace them, and doing so before a leak occurs  especially because the property will be occupied then is just a good move. So put $250-$750 into your budget for this.

Door locks: You should change out the door locks when you take possession of the property and after each tenant moves out. 

Flooring: If you need to change out the carpets, take a look at laminate wood flooring as an alternative. It will cost more upfront but should last 10 years or longer. Many laminates are tough as nails and look great. Laminate will save you the hassle of having carpets cleaned during turnover, arguing with past tenants over the cost and having new tenants complain about stains.


Leasing documents

Youll need to get a lease application and lease agreement. Your real estate agent can provide the standard documents for your state, but be sure to add any terms or clauses that are important to you. Once you find a prospective tenant, youll need to pull their credit report and conduct a criminal check. Your agent may be able to run credit reports.


Finding a tenant

You can post your listing on websites such as Zillow or Craigslist.


If your listing doesnt get inquiries, youre probably asking too much for rent. Interview people who respond to your ad on the phone before agreeing to meet with them. This will avoid wasting everyones time if they dont meet your credit, job or rental history requirements.

Once you find a good tenant, move quickly to get a lease signed so you dont lose them to another landlords property.

And finally, realize that being a landlord is a business, and your tenant is your customer. Just like any other business, the better you treat your customer, the more likely you will have a successful business venture.

Source: Zillow

What Documents do I need to apply for a Mortgage?

  • Application Fee (cost of appraisal and credit report)
  • Legible sales contract signed by Buyers and Sellers.
  • Social Security number of all applicants.
  • Complete address for the past 2 years (including complete name and address of landlords for past 24 months).
  • Name, address, and all income earned from all employers for past 24 months.
  • Copies of previous two years W-2 forms.
  • Copy of most recent year-to-date pay stub.
  • Name, address, account number, monthly payment and current balance for: installment loans, revolving charge accounts, student loans, mortgage loans, and auto loans.
  • Name, address, account number, and balance of all deposit accounts, including: checking accounts, savings accounts, stocks, bonds, etc.
  • Three months most recent statements for deposit accounts, stocks, bonds, etc.
  • If you choose to include income from Child Support/Alimony bring copies of court records of cancelled checks showing receipt of payment.

If you are applying for a V.A. Loan:

  • DD-214, Certificate of Eligibility, or statement from your Commanding Officer if you are on active duty.

If you are self-employed or paid by commission:

  • Previous two years Federal Income Tax Returns with all schedules and a year-to-date profit and loss statement.

Home Prices Rise in Detroit, Across U.S.


Home prices rose in July, both in metro Detroit and nationally -- a sign, analysts said, that the economy may be improving overall.

Nationally, home prices increased 1.2% in July, compared with the same month last year, according to the Standard&Poor's/Case Shiller index released Tuesday. It was the second straight year-over-year gain after two years without one.

In metro Detroit, prices were up 6.2%, driven in part by low interest rates, more sales, low inventory and fewer foreclosures.

"We all know we had to hit the floor, and now we're starting to come back up," said Jeanette Schneider, Re/Max's vice president of Southeastern Michigan.

Detroit-area buyers and sellers are seeing fewer homes for sale compared with last year, and that is pushing prices up.

Sellers who can afford to hold on to their homes and waiting for prices to rise are doing so, while those who had to sell already have, she said.

At the same time, she added, buyers who have been waiting to purchase a home now have more confidence in the economy -- especially the auto industry -- and that is releasing some pent-up demand.

Jim Diffley, an economist with IHS Global Insight, pointed out that part of the boost in the sales price in metro Detroit was a result of fewer distressed home sales this year, and the price increase is higher than it might be otherwise.

However, he said, the rise is still a good sign for the economy.

Patrick Newport, also an IHS economist, said low interest rates were a key driver of the price increases. The average rate on the 30-year fixed mortgage touched a record low of 3.49% last week and has been below 4% all year. He also said that in many cities, there were fewer homes for sale, which buoyed prices -- and mentioned job growth also was a factor.

Prices rose in July from June in all 20 cities tracked by the index. That's the third-straight month in which prices rose in every city. Steady price increases and record-low mortgage rates are helping drive a housing recovery.

Source: Detroit Free Press

RE/MAX Home Sales End August on High Note


Home sales in August increased 8.5% from one year ago and slightly higher than July, according to an estimate from real estate franchisor RE/MAX.

The report could signal continued improvement in existing home sales data from the National Association of Realtors scheduled for release Wednesday.

Home sales increased from one year ago for the 14th straight month in August, RE/MAX said.

The median sales price was $168,685, roughly flat from July but up 6.3% from last year on tighter inventory.

The amount of homes available for sale was 29.7% below levels last year and represented a 4.9 months supply. A six-month supply historically marks a balanced market for sellers and buyers.

"Nearly every month in 2012 experienced increased sales and prices over 2011, showing that we've definitely passed the bottom and we're looking forward to 2013 being an even better year," said RE/MAX CEO Margaret Kelly.

Of the 53 metro areas covered by the firm, 44 had an increase in sales from last year. And 29 have double-digit increases.

Activity increased 35.6% in Trenton, N.J. and more than 28% in Chicago, two of the largest gains in the country.

Source: Housing Wire

17 of Homeowners Under Value Their Homes


About one out of eight, or 17 percent, of homeowners with a mortgage believes their home is worth less than the amount they owe, when in fact the opposite is true. This suggests that large numbers of owners are undervaluing their homes, perhaps due to recent home price increases.

A new Rasmussen Reports national telephone survey of U.S. homeowners released last week shows that 39 percent say their home is not worth more than what they still owe on their mortgages, while 47 percent report their home is worth more than what they owe. Some 14 percent are undecided.

Yet only 10.8 million, or 22.3 percent, of all residential properties with a mortgage were actually in negative equity at the end of the second quarter of 2012, according to the latest data from CoreLogic. This is down from 11.4 million properties, or 23.7 percent, at the end of the first quarter of 2012. An additional 2.3 million borrowers possessed less than 5 percent equity in their home, referred to as near-negative equity, at the end of the second quarter.

Moreover, homeowner perceptions are turning more negative at a time when home values are improving. Scott Rasmussen, CEO of the research company that bears his name, says Rasmussen Reports has asked homeowners the question about home values and mortgages for years and it has never before fallen below the 50 percent mark. This represents a sea change in personal finances that challenges core assumptions about the way our economy works, he says.

CoreLogic, however, reports that negative equity is getting better. The level of negative equity continues to improve with more than 1.3 million households regaining a positive equity position since the beginning of the year, says Mark Fleming, chief economist for CoreLogic. Surging home prices this spring and summer, lower levels of inventory, and declining REO sale shares are all contributing to the nascent housing recovery and declining negative equity.

Ironically, another Rasmussen survey in August found that most U.S. homeowners are confident they know the current value of their home and think it is worth more than when they bought it. The survey found that 82 percent of Americans who own a home were confident they know how much the house is worth in todays market. That includes 43 percent who were very confident. Just 16 percent were not very or not at all confident that they know what their house is worth.

Source: RISmedia

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