April 2009 Bank Owned Buyers Guide Now Available!

The Avery-Hess April 2009 Bank-Owned Buyers Guide is now available. This guide features a selection of Bank-Owned properties, tips for purchasing them and information about financing as it pertains to these homes.

You can obtain your copy of this guide through an Avery-Hess Sales Associate or by contacting CustomerCare@averyhess.com.

Don’t forget to search for all the Active Homes on-line at: www.averyhess.com

March Madness!!!! April Happiness!!!!

Each month the Metropolitan Regional Information Systems, the local providers of the Multiple Listings for the Washington region, releases statistical reports for Realtors. And every month we pore over the reports, looking for positive information and encouragement that the market will finally show signs of a recovery. In order to be considered a trend I would suggest that one full quarter of sustained growth is required in order to assure some degree of confidence. While most people associate March Madness with the NCAA Basketball Tournament, I think the real estate market experienced its own March Madness as buyers resoundingly re-entered the marketplace. Each of the first 3 months of this year has shown a new resurgence of activity.

In an earlier blog I discussed the renewed popularity of FHA and VA mortgages. For veterans, VA is the only 100% financing available and as I mentioned, FHA provides an affordable option for qualified 1st time buyers. The statistic that caught my attention this month was not the number of units sold, or the dollar volume for the month of March but rather the number of FHA & VA loans originated. In Fairfax County there were 1384 units sold. Of that number 150 were cash deals and of the remaining 1234, 41% were FHA & VA. In Prince William County it was 62% and in Loudoun County is was 52%. That’s nearly half of all loans in Northern Va. being government loans. The other statistic that I feel is significant is that there were 4324 new contracts written in the same 3 jurisdictions in March, 61% higher than units sold. When April statistics are released we’ll see a remarkable increase in sold units. What this means to you is the pendulum is moving and the law of supply and demand is shifting. If you are even remotely thinking of purchasing a home soon you should call your favorite realtor and get the ball rolling. There are still deals to be found but they are slowly slipping away.

FHA Mortgages

There was a time when sellers would shy away from FHA mortgages because of certain restrictions, requirements for seller contributions, and difficult appraisal and underwriting processes. In the last few years however, the Federal Housing Administration reworked their guidelines and made significant changes, making their mortgages more affordable, more flexible and readily available. According to CNNMoney, there were 106,000 more FHA insured loans issued in the first 2 months of 2009 than in all of 2007 and nearly half as many as all of 2008. Why is that? Well, with decreasing home prices and increased loan limits, these loans are very attractive for buyers with good incomes but not enough money saved for a 20% down payment. FHA will finance up to 96.5% of the sales price. Because of the low down payment, competitive rates, and relatively easy credit score issues, these mortgages are now more of a life-saver than a death knell.

If you are seriously thinking about buying a home it can’t be overstated just how great a time it is right now to “pull the trigger”. FHA lending has soared in the last 3 years from 3% to 20% of the dollar volume of all home loans. There’s plenty of money available. If you’re not sure what you qualify for, consult with a Realtor and a Mortgage Lender. Don’t let this opportunity pass you by.

Remembering JFK

“Ask not what your country can do for you, rather, ask what you can do for your country”. These famous words were spoken by JFK 48 years ago during his Inaugural Address. How appropriate it is today to reflect on these words and consider what we can do for our country. Do you wait for things to happen or do you create your own circumstances? Instead of worrying about the cost of gasoline, perhaps you can utilize public transportation, carpool, ride a bicycle, or …gasp, walk. Do you recycle? If not, now’s a good time to start. Every little bit helps. Are you going green? Don’t be like Motel 6 and leave the lights on. Turn out the lights when you leave a room. Have you read a good book lately? Turn off the TV and the computers. Don’t listen to the news, it’s just depressing. Read a good, uplifting story.

And this is for all of you who are still renting. Why? There has not been a better time to purchase a home since the 1950’s. Home prices have fallen and probably bottomed out. Interest rates are historically low. Incentives such as an $8000 tax credit make the decision to own a home a “no brainer”. Go green, help the environment and our planet. Buy a home, help rebuild our economy as well as your own personal wealth, and begin to put green in your pocket.

Mortgage Market Reform

I read an article this weekend that featured commentary about proposed drastic reforms in the United States Mortgage Market. In a nutshell, Congress is talking about reforming the system in such a way as not to incent the sale of suspect loan products with confusing loan terms and higher than market rates to consumers. Specifically, the Congressional bill would directly prohibit compensation programs for Loan Officers that increase with the interest rate and terms of a loan.

Wall Street got themselves in this recent fiancial mess by incenting its folks to do just what this new proposal seeks to prohibit. With business practice(s) such as these, is it any surprise that many banks and financial institutions are in the trouble that they are in? This bill will seek to create minimum standards and guidelines for mortgages, ostensibly funding mortgages that are of the 30 year variety with rates that are what the market dictates; mortgages that require borrowers to fully document income and assets in order to prove that they can afford the loan they are getting.

Sounds like common sense to me.

I, for one, hope that this Congressional proposal has some teeth and substance. It will be good for the long term health of the financial AND Real Estate industries, and should put some much needed safeguards in place to protect financial institutions and borrowers from being sold/obtaining mortgage and loan products they really have no business being in.

Learn about Financing and Mortgages: www.averyhess.com/Mortgage

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